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Maybe the most important factor in getting your next loan.

I was talking to a teacher friend the other day, and she was talking about love – love for her “kids” and how the kids and the parents can see that love, care and concern which just makes the parent – teacher relationship so much better. She said that people just know when your really care and it just makes for a great relationship.

That makes a lot of sense, doesn’t it? There is a rule in selling that goes something like this, “your customer doesn’t care how much you know, until they know how much you care.” I don’t know about you, but I will buy something from someone who really cares about me, even at a higher price, before I will even spend the time with someone who I feel is just trying to make a quick buck for THEMSELVES!

Let’s pick an easy target – Telemarketers. I don’t care if they are trying to sell me a better interest rate, mortgage program, a political candidate or a vacuum cleaner. They just don’t know me, even if they say they do. How do I know? Because, for example, they say they want to improve my mortgage rate/program and don’t even know that they can’t do it!!! They don’t know that my rate is already at or below market and think that they are coming to save me money. They can’t help me but they act like they can!

So why do they do this? They are playing the numbers game and it works (or they’d stop). Sometimes they either get lucky and find someone they really can help or can convince someone their solution will benefit them, even when it won’t. Many times they are just trying to make a buck for themselves, either in a quota or commission sale.

It’s the attitude that gets to me. Many are the kindest people at first – so polite and wanting to help. Then, when I explain that what they have to offer can’t really help me, I get the phone slammed in my ear before I can finish my statement. Now there is someone who really cares about me, NOT!

Caring is a quality that is far too transparent in our society today. Far too many people are happier when they can do something that benefits themselves than someone else. I hear about it all the time from people who have had the nightmare mortgage - promised one thing and something else delivered at closing. Now, closing is a “great” time to discover that your rate is higher, your closing costs require more money than you expected or mortgage insurance is required with your payment.

Let me tell you, completing a mortgage is not an easy task. Unexpected circumstances can make a “clean” or “easy” file become a nightmare. Paper work can drive everyone crazy. But, having someone who cares about you goes a long, long way. If you know and trust that the person who is working to make your mortgage become a reality is doing the best thing for you and wants you to be delighted with the outcome – it can make the process less stressful and certainly build an on-going relationship.

You may ask, how do I find someone who really cares about me? Here’s a big hint. They are willing to spend time with you. Yes time. Let me explain. In the mortgage business, there are a lot of factors that make for a successful loan experience. Why does a doctor want to visit before diagnosing and treating an illness? Why does a mechanic want to look at the vehicle before providing a quote or proposing a fix? It’s all the same thing. We need to know as much as possible about the situation before we can give the best solution. That’s care and concern for doing the right thing, otherwise it’s a hit and miss guess. Does that make sense?

By the way, the commitment of time goes both ways. People who take the time to visit with me show a level of caring as well. After all, if you don’t care about your mortgage, why do you expect anyone else to?

Are you a good judge of character? Your past experiences may indicate an answer. If it’s been a bit bumpy or your current situation doesn’t feel right, search out a little TLC. It will go a long way.

HATE THE MORTGAGE PROCESS?

I’ll bet we haven’t lost any readers because it seems like everyone hates the mortgage process. From our perspective it's a bit humbling, especially when talking about our own careers. But after all, who wakes up in the morning and says, “I can’t wait to go find a mortgage today!”

NOBODY DOES!!!

It’s not like going to the big game, or even the mall. It’s more like getting your teeth drilled or something – right?  It’s a necessity that just plain hurts.

Like anything else that you put off, the “cavity” gets larger and more painful if you ignore it. So, if you ignore your credit, you may just lose your dream home -or- your ability to refinance to pull equity for that room addition, college for the kids, debt consolidation, the new swimming pool or whatever…

We see it all the time. People find their dream home first, then think about the financing and can’t get it. Disappointing? YES! Avoidable? YES!

BE PROACTIVE

You’ve got to get educated about the “hated” mortgage! Carve out some time and do it! Maybe, if you find a mortgage pro that will take the time to explain what it takes, you’ll say, “that wasn’t so bad.” Time is key. Learning what it takes to get your home financing, even a year in advance, is smart!

