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5 FACTORS THAT DECIDE YOUR CREDIT SCORE

November 17, 2013 Leave a comment

Credit scores range between 200 and 800, with scores above 620 considered desirable for obtaining a mortgage. The following factors affect your score:

1. Your payment history. Did you pay your credit card obligations on time? If they were late, then how late? Bankruptcy filing, liens, and collection activity also impact your history. 

2. How much you owe.  If you owe a great deal of money on numerous accounts, it can indicate that you are overextended. However, it’s a good thing if you have a good proportion of balances to total credit limits. 

3. The length of your credit history. In general, the longer you have had accounts opened, the better. The average consumer’s oldest obligation is 14 years old, indicating that he or she has been managing credit for some time, according to Fair Isaac Corp., and only one in 20 consumers have credit histories shorter than 2 years.

4. How much new credit you have. New credit, either installment payments or new credit cards, are considered more risky, even if you pay them promptly. 

5. The types of credit you use. Generally, it’s desirable to have more than one type of credit — installment loans, credit cards, and a mortgage, for example. 

For more on evaluating and understanding your credit score, visitwww.myfico.com.

 
 
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Is Being A Landlord: More Trouble Than It’s Worth?

November 9, 2013 Leave a comment

FOR RENTIt’s the way to make money … or so some people claim. On the surface, it seems likes like a surefire bet; in reality, it’s usually more headache than it’s worth. The challenges start early, and they almost always involve time and money.

Do You live too far away from the property? The farther you live away from your rental property, the harder it will be to monitor what is happening to it. Collecting rent, taking care of maintenance and eviction will all be made more difficult and costly if you live in another county – or state.

Do You understand cash flow? The purpose of renting is to make a profit from your property, or to at least break even on the mortgage, taxes and maintenance costs of ownership. You must be certain to charge enough rent to cover not only the fixed costs but also to allow for emergency repairs and unexpected expenses. If you do not charge the appropriate rent, you can have excellent tenants and still lose money.

Are You Lax about screening applicants? All would-be tenants are not equal. Choosing a tenant that is solvent, clean and respectful of your property and the lease agreement is key to having a pleasant landlord experience. You must be prepared to ask for employment information, renter’s history and references – and check them!

Do You Understand the legal side? Having a solid lease agreement will not only eliminate confusion about you and your tenant’s rights, but it can be a tool to help you recoup losses if the tenant and landlord relationship goes awry. There are many standard lease agreements available. You should either purchase and learn every item on it or have a customized lease form made by an attorney.

Do You think it is a no-hassle payday? If you think that you will hand a key to someone and begin receiving rent checks on the first of every month, you have not accepted the realities of renting. Tenants will need in-home repairs. They will need to be reminded to keep the yard clean. The home will need to be treated for termites. Heating and air conditioner filters will need to be changed. Being a landlord is a job, not a free paycheck.

Have considered maintenance and repair issues? If you are handy, you may elect to do your own repairs and maintenance. If your talents do not fall in this category, you will need to find reliable handymen, plumbers and appliance repairmen to assist you in keeping the rental in livable condition.

You are too soft hearted to enforce your own lease agreement? “But Mr. Landlord, we’ve had a hard time this month. Perhaps we can pay half now and the rest on payday?” If you have a hard time saying no to this or other situations, you may not be cut out for this profession. While it is not necessary to be heartless, you must be willing to protect your interests, lest your tenant’s money problems quickly become your own.

Have You Had Legal Problems with the Tenants? 1. Tenant Doesn’t Pay Rent,
2. Tenant Files Bankruptcy,
3. Tenant Violates The Lease,
4. Tenant Claims Uninhabitable Conditions,
5. Tenant Claims Mold Problems,
6. Tenant Sub Leases the property,
7. You have to Evict the Tenant in court’
8. Other Problems …….

Are you interested in selling your rental because of the issues stated above??? If so, now is an EXCELLENT time to do so, as my clients have recently experienced great success selling their homes at or near their asking price in a very short time after placing their homes on the market.

Mortgage rates dos and don’ts

August 22, 2013 Leave a comment

BillsMortgage rates dos and don’ts
Unless you are financially able to purchase a property outright, securing a mortgage is the only way to
achieve home ownership. Here are some do’s and don’ts when it comes to a mortgage.

Do:
1. Pay your bills on time and cut down on any debt. Credit scores are crucial. Your credit score will determine if you are able to get a loan and your interest rate.
2. Save now for a down payment. It’s no secret that the more you are able to put down, the less you have to borrow. However, it is important to note that it may make more sense to pay off high interest debt first. In other words, pay off your credit card debt and settle for less of a down payment because your mortgage interest rate should be less on the property loan.
3.Shop lenders. Compare interest rates and closing costs, such as application fees and appraisals. Learn about the different types of mortgages before meeting with lenders.

Don’t:
1. Don’t make any large purchases or career changes right before the closing. Your lender will recheck your employment status and credit profile again shortly before the closing.
2. Get pre-approved for a mortgage, not just pre-qualified. This will expedite the home buying process and give you negotiating strength and credibility. Sellers will sometimes accept lower offers from qualified buyers, who can show they can close the deal.
3. Don’t get in over your head. Borrow what you can afford, not what the lender is willing to lend. Scrutinize your budget and factor in property taxes, utilities and maintenance.

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