Aura Gauthier's Blog
Before you even start looking for a home, you should know what your credit score is. You can pull your own credit score from the three major bureaus without having points deducted from your credit score. You should know your score since it will affect how high your mortgage payments will be, and it will also determine if a lender will lend to you. Certain types of loans have a minimum credit score — if your credit is below the minimum, you won’t be able to qualify for that type of loan.
Credit Score Minimums
Many programs require you to have a minimum credit score. Most lenders will require these scores for these types of loans:
620 for a conventional loan;
580 for an FHA loan if you want your down payment to be as low as 3.5 percent;
500 to 579 for an FHA loan with a down payment of 10 percent;
620 for a VA loan;
640 for a USDA loan; and
720 or higher for a jumbo loan.
Credit Scores and Interest Rates
The lower your interest rate is, the less you have to pay to the lender for allowing you to borrow money. This also means a lower monthly payment for you. Even a half-point could make a large difference in how much you have to repay. While a half-point might equal $50 or $60 per month on your loan, when you pay that over 360 months, that is $18,000 to $21,600 over the life of the loan.
Creditors use your credit score to see how careful you are with credit – how you will pay it back, and if you will pay it back. The higher the score, the less risk you are to the lender.
Increase Your Credit Score
Sometimes, you can’t help having a low score. You might have lost a job, or you might have had high medical expenses after an accident. Before you buy a house, you should get your score up as high as possible. While it seems like it will drop overnight, it definitely takes some time to increase your credit score. While you are working on your credit score, you can start putting some money aside for a larger down payment. To help increase your credit score:
Get a copy of your credit report and scores from all three major bureaus.
Go through your report. Make note of anything that is incorrect, including accounts you have and your personal information.
Dispute anything that is wrong with each of the credit bureaus. If you have an account that is not yours that is listed on TransUnion, dispute it on TransUnion. If it shows up on TransUnion and Equifax, dispute it on both.
Determine how much revolving credit you have. This is the amount you are allowed to spend on credit cards and some types of home equity loans. Divide the total of your balances by the total amount of credit you have. That number needs to be below 35 percent for a better interest rate. In some cases, a lender will not give you a mortgage if that number is too high.
Showing more credit with a lower debt to credit percentage increases your score. Don’t close out any accounts, but make sure they are all paid on time, and get the highest balances as low as possible. During the months before you buy a house, you should try to avoid using credit cards if possible.
Pay off as much debt as possible.
Remember, every time someone, other than you, pulls your credit, your score gets dinged. Don’t shop for a mortgage until you are ready to buy, and try to keep all inquiries within 30 days.
Keeping good credit is more than paying on time. You also have to responsibly manage your credit.
For those who intend to sell a house, it generally is beneficial to explore ways to minimize stress throughout the home selling journey. That way, a home seller will be prepared to deal with any potential pitfalls that come his or her way.
When it comes to prepping for the home selling journey, stress can be problematic. But if you can remain calm, cool and collected in the face of home selling hurdles, you can find solutions to these problems and enjoy a stress-free home selling experience.
Now, let's take a look at three tips to ensure a stress-free home selling journey.
1. Evaluate Your Home's Strengths and Weaknesses
What separates your residence from others? Consider your house's strengths and weaknesses, and you can discover ways to transform various weaknesses into strengths.
Oftentimes, it helps to conduct a home inspection prior to listing a residence. This will enable you to identify any structural issues with your house and address such problems before you add your residence to the real estate market.
2. Enhance Your Home's Interior and Exterior
For those who want to minimize stress, it may be a good idea to hire professionals to help you upgrade your house's interior and exterior. Because if you have professional support at your disposal, you can quickly and effortlessly transform an ordinary house into an exceptional one.
To find the best interior decorators in your city or town, you may want to search online. This will allow you to examine online reviews and customer feedback and find the best interior decorators in any area, at any time.
Moreover, you should not hesitate to hire professional landscapers to help you bolster your house's curb appeal. Professional landscapers can trim the hedges, mow the lawn and perform other home exterior upgrades to ensure your house stands out to potential buyers.
3. Consult with a Real Estate Agent
Don't let stress get the best of you as you prepare to sell your house. Instead, hire a real estate agent, and you can avoid stress throughout the home selling journey.
