What Is the Minimum FICO Score to Be Approved for a Conventional Mortgage? Let’s Take a Look

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Shopping around for a mortgage can be a considerable enough task that contemplating all of the other ins and outs of a mortgage can be time consuming. However, if you’re serious about home ownership, your credit history and FICO score are very important in sealing the final deal. If you’re wondering what score is necessary to acquire a standard mortgage, here are the details on what you can expect.

 

The Importance Of Credit History

 The amount of money you have in the bank and your yearly salary are very important factors in determining the likelihood of mortgage approval, but your credit history can make or break the deal. While those with poor credit may not have the opportunity for a conventional mortgage, potential homeowners who have paid their bills on time and kept their credit history in good order should have a more positive result for a conventional mortgage.

 

Requirements For Mortgage Qualification

 There have been many changes to the mortgage approval process in recent years with advancements that have made it easier to acquire and review documents; however, there are still many things that are needed in order to submit an application. Beyond the data of your application, it is pertinent to provide your credit report – which will give a history of any bankruptcy or financial issues – as well as your current salary. Together, these factors will provide the information needed to approve or decline your application.

 

The Minimum FICO Score

 When it comes to loan eligibility from the Federal Housing Administration (FHA), a FICO score of 580 is a requirement to qualify for a mortgage with a low down payment option. If the applicant is able to provide a more significant down payment, they may still be able to get approved if they have a lower credit score than 580. While mortgage lenders will sometimes make exceptions, improving your credit score or saving additional funds will go a long way towards application approval.

There have been many changes to the mortgage market in recent years that have had a marked impact on the mortgage approval process. While the FICO score required has shifted as a result, those seeking a mortgage approval can still opt for a higher down payment or improving their credit score for a positive result. If you’re going to be on the market for a home in the future, you may want to contact one of our mortgage professionals for more information.

What Types of Coverage Are Included in Standard Home Insurance Policies? Let’s Take a Look

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Every insurance policy is different and can provide certain levels of protection tailored towards the needs of the policy holder. However, there are some standard types of coverage that are included in most basic home insurance policies.

 

Basic Levels Of Protection

 

Most homeowner insurance policies will include some basic levels of protection and coverage. The main dwelling will be protected from many forms of damage and the insurance company will pay to repair the damaged dwelling. This will extend to other smaller structures on the property, like sheds and separate garages, but the level of coverage will differ.

Damage is one important aspect of insurance, but protection for personal belongings is equally important and is also included in a standard home insurance policy. The monetary value of items in the home will be covered in case of damage or theft, so it’s a good idea to keep track of valuables. Every insurance company will have a different limit on the amount covered, so it’s wise to compare the value of belongings against the level of coverage.

The third aspect of home insurance policies is liability protection. This will cover any personal injuries that are incurred on the property by people who do not live there. It may seem silly, but having protection in case of a lawsuit can go a long way to saving a family financially as attorney fees and medical bills add up.

 

What Is Not Included?

Although each insurance company has different policies that cover different parts of the home, almost all of them do not include one important aspect in their policies. Damage caused by floods, earthquakes and war will not be included in most standard home insurance policies and may be important depending on the geography of the area.

Another important note is that flood damage does not just apply to natural flooding in the region, but will also include water damage from broken pipes or backed up sewage lines. It’s an important distinction because many first-time home owners assume this water damage will be covered under their basic insurance policy.

The right insurance policy can be difficult to figure out for first-time home owners. There are many questions to ask about the property to determine the right policy and it’s a good idea to consult with a local real estate agent to get their insight into what additions may be needed.

Understanding Home Seller Disclosures and What Information You Need to Share When You Sell

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When people buy a new home they have a right to be informed of the problems that they may face on the property and any issues that the home previously experienced.

However, as a seller it can be difficult to know whether the required information is being disclosed. Nobody wants to appear misleading, especially when it can impact a sale, and making sure all the proper information is finding its way to the buyer is imperative to make the deal go through.

 

What Needs To Be Disclosed?

 Disclosures are not handled at the Federal level except for the Lead-Based Paint Hazard Reduction Act, which requires all sellers to have their home inspected for lead paint if it was constructed before 1978.

Other possible disclosures include any legal issues with the property title, mold and water leaks, problems with the plumbing or sewage on the property, and issues with the roofing, air conditioning and heating systems.

 

Disclosure Laws Differ From State To State

 While it is best to err on the side of caution when dealing with home seller disclosures, every state’s laws are different and some are more stringent than others. A seller may believe they are disclosing everything that is required and still find themselves on the wrong side of a lawsuit.

When deciding what to disclose to a buyer it’s best to always consult a local real estate agent. Any professional will know the specific laws to their area and will be sure to let you know if you have left something vital off the list.

