Til’ Debt Do Us Part: How to Get a Mortgage If One Spouse Has Poor Credit

Til' Debt Do Us Part: How to Get a Mortgage If One Spouse Has A Terrible Credit ScoreA poor credit history is a reality for many people, but it can be particularly daunting when it comes to investing in a house. Simply because you or yours have experienced bad credit doesn’t mean that you should be penalized in the future. If your spouse has struggled with bad credit in the past but you’re both preparing to move forward and invest in a home, here are some tips for getting it together financially.

Face The Music

Many people who have bad credit are too scared to look at their credit report and broach it honestly. But it’s important to come to terms with the problem so that it can be fixed. Instead of ignoring it, get a copy of the credit report and review it for any errors so that you can update these if needed. It’s a good thing to be aware of the issues impacting your credit score. While there may not be any inaccuracies on the report, knowing what you’re dealing with will give you a place to start.

Make Your Payments

At some point, most people have missed a credit card payment, but the first step involved in improving your finances and your credit is ensuring you pay your bills on time. While this won’t require paying the complete balance each month, it’s important to pay the minimum balance before the due date, and stick with it! It may seem like a small step, but in time it will improve credit and say a lot to mortgage lenders!

Save Up For Down Payment

20% is the amount that’s often suggested when it comes to a down payment, but if your spouse has terrible credit, it may be worth your while to save up more. Having good credit for both you and your spouse is important in getting approved for a mortgage, but by having extra for your down payment and paying your bills on time, you may be successful at convincing lenders you’re a solid bet.

It can be a lot more difficult to get your mortgage approved if your spouse has bad credit, but there are steps you can take to improve your financial outlook and give lenders a better impression. If you’re planning on investing in a home soon, contact us for more information.

What’s Ahead For Mortgage Rates This Week – April 10, 2017

Last week’s economic data included releases on construction spending and labor-related reports including ADP Payrolls, Non-Farm Payrolls, national unemployment. Weekly readings on mortgage rates and new jobless claims were also released.

Construction Spending Increases in February

February construction spending grew by 0.80 percent from January’s reading of -0.50 percent. Analysts expected a reading of + 1.00 percent. Housing industry pros and analysts continue monitoring construction spending for indications of future construction projects. Construction spending was boosted by unseasonably warm weather in regions typically subject to cold winter climates.

U.S. homes are in high demand despite rapidly rising home prices due to short supplies of available homes; industry leaders contend that building more homes is the only remedy for the imbalance between would-be home buyers and low inventories of homes for sale. Home builders repeatedly cite shortages of buildable lots and skilled labor as obstacles to building more homes.

Job Growth Dips as New Jobless Claims and Unemployment Rate Falls

ADP reported that 263,000 private-sector jobs were created in March as compared to revised readings of 245,000 jobs created in February and expectations of 170,000 jobs created in March Private-sector employers were encouraged by potential reductions in taxes, regulations, infrastructure and improvements.

Non-farm payrolls dropped significantly in March; the Commerce Department reported only 98,000 new public and private sector jobs added in March as compared to expectations of 185,000 jobs added and 219,000 public and private-sector jobs added in February.

Economists said that rapid growth of jobs seen in the last few years was not sustainable and cited severe reductions in retail jobs as contributing to the drop in the Non-farm payrolls reading for March. The steep drop in job creation could cause the Federal Reserve to hold off on raising the federal funds rate in June, but this is far from certain depending on economic readings for April and May.

National unemployment fell to 4.50 percent in March against expectations of 4.70 percent and February’s reading of 4.70 percent

New jobless claims fell to 234,000 claims as compared to expectations of 251,000 new claims and the prior week’s reading of 259,000 claims. Lower initial jobless claims despite the steep drop in job growth suggests that workers are leaving the workforce and are ineligible to file new claims or that the drop in jobs growth was a “correction” and future jobs growth reports may not show such sharp adjustments.

Mortgage Rates Mixed

Rates for fixed-rate mortgages were lower last week. Freddie Mac reported that average rates for fixed rate mortgages fell; the average rate for a 30-year mortgage was four basis points lower at 4.20 percent. The average rate for a 15-year fixed rate mortgaged dropped three basis points to 3.36 percent. The average rate for a 5/1 adjustable rate mortgage ticked up by one basis point to an average of 3.19 percent. Discount points averaged 0.50 percent for fixed rate mortgages and 0.40 percent for a 5/1 adjustable rate mortgage.

