Posted by
admin on Mar 5, 2010 in
Finances by Brandon Cornett
If you’re planning to buy a home in the near future, you should know your FICO credit score. In fact, your credit score is one of the three most important factors considered by mortgage lenders (along with your debt and income levels). If your score is high, you’ll have a much better chance of getting approved for a loan. You’ll also qualify for a better interest rate, which could save you thousands of dollars over the life of the loan.
It’s important to check your FICO score early on in the home-buying process, because it takes time to improve a low score. While you’re entitled to a free credit report per year, you’ll have to pay a small fee for the credit score. They are two different things. You can purchase your score from MyFICO.com — this is the company that actually designed the FICO scoring model.
But what if you check your score and find out that it’s low? You could qualify for certain types of loans with a score in 600 range, but you’ll be much better off in the mid- to upper-700 range. The question now becomes: How do I Improve my score? And that brings us to the purpose of this article.
5 Good Sources of Credit Information
Here are five websites worth visiting, if you want to learn more about your credit reports and scores:
- www.myfico.com — We touched on this website earlier. This site is owned by the Fair Isaac Corporation, the company that created the credit-scoring model used by most lenders. They have plenty of educational articles, as well as a forum where you can post questions. It’s well worth a visit.
- www.homebuyinginstitute.com/credit.php — On this page, you’ll find a collection of more than 100 articles relating to consumer credit. This collection was compiled over a two-year period, as readers sent in their questions. If you have a question about credit reports and scores, you’ll find the answer on this site.
- www.annualcreditreport.com — This website is jointly owned by the three credit-reporting companies (TransUnion, Equifax and Experian). This is where you should go to request your free reports. This is the only site that is regulated by the Federal Trade Commission.
- www.ftc.gov/freereports — Why do so many people offer “free” credit reports, and then try to charge you for stuff? It’s a marketing strategy referred to as bundling, and you can learn the truth about it on this website.
- www.bankrate.com — This site is a treasure trove of helpful advice. In addition to credit tips, it explains the mortgage process in great detail. Start with a keyword search, or click on the “news and advice” link.
Research is the first step to home-buying success. The five resources listed above will help you get started on the right foot.
© 2009, Cornett Communications.
About the Author: Brandon Cornett is a consumer advocate and publisher of the Home Buying Institute. You may visit the author’s website at www.HomeBuyingInstitute.com to learn more about this topic.
Tags: buying a home, credit score, free credit report, free credit score, home buyers, mortgage qualifications
Posted by
admin on Mar 3, 2009 in
Buying If you are thinking of buying a home, you might be confused about the many issues in the news from mortgage rates to mortgage bills in Congress. But the fundamentals of buying a home really haven’t changed and, in fact, there are new incentives on the horizon that should make home buying more attractive than ever.
There are plenty of homes on the market in every price range and if you want one of them, you need only do what generations of people have done. You just have to pay attention to these basics:
- First, cultivate good credit by prudent living. Pay your bills and pay them on time. Use credit sparingly.
If you do this, you’ll earn a good credit score, which is crucial to getting a good interest rate. Research shows that many consumers believe that they have to have a high income to have a high credit score, but that’s not true. In fact, income is irrelevant to your credit score. Your credit score is a rating based on how well you live up to your obligations, pay your bills and use your credit.
- Second, save money for a down payment. In the current climate, most lenders will ask you to bring some cash to the table in a mortgage deal.
- Third, find a house you love but can also afford. One path to financial freedom is to buy a modest house and build equity. When you decide to move up, you can sell your house and take a large chunk of the money from the sale and apply it to your new home. Your payment is lower while you live better. It’s the good, always-in-fashion way to live.
Congress is also planning some incentives for new home buyers. It appears first-time home buyers will get a tax credit of 10 percent of the purchase price of a home up to $8,000. That means in the year you purchase a new home, your tax bill could be reduced up to $8,000. Homeowners will not qualify for the credit if they sell the home in the first year and must live in the house for at least three years, or they will be obligated to pay back the credit.