 

When Disclosing Can Be A Positive

 All disclosures are not created equal and in some situations they can even work in the favor of the seller. When the seller tells the buyer about an issue from the home’s past that has been repaired it can be a huge benefit.

Not only is the buyer being informed about the home’s history, they are being shown that the seller was a responsible home owner who took care of the property and fixed the issues as they came up. This can give them a sense of security and confidence that the home was well maintained.

If you are in the process of selling your home but can’t figure out what you need to disclosure legally and what you should disclose morally, speak with a local real estate agent. They will be able to walk you through the process so nothing is left off the list.

Understanding Automated Underwriting and How It Impacts the Mortgage Application Process

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Whether you’re embarking on the process of obtaining a mortgage for the first time or just preparing yourself for the advances in the industry, the implementation of automated underwriting in recent years has significantly changed the application process. From the time you’ll have to wait to the documentation that is required, here are some of the details on what you can expect when dealing with an automated underwriter.

 

Reduction In Document Requirements

 In the past, most home buyers submitting mortgage application documents were required to go into their backlogs to provide the pay-stubs for the previous 2 months pay, as well as W2’s for the last 2 years. Now, with automation, most home buyers will only need to submit their most recent pay-stub in order to move along to the approval process.

 

The Time Line Is Shortened

 Since the loan approval process previously had to go through an underwriter, there was a delay between when the documents could be reviewed and approved, and how long it would take for this information to be passed on to the home buyer. However, since a Findings Report is automatically created from the applicable data during the automated process, the timeline home buyers have to wait is shortened considerably.

 

Approval Rates Are Improved

 Previously, approvals that were completed by an underwriter were held to a standard that was made up of a person’s financial health and credit report, so having one and not the other could lead to a declined application. Due to the fact that automated approval is based on the degree of the deciding factors, home buyers who previously may have been turned away have a greater chance of approval.

 

A Useful Bargaining Tool

 While most home buyers have identified their ideal home before getting too involved in the application process, automated underwriting actually enables those who want to apply to get approval prior to deciding on a home. Instead of being an expenditure of time, this can actually be a good bargaining chip when it comes to putting in an offer on the right home.

With the advances in technology and the ever-shifting real estate market, there are many changes on the mortgage market that are important for future home buyers to be aware of. Fortunately, there are many advantages to the automation of underwriting that can offer great benefits to those going through the application process. If you’re applying for a mortgage soon, you may want to contact one of our mortgage professionals for more information.

Trying to Decide Whether or Not to Sell Your Home? Here Are 5 Key Questions to Ask Yourself

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Selling a home, especially one with sentimental value, is never an easy decision to make. There are many factors that go into determining if the home is ready to be listed and if the seller is actually ready to part with it.

 

Answering some simple questions can go a long way to help an owner decide whether or not it’s time to try and sell.

 

How Much Work Does The Home Require?

 

Some houses and condos are ready to hit the market immediately, but others have serious problems that would need to be disclosed to interested parties. It may not be wise to try and sell until all major issues are repaired.

 

What Is The Market Like In The Area?

 

Have similar homes in the neighborhood been selling quickly for a lot of money or have they been sitting on the market for years with no buyers? Any seller should look into the current market trends in their community to determine how much they would be able to sell for so they don’t lose money on the transaction.

 

When Is The Best Time To Sell?

 

Every city is different and the time of year can have a major impact on the market. A local real estate agent will have a strong comprehension of the best time of year to list the home, which could provide some valuable time to get it ready.

 

Will You Be Happier In A New Home?

 

Sometimes deciding to sell a home can become so overwhelming that people forget to ask themselves whether or not they will be happier in a new home. If the answer is a resounding ‘yes’ then there should be no question about selling.

 

Should A Real Estate Agent Be Involved?

 

It may seem easier for sellers to eschew the services of an agent to save a little money, but the nightmare that can follow without the assistance of somebody who has the time and experience to show and promote the home may not be worth it. Talk to local real estate professionals to see if there are any that feel like a good fit.

 

If you have been debating selling your home but still aren’t sure whether or not it’s the right time, speak with a local real estate agent. They will be able to walk you through the process and provide some insight about what you should expect.

Thinking about Refinancing? 3 Ways That You Can Boost Your Home’s Assessed Value First

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In an effort to boost the value of their property, many homeowners invest in renovations that will help them sell at a higher price. However, with all of the renovation options, it can be hard to know what kind of fix-ups are really worth investing time and money into. If you’re looking at all of your options for home improvements, here are some surefire fixes that won’t stress the bank and will probably bump up the offering price.

