Archive for January, 2014

CREDIT SCORES and MORTGAGES

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As most of us know our Credit Score (FICO) has a major influence on whether we can get a Mortgage at all. What’s not always understood is that it also has a huge impact on the interest rate we can get. Here’s a simple way of figuring out how big that impact can be for different scoring ranges: 

*    CREDIT SCORE BELOW 620:

A credit score of 620 or lower places you in the “sub-primeborrower category. If you are considered a sub-prime borrower, you will likely pay 3 percent more on a mortgage loan than someone with excellent credit and will likely pay double-digit interest rates on a home equity loan or a line of credit.

*    CREDIT SCORE OF 620 TO 674:

This credit score range is still considered below optimal. If your credit score falls in this range, you will likely pay 2 percent more than borrowers who boast excellent credit ratings.

*    CREDIT SCORE OF 675 TO 719:

If you find yourself in this credit score range, you should find it relatively easy to procure a good loan. You will typically pay up to half a percentage point more than a borrower who has excellent credit in regards to a loan.

*    CREDIT SCORE OF 720 AND ABOVE:

If you possess a credit score at or above 720, you have an excellent credit score. This means you will be able to acquire a lender’s most favorable rates and you are in the position to shop around thus finding the best loan for you in regards to term, interest rates and other factors.”

by the way….

Factors contributing to someone's credit score...

Factors contributing to someone’s credit score, for Credit score (United States). (Photo credit: Wikipedia)

 

If you are considering getting help with Credit Repair be aware that the vast majority of organizations claiming to do this are scammers and/or crooks.

I can personally recommend Ken Strey for a professional service. His contact info is below. 

Scorewell Inc. | 925-478-4732 | kenstrey@scorewellinc.com | http://www.scorewellinc.com

 

 

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MORTGAGE DELINQUENCY RATE DROPS NEARLY 25% IN LAST YEAR

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Things really are getting better. English: Mortgage debt

The mortgage delinquency rate (the rate of borrowers 60 days or more delinquent on their mortgage) dropped 23.3 percent in the past year, ending the third quarter at 4.09 percent, down from a year earlier when the rate stood at 5.33 percent, according to data gathered from TransUnion’s proprietary Industry Insights Report. The mortgage delinquency rate also dropped on a quarterly basis, down 5.3 percent from 4.32 percent in the second quarter, the seventh straight quarterly decline.

All 50 states and the District of Columbia experienced a decline in their mortgage delinquency rate between third quarter 2012 and third quarter 2013. Five states – California, Arizona, Nevada, Colorado, and Utah – experienced declines of 30 percent or more in their mortgage delinquency rate. Three states – California, Florida, and Nevada – had double-digit percentage drops in the last quarter.

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ADJUSTABLES ARE BACK (and thats GOOD NEWS for smart buyers)

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(and thats GOOD NEWS for smart buyers)

Absolute_Mortgage

Absolute_Mortgage (Photo credit: kathleenleavitt)

FACT: An adjustable Rate Mortgage, used inteligently, will always cost less over the life of any other type of loan.

Question. So why do all the so called experts advise you to only take a Fixed Rate mortgage?

Answer. Because they are at best ill informed, or at worst simply stupid.

The bias toward fixed rate mortgages is the result of settling for the simple but expensive rather than taking the time to understand  the relatively complex but much cheaper.

I’m constantly amazed by the number of home buyers who will give up their weekends for many months searching for the perfect home, yet take just a couple of hours to decide how to pay for it, and end up never knowing what their options were.

Choosing the wrong mortgage can and will cost many thousands of dollars.

Question. HOW TO DECIDE WHAT’S THE BEST MORTGAGE?

Answer.

That which cost the least amount over the life of the loan based on:

1. YOUR BEST ESTIMATE OF HOW LONG YOU EXPECT TO OWN THE HOUSE.

2. YOUR CURRENT FINANCIAL CIRCUMSTANCES.

3. YOUR ANTICIPATED FUTURE FINANCIAL CIRCUMSTANCES. Long and Short term.

REMEMBER. You are UNIQUE.

Your circumstances are UNIQUE.

Your plans are UNIQUE.

YOUR MORTGAGE SHOULD BE UNIQUELY DESIGNED FOR YOU, NOT FOR SOME MYTHICAL AVERAGE PERSON.

You should always know what options are available to you and how each one would work out over time.

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