Whats Ahead

This week’s scheduled economic reports include readings on inflation, core inflation and consumer sentiment. Weekly reports on new jobless claims and mortgage rates will also be released.

Your Debt-To-Income Ratio and How It Affects Your Mortgage

Your Debt-To-Income Ratio and How It Affects Your MortgageWhen you’re delving into the market in the hopes of finding your dream home, it’s likely you’ll come across the term debt-to-income ratio. While it might not seem important at first, but your DTI is the key to determining the amount of money you can put into your home and how much you should spend on a monthly basis. If you’re curious about what this means for you, here’s how to calculate DTI and how it can impact your mortgage.

What’s Your DTI Ratio?

One of the best ways to determine whether or not a home is affordable for you is to first calculate your DTI ratio. To get this amount, add up all of your monthly payments including any credit card, loan and mortgage payments Then divide this amount by your gross monthly income. The amount you get is your DTI percentage. This will help to determine how much your monthly payment should be.

What Does Your DTI Mean?

Your DTI percentage helps to determine the amount of house you can afford on a monthly basis. While a DTI of 25% or less is ideal, a DTI above 43% may make it harder to get financing since there will be little room for error. When it comes to a higher debt load, approval may come down to what your credit history says about your financial health.

The Amount Of Home You Can Afford

It’s easy to be convinced that your dream home is for you and worth the splurge. But investing in too much home can lead to future financial difficulties. If you’re set on a home that has a high monthly payment, you may want to hold off until you’ve saved a larger down payment. You can also revamp your budget so that you can make the investment work for you. It may also be worth continuing the housing search so that you have more flexibility to invest in education, travel or other things down the road.

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What’s Ahead For Mortgage Rates This Week – April 3, 2017

Last week’s economic news included Case-Shiller Home Price Index reports, pending home sales, and consumer confidence readings. Weekly readings on average mortgage rates and new jobless claims were also released.

CaseShiller: Home Prices Higher in January

According to Case-Shiller reports released last Tuesday, average home prices increased in January. The national average home price rose 0.20 percent from December to January; year over year, home prices grew by 5.90 percent. Home prices were 0.90 percent higher on a month-to-month basis when seasonally adjusted. The West continued to dominate home price growth. Seattle, Washington reported 11.20 percent growth in home prices year-over-year. Portland, Oregon reported year-over-year home price growth of 9.70 percent and Denver, Colorado reported that home prices grew by 9.20 percent year-over-year.

San Francisco, which posted double-digit home price growth in recent months, posted year-over-year home price growth of 6.20 percent. Home prices declined 0.40 percent month-to-month. While short supplies of homes for sale continued to drive up home prices, slower home price growth rates in San Francisco, California posted fell by 0.40 percent month to month and were 6.30 percent higher year-over-year. San Francisco posted double-digit year-over-year growth in recent months; slower home price growth over a period of months could signal a cooling of red-hot home prices in high-demand markets.

The three cities with lowest home price growth rates were Cleveland, Ohio and Washington, DC, where home prices rose 3.90 percent year-over-year. New-York City posted a year-over-year gain of 3.20 percent.

Pending Home Sales Rebound in February, Mortgage Rates Drop

The National Association of Realtors® said that pending home sales reached their second highest reading in ten years. Pending home sales rose 5.50 percent in February as compared to January’s negative reading of -2.80 percent. The Pending Home Sales Index rose to 112.30 in February as compared to January’s reading of 106.40. Unseasonably warm weather, home buyers rushing to buy before mortgage rates and home prices go higher. Improved jobs markets and few layoffs were also seen as boosting consumer confidence in buying homes.

Freddie Mac reported lower average mortgage rates last week the average rate for a 30-year fixed rate mortgage fell by nine basis points to 4.14 percent. The average rate for a 15-year fixed rate mortgage was five basis points lower at 3.39 percent. The average rate for a 5/1 adjustable-rate mortgage was six basis points lower at 3.18 points. Discount points averaged 0.50 percent for 30-year fixed rate mortgages and 0.40 percent for 15-year fixed rate mortgages and 5/1 adjustable rate mortgages.

