Credit Tips for Home Buyers, and Home Owners, to Consider

good-credit-vs-bad-creditYour Credit Score is the most obvious factor in your ability to getting your Mortgage Application approved. The higher your score, typically the less risk you pose to lenders and the lower your mortgage interest rate. So how is your credit score determined? And how can you improve it?
Here are some Credit Tips for Home Buyers to Consider:

• Consumers can obtain free credit score models on-line all with different ranges.
These scores can differ from the FICO score models used by mortgage lenders

      ♦ The Only Website authorized by law to provide the FREE Annual Credit
Report you are entitled to under the Fair Credit Reporting Act
annualcreditreport. com. 

• Mortgage accounts add more points to the FICO score since they are the most
difficult type of credit to qualify for.

• The higher the credit score, the more it drops after a delinquency.
• Most negative info remains on your credit report for 7 years.
• Revolving credit balances can have an extreme impact on credit scores.
     ♦ Revolving credit is classified as credit cards, overdraft protection on checking
accounts, and other lines of credit

• Most experts recommend keeping your overall credit card utilization below 30%.
Lower credit utilization rates suggest to creditors that you can use credit r
responsibly without relying too heavily on it, so a low credit utilization rate may
be correlated with higher credit scores.
You can calculate your credit utilization rate by dividing your total credit card
balances by your total credit card limits. The resulting percentage is a
component used by most of the credit scoring models because it’s often
correlated with lending risk.

• Closing revolving credit cards can reduce scores dramatically since it can alter the balance-to-limit ratio.
      ♦ All of the accounts on your credit reports count, even if they are closed.
• The older the average age of credit, the better it is for FICO scores.
• Seasoned credit is credit accounts that are over 2 years old.
• Consumers with the strongest credit scores tend to have a mix of different
types of accounts.
The key is to manage all these accounts responsibly. Credit scoring models are
looking to see if you can handle all different types of financing as they assess
your creditworthiness.

• When consumers find errors on their credit report, they should speak with a credit expert before calling the creditor directly.
Consumers often rush to call creditors about errors on their credit  report
thinking it will help them. Often times, they may make a statement that
confirms their guilt or makes it more difficult to reach a successful resolution.

Resources: Northshore Advisory. www.northshoreadvisory.com

 

 

What To Know When Choosing the Right Real Estate Agent

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From beginning to end, it is a real estate agent helping you select, negotiate, and legally purchase your new home. Choosing the right real estate agent to help guide you through the whole process isn’t easy. Here’s an overview of what you need to know.

THE AGENCY RELATIONSHIP

Real estate agents are licensed by the State of Connecticut to represent a person in the purchase, sale, exchange or lease of real property. The Agency Relationship is based on one person representing the interests of another person.
The responsibility of the real estate agent is defined by the state law relating to agents, the REALTORS®’ Code of Ethics, and general principles of agency law.
The type of relationship formed between the agent and the client is called a fiduciary relationship. A fiduciary relationship is one based on trust because the agent owes the following duties to the client: Loyalty, Obedience, Diligence, Disclosure, Confidentiality, Accountability and Reasonable Skill & Care.

THE FOUR TYPES OF AGENCY RELATIONSHIPS

BUYER AGENCY
A Buyer’s Agent represents the interests exclusively of the buyer in a real estate transaction.
A Buyer’s Agent:
o        Arranges property showings that meet the buyer’s needs.
o        Provides information about the home or property, community, schools, taxes, utilities, and zoning.
o        Discloses any information about the property that can be obtained from public sources.
o        Prepares a competitive market analysis on the property.
o        Counsels the buyer on what price to offer the seller.
o        Shows what other buyers are paying for property in the area.
o        Assists in writing an offer with the buyer’s interests in mind.
o        Negotiates the best price and terms for the buyer.
o        Keeps the price capabilities and objectives of the buyer confidential    and maintains anonymity, if desired.
o        Assists with the loan application process.
o        Monitors all dates, events, and requirements.
o        Attends the closing with the buyer.

SELLER AGENCY

A Seller’s Agent represents the interests exclusively of the seller in a real estate transaction.
A Seller’s Agent:
o        Prepares a competitive market analysis of the seller’s home or property.
o        Develops and implements effective marketing strategies for the seller, including asking price, staging, and positioning.
o        Informs the seller how much other homes and properties have sold for in the area.
o        Presents all offers and counsels seller on what price to accept.
o        Negotiates exclusively on the seller’s behalf.
o        Updates the seller on market conditions.
o        Prepares an estimate of closing costs.
o        Works closely with seller to assure a smooth closing.
o        Monitors all dates, events, and requirements for the seller.
o        Represents the seller’s interest at the buyer’s walkthrough inspection.
o        Attends the closing with the seller.

