Whether you are looking to buy or sell, your credit score can play a major role in your finance approval. By definition, your credit score is a number that reflects your credit worthiness at any given point in time. When a landlord, lender or credit card company is asked to loan money, they run a credit report to determine the amount of risk involved in investing in you, the applicant. Loan approval and the amount of money you are eligible to receive is one of the most critical elements of your real estate transaction – which makes it important to understand how credit scores work.

Your credit score is calculated based on a number of different factors. These factors are broken down below by percentage of consideration:

  • The number of new account and credit requests you’ve made (10%)
  • Your credit risk (10%)
  • The length of your credit history (15%)
  • Your total indebtedness (30%)
  • Your payment history or record of paying your bills on time (35%)

If you have questions about your credit score and real estate financing or want to see what type of loan you could be pre-approved for, please don’t hesitate to contact me. I am here to help!

Carlos Figueira – NMLS# 147484

President

Keypoint Mortgage LLC

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Posted by: cfigueira | October 25, 2017

How to Dispute Errors on Your Credit Report

One of the biggest obstacles standing between you and that house or condo you want to buy may be your creditworthiness.
And, who is it that tells your lender whether or not you are worthy of getting a mortgage? Credit reporting bureaus — known collectively as “The Big 3” (Experian, Trans Union, and Equifax), are the first to investigate how risky lending money to you may be.
Let’s take a look at how the determination is made and, more important, why you should be diligent in checking for mistakes made along the way.

The Big 3

Whenever you borrow money, whether it’s for a major purchase such as a car or home or with revolving credit, such as a charge card, the lender will report your repayment history to the Big 3.
But that’s just the beginning. These agencies also receive information about you from debt collectors and they purchase information from public records, such as tax liens, judgments, and bankruptcies.
Most, but not all creditors report to all three agencies. Some don’t report to any.

How They Determine Your Credit Worthiness

Each of the three agencies “has its own model for evaluating the information in your credit report and assigning you a credit score,” according to the experts at Equifax. This is why your score may be different with each agency.
A big chunk of your credit score is determined by the types of credit accounts you have and how many you have.
Equifax, for example, bases 15 percent of its determination on these factors.
Payment history, however, is the most important factor.

The Big 3 Are Only Part Of The Story

The three credit reporting agencies report to credit scoring companies, such as FICO®, short for Fair Isaac Corporation. About 90 percent of lenders in the country use a borrower’s FICO® Score when determining whether or not to approve a loan.
FICO® examines each credit report, looking for the following:
  • Payment history – accounts for 35 percent of the credit score
  • Amount of money owed – makes up 30 percent of the credit score
  • Length of credit history – 15 percent of the credit score
  • New credit and credit mix – each make up 10 percent of the borrower’s credit score
The company then assigns you a credit risk score, from 300 (considered poor) to 850. Borrowers with credit scores of 740 or higher qualify for the lowest mortgage interest rates from the majority of lenders.
Those with scores lower than 620 will find it challenging to obtain a loan and, if they do manage to get approved, will typically pay much higher interest rates.

Everybody Makes Mistakes

Your credit score is only as good as the information supplied to the credit reporting agencies. And, errors are common.
“As many as 42 million Americans have errors on their credit reports,” according to CNN Money
Some of these mistakes are egregious enough to ding the consumers’ credit scores. When you’re getting your finances in order to go after that loan preapproval letter, check your credit reports (from all three agencies) carefully.
Some of the most common errors, according to the Federal Trade Commission, include:
  • Identity information – Ensure that your name, address and social security number are accurate. “Mixed files,” those that contain information from two consumers with similar names, are common.
  • Accounts – Check each account to ensure that it is truly yours. Identity theft is another common reason for errors in a credit report.
  • Status – Check that the status of each account (open or closed) is listed correctly.
  • Delinquent accounts – Verify that an account listed as delinquent is actually delinquent.
  • Dates – Each account should list when the account was opened, closed and the date of the last payment. Ensure these dates are correct.
  • Double entries – Dispute any debt that is listed more than once, even if they have different account names or different creditor names.
  • Corrected information – If you’ve received a correction to a previous dispute, ensure that the information in the current report remains corrected.
  • Balances and limits – Check all the outstanding balances and credit limits to ensure they’re correct.

How To Correct Errors In Your Credit Reports

Each credit report includes information on how to dispute information contained in it.
  • Experian – handles all their disputes online. Learn more, here.
  • Equifax – they, too, handle all disputes online. Go to equifax.com to get the details.
  • TransUnion – dispute your credit report online, by mail or phone.
The dispute process takes time, so start it as soon as you’ve decided to purchase a home.