To be classified as a first-time homeowner, you must not have owned a home in three years
Tags: first time home buyers, home buyers, home buying, homes for sale in camden county, homes for sale in gloucester county
Posted by
admin on Feb 20, 2009 in
Announcements The American Recovery and Reinvestment Act of 2009, H.R. 1, was signed into law by President Obama on February 17, 2009. A couple of key npoints that were supported by REALTORS® and The National Association of REALTORS® were:
- 1. $8,000 first-time home buyer tax credit that would be available to first-time home buyers for the purchase of a principal residence on or after January 1, 2009 and before December 1, 2009. View a chart detailing this provision.
- 2. Commercial real estate provisions, which focus on green building and energy efficiency as well as business tax incentives. H.R. 1 provides significant funds for New Jersey energy programs, which in turn, could help support commercial property owners’ investment in energy efficiency upgrades.
This is the perfect time to buy your next home. Besides the additional tax credits (they net against your current tax liability – if you owe money, this credit reduces that amount and if you have money being returned to you, this increases the amount you have coming), home prices are at their lowest in decades, and interest rate are at a point where they cannot go anywhere but UP.
This has also reinstated the higher loan limits for Federal Housing Administration (FHA), Fannie Mae and Freddie Mac. View the newly approved loan limit estimates. Lastly, you may want to view an outline of the Homeowner Affordability and Stability Plan, which President Obama announced on February 18, 2009 designed to help up to 7-9 million families avoid foreclosure by restructuring or refinancing their mortgages.
Tags: American Recovery and Reinvestment Act, first time home buyers, home buyers, loan limits, obama, tax credit, tax credit for buyers
Posted by
admin on Jan 29, 2009 in
Buying,
Editorial Renters, have you any idea of how much money you are throwing away each year?
If you only knew how much money you will MAKE just by buying a home, you’d be foolish not to buy a home through us! Did you know that in addition to the tax deductions you receive as a home owner that you can get tax money BACK from the Federal Government.
Not only is interest that you pay on your mortgage loan tax-deductible, but the US government is providing a tax CREDIT (not simply a deduction) of up to $7500 for most first time homebuyers. In short, the US Government is bending over backwards to help people become homeowners at a time when there already are real estate bargains everywhere! For a limited time, qualified first-time homebuyers may receive a tax credit up to $7,500 as part of the Housing and Economic Recovery Act of 2008.
If you plan to live in the home as your primary residence and have not owned a home during the past three years, you may qualify for the tax credit. This tax credit must be repaid over a 15-year period. Take your first step by calling us for more information and recommend the best mortgage loan advisors on our team that work with first time home buyers. You may be able to buy your first home sooner than you thought possible.
Just how much money can you gain when you own your own home? As an example, the tax deductions you’re eligible to take for mortgage interest and property taxes greatly increase the financial benefits of homeownership. Here’s how it works.
Assume
:
$9,877 = Mortgage interest paid (a loan of $150,000 for 30 years, at 7 percent, using year-five interest)
$2,700 = Property taxes (at 1.5 percent on $180,000 assessed value)
______
$12,577 = Total deduction
Then, multiply your total deduction by your tax rate.
For example, at a 28 percent tax rate: 12,577 x 0.28 = $3,521.56
$3,521.56 = Amount you have lowered your federal income tax (at 28 percent tax rate)
Plus $7,500.00 from the federal government
Equals $11,021.56 in a potential tax refund!
Linda & Terry Iwaniw
============================
REALTOR Associates
ReSales & Investment Realty, LLC
http://www.sjerseyhomes.com/
Cell: 609-417-1084
Office: 856-795-3111 x262
============================
Tags: 1st time buyers, buying a home, first time buyers, first time home buyers, home buyers, home buying, renters
(Edison, NJ) New Jersey residents might have heard a lot about waiting for the real estate market to “bottom out” lately from real estate speculators and financial pundits, but before deciding to wait on the sidelines, home buyers need to first consider three timely reasons why waiting can end up costing them.
“No one can time the market perfectly,” said 2008 New Jersey Association of REALTORS® (NJAR®) President, Drew Fishman. “We really won’t know when home prices have officially ‘bottomed out’ until they start to go up. That’s why interested home buyers who are financially capable can’t afford to let these opportunities pass them by.”