 

Add In Stainless Steel

 The look and functionality of the kitchen is one of the deciding factors for many home buyers, and this means that if you have old appliances or an outdated look, you should definitely spend some money on a little upgrading. Since kitchen renovations can be a significant expense when it comes to knocking out walls and adding an island, you may want to stick with smaller stuff like a stainless steel appliance replacement or even renovating your cupboards for a more up-to-date look.

 

Increase Energy Efficiency

 With the push towards reducing overall housing costs and being environmentally sustainable, making your home more energy efficient can be a huge selling feature for the kind of buyers who will be able to save money as a result of renos. While there are many financially taxing overhauls that can seriously bust the bank, try simple fixes like adding extra insulation where drafts exist, and installing LED lights for lowered energy costs and longer light bulb expectancy.

 

Prep For Paint

 It may require a little bit of work to get the job done, but re-painting your home can be one of the best, and most economical, means for upping the value of your home. While painting can still be an economical option even with professional painters, a shiny new coat can take years off the look of your house and instantly improve its appearance. You just need to make sure you choose a neutral color and a high-quality paint for maximum effect.

While taking on home renovations will require a bit of spending, it can be a great idea if you’re re-financing your home and are looking to boost its value. The only thing to keep in mind is making sure you choose the kind of fixes that will be inexpensive and popular on the market. If you’re currently looking into your options for re-financing, you may want to contact one of our mortgage professionals for more information.

Spouse with Bad Credit? 3 Reasons You’ll Want to Consider a Co-signer for Your Mortgage

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Obtaining a mortgage can be quite a complicated process even without the financial hurdles, but if your spouse’s credit has experienced a number of difficulties, acquiring a mortgage can be even more of a burden. If you’re concerned about what bad credit will mean for your mortgage and are weighing your options, here are some reasons why it might be important to use a co-signer for your application.

 

Increasing The Likelihood Of Approval

 From getting an education to purchasing your first vehicle, it’s a common occurrence for people to take a loan out at some point in their life. However, getting a loan can be very difficult if you happen to be married to someone with a poor credit history. While having someone you know co-sign your application is not without its risks, it can be a means of securing mortgage financing so that you can move towards a less burdensome financial situation.

 

Improving A Bad Credit History

 It adds stress to the process if you have a partner with a poor credit history, but the benefit of a co-signer is that it can be one of the few opportunities you’ll have to really improve a problematic rating. With a co-signer to vouch for you, you will be able to pay down your mortgage consistently and slowly build your spouse’s credit in a way that will give both of you a lot more financial opportunities in the future!

 

Building Up Trust

 It goes without saying that having a co-signer can be a significant financial risk for the person who chooses to sign for you, but – if approached responsibly – this can be a means of building trust with your family members or friends. While co-signing may be a necessity for your situation, it’s important to be aware that it’s a huge commitment for the person who agrees to it and their support should be seen for the good faith it is.

Bad credit may put a black mark on your mortgage, but having a co-signer can have a significant impact on improving your overall financial health. As co-signing is a considerable responsibility for the person who offers it, it’s important to ensure that purchasing a home is the right financial choice for you before asking someone to vouch for your application. If you’re currently in the process of looking for a new home, you may want to contact one of our experienced mortgage professionals for more information.

Real Estate Investing: 3 Insider Tips to Winning House, Land or Foreclosure Auctions

 

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House, land and foreclosure auctions can be one of the most nerve-wracking ways to buy a property. However, if you prepare yourself with proven bidding tactics, auctions can be a great way to purchase your dream home at a competitive price.

 

If you’re in-it-to-win-it, familiarize yourself with these top three tips and tricks before attending a real estate auction.

 

Give The Right Impression

 While you may not have control over what other bidders are willing to pay for a property, you do have some control over their perception of whether or not bidding against you is worthwhile. Come well-dressed and maintain a confident demeanor to give the appearance that you are a serious buyer, one whom ‘the other guy’ likely can’t out-bid.

To enhance this appearance, do not make an offer right away. Wait until the bids have reached approximate 80% of your maximum price and then join in, as it will knock out the bargain hunters. A big first bid can be intimidating to others, making them question whether they stand a chance against you. Following bids should be made quickly and confidently to send the message that you are the person who will be closing this deal.

If you are extremely anxious to place bids, consider hiring a professional bidder to do the work for you. A seasoned pro will be able to maintain their cool while placing bids strategically to maximize your chances of getting the property you want at the price you want.

 

Know Your Limit

 Never go into an auction without knowing your absolute limit. If you are emotionally invested in the property it is best to write your limit somewhere on the inside of your hand, so that you are forced to remember it when you’re tempted to exceed it.