If you have questions about your credit score and real estate financing or want to see what type of loan you could be pre-approved for, please don’t hesitate to contact me. I am here to help!

Carlos Figueira – NMLS# 147484

President

Keypoint Mortgage LLC

Assess your requirements: Firstly, you need to determine your needs and wants. Consider all important aspects such as your need to purchase a home in the current market, the neighborhood, proximity to schools, entertainment, logistics etc. Once you prioritize your needs, look out for the most suitable areas and real estate properties that fulfill all of your requirements.

Calculate your costs to make a purchase within your budget: The down payment is a concern for most of the homebuyers who think of buying a home. You need to be aware of the taxes involved, property insurance and closing costs to ensure that the total calculated cost doesn’t exceed your budget.

Call Keypoint Mortgage and explore mortgage options: By choosing a professional loan officer, you can make the home buying process hassle free. A loan officer can suggest to you various flexible loan programs with lower down payment and a lesser interest rate.

Be financially ready: Before you decide to buy a home, you need to be financially stable and secure. You can also figure out your current credit score by getting your credit report. A lender can also educate you about various other eligibility factors to increase the possibility of loan approval.

Start gathering documents: Apart from calculating costs, you need to keep the essential documents ready to submit during loan processing. Documents range from income tax records, bill payments, employer verification, bank and asset statements, etc. After submitting these documents, an underwriter will evaluate each parameter to determine your eligibility to receive a loan.

Look out for first time home buyer programs: You need to look out for various factors like pricing trends, mortgage rates, depending upon your preferred location. For instance, as a first time home buyer in a state like Texas, you can look out for different grants and programs that can assist you in financing. FHA and USDA loan programs are widely popular among home buyers who look for smaller down payment and low interest rates.

Find the right real estate agents: You need to find a reputed and trustworthy realtor who can assist you in first time home buying. You can ask for recommendations from friends/relatives to look out for agents who specialize in the kind of property you wish to buy.

Posted by: cfigueira | January 20, 2014

Which are the 50 safest communities in New Jersey?

Mahwah is the safest community in New Jersey, according to one security organization.Star-Ledger file photo

New Jersey’s safest community straddles the state’s border with New York.

That’s according to a ranking published by security organization SafeWise, which has determined Mahwah is the Garden State’s safest place.

Mahwah, a township of about 26,000 in northern Bergen County, edged Sparta in Sussex County for top honors.

SafeWise determined its rankings by combining 2011 FBI crime data with other factors such as unique safety initiatives and security programs, the company said in a release.

A municipality must have at population of at least 15,000 to qualify for the list.

SafeWise said it was impressed with the Mahwah police’s Stay Connected app in which citizens can report zoning violations, service requests and other concerns. Mahwah police didn’t report any murders, rapes, robberies or arson in 2011.

Two other Bergen communities also made SafeWise’s top 10: No. 6 Dumont and No. 8 Bergenfield.

Sparta got high marks for its low poverty rate (1.5 percent). Sparta cops reported fewer than 20 burglaries in 2011.

“From relaxed rural countrysides to fast-paced city living, the 50 safest communities in New Jersey share one critical, crime stopping characteristic: community cohesiveness” SafeWise security analyst Alexia Chianis said.

Here is SafeWise’s Top 50:
1. Mahwah (Bergen)
2. Sparta (Sussex)
3. Warren (Somerset)
4. Washington (Morris)
5. Bernards (Somerset)
6. Dumont (Bergen)
7. Hopatcong (Sussex)
8. Bergenfield (Bergen)
9. Madison (Morris)
10. Plainsboro (Middlesex)
11. New Milford (Bergen)
12. Montgomery (Somerset)
13. Wyckoff (Bergen)
14. Monroe (Middlesex)
15. Ridgewood (Bergen)
16. Readington (Hunterdon)
17. Hopewell Township (Mercer)
18. Morris Township (Morris)
19. Hillsborough (Somerset)
20. Montville (Morris)
21. Randolph (Morris)
22. Raritan Township (Hunterdon)
23. Cliffside Park (Bergen)
24. Mount Olive (Morris)
25. Manchester (Ocean)
26. Fort Lee (Bergen)
27. Princeton (Mercer)
28. Marlboro (Monmouth)
29. East Windsor (Mercer)
30. Jefferson (Morris)
31. Palisades Park (Bergen)
32. Manalapan (Monmouth)
33. Scotch Plains (Union)
34. Cranford (Union)
35. Denville (Morris)
36. Westfield (Union)
37. Parsippany (Morris)
38. Barnegat (Ocean)
39. Pequannock (Morris)
40. Nutley (Essex)
41. South Brunswick (Middlesex)
42. Roxbury (Morris)
43. West Milford (Passaic)
44. Summit (Union)
45. Lakewood (Ocean)
46. Fair Lawn (Bergen)
47. Middletown (Monmouth)
48. Medford (Burlington)
49. Piscataway (Middlesex)
50. Hazlet (Monmouth)