DUAL AGENCY

Legal in all 50 states, Dual Agency occurs when a buyer’s agent shows a property to a buyer that is also represented by that REALTOR®’s firm, or when the Listing agency shows real estate to a buyer that is also represented by the same firm. In dual agency situations, both the buyer and seller will be asked to sign a consent agreement.
A Dual Agent owes both the buyer and seller equal representation and must:
o        Treat both parties fairly.
o        Not knowingly represent one party to the detriment of the other.
o        Disclose facts each party needs to make an informed decision.
o        To assist, as the buyer and seller are empowered to negotiate on their own behalf.
o        Assure confidentiality on each party’s price, terms, and personal information.

DESIGNATED AGENCY

Buyers and sellers have an option when the real estate brokerage firm is a dual agent. That option is called Designated Agency. In designated agency, the real estate brokerage firm will designate a salesperson to represent the buyer and another salesperson to represent the seller. The designated buyer’s agent will act as an agent for the buyer as described in “buyer agency” above. The designated seller’s agent will act as an agent for the seller as described in “seller agency” above. This is the case even though each of the salespeople is from the same real estate brokerage firm.

The seller and the buyer must each agree to having a salesperson designated for them, and the real estate broker in charge of the brokerage firm must make the designation.

UNREPRESENTED PERSONS
A person is Unrepresented by a real estate agent unless he or she has signed a representation agreement with that agent.
The real estate agent cannot provide advice or counsel to an Unrepresented Person on matters pertaining to real estate, including real estate financing. An Unrepresented Person has the responsibility to protect his or her own interests.

All real estate agents are obligated by law to treat all parties to a real estate transaction honestly irrespective of whom they represent in the transaction.

This information is reprinted courtesy of:

CONNECTICUT ASSOCIATION OF REALTORS®, INC.

ct-realtor

Click Here for more information on choosing the right real estate agent

Why Every Home Buyer Should Get Mortgage Pre-Approval

What is the benefit of having a Mortgage Pre-Approval when looking for a new home?

There is a difference between a Mortgage Pre-Qualification and a Mortgage Pre-Approval.

A mortgage pre-qualification is based on the information you verbally give to your loan officer to  get a snapshot of how big a house you might afford and how much money you can afford to borrow to buy it.

A Mortgage Pre-Approval is an application file reviewed by an underwriter to be sure your income; assets and credit history qualify you to get the loan you are applying for.

Knowledge is Key:  A Mortgage Pre-Approval gives you a firm idea of how much house you can afford. The underwriter bases this amount using a formula that compares your income to your total outstanding debt.
The Debt:Income Ratio (DTI) is derived from the monthly payments that show up on your credit report and the income documents you surrendered as part of the process. This will keep you focused on the big picture and help to prevent being disappointed if you fall in love with a home that is too expensive.

Improve Your Negotiating Position:  When a seller is comparing two offers and one of the buyers has Mortgage Pre-Approval there is a high confidence level that the deal will go through and close sooner. This may help you to win in a competitive bidding situation.

Confidence in Your Offer:  Knowing that the key information in obtaining a mortgage has been reviewed by an underwriter will give you, and the seller, confidence that your offer is bona fide.

Keeping Your Spending On Track:  Having detailed information on your interest rate, mortgage payment, closing costs and down payment requirements will help you stay within your monthly budget.

Time is Valuable:  Knowing what you can and cannot afford can save you time and frustration in the house hunting process. This will help your Realtor find the perfect house in your price range.

Move in Quicker:  Having Mortgage Pre-Approval will save you time when you submit your complete mortgage application for approval. Everything has been done beforehand. All you need is and inspection, appraisal and closing documents. The faster you close, the sooner you can begin to enjoy your new home.

pre-approval 2If you are looking to buy a new home, a Mortgage Pre-Approval is the smartest way to get into your new home. Call Me at 860.945.9284 to discuss the right mortgage option for your family and to take advantage of my  FREE Jump Start Mortgage Pre-Approval service.

100% USDA Loans Now Cheaper: Lower MI in 2017 for USDA Loans

usda 2The USDA Guaranteed Rural Housing Development Loan (aka USDA RHD Loan) is extremely popular with Millennial Home Buyers.  That’s because the program requires Zero Down Payment. That’s right… 100% Financing is available to purchase eligible properties in select areas of Connecticut.

