So what's your New Year's Resolution?? Interest Rates ticked up a bit... should we lock or not?

I received much positive feedback on this last post, so I thought I'd resend it to you along with a few additional updates.

I pray you and your families had a joyous Christmas!

What's your New Year's Resolution? Eat Right, Exercise More, Get Organized.... or considering buying or refinancing your home?? This blog will hopefully help you make a good choice if it's regarding home financing!

If you have been considering buying a home or even refinancing, you've probably been asking one of these questions? Should I refinance now? Should I buy now? What if rates go down again? With the economy this way, surely rates will have to drop again? I heard the Feds are going to lower rates again to stimulate the economy, should I wait to lock in an interest rate then? Just since Christmas, mortgage rates have tinged up about 3/8 or .375%. Depending on your loan size, that can make a difference on whether it makes sense to refinance or not.
These are all great questions and very valid. In the past, before all the housing bubble began, the answer to these questions might of been to wait. Times have changed! It's a whole new game in the mortgage world. If you are considering waiting to buy or refinance, below is a few reasons not to:

1. Mortgage Lenders are tightening guidelines to protect against future losses. Mortgage lenders are reducing loan to value limitations. They may require you to have 20% equity or more? If you are an investor or a jumbo borrower, those equity requirements are even higher. Someone who could qualify today, may not be able to qualify tomorrow.

2. The value of your home could decline, maybe it already has and could again? Foreclosures and short sales lower the market value of every home in your neighborhood and surrounding areas. A home that is comparable to yours that ends up selling for less than yours is going to lower your home's value. Lower appraisals lead to higher loan to values and, often, higher mortgage rates.

3. Have you or someone you know lost their job in the last two years? Job losses are happening at a very rapid rate. Many are being laid off as employers fear for the future stability of the company. Many are downsizing to offset lower prof ts (or no profits at all). Without a job and a steady paycheck, lenders won't give you a mortgage loan. I work with Business Fellowship International, a ministry that helps folks get connected and possibly into a new job. If this is you, please email me and I will help you in any way I can.

4. Another rise in cost is mortgage insurance or PMI. This is required if you have less than 20% equity or down payment in your home. PMI is an insurance that protects the lenders in the event of default. Remember hurricane Andrew and the impact it made on the insurance carriers? What's going on in the housing market right now, is comparable to that. Mortgage insurance carriers are raising rates and tightening guidelines as well, making it very hard to qualify or not allowing your payment to drop with the interest rate reductions.

5. What is your credit score? Most people assume their credit is good. But what is good anymore? To get the "preferred" or "going" interest rate, you have to have excellent credit scores, that means over 700 and sometimes over 720/740. Now don't get me wrong, we are still able to do loans under 700, but we would need to review your situation to see if it makes sense for you.

If you are thinking about buying or refinancing, now's the time to do it. The pendulum for mortgage loans has swung from one extreme to the other and it may be a long long while before lenders will consider loosening guidelines again. Financial crisis has it America.

But there is hope! Jeremiah 29:11 says, For I know the plans I have for you says the Lord, plans to prosper you, not to harm you, but to give you a future and a hope. 2 Chronicles 7:14 says If my people, which are called by my name, shall humble themselves, and pray, and seek my face, and turn from their wicked ways; then will I hear from heaven, and will forgive their sin, and will heal their land. If you have a relationship with the Lord, He will see you through! If you don't, consider asking Jesus into your heart, ask Him to forgive you of your sin and to cleanse you and make you new. He loves you so much and wants only good for you!

So, if your New Year's Resolution is to make a move or refinance your existing home, Jewel and I, the InSight Team, are here to help you make sound choices. We have many valuable resources and offer a variety of mortgage products.

For an Honest Approach to your Home Financing Needs, please give us a call or email us or visit us on the web at www.wantinsight.com.

Blessings Abundant!

Michele "MAC" A. Cole
Business Development
michele@wantinsight.com

Jewel Callahan
Mortgage Consultant
816-510-1399

THE NUMBERS GAME -- Your Credit Score

What do you consider the most important number in your life? Your social security number? Your birth date? Your phone number? While the majority of people don’t know this number, it pretty much rules your finances --- it’s your credit score.

A credit score is used by lenders in the decision making process of “if I give Person #1 a loan or credit card, how likely is it that Person #1 will pay me back on time?” This number is also called a risk score and is actually a statistical measure of the risk that a person will be able to repay the debt as agreed.

A good credit rating is essential these days if you plan on making a major purchase, apply for a credit card, or take out a loan. If your credit rating isn’t as positive as you’d like, there are ways to improve it.

WHERE DO I GO TO FIND OUT MY SCORE?

There are three major credit reporting bureaus and you are entitled to one free report per agency, per year. And, the reported score may be a different number from one agency to the other. You also have the right to dispute any errors on the report(s). Request a written report to be sent to you:

Equifax www.equifax.com
Experian www.experian.com
TransUnion www.transunion.com

You can always call any of us at the office,at 913-642-3334 or email me at michele@wantinsight.com for additional information on credit scores.


REVIEW THE REPORT

It’s been reported that nearly 80% of all credit reports contain at least one error! So, review your report carefully. Once you’ve identified any discrepancies, they’ll need to be eliminated. A dispute form usually accompanies the credit report (or request one from the website). Fill it out and send it back as Registered Mail. Documentation of each step you take is important, so keep a “paper trail”. And note that the law states that any item that is not verified as accurate must be removed from your report.

IT’S CLEAN UP TIME

Now the mistakes are cleared up, but there are still a few blemishes that are yours. What next? Identify any debts that are still pending and make a plan for eliminating them. It takes time to clear up debt, so it’s important to start now. AND, you also have the legal right to add remarks to your file. This is an opportunity to defend yourself and also highlight the positive points in your report.

WASH & REPEAT

Consistent payments (small is fine, as long as it’s the minimum due) is key. Consistency proves you are responsible enough to repay loans as promised. Over time, that consistency outweighs the possible negatives on your report.

LOOK AGAIN

Check your credit information at least once a year to avoid any nasty surprises when you’re ready to make a major purchase.

OTHER NUMBERS

It’s good to have a few open lines of credit, none max’ed out, and no more than what you can afford to pay off on your income. Cancel old cards you don’t use any more. BUT, do not use up one huge line of credit by putting your full amount of debt on it! Credit card issuers like to see no more than 30% of your limit accessed at one time. Prove your self control by having 2-4 lines of credit with a small or even no balance on each.


For help with any of your credit related questions please call me, 913-642-3334, or email me at michele@wantinsight.com