Finance

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Mortgages - The Best Time to Finance

If you have already decided to purchase a home and you don't have the luxury of waiting for a market change, your lending rate will in large part depend on the market. If you have time to decide when to jump into the mortgage market, then research mortgage rate forecasts for the next year. If rates are expected to increase you may want to submit an application quickly, if rates are moving down you can wait.

Of course your credit rating will be another relatively fixed variable in your quest to get the best rate, if it's relatively low you will pay a higher rate. So if you have time before you need to borrow attempt some credit repair through one of the better known repair firms. It usually takes a few months for them to make a difference but the points they gain could save you significantly over the term of your loan.

It's common sense to shop around for the best mortgage rate and terms and negotiate with mortgage lenders until you are satisfied that you have been quoted the best available rate. So, you can go through whatever expedited process you want, you need to establish to best rate and terms before you zoom through to closing.

Mortgage companies may lock in your interest rate once you apply and are approved but if rates are too often changing they may not offer you an opportunity to lock the rate.

As an appraiser and I understand how important your valuation is. If you have problems with the appraisal the rest of the transaction can just fall apart. Address valuation issues before you bother with loan commitments, if the property you want to finance won't appraise as high as expected you may be wasting your time.

If you do get a commitment of any kind from a mortgage company make sure you get a copy of it, some mortgage companies have gone to on-screen signature documents that disappear once you have electronically signed them. The document you need may disappear when the mortgage lender no longer want to honor them at closing, it's happened to me, so you better have a "screen print" copy before your disappears into the ozone.

Historically mortgage rate have varied between 3.0% and 18.0% and at the moment, in early 2018, the 30-year fixed mortgage rate is near 4%. So we have current mortgage interest rates that are near the low-end of the mortgage interest rate range and if you wait no guarantee exists that they will remain low indefinitely.

If you take the time to make sure the home you want to borrow on will appraise near your expectations, that you are in the best credit position to borrow, you have shopped for the best available rate / terms and considered timing you will get a lot more for your money.




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Getting Your Credit Score to Work For You

This is a topic for those of you who often deal with credit cards or for the process of repayment and other loans.

Here will be discussed some things that are very important to know by you as the customers because it will relate to the future.

Nowadays it is not taboo if someone will try another credit after he has paid off the credit he already had.

But the question is, does what you propose will be easily accepted by the lender? On the other hand, if you have a good credit history then this will not be a problem.

Because your track record will be archived at the underwriter when you will use the services.

Thus this credit report will provide feedback to prospective lenders whether your submission is accepted or on a decline as well as a basis to provide interest on your loan.

From here the assessment will be done and the results are concluded.

Any data of yourself as a credit customer will have a value as a reference of the guarantor in providing assistance again at a later time.

The function of credit score here is certainly very clear. For lenders will greatly assist the survey process and the amount of loan to be approved.

Likewise, for the recipients of the loan (the customer), the credit score will assist in obtaining wider access to the lender by relying on their own financial reputation without having to depend on the ability to provide collateral.

For lenders, there will be certain criteria that become standard. The following are the credit scoring criteria determined by one of the banks.

 

  • Age
  • Place of Work (business field)
  • Number of self-financing
  • Marital status
  • Working period
  • Relationship with the bank
  • The number of dependents
  • Types of loan collateral
  • The husband/wife profession
  • Net income
  • Current credit status
  • Educational status
  • Other Income
  • Credit/debit card ownership
  • Job title

Any information from the above criteria has different weights. Important information such as the accuracy of your loan payments will have a higher value weight than others.

 

Like the previously mentioned credit score function, the credit score will help the bank determine whether your loan is approved or not, and also can determine the amount of loan you will get, how many terms you get and how much interest the loan will be.

If your credit score turns out to be small, you may still be able to get a loan but with higher interest, or you are required to provide collateral.

Have you had a bad history regarding this credit score? Don't worry, we will review how to improve your credit score.

How to Increase Your Credit Score

1. Use Credit Cards Regularly

The great effect on your credit score level is the credit card.

So do not be surprised if you want to borrow or purchase on credit, the lender will ask if you are a credit card user or not.

The credit card itself is ideally a substitute for cash as a means of payment. So, if you never use your credit card, then there will be no data recorded in the bank.

You can use credit cards for payments, especially expensive items, such as airfare and hotel payments, or buying electronic goods.

After that, use a credit card for a smaller payment like eating in a restaurant. It can improve your credit reputation slowly.