And, it just got more attractive  Just in time for the New Year, the USDA lowered its new year.jpgUp-Front Mortgage Guarantee Fee from 2.75% to 1.00%. And… it also reduced its Monthly Mortgage Insurance Premium from 0.50% to 0.35%

The USDA loan is now one of the most affordable home loans available, This fee reduction makes the RHD less expensive than FHA products. A USDA home loan can make owning a home less expensive than renting one  and could be the avenue for Millennial Home Buyers to move into a new home in 2017. 

What Is a  USDA Loan? The United States Department of Agriculture partners with approved local lenders to assist homebuyers with competitive interest rates and loan terms to buy their primary residence in select areas of Connecticut

The Program Offers:
usda 3100% Financing – No Down Payment is Required. Coming up with a Down Payment is one of the biggest barriers to entry into the housing market for Millennial Home Buyers. A USDA mortgage eliminates that obstacle.

Closing Costs Can Be Rolled Into the Loan Amount. The closing costs associated with obtaining a mortgage can be included in the loan amount when the appraised value exceeds the contracted sales price.
Liberal Credit Scores. The USDA Guarantee allows lenders to approve mortgages that would not qualify under guidelines for other programs. Applicants with credit scores down to 640 are eligible for this loan.
Debt:Income Ratios: To qualify, you must meet debt-to-income requirements. The DTI ratio limits are 29% (for PITI) and 41%. The reduced fees make it easier to meet these ability to pay guidelines.

Millennial Home Buyers often chose the more expensive FHA loan program, even when they are buying in USDA-eligible areas. If you are buying in a suburban or rural area, it pays to check USDA eligibility maps. Choosing USDA can save you the 3.5% down payment that FHA requires. And, now that the reduced mortgage insurance fees are in effect, you can save money each month over FHA

Eligible home buyers should weigh the benefits of a USDA loan.

Thomaston CT Homes for Sale – Eligible for 100% USDA Financing

usda 3These selected Homes for Sale in Thomaston CT are Eligible for up to 100% USDA Financing with a Guaranteed Rural Housing Development Loan.

The USDA Guaranteed Rural Housing Development Loan offers many benefits to qualified buyers:
•   Up to 100% Financing of the home’s Appraised ValueNo Down Payment Required
•   Ability to Finance the Closing Costs in the loan when the Appraised Value is higher than the negotiated sales price
•   One 30 year fixed rate mortgage at low-interest rates
•   Reduced Mortgage Insurance beats FHA and increases buying power.

Call Me @ 860.945.9284 to discuss the right mortgage option for your family and to take advantage of my FREE Jump Start Mortgage Pre-Approval service.
With USDA Guaranteed Rural Housing Development Loan you just might be able to move in to a new home this New Year with a minimal down payment and low to no closing costs.

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52 Stoughton St, Thomaston, CT  

52-stoughton
It’s so much larger than it appears. Plenty of room to stretch out in this well cared for cape style home boasting 4 BRs with a full bath on each floor. Many possibilities for small. large or extended families.
Ideal for Millennial First Home Buyers.

174 Edgewood Avenue, Thomaston, CT
174-edgewood

Charming 4 BR ranch with many extras. Reduced price for New Year sale

 

 

Please Note; Most single-family properties for sale in Thomaston, CT are eligible for the USDA Guaranteed Rural Housing Development Loan program. Condos too, as long as the HOA meets FNMA and FHA guidelines. The program has liberal income limits and DTI ratios that might enable buyers of other high-end homes to qualify for this program. Call me for details.

52 Stoughton St, Thomaston, CT For Sale – Eligible for 100% USDA Financing

usda 3It’s so much larger than it appears. Plenty of room to stretch out in this well cared for cape style home boasting 4 BRs with a full bath on each floor. Many possibilities to accommodate small. large or extended families. Ideal for Millennial First Home Buyers.

And it’s Eligible for Up to 100% USDA Financing.

Closing Costs can be rolled into loan amount.
Low Rates! Reduced MI. Beats FHA and CHFA any day.

52-stoughtonhttp://www.zillow.com/homedetails/52-Stoughton-St-Thomaston-CT-06787/57821597_zpid/

Reach out to Rick Cignoli at 860.945.9284 to see if the USDA Guaranteed Rural Housing Development Loan is the right mortgage option for you  and to take advantage of his FREE Jump Start Mortgage Pre-Approval service.

Then call Kristen Butts at Clemens & Sons to schedule a showing and be ready to make an offer.