THINGS HAVE CHANGED AND KEEP CHANGING

Mortgage programs are different than even a few short months ago. Don’t assume what worked before will work again. New changes are on the horizon and can impact your ability for home financing. Take action now if home loans are in your future.

KEY FACTORS IF YOU’RE BUYING

Credit scores are still “GOOD, BAD and UGLY” but the number evaluation has changed. 720+ is good credit and should be your credit score goal. 620 is bad, but can offer some options. 580 is ugly and may get you in the house with certain programs.

Liquid assets include money available for a down payment, closing costs and payment reserves. The more you have the better. 100% financing may become difficult, if not impossible to find in the future.

The condition of the subject property is important. Major construction and condition problems mean problems getting your loan approved by the lender. Fixer uppers require special consideration.

WE’RE HERE TO HELP – CHANGES IN THE INDUSTRY

Recent legislation has been signed into law that impacts FHA loan programs. Currently, FHA loans require the borrower to put 3% of their own money into a purchase. Down Payment Assistance (DPA) programs have been in place to allow the seller to fund the buyer’s down payment (the money was allowed toward the 3% requirement). Not any more. Effective 10/1/2008, the DPA option is eliminated and the 3% buyers money requirement is increased to 3.5%. No more 100% FHA loans - a big hit for many home buyers!

Top Ten Questions and Answers you need to know about Credit…

1. Q: What are the best/worst credit scores?

        A: The best score is an 850, the worst a 300. Higher scores indicate lower credit risk. Anything below 680 makes it difficult to obtain higher LTV (Loan to Value) mortgages.

2. Q: When does a BK (Bankruptcy) not affect my credit score?

A: Bankruptcies will stay on your credit report for 7-10 years, however, usually after two years of maintaining new payments and credit accounts, scores will begin to improve.

3. Q: What is considered a late payment?

A: A late payment is any delinquent payment made on a trade line 30 days from the due date. Keep in mind late payments hurt your scores and a 60 day late made just a month ago will affect a score more than a 90 day late from five years ago.

4. Q: Would closing my accounts improve my score?

A: No. Absolutely not. Do not get this confused. Having too many OPEN accounts can hurt your score. But once you have opened the account you have done the damage. You can’t repair it by shutting down the account.

5. Q: What information is in my credit report?

A: A credit report is the equivalent of your financial report card. It details credit history, credit types, amount of times you use these credit types, amount of time your accounts have been opened, and if you pay your bills on time. Also employment information, your list of creditors, and any BK’s, judgments, or liens.

6. Q: Should I pay all these collections?

A: That depends on the last activity date of the collection. Recent, say within the last 24 months, collections demand the most consideration for payoff. Many times you can negotiate a payoff amount with the collection company – but – get the payoff in writing! Keep in mind, that derogatory collection accounts fall off your credit report in 7 years from the last activity date. Contacting the collector may just renew your activity date and the clock starts all over again.

7. Q: I had two people pull my credit over the last week. Why were their scores different?

A: There are a number of factors that go into your credit report. Each credit bureau may, or may not, receive the same information at the same time. New information can influence your report at any time. Just remember, your credit report is a “snapshot” in time with inevitable updates and changes.

8. Q: How can I establish credit?

A: Credit is based upon a person’s ability to pay an obligation. Borrow money for almost any reason and you are on the road to establishing credit. However, to be certain it will help with your credit report, ask the lender if they report to the bureaus. This is important since some lenders do not report, but most do. Typical accounts that report are home mortgages, auto and other installment loans and revolving accounts, like credit cards. The real key here is to make sure the credit you establish is good, so make payments on time!

9. Q: I had a bankruptcy and am having a hard time getting credit. Any ideas?

A: You may have to start slow. Inquire at your bank or check with credit card companies for high interest or prepaid credit. Look into department stores for low limit accounts. You may try to piggyback on an account with a relative. Contact a credit repair company for more specific recommendations.

