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Title: 10 Secrets To Better Mortgage Rates In A Changing Mortgage World
Word Count: 925
Author: Scott Pasinski
Email: scottpasinski@gmail.com
Category: Finance & Investment
Article URL:
http://www.submityourarticle.com/articles/easypublish.php?art_id#17117
The article is preformatted to 60CPL.
10 Secrets To Better Mortgage Rates In A Changing Mortgage World
Long gone are the days of the 100% stated income mortgage
loans with a 620 credit score. Some high powered Wall
Street executives took advantage of us all by promoting
loans that inherently placed people in tough financial
positions. We all see where that has taken us now. In
fact, everyone sees it all over; there are a record number
of delinquencies and foreclosures, millions of them. Why,
because a percentage of these borrowers should never have
received the loan they did. Our ’10 Secrets to Better
Mortgage Rates’ can change a lot of things for a lot of
people.
Maybe some people could afford a home, but just not the
$350,000 one. The mortgage industry has a responsibility
to educate our customers and build strong lifetime
friendships. We must look at the long term goals of owning
a home, rather than owning what we want now. Build
yourself in the `Best Borrower’ so you can get the home
that you have always wanted, it is really not that
difficult. If you make your mortgage payment a struggle,
it will only hurt you in the end.
There is something to be said about the years of `buyer
education’ our parents went through to buy their first
home. It created financial strength. Often times it took
years to accumulate enough money to buy the American Dream.
Imagine both the financial commitments and attention to
credit that must have had? Did you know that the subprime
mortgage industry is really less than 20 years old? It was
only recently that the birth of the `not so perfect’ credit
mortgage and `now you need less that 20% down’ mortgages
were born
Ironically, it’s these new ideas that have allowed many
more people to own a home. The United States has recently
achieved its highest percentage of home ownership in our
history. Obviously home ownership is great; however, it can
show it’s ugly face with foreclosures and all the stress it
causes as well.
So we would like to offer you the `10 ways to be your best
borrower in a changing mortgage world’. These may sound
simple, but absolutely everything in this world has
fundamentals and building blocks that we can apply if we
are to get the most out of them. This guidance will make
you a stronger borrower and will get you better mortgage
interest rates.
1) Pay your rent/mortgage on time with checks. Lenders
want to see a consistency in major payments. None are more
important than your current rent or mortgage. Even if
their landlord lives next door, pay by a check. Days of a
private Verification of Mortgage have gone away. This
stability in payment shows a stronger borrower.
2) When building credit, pay on time and avoid high
balances. We are looking at buying a home twelve months
from now. Pay a little extra every month. Stay away from
the specialty finance programs that say “18 months same as
cash”. Most likely these programs will give you a credit
line for the amount of the unit you are purchasing. Fore
example, that large screen TV for the big game. The line
is maxed when you buy the unit. New credit opened and then
it’s maxed. This has many negative effects.
3) Stay in that car for a couple more months. Get in the
home and then go after the car. This can really drive your
score down.
4) Buy a home within your means. This will allow you to
keep the home and get the home that they want when they can
afford it. This benefits all of us.
5) For cash paying incomes =96 Deposit your money first!
Many banks have 12 months bank statement programs. This
can allow you to avoid stated income products and higher
rates. We all love our extra part time bartending job.
Showing this income to a lender will help as well.
6) When paying down credit lines, keep them open. Don’t
pay them off. Credit lines that are paid off negatively
affect credit
7) Educate yourself. Stay up to date on programs and
industry trends. For example, right now a 40 yr mortgage
is better than an interest only or a 50 yr program. The
secondary market, which drives mortgage programs and rates,
looks negatively on 50 yr and interest only products. When
this happens your rates become higher.
8) Look at the benefits on refinancing. Most lenders use
these guidelines called Net Tangible Benefits. This is
there to protect you as a borrower. Are you getting 10%
cash out? Are you lowering their payment by 10%? Are you
moving from a Adjustable Rate to a Fixed Rate? If there
is no benefit, think again. This is probably not the
lender for you.
9) Know what payment will affect your credit the most.
Your home and your car can affect you the worse. It can
take 12 months to repair this damage. Don’t ever think one
payment won’t hurt.
10) Before you refinance, can you take out a Home Equity
Line of Credit? Most HELOC’s do not have a prepayment
penalty. Take one out to repair the credit and pay off
debts and then refinance. Over time a borrower will save
more then the costs of the HELOC because their mortgage
interest rates are lower. 40 to 100 points in your score
can make a lot of difference to your rate.
If you know the 10 Secrets to obtaining your best mortgage
terms before you buy a home, you definitely will saves
thousands of dollars.
About the Author:
Scott Pasinski is a Senior writer for
http://www.ConsumerMortgageReports.com as well as a
profession mortgage broker. ConsumerMortgageReports.com
philosophy is to provide valuable information to homeowners
throughout the United States.