Can Debt Consolidation Help Increase my FICO Score
Posted at 1:31 am | Filed Under mortgage-financing-tips.info-part2-20
Credit card debt and revolving charges determines 30% of your FICO scores. High balances or, more precisely, balances that are close to your credit limit can negatively affect your personal credit scores. Thus, one of the best ways to improve your credit rating is by paying off outstanding debts. A debt consolidation loan by means of mortgage refinancing or a home equity loan (second mortgage) can help you do this. On top of that, you may be able to deduct up to 100% of the interest you pay from your taxes. With the new, tougher bankruptcy laws in effect, consolidating your credit card debt with a second mortgage or home equity loans and other consumer debt is a far better option for debt relief than bankruptcy.
The way debt consolidation helps your FICO credit scores not only by raising them, but also by lowering your debt-to-income ratio. A debt-to-income ratio is a measure of financial stability calculated by dividing monthly minimum debt payments by monthly gross income. Typically, the lower your ratio, the better handle you have on debt. The only ways a debt consolidation loan can hurt your FICO scores is if you run up too many inquiries shopping for a loan, run up the debts again after getting the loan or you stop paying your bills on time. If you need a loan, according to Fair Isaac and Company (the creators of the FICO credit scoring system), do your rate shopping within a focused period of time, such as 30 days. FICO scores distinguish between a search for a single loan and a search for many new credit lines, in part by the length of time over which inquiries occur. They go on to say that looking for new credit can equate with higher risk, but most credit scores are not affected by multiple inquiries from auto or mortgage lenders within a short period of time.
If you are tempted to use the credit cards you just paid off, cut them up or lock them away in a safety deposit box. But, save two major credit cards (American Express, Visa, MasterCard, Discover) and use them SPARINGLY. Keep balances at 30% of your credit limit or lower and pay your bills on time. Closing revolving accounts you have paid can hurt your credit scores by raising your debt-to-income ratio and making your credit history look younger than it actually is. Keep the credit accounts open, but just do not use the credit cards. A refinance or second mortgage for debt consolidation is available as a fixed mortgage rate loan or an adjustable rate mortgage (ARM). Check with your lender to see which is best for you.
Maria Ny is a well-known free-lance writer from San Diego, California. She has many published articles that cover a variety of subjects ranging from Bill Consolidation, Bankruptcy Reform, Credit Repair to Subordinate Mortgages. Check out her helpful articles online at BD Second Mortgage & Equity Loans.
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Tags: 125 second mortgage, credit lines, debt consolidation loans, home equity loans, rates, second mortgagesInternet Mortgage Lead Companies
Posted at 1:23 am | Filed Under mortgage-financing-tips.info-part2-20
For any business, attracting and capturing customers and clients is the key to gaining a profit. In the highly competitive world of mortgage loans, finding good prospective customers can be very difficult. The key to gaining a strong hold on the mortgage loan industry is to get the best leads, which will translate to successfully closed deals. For mortgage brokers, finding these high-quality leads is now easier and faster than ever when they use the services of Internet mortgage lead companies.
Internet mortgage lead companies provide various types of leads that mortgage brokers can buy. If you are planning to purchase mortgage leads from an Internet lead company, there are some vital points to consider. Buying mortgage leads is an investment, and you should receive your money’s worth when you purchase mortgage leads. Thus, it is important to do your research first on the various Internet mortgage companies before making a decision and settling on one.
Price is, of course, an important factor. This will depend on what kind of leads you are buying. Real-time or fresh leads are more expensive, since they are new and offer a higher closing rate. Meanwhile, recycled leads have already passed through several lead companies. You can also opt to purchase exclusive mortgage leads, or leads that are sold only once, as these give you a much higher chance of closing a loan.
When considering various Internet lead companies, examine the way they generate leads. The better Internet lead company operates its own website to obtain the freshest leads. Confer with the lead company’s customer service representative and learn more about their services and the quality of their leads. Also, make sure that the company offers a good return and refund policy as well as a guarantee on the quality of their leads.
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Tag: Internet Mortgage Lead CompaniesFinding a Way to Purchase a Home
Posted at 1:01 am | Filed Under mortgage-financing-tips.info-part2-20
Buying a home is an exciting time, and often not as difficult as it may seem. All you need is a little information.
You need three basic things to purchase a home: good income, good credit and a good amount of cash. If you are lacking in one area, don’t worry, with a little effort, you can find a solution.
For example, if you have a lot of cash, your income and credit may not matter. You simply pay for your home outright. That is the ideal situation. You can usually negotiate with a seller for a lower purchase price because you don’t require a mortgage approval. You are a simple, quick transaction to the seller.
You may be in the opposite situation. You could have a good income and excellent credit, but little cash saved. There are options for you as well. You can find many loan programs, especially those for first-time homebuyers, which offer low down payments, sometimes as low a 3%. You will have to pay for private mortgage insurance, but it is worth it to be able to purchase a home.
There are loan programs out there for those who do not want to disclose their income information. These loans are called no-doc mortgages. You will pay a higher interest rate and might have to put a large down payment on the mortgage, but you won’t have to submit your income information. Many self-employed individuals turn to this option.
There are ways to purchase a home, no matter your situation. If you have made poor choices in the past and have questionable credit, you can find lenders out there willing to grant you a mortgage. You may have to prepay points. You will most likely pay a higher interest rate as you are more risky to the lender. But if you are willing to make the sacrifice, there is no reason you can’t refinance your mortgage in five to ten years, when your credit is improved.
Look into all of your options when considering purchasing a home. It may be that you are better off waiting, saving some money and improving your credit history. Given time, you may be in a better position to purchase.
What you ideally need to obtain the best interest rates and repayment terms is a good, steady income with a long-term employer; a great credit score; and a large downpayment of at least 20%. It may be worth it, especially with rates on an upward trend, to wait a while and get your ducks in order before you buy a home. The more you are able to reduce your interest rate, the less you will pay back over time.
But if you are ready to buy now, do a little research and find out what is available to you. There are many loan programs and options that make owning a home a possibility for everyone. Yes, you may pay a higher interest rate, but you receive a home in return. Good Luck.
Martin Lukac (http://www.MartinLukac.com), represents http://www.RateEmpire.com and http://www.1AmericanFinancial.com, a finance web-company specializing in real estate/mortgage market. We specialize in daily updates, rate predictions, mortgage rates and more. Find low home loan mortgage interest rates from hundreds of mortgage companies!
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