This Venice architectural compund features original, unique artwork by acclaimed French artist Invader, and lists at $8.25 million.
Source: fancypantshomes.com
Category: Loans
Newly Renovated, 1915-Built Townhouse in Park Slope Asks $4.4 Million
A four-bedroom townhouse with park views and tons of charm has recently hit the market, and we’re dying to tell you all about it. The listing, brought to market by Compass’ Michael J. Franco, is right next to Prospect Park, Brooklynâs second largest park, and has plenty of outdoor space (and a rooftop deck to boot).
The townhouse sits in one of Brooklynâs trendiest, most desirable neighborhoods — Park Slope — with its leafy streets lined with brick and brownstone townhouses, many of which were built near the turn of the 20th century and have been lovingly updated over the decades by young families migrating from Manhattan. Much like its neighboring properties, the 2,600-square-foot townhome at 15 Prospect Park was originally built more than a century ago in 1915 and retains its old-world charm — but has been carefully updated to meet modern standards of living.
With 4 bedrooms, 3.5 baths, a generously sized living room, and a finished basement, the Brooklyn townhouse also comes with a few rare features for a New York home: ample outdoor space and private parking (that includes a private garage and its own driveway).
The layout is split on three levels, with the first floor housing a large living room and open dining room — both with distinctive pre-war features like classic moldings and arches — and a renovated kitchen that opens up to a lovely terrace.
The second floor is home to 3 bedrooms and a sizeable landing which is perfect for either a library or a home office, while the third floor is dedicated to the primary bedroom suite and its massive walk-in closet, renovated bath with skylights and soaring ceilings, with a separate sitting area/den. The third level also provides access to the townhouse’s own rooftop deck, which adds more outdoor space and looks like a perfect place to entertain guests.
The property is listed for $4,400,000 with Compass associate real estate broker Michael J. Franco.
More beautiful New York City homes
This Brooklyn Condo Has a Dreamy Backyard that Will Make You Forget Youâre in the City
Trophy Apartment Once Owned by Composer Leonard Bernstein Asks $29.5 Million
These 5 Unique Listings Will Remind You of Everything that Makes NYC Real Estate Special
This $16M NYC Penthouse Has Unobstructed Views of Central Park and the Manhattan Skyline
The post Newly Renovated, 1915-Built Townhouse in Park Slope Asks $4.4 Million appeared first on Fancy Pants Homes.
Source: fancypantshomes.com
So You Want to Buy a Fixer-Upper: Hereâs What You Need to Know
Stephen and David St. Russell, self-taught renovation and fixer-upper experts, are sharing their advice for homebuyers who are looking to explore buying a home that needs some extra TLC.
The post So You Want to Buy a Fixer-Upper: Hereâs What You Need to Know appeared first on Homes.com.
Source: homes.com
How Long Does It Take To Buy A House?
How long does it take to buy a house? The answer is: it depends. You can buy a house in a matter of weeks or it can take you anywhere from 4 to 6 months. The question is how ready are you? It can take a long time, and that’s just learning about various mortgage options or improving your credit score.
So understanding the various factors involved in buying a house can give you an estimate of how long it will take you to buy the house
Check out now: 5 Signs You Are Not Ready To Buy A House
How long does it take to buy a house? A step-by-step guide.
It can take a homebuyer a few weeks to several months to complete the home buying process. But when determining how long it will take you to buy a house, you first have to find out if you will be pre-approved for a mortgage. There is no sense of shopping for a house to then realize you can’t afford it.
If you are interested in comparing the best mortgage rates through LendingTree click here. Itâs completely free.
I. How long does it take to get a pre-approved mortgage letter in order to buy a house?
If you’re serious about buying a house, it’s important to get pre-approved for a mortgage. So when it’s time to make an offer, the seller will know you’re serious. If you don’t have one handy, the seller will likely move to the next buyer.
Getting pre-approved for a mortgage in order to buy a house can take longer. That is because you have to make sure your financial situation is in shape. For example, your income-to-debt ratio, your down payment, and your credit score must be good. That’s exactly what a mortgage lender will look at.