Lower mortgage rates could help first-time buyers who’ve been sidelined due to rapidly increasing home prices and mortgage rates.

In other news, new jobless claims were lower than last were with 258,000 new claims filed as compared to last week’s reading of 261,000 new jobless claims. Analysts expected a reading of 247,000 new claims filed. Spring holidays and school vacations can create additional volatility in week-to-week first-time jobless claims.

Consumer sentiment index readings for March increased to 96.90 against expectations of a 97.60 index reading. February’s index reading for consumer sentiment was 96.30.

Whats Ahead

This week’s scheduled economic reports include readings on construction spending, ADP payrolls, Non-farm payrolls and the national unemployment rate. Mortgage rates and new jobless claims will also be released.

What’s Ahead For Mortgage Rates This Week – March 27, 2017

Last week’s economic news included releases on new and pre-owned home sales and weekly readings on average mortgage rates and new unemployment claims.

Pre-owned Home Sales Fall, Due to Dwindling Inventory

5.48 million pre-owned homes were sold on a seasonally adjusted annual basis. Analysts expected 5.45 million sales based on January’s reading of 5.69 million sales. Lagging supplies of listed homes continue to cause home prices to rise as buyers compete for fewer available homes. First time buyers represented only 32 percent of sales as compared to the normal reading of 40 percent. First-buyers represent new demand for homes and they are important to sales of existing homes that allow current homeowners to move up to larger homes.

The available supply of pre-owned homes was 6.40 percent lower in February than for February 2016. Real estate pros reported that as of February 2017. There was a 3.80 months’ supply of available homes as compared to the normal range of six-month supply.

Regional Results for Existing Home Sales

Existing home sales declined in three out of four regions tracked by the National Association of Realtors®. Sales of previously owned homes fell by 13.80 percent in the Northeastern region; the Midwestern region posted a 7.00 percent decline in sales. The Western region reported a 3.20 percent decrease in sales. The Southern region posted a 1.30 percent increase in existing home sales.

Sales of new homes rose in February; 592,000 homes were sold on a seasonally-adjusted annual basis as compared to expectations of 571,000 sales and 558,000 new home sales in January. Sales were 6.1 percent higher than for January and were 12.80 percent higher year-over-year. February’s reading was the highest in seven months

Analysts said that the national median price of a new home was $296,000 in February, this was 3.90 percent lower than January’s reading and 4.90 percent lower year-over-year.

Mortgage Rates Fall, New Jobless Claims Rise

Freddie Mac reported lower mortgage rates last week. The average rate for a 30-year fixed rate mortgage fell by seven basis points to 4.23 percent. The rate for a 15-year fixed rate mortgage was six basis points lower at 3.4 percent. The rate for a 5/1 adjustable rate mortgage was four basis points lower at 3.24 percent on average. Discount points for fixed rate mortgages averaged 0.50 percent; discount points for a 5/1 adjustable rate mortgage averaged 0.40 percent. Lower mortgage rates stood in contrast to the Fed’s decision to raise the federal funds rate last week.

New jobless claims jumped last week with a reading of 258,000 new claims as compared to the prior week’s reading of 243,000 new claims and expectations of 240,000 new claims. While week-to-week readings for jobless claims are notoriously volatile, the four-week rolling average of new jobless claims was higher by 5000 new claims at 246,000 new claims.

What’s Ahead

This week’s economic news includes Case-Shiller Housing Market Index and pending home sales. Also scheduled are readings on inflation and consumer confidence.  Weekly reports on mortgage rates and new jobless claims will also be released.

Spring Is Real Estate’s ‘Rush Hour’ — Here’s How to Prepare

Spring Is Real Estate's 'Rush Hour' -- Here's How to Tell If You're PreparedThe most popular time of year to buy a home is in the spring. This means that if you’re preparing yourself for getting into the real estate market, you may be experiencing a time crunch. If you’re ready to put your home up for sale in time to take advantage of the season, here are few things you’ll want to think about.

Have You Cleaned Up And De-cluttered?