By: Jeff Golman/The Star-Ledgar

Rumors continue to swirl of a potential government shutdown if a budget agreement cannot be reached by Friday April 8th.  In the event that a budget agreement can not be reached, a government shutdown would affect several areas of the mortgage business.

• IRS Tax transcript: In the event that the IRS is not open, Lenders will be unable to obtain tax transcripts.  It is our policy that tax transcripts must be received prior to the closing of a loan.

• Flood insurance:
Borrowers living in flood zone areas may have difficulty obtaining flood insurance through FEMA during this period.
• FHA: We have been advised that during the shutdown FHA Connection will be operational and that case numbers can still be obtained.  However, during the shutdown, no one will be able to perform CAIVRS’ checks or obtain insurance endorsements, including lender insurance.  We anticipate a mortgagee letter will be released prior to the shutdown to address the systems and functions that will be affected.
• Rural Housing: We have learned that USDA will allow our Lenders to close loans for which we had already received a commitment.  During the shutdown, USDA will not issue any new commitments or Loan Note Guarantees for closed loans.  Unlike FHA, the GUS system will not be available during the hiatus.

At East Coast Mortgage Corp., our goal is to keep you informed.  We are working to minimize consequences that may affect our business because of a government shutdown.

Posted by: cfigueira | April 7, 2011

FHA Case Numbers

Potential Government Shut down

While it is unknown at this time if congress will pass a balanced budget, East Coast Mortgage Corp.  strongly suggests that any pending case numbers be ordered as soon as possible in the event that the government does a temporary shut down. If a shut down does occur, it is believed that FHA connection will not support ordering case numbers. Again, I strongly suggest that you order your case numbers today.

Posted by: cfigueira | April 5, 2011

UPDATE: TILA Compensation

UPDATE:

TILA Compensation Rule Stay Dissolved On April 5, 2011.  The U.S. Court of Appeals ordered that the stay on the TILA Compensation Rule be dissolved. Loan applications received by East Coast Mortgage Corp. on or after April 6, 2011 will be subject to the rule.

Posted by: cfigueira | April 1, 2011

Loan Originator Compensation Rules

The U.S. Court of Appeals in Washington, D.C. has granted a temporary stay of the implementation of the Federal Reserve Board’s Loan Originator Compensation rules. The court has directed the defendant Federal Reserve Board to file a reply brief by Monday April 4th. The plaintiffs, the National Association of Mortgage Brokers (NAMB) and the National Association of Independent Housing Professionals (NAIHP), have until Tuesday morning April 5th to file their reply briefs. After that filing takes place the Appeals court can order a hearing or make a decision on the basis of the filed briefs. The stay the court has ordered is a temporary measure freezing things in place while the appeal is considered. If the court decides in favor of the NAMB and NAIHP then the most likely course of action would be that the case would move back to the District Court. The stay would probably be extended to cover the period of time the case is in the District Court and could be extended further if there is another appeal. If the Appeals Court decides in favor of the Federal Reserve the stay will be dissolved upon the issuance of the decision

Posted by: cfigueira | April 1, 2011

TILA Compensation Rule

A stay on the TILA Compensation Rule has been ordered by the U.S. Court of Appeals with a hearing scheduled for April 5, 2011.  East Coast Mortgage Corp. and all it’s lender / broker outlets have rolled back operational implementation of the rule until further notice.  Finally, a bit of good news for all the honest, hard working loan officers.

Posted by: cfigueira | March 31, 2011

April 18: FHA Increases MIP

Reminder: the annual Mortgage Insurance Premium for FHA forward mortgages will increase effective for FHA case numbers assigned on or after April 18, 2011. FHA will increase annual premiums collected on a monthly basis for traditional purchase and refinance products. There are no changes to the Upfront Mortgage Insurance Premium.

The rate will go up by .25% more, to a total of 1.15%.  This will equate to a MI payment of approximately $191.66 on a $200,000 mortgage.  The consumer gets socked with $41 more in cost per month, from which they see no additional benefit.

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