Even when these things are in order, shopping and comparing mortgage rates and fees can take several weeks.
Let’s take a look on how long it will take you to get these things in shape before buying a house.
Click here to compare mortgage rates through LendingTree. Itâs completely FREE.
A. How good is your credit score?
A low credit score can make buying a house take longer, because it can take months to a year to improve a bad credit score.
A conventional loan will usually require a 640+ credit score.
In fact, your credit score is the number 1 item mortgage lenders look at to decide whether to offer you a mortgage. And if it is not where it’s supposed to be, you might get rejected.
Luckily for you there are other ways to get a loan with much lower credit score: FHA loans.
FHA loans only require a credit score of 580 with 3.5% down payment. You may get qualified with a 500 credit score, but you’ll have to come with a 10% down payment.
So before you get into the fun part of shopping for a mortgage or visiting homes, it’s best to know what your credit score is and take steps to improve it.
You can get a free credit score at Credit Sesame.
B. Fix errors on your credit report.
Fixing errors on your credit report in order to get pre-approved for a loan in order to buy a house can take 30 days.
According to Transunion, “most investigations are completed within 2 weeks, but some may take up 30 days.”
Again, we recommend you get a free credit report at Credit Sesame. A credit report will give you a detail analysis of your credit history, how much debt you owe, and how creditworthy you are, etc. If there are any errors or inaccuracies, fix them immediately so there’s no surprise when you’re actually applying for a mortgage.
The best way to do that is by filing a Transunion dispute or Equifax dispute.
C. Do you have a down payment for the house?
How long it will take you to buy a house will also depend on whether or not you already have money saved up for a down payment.
Unless you’re going to buy the house with outright cash, you’ll need a down payment. And saving for a down payment can take a long time. Depending on your income and expenses, saving for a down payment on a house can take years.
Assuming, for example, you want to buy a house that will cost you $450,000, and you’re using a conventional loan to finance the house. With a 20% down payment, you will need to come up with $90,000.
Let’s say again, because of other monthly expenses, you can only save $1500 a month for the down payment.
You see how long it will take you to save for a down payment to buy the house? 5 years. And that doesn’t even take into account other upfront costs of buying a house, such as closing cost.
While it’s possible to get a mortgage with a down payment as low as 3.5% of the home purchase price, it’s advisable to put at least 20% down. The reason is because you will avoid paying private mortgage insurance (PMI), which protects the lenders in case you default on your mortgage.
Home buyers with a down payment below 20% are usually charged with PMI.
Another reason for a larger down payment is that it reduces the cost of the mortgage, grows equity much faster, and saves you on interest over the life of the loan.
As you can see, it can take you as much as 5 years from the time you’re thinking about buying the house to the time you’re actually ready to start the process.
But once you have taken care the things above, buying a house can go a lot faster.
II. How long does it take to find a real estate agent?
Average time: 1 day to a month
Once you have been pre-approved for a mortgage, the next step is to find an experienced real estate agent. Finding a good real estate agent can take a day to a month. Websites such as Zillow and Redfin list real estate agents you can use.
III. Shopping for a home.
Average time: a few weeks to a few months
With the help of a real estate agent and your own due diligence, finding a home can can go faster or take longer depending on available homes, the season and your desired location.
But experts say on average it can take a minimum of three weeks to a few months.
IV. Making an offer, negotiation, and inspection.
Average time: 1 to 10 days
Once you have found the home of your dream, the next step is to make an offer. You and the seller can go back and forth negotiating the price.
Once your offer has been accepted, you and the seller sign something called a purchase agreement. Then, the next step is to hire a professional to inspect the home for defects. Depending on your state, a home inspection must be completed within 10 days. And if the inspection finds some defects in the house, that could delay the process.
V. How long does it take to close on a house?
Average time: 30 to 45 days.
Once the inspection is done, your lender will need to officially approve you for the loan. And depending on the lender, it can also affect how long it takes to buy a house. You may need to provide additional documents. But the lender will need to assess the home for its value. And depending on the program (whether it’s conventional loan or FHA loan) it can take anywhere from 30 to 45 days to close on a home.