10. Q: Why is the credit score so important? I have good income…

A: Good income is an important factor in your ability to pay, but many people with good income tend to spend more, or let’s just say, to their limit or beyond. The basics of your credit score show your ability, and even more importantly, the responsibility you place on your current and past obligations. Pay on time, all the time, and you won’t have to worry about your credit score.

 If you came to us and asked what would be the most important thing you could do to help yourself prepare for your next mortgage, what would we say? Well, it’s something we have been preaching, and I’m sure you’ve been hearing in the media for some time. The answer is credit improvement. It’s the foundation of your financial being and it can save you money in so many other ways if you just take advantage of the opportunity. Great credit scores simply mean you pay your obligations, are a low credit risk, and worthy of consideration. Great credit can be enjoyed by everyone willing to make the necessary choices. It is a battle you can win no matter what the current circumstance.

SO, WHAT’S IN IT FOR ME – to have great credit? It’s quite simple.              

1. Saves money (lower rates and insurance premiums)
2. Qualifies you worthy of credit cards, utilities, cell phone, etc.
3. Job opportunities (many employers check credit reports)

Those three bullet points are exactly what I’m talking about when I say “your financial being”. So now we have an understanding that working on your credit deserves attention, but so many ignore it until it’s too late. It’s kind of invisible and taken for granted like breathing clean air. You may not know it’s a problem until something bad happens and then it’s too late. Don’t wait until your next auto purchase or insurance quote or mortgage to pay attention to your credit. DO IT NOW!

WHAT SHOULD I DO TO WORK ON MY CREDIT? That’s a great first question and there’s a simple answer. Commit some time and money to get started. Actually, the amount of time and money can be very minimal. Take the time and invest the money to pull your credit report. Depending on your situation, the time can be a few minutes and the money can be well under $25. It just depends on how extensive your credit history may be. Here are some tips for getting your credit report:

1. www.annualcreditreport.com (may have to pay for  scores)
2. Contact us for a report at cost, complementary time

So, now that you have pulled credit there are several questions that will need to be answered. We are going to address the general questions in a series over the next few months. Next month we will be answering what we believe are the top ten questions people have when reviewing their credit. Stay tuned…

Welcome to a new year!! The Home Team Mortgage wants you to know it’s starting out right. In this Blog we will be short and sweet. There are two announcements we want to share -

1. We begin with mortgage rates. Folks, rates are great right now. If you are thinking of purchasing or refinancing, now is the time to do it. With rates as low as 4.875% in some situations, acting now could save you a lot of money. We don’t know how long into the new year this will last so call your mortgage professional today. For free and accurate rate quotes please call or email us at any time.

2. Introducing a new feature on our website which we feel will make your web experience much more convenient. It is an interactive chat which you can use while navigating throughout the site. With the click of a button you have the option to be chatting with us while on the site. What this does is ensures your questions will be answered while they are fresh in your mind. Also, if you are having trouble finding a certain page or certain information on our site, we can simply click a button and that page will be automatically opened on your computer. This is mortgage shopping at its BEST!!

That’s all for this month. Enjoy those great rates and remember if you want live interaction with us while on the site, simply click on the button just below the picture of our office on the home page. This will enable the live website interaction and you will be off and running.

For those of you who are considering buying, refinancing or investing in real estate in Oklahoma, the joy of the holiday season exceeds our traditional celebrations. Here’s some good news –

* Mortgage rates are great

* Oklahoma home values are increasing

* There may be a way out for people stuck in adjustable rate mortgages

The key to those super mortgage rates is good credit. This means, aim high and shoot for the best scores possible. If you need help on how to get there, check out our web site or call us. We’d be happy to provide some pointers.

Oklahoma home purchase prices have increased by 2.39% over the last quarter, 5% over the last 12 months. The good news here is that the last quarter increase is the most significant and is one of the highest appreciation rates in the USA. Just because we hear of all the bad news from the coasts and the depressed areas of Michigan and parts of Ohio doesn’t mean it applies to Oklahoma. Our economy is strong!

