Does The Balance On Your Account Matter?

February 4, 2012 by Leave a Comment

new home sales apexI recently read a report that said:

“Several of my clients are in the credit restoration business and a recent conference call with some of the heavy hitters in the business revealed an astonishing new update to how the FICO score is computed.

Balance management – that is the practice of getting the “balance to available credit” (similar to ltv) below 50% and ultimately to below 30% for maximum benefit, “NO LONGER appears to improve the score” was the quote on the conference call. It was a common, and very simple way to get a few point increase in FICO score was to transfer balances accross cards, or pay down across cards to get the balances below 50 and 30% of the available credit line. Another common practice if there was no room on other cards or no cash to pay balances down was to call the credit companies and request an increase in the available credit limit – which would result in an improved ratio and a better score. It appears this is NO LONGER the case.”

In review of our recent files… we do not feel this is accurate information.  Our files show that folks who pay their accounts down to at lest a 50% level do have an improvement in their scores.

Don’t be fooled by those who don’t have many clients, are not working full time in the business, and just plain don’t know…  Steve Thorne at Mortgage Banker in Cary 919 649 5058  if you want to buy a house and need more information!

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Basics to Qualifying for a FHA Mortgage Loan

February 5, 2009 by 1 Comment

Buy Baby A New Home!FHA mortgage loans offers some of the most flexible financing available for today’s home buyers!  With FHA, you can purchase a property that’s located almost anywhere, (unlike USDA that has a “footprint” of where you can purchase) and you don’t have to be a Veteran (a requirement for VA home loans ).  AND you can use a GIFT for your downpayment!  

Here are the Basic Guidelines:

  • You can Own property somewhere else…. meaning if you move to NC from Ohio (for instance) and you own a property there, you can still qualify for a FHA mortgage loan in NC! (but there are some details you need to remember about using rental income so click here to learn more!)
  • You can get a Gift for the Downpayment!
  • We can use income from a Second Job if you’ve had that job for at least 18 months, and/or you have a history of working 2 jobs!
  • Minimum Credit Scores are more difficult to pin down.  In GENERAL – you need at least 12 months of “clean credit,” and no collections or judgements in the last 12 months.  I you are new to the credit “game” it’s going to be tough to get a loan, but we do have some investors that will help with “non-tradtional credit.”
  • Debt To Income Ratios are “loosly” 33/43.  This means that based upon your GROSS income, you can have 33% of your monthly income going to your housing expense (which includes Principal and Interest, Taxes, Insurances and HomeOwner Dues, if you have them!).  Then you take your Gross Monthly Income and only 43% of your income can be gong to TOTAL debt – which includes the Housing expense above, but it also includes the items which report to the credit report (car payments, credit cards, etc.)
  • Downpayment is 3.5%!
  • You do not have to count child care payments!  (WHEW!)
  • You can use a non-occupying co-borrower.  This means that if your parents want to help you by being on the mortgage loan, you can use their income and assets to qualify.  BIG, BIG, B-U-T here… you can not have sorry credit, and overcome that with a co-borrower. 
  • The maximum loan amount for Wake County and Johnston County in NC is $271,050.  The maximum loan amount in Orange and Durham Counties is over $330,000!
  • You can STREAMLINE refinance to a lower rate FHA Mortgage with minimal costs!

If you are considering a purchase or refinance and have questions about FHA mortgage financing – please call us!

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Government Guidelines Are Getting Tighter

January 13, 2009 by Leave a Comment

A major bank announced last week that they are going to begin charging a higher fee to folks seeking Government Financing (the most popular loans right now) that have credit scores less than 620.

For more information about this change… click here.  8o((

This does NOT mean that you can not get a loan if your score is less than 620, only that you will pay a higher interest rate, and it will be more difficult for the lender to give you a credit to cover part of your closing costs!

If you have specific questions about purchasing a home in NC, call us!

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One Works at Bragg – One in Wake County!

October 28, 2008 by 6 Comments

ft braggWe are working with a couple looking for property that will allow the Veteran to commute to Fort Bragg (in Fayetteville, NC) and the spouse to work in Apex, NC (Wake County).

Since we’ve been making mortgage loans for many years in the Triangle, this is not the first couple we’ve met who decide to purchase a home in Harnett County or the Southern Most areas of Johnston or Wake County!  It’s a “hot spot” for Veterans – and the homes are VERY affordable! 

Lot prices in this area are also lower than in more populated sections of Raleigh, making new homes, custom built in this area very attractive right now!

The Veteran’s Administration does not make VA loans, just HUD does not issue FHA loans.  The VA insures these loans.  Here are the basic guidelines for qualifying for a VA loans:

  • Total Debt Ratios not to exceed 41 to 43% (depending on energy efficiency of home).
  • Credit needs to have a score, however the VA does not publish a guide on a minimum credit score.  Most Investors want a score of at least 600 – although exceptions are certainly made.  The VA is most interested in a 12 month history of “clean credit.” (click here for more details)
  • Must be a Veteran (to see if your service experience qualifies click here).  If you are qualifying with another person’s income, they must also be a veteran, or a spouse. (more information about co-signors here)
  • We must verify employment, there are no stated income VA loan products.
  • You can receive a gift for closing costs, and/or the seller can pay for closing costs.

If you have other questions about VA home loans, please call us, we’d love to help you too!

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Looking for a Home – When Do I Apply?

October 13, 2008 by 2 Comments

This is a question that was posted recently on Trulia Voices…

“Looking for a Home in the Triangle.  I think I’ll be ready to purchase in March of 2009.  When should I apply for a mortgage???”

People who are considering a move to the Triangle need to plan for their home purchase.  If you will be in the market to purchase in 2009 – you should speak with a NC lender as soon as possible.  Why?

We have our own set of unique qualifying guidelines in NC – mandated by the State Legislature.  While we are a “brick and morter” state (meaning if you are a mortgage company doing business in NC you should have an office here and not just be “virtual”), there are always those with fancy footwork trying to figure out a way around the system.  Better to be safe than sorry – and find a “local” to work with.

In some cases, our State Legislature defines how much a lender can contribute toward closing costs, they also dictate WHICH KIND of loan programs are available to consumers.  So again, think local.

But the MAIN REASON you should speak with a lender even six or eight months before you purchase is this:

With the “mortgage MESS” of the last year, credit scores have become one of the MOST IMPORTANT parts to a loan approval… ESPECIALLY in North Carolina.  Because our programs are limited, we rely even more heavily on high credit scores to qualify buyers, and get the best interest rate.  If you have a “good” score of 640 – we could get your FICO score up to 720 if we had 6 to 8 months! This change in your score could mean the difference of over $75 a month in your payment!

Let’s see… $75 a month savings, live in a house for 4 years, that’s a MINIMUM SAVINGS of $3600!  Just for speaking with a loan officer EARLIER in the process!  So if you are considering a purchase, call now!

Steve and Eleanor Thorne, Corporate Investors Mortgage Group, 919-649-5058

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Countrywide Mistakes Means Free Peek!

September 17, 2008 by 1 Comment

Countrywide had a data breech – leaving almost 2 million people “exposed!”

“Countrywide Home Loans has revealed that there was a security breach and that people who have their mortgages with their company may have had their social security numbers compromised.

When you get a home loan, you give plenty of information. Enough needed to become a serious victim of identity theft.

Identity theft experts recommend that you check your credit at least once per year, and the federal government has given you the right to do it at no charge.  [Read more...]

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