Bottom line
When asking yourself this question: “how long does it take to buy a house?” The answer is : it depends. If you have your credit score, your down payment, your other finances under control, you can buy your house in two months or less. But if you have to save for a down payment, fix errors on your credit report, raise your credit score, the whole home buying process can take years.
Click here to compare mortgage rates through LendingTree. Itâs completely FREE
Still wondering how long it takes to buy a house? Read the following articles:
- 5 Signs You’re Not Ready To Buy A House
- 10 First Time Home Buyer Mistakes To Avoid
- 3 Signs You’re Not Ready to Refinance Your Mortgage
- The Biggest Mistakes Millennials Make When Buying a House
- 7 Signs You’re Ready To Buy A House
Work with the Right Financial Advisor
You can talk to a financial advisor who can review your finances and help you reach your goals (whether it is making more money, paying off debt, investing, buying a house, planning for retirement, saving, etc). So, find one who meets your needs with SmartAssetâs free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.
The post How Long Does It Take To Buy A House? appeared first on GrowthRapidly.
Source: growthrapidly.com
Which Student Loan Should You Pay First?
The financial camps are divided between paying off your smallest first vs. your highest interest student loan. So whoâs right? Finance people can agree on a few things. Some debts like payday loans and IRS back taxes are worse than…
The post Which Student Loan Should You Pay First? appeared first on Modern Frugality.
Source: modernfrugality.com
Should You Refinance Your Student Loans?
Due to financial consequences of COVID-19 â and the broader impact on our economy â now is an excellent time to consider refinancing most loans you have. This can include mortgage debt you have that may be converted to a new loan with a lower interest rate, as well as auto loans, personal loans, and more.
Refinancing student loans can also make sense if youâre willing to transition student loans you currently have into a new loan with a private lender. Make sure to take time to compare rates to see how you could save money on interest, potentially pay down student loans faster, or even both if you took the steps to refinance.
Get Started and Compare Rates Now
Still, itâs important to keep a close eye on policies and changes from the federal government that have already taken place, as well as changes that might come to fruition in the next weeks or months. Currently, all federal student loans are locked in at a 0% APR and payments are suspended during that time. This change started on March 13, 2020 and lasts for 60 days, so borrowers with federal loans can skip payments and avoid interest charges until the middle of May 2020.
Itâs hard to say what will happen after that, but itâs smart to start figuring out your next steps and determining if student loan refinancing makes sense for your situation. Note that, in addition to lower interest rates than you can get with federal student loans, many private student lenders offer signup bonuses as well. With the help of a lower rate and an initial bonus, you could end up far âaheadâ by refinancing in a financial sense.
Still, there are definitely some negatives to consider when it comes to refinancing your student loans, and weâll go over those disadvantages below.
Should You Refinance Now?
Do you have student loan debt at a higher APR than you want to pay?
- If no: You shouldnât refinance.
- If yes: Go to next question.
Do you have good credit or a cosigner?Â
- If no: You shouldnât refinance.
- If yes:Â Go to next question.
Do you have federal student loans?
- If no: You can consider refinancing
- If yes: Go to next question
Are you willing to give up federal protections like deferment, forbearance, and income-driven repayment plans?
- If no: You shouldnât refinance
- If yes: Consider refinancing your loans.
Reasons to Refinance
There are many reasons student borrowers ultimately refinance their student loans, although they can vary from person to person. Here are the main situations where it can make sense to refinance along with the benefits you can expect to receive:
- Secure a lower monthly payment on your student loans.
You may want to consider refinancing your student loans if your ultimate goal is reducing your monthly payment so it fits in better with your budget and your goals. A lower interest rate could help you lower your payment each month, but so could extending your repayment timeline. - Save money on interest over the long haul.
If you plan to refinance your loans into a similar repayment timeline with a lower APR, you will definitely save money on interest over the life of your loan. - Change up your repayment timeline.
Most private lenders let you refinance your student loans into a new loan product that lasts 5 to 20 years. If you want to expedite your loan repayment or extend your repayment timeline, private lenders offer that option. - Pay down debt faster.