Ultimately, a real estate agent is a difference-maker for a home seller. This housing market professional will teach you everything you need to know about selling a house and ensure you can make informed home selling decisions. As a result, a real estate agent can make it easy to navigate each stage of the home selling journey.
Let's not forget about the comprehensive home selling guidance that a real estate agent can provide, either. A real estate agent can help you take an objective view of your home and establish a competitive price for it. Also, after you receive an offer on your home, a real estate agent can help you examine this proposal and determine whether to accept, reject or counter it.
If you want to streamline the home selling process, there is no need to worry. Take advantage of the aforementioned tips, and a home seller can reap the benefits of a stress-free home selling experience.
In the internet age, we’ve all seen dream homes on Google, Pinterest, or Instagram that seem to encompass everything we’ve ever wanted in a home.
Sometimes, obsessing over dream homes can be detrimental to us--making us feel bad about our own living situation or discouraged about ever being able to afford the home we truly want.
However, dream homes can serve a purpose when it comes to identifying what we really want out of a home.
In today’s post, we’re going to use the idea of a dream home “wish list” to help you narrow down what really matters to you and your family in your next home.
Step 1: Start by making a list of your dream homes
This is the easy part. If you’re like me, you probably have a Pinterest board or bookmark folder just for home inspiration.
Put all of the dream homes on your list. The order doesn’t matter, and you’ll find out why below.
Step 2: For each home, write down one or two of your favorite things
Is it the square footage? The location that’s perfect for your commute or for trips to your favorite places? Or, is it just the color scheme of the kitchen?
No aspect is too small for this list--it all depends on what you like, not what the price tag is.
Step 3: Go over your list and try to put the items in order of how much they matter to you.
An example would be:
A cheerful, bright colored kitchen
A cozy office to wok quietly in
A two-car garage
A playroom for the kids
A location that’s close to the water
Looking over these five things, there are only two items that can’t be found in most houses, a two-car garage and a location that’s near the water. And, this house-hunter didn’t even list those items as the most important.
So, what can we learn from this exercise? Oftentimes, the things we’re looking for the most in a home can be things that we can do later, like interior decorating or designating spare rooms to serve as an office or playroom.
Step 4: Use your top 3 when house hunting
Now that you have the top three things that you’d find in your dream home, take this list with you on your house hunt. Try to seek out a home that has a combination of these items and one that will be the most practical for your family.
You might find that these conveniences, such as being closer to your work for a shorter commute, will pay off in the long run, as they’ll let you spend more time with our family and make each day a little bit easier.
24 Winding Way, Plymouth, MA 02360
Understanding the type of loan you're getting matters, to protect your financial interests. You also need to know when to choose one type of loan over another. So, should you choose a bridge loan? When might that be the best choice for getting into the home of your dreams? Here's what you need to know about this particular loan type.
What Are Bridge Loans?
Bridge loans typically provide temporary home financing, and are designed for use for six to 12 months. They carry an interest rate that is approximately two percent higher than a standard mortgage. These loans can "bridge" the gap between buying one property and selling another, allowing the borrower to get into a different home before their original home is sold and closed.
Who Can Receive a Loan Like This?
Anyone who owns a home and is trying to buy another one could potentially get a bridge loan. Just as with a traditional mortgage, though, you would have to qualify. Income and equity requirements must be met. There is also usually a debt-to-income ratio that's very important, since you'll have to make loan payments for a few months.
Why Would Someone Want a Bridge Loan?
When you're selling your home but you haven't found a buyer yet, you might find another home you want to buy. Since you don't have the funds from the sale of your current home, you wouldn't normally qualify to buy the other home. If you can get a bridge loan, though, you can buy the second home while still trying to sell the first one. When the first one sells and you receive the proceeds, you can use that money to pay off the bridge loan. Bridging that gap between the financing for the two homes can be vital in markets where housing is very competitive, or where you need to move quickly to purchase a particular home.
How to Get This Type of Loan
Getting a bridge loan involves talking to your bank or other lender, just like you would with another type of loan. Not all lenders offer bridge loans, so it's important to shop around. Additionally, your real estate agent can be a great resource when it comes to finding a bridge loan. Some agents even partner with lenders for these kinds of loans, to give their clients more options.
If you're not sure whether a bridge loan is the right choice for your home buying and selling needs, talking to your lender and real estate agent can help. There are times when borrowing additional money isn't a good choice, but these kinds of loans can also be very beneficial in certain real estate circumstances.