In terms of setting a limit, pick a figure that isn’t rounded. Many buyers will set limits such as $500k or $1.2 million, and will drop out after these round figures have been reached. If your limit is $515k or $1.25 million, you will have an extra cushion than may just barely outbid your rivals – and that’s all you need to win.

 

Ask The Hard Questions

 Do your research beforehand and ask the auctioneer about the property’s flaws. Questioning whether the deck is up to code or whether there is still a possibility of road widening could make other bidders second guess the property and drop out before bidding has even begun.

Ready to blow the competition out of the water? Make sure you are completely prepared for an auction, contact a real estate professional today.

Pay down Your Mortgage Faster by Eliminating These Five Unnecessary Household Expenses

wallet-cash-credit-card-pocket-largeThe monthly mortgage payment can be one of the most significant household expenditures for a family. However, while it can be a sizeable amount, there are certain household things you may be able to eliminate that will help you put down more money and pay your mortgage off a little faster. If you’re interested in ways to save, here are some expenses you may want to consider cutting out.

 

Giving Up The Cable

 Television is an important de-stressor for many people, but it can also be a considerable monthly expense that is often unnecessary. With borrowing materials available at the library and many videos available for streaming online, you can cut your cable cost and may be able to save more than $100 a month.

 

Coffee On The Go

It may not be a household expense, but the average person can rack up a lot of expenditures each month on caffeine alone. Instead of stopping at the local café for a quick fix, consider trying the office coffee or taking a thermos in the morning for savings that will add up by the week’s end.

 

Dinner On The Town

 Going for dinner or getting take-out on the way home can be a great way to finish off a day, but it can also add up to huge monthly expenditures if you’re doing it frequently. While you shouldn’t cut out trying new restaurants altogether, ensure that it’s not something you’re indulging in all the time.

 

The Grocery Bill

 You’ll be able to save a lot of money easily if you’re not buying lunches or dinners, but bargain shopping is still important when it comes to household staples. While this may not make a difference on each bill, it can add up to a considerable dent in your monthly payment overtime.

 

Saving On Your Smart Phone

 Nowadays, most people have a smart phone and have exhausted their need for a landline, but phones can still be quite a money drain when it comes to extra data and an expensive plan. Instead of accepting your bill as is, talk to your provider about deals they can provide so you can save the difference.

The monthly mortgage payment can be a financial burden, but there are many simply ways to save through the year that will add up to big savings and a faster pay-off date. If you’re planning on putting your home on the market, you may want to contact one of our mortgage professionals for more information.

Moving with Children? Here’s How to Quickly Assess Whether a Community Is Family Friendly

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If you’re looking for a home that’s in a family-friendly neighborhood, there are a few key things you can look for to make sure your new house is a good fit for both you and your children.

 

Quality Public or Private Schools

 Are there good public schools nearby? If so, do they span from kindergarten all the way to high school? Finding a home in an area with a great elementary school can be a good fit for several years, but if you’re looking for a home that will be convenient in the long-term it’s important to consider your proximity to both primary and secondary schools.

 

Parks And Other Relaxing Green Spaces

If you’re looking for a family-friendly neighborhood with free sources of entertainment, make sure that there is at least one park or playground nearby. Playgrounds can provide endless amusement for younger children, whereas a park can offer entertainment for kids of any age. Either way, have a park in the area will help boost the quality of your family’s leisure time.

 

Recreation Facilities And Other Amenities

 For even more great leisure opportunities, check out the local recreational facilities. Public swimming pools, community centers, and recreation centers often offer a wide variety extracurricular activities and programs. These can be a great support when it comes to supplementing what your kids’ education with skills that are learned outside of school, and can encourage a healthy lifestyle as well.

 

Shopping & Services

 If you’re looking for a convenient lifestyle, perhaps one of the most important factors to consider is what stores and businesses are located nearby. Is there a grocery store, doctor’s office, cafe, drugstore, gas station, or other essential businesses nearby? Make your life easy! If there are stores nearby that meet your needs it will help boost your neighborhood satisfaction for years to come.

 

A Short (Or At Least Tolerable) Commute

 If you commute to work, it is also valuable to consider how long of a drive it is between your place of employment and potential new home. The less time you have to spend on the road, the more time you’ll have with your family.

 

Neighbors You Will Enjoy Associating With

 Finally, it is important to consider who else lives in the area. Is the neighborhood you’re looking at full of other young families? Are there other children for your kids to play with? Does it seem like a close-knit community?

Although you can’t predict how relationships will blossom in a new home, you’ll set yourself up for success if there are people with similar interests and lifestyles as you. If the people seem great, chances are the neighborhood is, too!

Ready to find the perfect home to raise your family in? Contact a trusted real estate professional today.