Finally, we’ve all heard of the controversy and finger pointing regarding the mortgage mess. Adjustable rate mortgages have become a bad term. Foreclosures are a sad commentary on the state of family finances, also leading to the alarming number of mortgage companies out of business or in financial trouble. President Bush has suggested help for those who may see their mortgage payments increase in the coming year. That’s got to be good news for some who cannot refinance due to their credit or lack of home equity. For others, check out a refinance and get into a fixed rate. It’s still a great time to get that done.

Enjoy this time with your friends and family. We, at The Home Team Mortgage, wish you a Merry Christmas and every joy and blessing in the New Year.

       IT’S ALL IN THE PREP!

When you begin a paint job every expert will tell you that the key to great results is in the prep work. The scraping, sanding, and priming make all the difference in a good finish. But, when you are excited to change your walls from humdrum off white to the perfect shade of red the details are not the most thrilling part of the job. You can’t wait to pick up that roller and see the color come alive on your dining room wall. However, no one would be happy with the look of any color over chipped paint.

The same is true when looking for a new home. The end result will not be pretty unless you have taken the correct steps BEFORE you start. Pulling your credit and studying your financial situation with a mortgage professional at the beginning of your search will improve the process and leave you with better results. Credit issues can be scraped, sanded and primed to be ready for a smooth closing.

Unfortunately we have had people come to our door who have found a house and are thrilled to move in. When we look at their qualifications they have work to be done before a purchase can happen. This can delay a closing or cause them to lose a house altogether. If they had visited a trusted lender months before, this could have been avoided.

A qualified mortgage professional will be happy to spend some time with you to get your prep work right. We love to see the look of satisfied customers. 

 Have a great Thanksgiving everyone.

                          Trick or Treat?

  In our last blog I promised to give you a horror story and in the Halloween spirit, I will. First, I just want to take a minute to give some “treats” on how to maintain good credit and some things the credit bureaus (Experian, TransUnion, and Equifax) look for when scoring your credit. These are in no particular order of importance.

1. Do not close your open lines of credit (meaning credit cards, etc). The credit bureaus want to see that you can “manage” your debts. They want you to have open trade lines; in fact it is a good idea generally to have three good open lines of credit. So what does “manage” my credit mean? Simply this, try to keep your balances low (do not “max out your cards”), pay your bills on time, and maintain the line of credit for an extended period of time. Approximately 35% of your score is based on payment history.

2. Do not open a lot of new accounts too rapidly. Maintaining good credit can be easy but it takes time. So try to space your accounts out over an extended period of time. A bunch of new accounts too rapidly may raise suspicion and lower your average account age, which may actually have a negative effect on your score. Open new accounts responsibly and pay the balance due each month on time and this will raise you score in the long term.

3. Review your credit at least once a year and especially before making a large purchase like a home or a car. Keep yourself informed so that when you are ready to make that big purchase there won’t be any surprises. There are several resources for obtaining your credit report, in fact, right here on our website, if you go to the FREE TIPS drop down menu and click on the CREDIT SCORE GUIDELINES tab you can find how to pull your own credit report right at home. Remember, you determine how “good” or “bad” your own specific situation will be. Keep on top of it.

Ok, now for my quick personal horror story that pertains to why checking your credit is so important. I make sure to pay my house bill on time every month. Well, a couple of weeks ago I received a letter stating that my house payment was thirty days late. Then another letter stating I hadn’t made a payment in two months. Of course I thought this was absurd but it was a serious problem that needed fixing ASAP. I found out that someone in the receiving department of the lender lost track. But I still had to provide bank statements showing on time payments for the last four months. Now, my credit had been affected because when you are 30+ days late on a mortgage payment (whether it’s your fault or not) it gets reported and immediately begins to hurt your credit.

So here is the important part - I wrote a letter to the lender stating I wanted them to inform all three credit bureaus that I have not had late mortgage payments and needed proof that this gets taken off my report.  If I had not taken this step my credit could have been ruined for a lengthy period of time.

It is so important that you keep up with your credit like I had to do, because even if it’s not your fault, things can go wrong. Credit can spiral downward quickly and you must take the initiative to get it fixed. If you don’t, no one will, and you will receive a “trick” instead of a “treat” the next time you want to make a major purchase.