Spring is not only an optimal time to put your home up for sale, it’s also an ideal time for spring-cleaning! Instead of leaving all of the de-cluttering to the time when you know you’ll be moving, prepare now by discarding anything that you don’t want to move. This will not only make your packing more streamlined, it will also make the basic cleaning duties like vacuuming and dusting a little easier to carry out.

Are You Prepared To Move?

A home can sit on the market for a few weeks or months, and it can also sell on the first day. You’ll want to have a game plan for moving beforehand. Determine a plan for yourself and your family so that you can start looking for a home to invest in or at least rental property. You don’t want to lose out on a good offer by not being prepared. Make sure you know where you’re going before getting into the market.

Do You Know The Market Conditions?

Spring is certainly the most popular time to buy, but if your home isn’t priced right, it may linger longer than you’d expect. If you’re selling on your own, you may want to take a look at the MLS listings to determine what similar homes are selling for. It can also be a great idea to utilize the services of a local real estate agent. They will have background knowledge of the market and be able to do the tough negotiating for you.

With spring being the best time to sell, it’s important to de-clutter your house ahead of time and be aware of the market conditions you’ll be dealing with.

Three Major Mortgage Mistakes To Avoid When Buying a Home

Buying a New Home? Three Major Mortgage Missteps That You'll Want to AvoidBuying a home is one of the biggest financial investments you’ll make in your life. It’s important to make sure that you’re doing what will be right for you down the road. If you’re trying to avoid buyer’s remorse and are wondering what major missteps to avoid when diving into the market, here are a few things you may want to watch out for.

Buying Too Much Home

It’s often the case that a homebuyer will get so excited about a home they see that they need to have it. But putting all of your money into one investment can be difficult to sustain over time. Instead of deciding to budget and buckle down on your expenditures, ensure that your monthly budget still leaves room in the event of other expenses or financial setbacks. This will ensure that your home stays as something you can enjoy that won’t become a burden.

Not Saving Up Enough

Many people want to invest in the market right away and get into a home, but it can often be worth the wait to save up so that you have at least 20% for a down payment. Putting 20% down on a house means that you won’t have to pay the added costs for Private Mortgage Insurance (PMI). Not only can this lead to smaller mortgage payments on a monthly basis, it also means that you’ll be able to pay off your mortgage loan that much more quickly.

Forgetting All The Associated Costs

It’s easy to be wooed by the cost of the monthly payment and think that it’s less expensive than you thought. But it’s important not to forget about all the other costs that go into owning a home. In addition to the closing costs of home ownership, there will also be property taxes, homeowner’s insurance and the maintenance fees required for home upkeep. If the monthly mortgage payment is already pushing it, costs like these can make your overall mortgage costs unmanageable.

There are many mistakes that can be made when it comes to purchasing a home. But by being aware of all of the costs of home ownership and taking the time to save up, you’ll be well on your way to owning a home that’s affordable and sustainable. If you’re getting prepared to delve into the real estate market, contact your trusted mortgage professionals for more information.

Feeling ‘Priced Out’ of the Market? Here’s How You Can Still Buy a Great New Home

Feeling 'Priced Out' of Your Local Market? Here's How You Can Still Buy a Great New HomeIf you’re trying to buy a new home, few things are more frustrating than a hot real estate market. When home prices are climbing fast it can feel like you’ll never be able to save enough for your down payment. Here are a few ways that you can get in – even if you’re feeling priced out.

Start Smaller And Upgrade Later

If you’re a single professional or a young couple, it might be wise to start with a smaller starter home. While a townhouse or condo might not feel as large as a detached house, they are more affordable options. Starting small allows you to build equity in your home. This, plus your increased earning power as you work for longer, can open up more home options later.

Another benefit of starting small is that you’ll already have a home. If the local real estate market experiences a quick change, you won’t need to scramble. You can plan to buy a larger home – that ‘perfect’ house – when the time is right.

Bring In Family As Investors

Do you have family members who might be willing to provide a loan or financing? If so, start the conversation with them to see if they are willing to co-invest in your new home.

There are many ways to bring in family as investors when you buy. They can provide a straight loan of funds to increase your down payment. Or if they want to be less involved, they can co-sign your mortgage, which will allow you to borrow a larger amount. In many areas, a family member or investor can also be a legal co-owner of the house or the property it sits on.

