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What is a Thin Credit File? What does it mean when a funding institution denies you for “weak credit” or “thin credit file”? Basically it means, that you do not have enough credit history to rate, that you do not have enough loans, credit cards, mortgages, or car loans to generate a score high to get any funding. So when a financial institution pulls your credit and there is not enough history, the credit bureaus send out an alert that you have a “thin file.” A “thin file” means you don’t have much of a track record with credit. Either [&hellip

Refinancing an ARM Loan Adjustable Rate Mortgage can be a ticking time bomb Find out if refinancing an ARM loan is the best choice The Federal Reserve recently raised interest rates, and if you have an Adjustable Rate Mortgage (ARM), it may be a good time to consider refinancing your home. There’s no one-size-fits-all answer to whether you should refinance, so here are a few of the key thoughts. How long does your introductory rate last? Most ARMs have a fixed rate for the beginning of the mortgage. This is an introductory period (usually 3-10 years) when your rate will [&hellip

Foreclosure -vs- Short Sale and the affect it has on your Credit Score Pam Standlee owner of Credit Come Back shares this blog about the impact of foreclosure versus short sale and the affect on the individual’s credit score. The common alternatives to foreclosure, such as short sales, and deeds-in-lieu of foreclosure are all “not paid as agreed” accounts, and considered the same by the scoring models. This is not to say that these may not be better options for you from a financial perspective, just that they will be considered no better or worse for your credit score. The above [&hellip

5 Steps To Improve Your Credit Score By Pam Standlee 1.      Check Your Credit Report: Credit repair begins with your credit report. You can request a free copy of your credit report(s) by going to (the only official site): www.AnnualCreditReport.com.  Your credit report contains the data used to calculate your score and it may contain errors. If you find errors on any of your reports, dispute them (in writing) with the credit bureau and the creditor that is reporting the error. 2.      Errors to Look For/Dispute Include: Account not mine, wasn’t late, duplicate account, incorrect balance, past due amount (a [&hellip

The benefits of a 20% down payment For many conventional mortgages, you need to have a down payment of at least 5 percent of the purchase price. However, putting less than 20 percent down can have significant financial implications. Not only could a 20 percent down payment save you hundreds of dollars on your monthly payment, but you’ll build equity in the house more quickly and save a considerable amount of money on interest. One of the areas you will save the most money is PMI. PMI (private mortgage insurance) is what you pay to a lender to avoid loan [&hellip

Qualified Mortgages The win for Lenders What is the big win for lenders making a Qualified Mortgage (QM)? A lender that fellows the rules of a QM loan have greater protection from law suits. This provision of QM is called “safe harbor”. In theory, under the Consumer Financial Protection Bureau’s final mortgage rules, low-priced loans that meet all the criteria of QM are supposed to be largely immune from consumer lawsuits. Lenders that make Qualified Mortgages get certain legal protections even if the loans default. For QMs that are not “higher-priced,” lenders get a “safe harbor.” This means that the [&hellip

  New Mortgage rules: Debt to Income Ratio The new mortgage rules called Qualified Mortgage or QM impact many parts of the real estate loan process. A major new rule is the maximum Debt to Income Ratio (DTI) or some times called the back end ratio. QM sets the new maximum DTI to 43%. This is lower than current standards. The clear impact of the new rule is less people will qualify for a QM loan. Is this a good thing, or bad thing only time will tell? What is a Debt to Income Ratio? The Debt to Income Ratio [&hellip

New Mortgage rules: Ability to Repay   The eight factors Ability to Repay creates in underwriting a new mortgage.   These eight Ability to Repay factors a lender must consider when reviewing a new mortgage loan application will cause a number of people not to be able to get a mortgage, and therefore not buy a home. Is that a good thing or bad thing only time will tell? Here is the list of the eight elements the new rule Ability to Repay (ATR) creates in mortgage lending. One. The current or reasonably expected income or assets that the consumer [&hellip

Loan Preapproval: Why You Need to be Preapproved Do you feel ready to start looking for your first house?  Well, the first step of any home-buying experience is to get prequalified for a loan. Most people are going to need a loan in order to purchase a house.  If you are one of the many people who fall into this category, then there are some things you need to know. The seller wants to get the best deal they can and they want to get it fast. If you fall in love with a home and put in an offer, [&hellip

California Mello-Roos Property Tax Mello-Roos was signed into law in 1982 as a way to gain funding for new communities after Proposition 13 inhibited the raising of property taxes in California.  Though it isn’t technically a property tax, it is an additional tax that is applied to properties in newly developed areas.  The money is used to build the necessary facilities, utilities, roads, and the like for new towns.  This keeps the cost of development for the new town on the shoulders of the persons living there. Because Mello-Roos is independent of the property tax that is protected by Prop [&hellip