- The Federal Housing Administration (FHA) will require a higher down payment percentage after January 1, 2009. The Housing and Economic Recovery Act passed by Congress in July raised the down payment requirement on FHA loans to 3.5 percent, up from the current requirement of 3 percent.
- FHA, Fannie Mae and Freddie Mac mortgage loan limits will drop after January 1, 2009. The February 2008 Economic Stimulus Package temporarily raised the FHA loan limit to $729,750 in high cost areas through December 31, 2008. According to the Department of Housing and Urban Development (HUD), beginning January 1, 2009, FHA will insure single-family home mortgages in New Jersey up to $417,000 in low cost areas and up to a maximum of $625,500 in high cost areas. Buyers purchasing homes in Bergen, Essex, Hudson, Hunterdon, Middlesex, Monmouth, Morris, Ocean, Passaic, Somerset, Sussex and Union counties will be affected by the new lower maximum loan limit. Loan limits in the remaining New Jersey counties will vary based on the median home price indicator used by FHA. Depending on the area, some buyers in these counties may also face lower limits. Fannie Mae and Freddie Mac insured loans will also drop down to the lower limits as of January 1, 2009, according to the Federal Housing Finance Agency (FHFA). More information is available at www.fha.gov and www.fhfa.gov.
- First-time home buyers can only take advantage of a $7,500 tax credit until July 1, 2009. The 2008 Housing and Economic Recovery Act (HERA) became law last July and included a new, temporary tax credit for buyers who have not owned a home in the past three years. To qualify, buyers must purchase a principal residence on or after April 9, 2008 and before July 1, 2009 to qualify for the tax credit when filing their federal tax returns. Individual buyers with an adjusted gross income of less than $75,000 and joint filers with income no more than $150,000 are eligible. Individual buyers with income of up to $95,000 and couples with income up to $170,000 are eligible for a partial credit. The credit is repaid in 6.67% increments over 15 years making it, essentially, an interest-free loan. For an overview of the tax credit, visit
http://www.njar.com/government_affairs/issues/federal/pdf/tcchart.pdf.
The I-Team & NJAR® is encouraging New Jersey residents to Get the REAL StorySM on real estate in New Jersey with a public education campaign that features an informational website and advertising campaign that also features real stories from recent buyers and sellers. For more information on the campaign, or simply to Get the REAL StorySM on real estate in New Jersey, visit www.REALstoryNJ.com.
Tags: burlington county buyers, camden county home buyers, FHA, gloucester county home buyers, home buyer in new jersey, home buyers, New Jersey Association of REALTORS®, NJAR, real estate market, salem county home buyers
Posted by
admin on Oct 31, 2008 in
Buying,
Real Estate If you do not think that a home inspection is important, you are wrong. While some buyers make a purchase without having an inspection, nobody would recommend this. The fact of the matter is that you never know what is wrong with a home. And guess what? If you do not order a home inspection, you may never find out. If you do, it could be several months later.
Here are three of the best reasons to consider ordering a home inspection.
- Many people think that a home inspection will cost them a lot of money. But all in all, this is not true. For the most part, you should be able to order a home inspection for right around $300 or so. Of course, this will differ based on the type of property, area, and much more. But this is a small price to pay for finding out what could potentially be wrong with the home that you are buying.
- If you do not pay for a home inspection now, you may end up paying for it later. In other words, a problem that is not caught before you buy is one that you will have to pay for on your own when you discover it at a later date. And if the problem is a big one, such as a leaky roof, you are going to bet out quite a bit of money. When you pay for a home inspection you will give yourself the chance to learn about all the problems you are buying, or maybe even have them fixed before you move in.
- A home inspection will give you peace of mind. You may not think that you need to order an inspection, but after you move in you will begin to worry about any problems that may be haunting you. It is much better to pay for an inspection before buying so that you can live stress free after moving in. It is no fun to always be worrying about something going wrong.
These are three great reasons to order a home inspection. If you are on the fence about whether or not to pay for an inspection, let the three tips above sway you towards doing so.
