Category Archives: Condo Buyers

The Things That Matter The Most In Your Credit Report

Credit Report Mortgage Loan

If you haven’t looked at your credit report in a while, it’s probably time to go ahead and pull another free one at www.annualcreditreport.com. This is a site supported by the three main credit repositories, Equifax, Experian and TransUnion and allows consumers to get a free report once per year. Consumers are encouraged to retrieve this report primarily to make sure there are no errors showing up. Unfortunately, credit reports have their fair share of mistakes.

But it’s really not the fault of these repositories because they only report what is sent to them by merchants and businesses who issue credit. When data is forwarded to them, they include it. They’re not going to verify data on their own each time someone’s payment history is sent to them. They’ll review it when a consumer sees a mistake and informs them of the offending line item.

For example, someone with a similar name might show up on your report and show some late payments which don’t belong to you. That’s the sort of thing to look out for. You’d be surprised about what all is included in your report. The property addresses where you’ve lived over the years will appear. So will any other names you’ve gone by. John Smith, J. Smith, John D. Smith, John David Smith…you get the idea.

When consumers do view their report, they should look for mistakes, but they also want some assurances what’s being put out there is accurate. For those building a strong credit history, it’s important to make sure these credit agencies are reporting your timely payments. Some of the data bits being reported are more important than others. What are they?

Surely the addresses of where you’ve lived over the past few years isn’t that important. At least to you, anyway, right? And of course, any other surnames you’ve used. If you married John Doe and you’re Jane Smith, you’ll be recorded as both Jane Smith and Jane Doe. Pretty simple.

Paying on time is the most important factor in your credit report. So too are account balances. Someone who regularly keeps a balance at or near the allowable limit will see their scores fall. On the other hand, keeping a relatively low balance at all times improves scores.

A late payment on a credit card you’ve had for a while won’t hit your scores very hard as long as the late payment (more than 30 days past the due date) is relatively isolated. But a late payment on a mortgage will count more against you compared to a late credit card payment. A bankruptcy or a foreclosure is the most damaging to a credit report, although the damage is lessened over time. What’s more important on a credit report is what has happened over the past couple of years, not something that happened say five or six years ago. Old, bad information will be shown, just largely ignored as long as current and timely payment patterns are being reported.

When applying for new credit, an “inquiry” will be entered into your record. An occasional inquiry for new credit won’t affect your credit but if there are multiple inquiries for new credit within a specific period, that will harm your credit. Not as much as a late payment or high balance accounts, but an impact, nonetheless. Multiple inquiries will carry more weight when there are other negative marks appearing.

In general, it all goes back to making sure payments aren’t made more than 30 days past the due date and keeping balances somewhere around one-third of credit lines. These two are the biggies. When a mortgage company reviews a credit report and credit scores, if payment history and balances are kept in check, your credit will be just fine.

Source: RealtyTimes
Author: David Reed

New Rules and Policies Open up Condo Market to More FHA Financing

Davidson Landing Waterfront Condos

Have you considered purchasing a condominium unit but were scared off when someone warned you that obtaining a mortgage loan could be difficult?  It seems like most real estate professionals have war stories about seemingly qualified buyers being unable to obtain financing to buy a residential condo unit.  There is good news for you, in the 4th quarter of 2019, the Federal Housing Agency (FHA) instituted new rules and policies to open up the residential condominium market to more FHA insured financing.

FHA is now permitting approval of individual residential condominium units in non-qualified condominium projects.  Previously the entire condominium project had to be approved in order for a buyer to obtain an FHA insured mortgage loan to buy a unit in the condominium project.  In practice, only the larger condominium projects were obtaining this condominium development-wide approval, leaving buyers unable to obtain FHA insured financing on the vast majority of the condominium projects.  While non-approved condominium projects have limits to the number of units which may have FHA insured financing, today even units in the smallest condominium projects may be eligible for FHA insured financing.

Additionally, FHA has loosened the eligibility requirements for mixed-use condominium projects; meaning condominium projects that include both residential and commercial units.  For us in the Pittsburgh market, we see the number of buildings Downtown, in the Strip District and East Liberty being built or converted into these mixed-use condominium projects.  The broadening of FHA eligibility for these type of projects is allowing those first time home-buyers and Millennials to obtain FHA insured financing to buy condominium units in areas and in projects where they want to live. Now is the time, don’t limit your wish list and settle for a property because FHA insured financing is not available.  FHA has heard the calls of the market and have taken good reasonable steps to assist you in financing your dream home, even if that “dream home” is a unit in a condominium.

Contact a Lake Norman real estate agent to get started on your Lake Norman condo search: 704-907-7907

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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