Also, keep in mind that reducing your interest rate or repayment timeline can help you get out of student loan debt considerably faster. If youâre someone who wants to get out of debt as soon as you can, this is one of the best reasons to refinance with a private lender.
Why You Might Not Want to Refinance Right Now
While the reasons to refinance above are good ones, there are plenty of reasons you may want to pause on your refinancing plans. Here are the most common:
- You want to wait and see if the federal government will offer 0% APR or forbearance beyond May 2020 due to COVID-19.
The federal government has only extended forbearance through the middle of May right now, but they might lengthen the timeline of this benefit if you wait it out. Since this perk only applies to federal student loans, you would likely want to keep those loans at 0% APR for as long as the federal government allows. - You may want to take advantage of income-driven repayment plans.
Income-driven repayment plans like Pay As You Earn (PAYE) and Income-Based Repayment let you pay a percentage of your discretionary income each month then have your loans forgiven after 20 to 25 years. These plans only apply to federal student loans, so you shouldnât refinance with a private lender if you are hoping to sign up. - Youâre worried you wonât be able to keep up with your student loan payments due to your job or economic conditions.
Federal student loans come with deferment and forbearance that can buy you time if youâre struggling to make the payments on your student loans. With that in mind, you may not want to give up these protections if youâre unsure about your future and how your finances might be. - Your credit score is low and you donât have a cosigner.
Finally, you should probably stick with federal student loans if your credit score is poor and you donât have a cosigner. Federal student loans come with fairly low rates and most donât require a credit check, so theyâre a great deal if your credit is imperfect.
Important Things to Note
Before you move forward with student loan refinancing, there are some details you should know and understand. Here are our top tips and some important factors to keep in mind.
Compare Rates and Loan Terms
Because student loan refinancing is such a competitive industry, shopping around for loans based on their rates and terms can help you find out which lenders are offering the most lucrative refinancing options for someone with your credit profile and income.
We suggest using Credible to shop for student loan refinancing since this loan platform lets you compare offers from multiple lenders in one place. You can even get prequalified for student loan refinancing and âcheck your rateâ without a hard inquiry on your credit score.
Check for Signup Bonuses
Some student loan refinancing companies let you score a bonus of $100 to $750 just for clicking through a specific link to start the process. This money is free money if youâre able to take advantage, and you can still qualify for low rates and fair loan terms that can help you get ahead.
We definitely suggest checking with lenders that offer bonuses provided you can also score the most competitive rates and terms.
Consider Your Personal Eligibility
Also keep your personal eligibility in mind, including factors beyond your credit score. Most applicants who are turned down for student loan refinancing are turned away based on their debt-to-income ratio and not their credit score. Generally speaking, this means they owe too much money on all their debts when you compare their liabilities to their income.
Credible also notes that adding a creditworthy cosigner can improve your chances of prequalifying for a loan. They also state that âmany lenders offer cosigner release once borrowers have made a minimum number of on-time payments and can demonstrate they are ready to assume full responsibility for repayment of the loan on their own.â
Itâs Not âAll or Nothingâ
Also, remember that you donât have to refinance all of your student loans. You can just refinance the loans at the highest interest rates, or any particular loans you believe could benefit from a different repayment term.
4 Steps to Refinance Your Student Loans
Once youâre ready to pull the trigger, there are four simple steps involved in refinancing your student loans.
Step 1: Gather all your loan information.
Before you start the refinancing process, it helps to have all your loan information, including your student loan pay stubs, in one place. This can help you determine the total amount you want to refinance as well as the interest rates and payments you currently have on your loans.
Step 2: Compare lenders and the rates they offer.
From there, take the time to compare lenders in terms of the rates they can offer. You can use this tool to get the process started.
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Step 3: Choose the best loan offer you can qualify for.
Once youâve filled out basic information, you can choose among multiple loan offers. Make sure to check for signup bonus offers as well as interest rates, loan repayment terms, and interest rates you can qualify for.
Step 4: Complete your loan application.
Once you decide on a lender that offers the best rates and terms, you can move forward with your full student loan refinancing application. Your student loan company will ask for more personal information and details on your existing student loans, which they will combine into your new loan with a new repayment term and monthly payment.