Tags: buyers, home buyers, home buying, home inspections, home ownership
Posted by
admin on Sep 23, 2008 in
Announcements Laurel Springs, New Jersey – September, 23 2008 – In light of the current financial market, many home buyers are retreating and “circling the wagons”. First time home buyers can move forward with confidence because of the launching of a new web site focusing exclusively on first time home buyers.The first time home buyers are the most vulnerable real estate customers and the most suseptible to misinformation, gimmicks, and other questionable tactics. The reason for this is that the first time home buyers have never bought a home nor do they know the process that they need to complete in order to complete it with a minimum of problems and stress. Many real estate agents do not spend nearly enough time with these first time home buyers to help them navigate through the sometimes complex series of tasks and transactions required to purchase a home. These real estate agents just want to get these buyers into a house that is close to what they are looking for, get them to make an offer, sign a sales contract, and then move onto their next prospect. But it doesn’t have to be that way. Linda and Terry Iwaniw, REALTOR Associates with RE/MAX Home Team, known as the I Team believe that first time home buyers deserve more consideration and closer working relationship because they have never had to go through the home buying process or have not had to do so in recent years. First time home buyers are defined as those that have never owned a home or have not owned one in the previous three years. In order to foster a closer working relationship and to help present information and resources for first time home buyers, Linda and Terry have created and launched a new web portal for the first time home buyer. Information, resources, and relevant articles will be presented at the web site at http://www.homes4firsttimebuyers.com . As First Time Home Buyer Specialists, Linda and Terry will insure that the information on the web site is concise and timely for use by the first time home buyer.
It is important that the first home purchase a potential home owner participates in should be as trouble-free and unstressful as possible. A nightmarish real estate transaction could taint a home buyer’s attitude for years to come. One of the key tasks that every REALTOR is responsible for is to educate, inform, and guide clients and customers regarding the real estate market and the transaction process. To this end, The First Time Home Buyer portal at http://www.homes4firsttimebuyers.com was created.
Linda and Terry Iwaniw are REALTOR Associates with RE/MAX Home Team, and are known as The I-Team as well as First Time Home Buyer Specialists. They pride themselves on their focus on customer service and the fact that they treat their customers as real people not just a transaction. When you hire Linda and Terry you deal with them, directly. They do not pass you to some underling like so many others do. You can reach them at their web site at http://www.i-teamhomes.com/.
Tags: Buyer Information, buyer resources, first time home buyers, home buyers
In April of 2008 the NATIONAL ASSOCIATION OF REALTORS® conducted an on-line survey of members on issues related to the credit crunch, foreclosures, and short sales. They released approximately 5,800 responses. Below is a summary of the results of that survey.
Short Sales
What is a short sale? A short sale is usually defined as a case in which a bank or other mortgage lender “discounts” the balance of the loan, usually due to a borrower’s financial or other economic hardship. The property owner/borrower then sells the property at that lower price and the proceeds from the sale are turned over to the lender. Typically, short sales are done in order to prevent foreclosure.
In the national NAR survey, REALTORS® indicated that overall 40 percent of their clients have been involved in a short sale. And of those REALTORS® that participated in short sales, 55% of them reported that they had assisted the buyers and 45% had assisted the sellers.
We are always being asked about short sales because buyers in New Jersey, based on what they are reading in the news media, belive that a large portion of the homes being marketed are short sales. To clear up any misconceptions that anyone gets from reading the mainstream news media, the top states in terms of the percentage of REALTORS® involved in short sales were
- Nevada (65%)
- Rhode Island (52%)
- California (52%)
- Florida (50%)
- Arizona (47%)
The states with the lowest percentage of REALTORS® involved in short sales were:
- Vermont (less than 1 percent)
- Wyoming (11%)
- Mississippi (17%)
- Alaska (17%)
- Delaware (18%).
Since short sales involve some write-down by the lender of the amount owed, the survey asked REALTORS® about the extent of write-downs. More than a quarter of respondents who participated in short sales, approximately 26.7 %, stated that the short sales involved more than 20 percent debt forgiveness. Only a small percentage, about 4.4 %, said that the short sales involved less than five percent debt forgiveness.