Make Use Of Experienced Professionals

Finally, don’t forget to ask the local experts for more advice. Real estate agents and mortgage brokers are in-tune with the local market. They spend each day helping buyers like you understand the options available. If you’re short on ideas, a real estate professional is a great place to start.

It can be tough to stay positive when you’re feeling priced out of the local real estate market. But with a little ingenuity and planning, you can get out of the rental market and into a great new home.

What’s Ahead For Mortgage Rates This Week – February 27, 2017

Last week’s readings on new and existing home sales provided further evidence of strengthening housing markets. Both categories of home sales exceeded December’s readings. Consumer sentiment was lower in February than for January and average rates were mixed with fixed rates higher and the rate for 5/1 adjustable rate mortgages lower. Consumer sentiment lower in February.

New and Previouslyowned Home Sales Higher in January

Home sales volume rose in January regardless of obstacles including higher mortgage rates and rising home prices. The National Association of Realtors® reported more sales of pre-owned homes in January. 5.69 million homes were sold on a seasonally-adjusted annual basis in January, which surpassed expectations of 5.57 million sales and December’s reading of 5.51 million sales of previously-owned homes.

New home sales also rose in January. 555,000 new home sales were reported, which fell short of 586,000 new home sales expected. 535,000 new homes were sold in December.

Mortgage Rates Mixed

Mortgage rates have traditionally been tied to the performance of 10-year Treasury notes, but this connection may be weakening due to uncertainty about current economic influences. Freddie Mac reported that the average rate for a 30-year mortgage rose one basis point to 4.16 percent; the average rate for a 15-year fixed rate mortgage rose two basis points to 3.37 percent and the average rate for a 5/1 adjustable rate mortgage dropped two basis points 3.16 percent. Discount points averaged 0.50 percent for fixed rate mortgages and 0.40 percent for 5/1 adjustable rate mortgages.

New Jobless claims also rose last week; 244,000 new claims were filed as compared to expectations of 237,000 new claims and the prior week’s revised reading of 238,000 new claims. The weekly reading for new jobless claims remained below the benchmark of 3000 new claims. The less volatile four-week rolling average of new claims filed reached its lowest level since July 1973 and fell by 4,000 new claims to 241,000 new claims filed. Layoffs remain low, so week-to-week variances in new jobless claim filed do not necessarily indicate faltering job markets.

Whats Next

This week’s economic news includes readings on pending home sales, Case-Shiller Housing Market Indices, pending home sales and inflation. Weekly reports on mortgage rates and new jobless claims.

5 Things You Should Do Now Before Selling Your Home

5 Things Nobody Tells You About Selling Your First HomeIt’s often so exciting to think of buying a new home that homeowners forget about the sale. But there are a lot of details involved in putting a home on the market. Whether you’re just considering selling or you’re ready to put your home up, here are some things you might not know about the process.

Marketing Strategy Is Important

The days of putting a sign on the front yard and waiting for buyers are gone. It’s important to have a strategy that will successfully highlight your house. Whether you decide to make a website, use social media or invest in a professional photographer, ensure you’re prepared to put your home out there.

The Right Price Is Everything

You have the ability to change your asking price at any time, but it’s best to hit the market with a price that is both reasonable and competitive. This will not only prevent your home from lingering on the market, it will make it more likely you’ll get the offer you’re looking for.

Fixing It Up Is Important

You might want to avoid minor fix-ups before selling your home, but maintenance issues can impact the offers you’ll receive. Instead of leaving these for the next homeowner, put time aside to do paint touch-ups, repair doors or insulate the windows so the small things don’t affect your offer.

Prepare To Pack

It’s great to receive an offer on your home, but packing up can be one of the most stressful aspects of moving. Instead of leaving this to the last minute, do some preliminary ‘spring cleaning’ to discard the stuff you won’t use and pack up the stuff you won’t soon need. This will make moving out a little smoother.

Be Ready For An Open House

It can be a pain to stage your home and leave on short notice to accommodate an interested homebuyer, but a good open house is one of your best bets for selling your home. This means your house should be clean and clutter free all the time so only a few last-minute fix-ups will be required.

There are a lot of things involved in selling your first home, but by completing the little fix ups and choosing the right price, you’ll be well on your way to an interested buyer.

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