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So by now you have heard the news. Bank of America is buying out Countrywide for pennies on the dollar. You got to give it to BOA… they got a deal. Of course, it does come with baggage as well, but I think it will still be good for BOA. My question is though, will it be good for consumers….

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Earlier I was snooping around CNN Money online to get info from Bernanke’s speech today about the Fed Reserve. While there I saw an ad from Bankrate.com, a well “respected” website that is supposed to be objective. For the fun of it, I clicked on the rate comparison for a 30 year loan (which advertised a SUPER LOW rate.) I was then prompted to provide more information about locality, loan amount and down payment. When all was said and done, that rate was nowhere to be found.. and at the bottom of the list of lenders and their “Todays’ Rates” list was this tag: Read the rest of this entry »

2007 was filled with finger pointing left and right. So many lenders pointed the fingers at mortgage brokers as the bad guys that “pushed people into higher rate loans” to make more money. In reality, most mortgage brokers simply sold the products that were available. After all, if a customer would qualify for a conforming 30 year fixed at 6%, why in the world would that customer ever take a 2 year arm at 8%? That thought process and blaming doesn’t even make sense. So why all the blame? Read the rest of this entry »

Special Contribution Article

The Top Ten Credit Dos and Don’ts During the Mortgage Loan Process

Keep in mind the actual lender will pull their own credit report at closing, and if your credit scores have dropped, you may no longer qualify for the rate that was underwritten and the final approval may come back with a higher rate. Unfortunately, all lenders qualify you by your credit score as to which criteria you fit and every loan has different criteria attached. The loan to value, the debt to income ratio and so on etc. This is what borrowers do not understand, and they think the loan officer is baiting and switching. They are not. If an issue comes up that the lender decides you do not qualify for a certain loan, the only thing a loan officer can do is shop for lenders and see if any are willing to give the rate and program they thought you qualified for. If you have good credit and know your score, the loan officer can give you an idea what he or she can offer based on what you say.  But do not expect them to stand by their quote if and when they pull your credit your scores have dropped.

Following are some helpful tips to avoid the credit mistakes that many borrowers make during the loan process:

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Special Contribution Article

Planning Your Mortgage and Seeking Pre-Approval

The Benefits of a Professional Consultant

Choosing a good lender is a key element in managing your mortgage.  A professional consultant won’t just provide a loan, they will help you select the one most beneficial to you and your long-term goals, and then, help you manage that debt over time. There are not many lenders out there who provide this type of personalized service. Read the rest of this entry »

One of the ways I want to help others is by keeping up to date with what is going on in the news. Especially news that is related to mortgage and finance. To do that, I recently changed my home page on my browser to Google and requested News to be posted on my home page.

It did not take long Read the rest of this entry »

In 2008, Fair Isaac Corp has announced that it will be changing the FICO credit scoring model. The new model, dubbed FICO 08, will make it easier on some and harder on others. Here are a few changes to expect:

• Bye Bye Authorized Users - In response to those that have charged up to $1,000 to add someone on their account to improve credit scores, authorized user accounts will no longer help boost credit scores. In fact, they could actually lower your score. No official word on this, but my expectation is that if MAJORITY of your credit is someone else’s credit, your score WILL reflect that. Also, if you are an authorized user on an account that is being sold for improving scores, expect to get hit hard! (again, no official word on that, but I expect this will be the case.)
• Occasional Slips Forgiven - So you have gone on forever making all your payments on time and then you have this one time late payment. Maybe it really got ”lost in the mail”, but the occasional random late may not hurt you quite as bad as it has recently. The word is that Fair Isaac is really trying to find out WHO is most likely to stop paying… the occasional late payment happens to most of us. But if most of your accounts are paid as agreed, the occasional late may not be such a big deal.
• Frequent Late Pays Hit Hardest - If you are late frequently, expect your score to be even worse that it was before. When this mew scoring model roles out, you will be penalized for constantly being late. The cure? Start making your payments EARLY and not waiting till the last minute.
• Variety is the Spice of Life (and now credit) - Those with a more diverse profile may see improvements. For example, someone with only 2 credit cards may not see the same gains as someone with a credit card, a loan, a car payment and a mortgage. I would still recommend credit cards for rebuilding as they do have a more instant impact on credit, however you will want to show more consitency across the board. One rule to remember… avoid Finance Companies if at all possible. They can still tend to hurt your score!

The bottom line is that lenders are more sensitive to risks right now and Fair Isaac is trying to help correct that. With other credit score models coming out, Fair Isaac wants to keep the FICO model on top of the market place. This new model will further seperate the good from the bad with little room in the middle.

If you do not understand how credit works, see a credit counselor immediately so that you can get yourself on top of things. Or, if you live in the Charlotte area, you can call me and I will try to help. If you are thinking about buying a home in Charlotte in the near future, start now by checking your credit profile and speak to a mortgage professional. You can never start that process too early!

Ed Nailor - dedicated to educating, inspiring and assisting in the American Dream! Apply for a Mortgage in Charlotte

Fannie Mae and Freddie Mac announced recently that they would be changing mortgage rate pricing due to increased losses in the mortgage industry. That has now gone into effect with majority of the major lenders.

If you put less that 30% down on a home purchase and have a credit score below 680, you will have a higher mortgage rate. How does this play out? Here is an example:

$200,000 Purchase with 5% down (full income documentation)

Standard Rate: 680 score and above: 6.25

If score was 660: 6.50

640 score would be: 6.75

620, rate would be: 7.0

This is just an example, and not a rate “quote”, but as you can see, credit score can make close to a 1% difference. (in some cases, it could end up as more than 1%)

So what does this mean? Well, getting with the right lender for one makes even more sense. Someone that understands credit and scoring and can help you determine if you need to improve your credit, and if so… HOW. Be careful… if the person you are talking to does not know how credit scoring works, the simple advice they give may hurt your score!

Let us take a look and see where you stand. We are experts in credit and mortgages and know what needs to be done.

Now, more that ever, when time and money really matter, call the Carolina Mortgage Connection.

877-411-9327