2. Avoid Delinquent Credit Card Bills

In the use of credit cards, delinquent bills are strictly prohibited. The level of customer credit collectibility is one-way banks assess the quality of a person's credit.

This level is divided into five criteria, ie smooth payments, special attention payments, substandard, doubtful, and bad credit.

Advice for you as a credit card user, try to pay monthly bills of 10% first. But if you are able to pay the full course would be better to avoid the high interest every month.

As with loan installments, make the same effort to pay 10% of the initial bill and pay as many bills on time as possible.

3. Reapply When Your Credit Approval is Rejected

When your loan or credit card submission process is denied, give the waiting period a few months before re-submitting.

During this waiting period, you can check what is wrong with you as a customer.

For example, you have applied for credit of more than 30% of income, or you still have other repayment responsibilities. Try to focus to pay off all your debts first.

Then after that, you can apply for credit card with low limit first. This can be seen as a positive indication to the bank that you are a trustworthy debtor that can help improve your credit score.

Conclusion

Remember that credit cards are just an alternative way of a payment process and not necessarily a habit. And even if you really need to use the credit system over and over again, it's not a problem either. Keep your good credit score, a commitment to it, and consistently to live it. The higher your credit score the faster your credit application will be.




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Millennials Need To Get Their Finances In Shape

Most millennials are now in there 20s and 30s, beginning a career climb and also the time when you are making major financial decisions. These financial decisions can include home ownership, investment strategies, and family planning. Certainly, you want to try and avoid some of the financial hazards that have transpired in the lives of previous generations.

Financial literacy is seldom taught in school, so if you didn't learn it at home growing up, your first time in the "real world" may get you into some financial distress. Read below to learn some of the top financial tips that will help millennials make smart financial decisions.

Take online money management courses

Because most millennials excel at technology, I would suggest signing up for courses in basic economics, accounting and budgeting. These types of courses can be very affordable and very well delivered by the online professor. I feel this is a very efficient way to update yourself on financial topics that may simplify and improve your financial life.

Build up your retirement savings

Did you know that Wells Fargo revealed that almost 50% of millennials weren't planning for retirement? Make sure you participate in your employer's 401(k) plan, even if you can only afford to contribute the minimum every month.

Make a list of your whole financial picture

I recommend you make a list of everything that is spent each month. After you have digested this information, ask yourself this question. How am I going to pay for all of this? There are also four essential things everyone should know about their finances: income, expenses, assets and liabilities. Having a firm comprehension of these items will help you make sense of your finances. There are many online tools that can help you connect all your accounts - Mint, Quicken just to name a few. I believe this is your first step in improving your finances.

Research passive income opportunities

Most of us work for money all our lives and never really put it to work for us. It is possible to use your job income for passive income from your investments. For example, the IRS says passive income can come from two sources: rental property or a business in which you do not actively participate. Make no mistake; passive income is not about getting something for nothing. It involves a lot of work and is definitely not a "get rich quick" scheme.

Start a savings account

Open up a share account at your credit union even if you can't make regular deposits. You can use this account to put extra money aside for your short term and even long-term goals. This can also be used as your emergency fund. Shoot for 3-12 months of expenses, put aside for emergencies.

Pay yourself first

Once you have money in your hand from your paycheck, IRS refund, etc. always pay yourself first. Arrange for automatic transfers from your checking account directly to your share account every payday or on a monthly basis.

Do you know the impact of your credit score?

Everyone, but especially entrepreneurial millennials need to understand that their personal credit can be the defining factor in getting working capital in the future. Getting approved for a loan can be very challenging when your credit score is low. Learn how to read your credit report and check it frequently.

Reduce your debt faster

Pay off small debts first and gradually tackle the larger ones. This will allow you to see results and stay motivated.

Enlist the assistance of a trusted mentor

There is an overabundance of information online regarding financial literacy. However, picking the brain of someone you know and trust is better. Their insights are often tailor-made to your specific needs.

Remove extra costs

It is a proven fact that millennials have expensive habits ($5 lattes every day, eating out on a regular basis, designer fashions, etc.). Keep a close eye on your expenses and trim them where you can.

Raise your children to be financially savvy

At this point you may already have young children or planning to start a family. Teach them that saving money is essential. When they are old enough take them to your credit union and help them open up their own accounts. This will hopefully excite them to continue saving their own money.

I hope you use these financial tips to keep your finances on track while you are young. Remember, you have a very bright financial future ahead of you if you start now and stick with it!




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