Foreclosures
REALTORS® were also asked about the share of active listings in their market (or in their multiple listing service) were foreclosed properties. The median percentage of “foreclosure” listings was
6%. More than a 1/3 of respondents didn’t know the number of active listings were foreclosed properties. Also, some MLS’s do not list foreclosed homes. Almost 15% of the REALTORS® indicated that one to five percent of their market listings were foreclosed properties. Overall, this is an extremely low number as compared to what the news media’s articles would lead you to believe.
Credit
In addition to asking the participants about short sales and foreclosures, REALTORS® were also asked about recent availability of credit and what percent of their clientele were having difficulties/challenges
in obtaining approval for mortgage loans. Over a third of respondents indicated that all or nearly all of their their clients/customers encountered no problems in getting a loan.
But there were differences in some states. Fully two thirds of the participating REALTORS® from Alaska reported that their clients had no problems obtaining approval for a loan. Similar trends were reported in New Jersey (59%), Montana (48%), Wisconsin (47%), and the District of Columbia (46%).
Postponing the Homebuying Decision
Some potential homebuyers have been “on the fence” – perhaps waiting for prices to dip further, for interest rates to decline, or for their personal financial/economic situations to improve. In a difficult housing market, it is sometimes challenging to determine the factors that are influencing a buyer’s decision whether or not to purchase a home.
The survey asked REALTORS® if their recent clients had postponed the home buying decision. More than half indicated that their clients did actually purchase a property. But more than a 1/5 reported that buyers wanted to wait for home prices to decline even more before purchasing. Almost 8% said that their buyers were not able to purchase a home because they needed to sell their current home in order to use the proceeds on their next home purchase. But only 3.9 percent participants reported that buyers postponed a home purchase for personal reasons.
Some Positive Signs for the Future
Now, for some good news! Mortgage purchase applications are up according to recently released data from the Mortgage Bankers Association. The purchase portion of the MBA’s Mortgage Applications Index increased by 6.4%, from 349.0 to 371.5 for the week ending September 5, 2008. That is a fourth consecutive weekly increase. What this means is that buyers are returning to the market, it may be at a moderate pace but it’s still in numbers that can be measured. It may take some time for customers to absorb the recent positive housing news, the affordable home prices, a large selection of existing inventory, and the still historic low mortgage rates, these factors are already attracting the fence sitters.
Tags: Foreclosures, foreclosures for sale, home buyers, mortgages, real estate market, short sales
We’ve just been informed of a new mortgage loan program available to New Jersey Home Buyers. The mortgage loan program is called USDA Rural Development 502 Guaranteed Housing Loan Program and has the following special advantages*:
- No Down Payment
- No Mortgage Insurance
- No Cash Reserves Required
- No stated maximum loan amount; maximum loan based on repayment ability
- Loan up to 102%** of appraised value allowed
- No First Time Homebuyer Requirement
- New and Existing Homes OK
- Fully amortized 30-year fixed rate loan
- No Prepayment Penalty
- No Seller Contribution Limit
- No limitation on source of funds for closing costs
- 100% gifted closing cost or down payment assistance is permitted
- Loan amount can include closing costs and repairs up to appraised value
- While an RD GRH loan is not FICO Score driven, RD does reward you for higher scores. Borrowers with a score of 620*** mid-score or higher get an automatic “Credit Waiver” and do not need to explain credit derogatory including bankruptcy and no rental verification is required (see Note 1).
The 502 Guaranteed Mortgage Loan is a guaranteed loan secured by Rural Development is made by an approved mortgage lender to a borrower who is unable to qualify fully for a conventional loan because of substantial down-payment requirements.
If you’d like to know more about this and what areas in New Jersey are eligible for this loan, please contact us at 609-417-1086.
* To qualified borrowers
** Appraisal may be exceeded by amount of Gauranteed Fee
*** FICO score may be adjusted upwards by the Agency
Note 1: Exception – Any applicant with delinquent Federal debts, regardless of credit risk score and any applicant with an unsatisfactory payment history on a previous Rural Development loan, regardless of credit risk score. For general information purposes only. Loan approval subject to Lender underwriting guidelines and RD regulations 1980-D and applicable ANs.
Tags: bankruptcy, buyers, home buyers, mortgage loans, mortgages, usda
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