The Bottom Line
Whether it makes sense to refinance your student loans is a huge question that only you can answer after careful thought and consideration. Make sure you weigh all the pros and cons, including what you may be giving up if youâre refinancing federal loans with a private lender.
Refinancing your student loans can make sense if you have a plan to pay them off, but this strategy works best if you create a debt repayment plan you can stick with for the long-term.
The post Should You Refinance Your Student Loans? appeared first on Good Financial Cents®.
Source: goodfinancialcents.com
How does refinancing a student loan affect credit?
Does refinancing student loans affect credit? Learn all about student loan refinancing and whether itâs right for you with Lexington Law.
Source: lexingtonlaw.com
How Do You Use a Degree That Isn’t Very Specific?
Hello! Enjoy this post from my friend Martin. I know this situation applies to many out there (the possibility of what you or others may believe to be useless degrees), so hopefully this post can help someone out!
“Why did you waste your time on that degree?”
The most ignorant question in the world. You deserve a smack across the face if you’ve ever asked anyone this. There’s no such thing as a waste of time if you learned a few things and opened your eyes a little. Also, it’s none of your business what someone else studied, unless you of course paid for their full education.
Why would you ask someone this?
The person with the degree doesn’t possess the power to time travel and change things. It’s already too late. They have the degree proudly hanging on the wall. There’s no need to be a ruthless jerk who puts down their friends. The person on the other end will get highly defensive and the argument won’t be pretty.
Why would you ask such an ignorant question?
Sadly, European relatives ask this all of the time. So do friends on Facebook. Most people will ask about why you studied what you did. It’s fairly standard small talk.
Do you need to earn a highly targeted degree?
All stats out the window, the answer is no.
You don’t need to do anything. You can’t force yourself to study a topic that you despise for four years of your life. This never ends well. If you do complete your studies and find work in the field, you won’t be happy because you never wanted to do this in the first place.
Can you imagine working in a field that you despise until you’re 65? That’s at least 40 years. That would be one miserable existence.
While I highly suggest that you study a subject that can open up opportunities for you after college, I also realize that not everyone has life figured out in their teens.
When I had to decide what I wanted to study I was 17. Due to my late birthday, I had to figure everything out at this young. I remember choosing a community college because I had no clue of what else to choose. I started at a community college at 17 and somehow managed to survive. I was completely clueless about why I was even there.
You can’t be expected to have your life figured out in your teens. It’s okay if you don’t study the most specific topic.
How do you use a degree that’s not in demand?
Well, you don’t have to find a work in your specific field. There’s no rule that states you need to work as a Historian just because you studied history.
You don’t have to find work in the exact field that you studied. You have other options, such as:
- Totally changing gears. You can pick up a trade or find work in a totally new field. Some of my friends have become bloggers and front line management.
- Starting your own business. Do you have a business idea in mind?
- Graduate school. My friend went to graduate school since they had high grades and found work in management.
- Using your alumni relations connections. Your alumni department could open your eyes.
- Travel. Have you thought about teaching English abroad?
If your degree isn’t in demand, that’s okay because you can still be in demand. You don’t have to live and die based on your degree. You’re not your degree. You have more to offer this world than the piece of paper that you picked up on stage.
Should you feel guilty about having useless degrees?
Nope.
There’s no rule that states you must work in the field that you studied. Most of my friends are in completely unrelated fields. I don’t really know anyone that went to directly find work in their specific field. The only friends that are using their degrees 100% are my friends who became teachers and nurses. Those fields are very specific and you can’t get in without the correct credentials.
Everything else can’t be taught.
Do you think there’s a four year program for bloggers like Michelle? Hell no.
Do you think there’s a program that teaches you how to solve problems? Not really.
Is there a college degree that encourages you to take risks? Nope.
College is a wonderful experience. This is your first taste of the following:
- Freedom.
- Responsibilities.
- Deadlines.
- Love.
- Failure.
- Massive hangovers.
- Depression.
- Confusion.
Very little of what you study in college will be used in your real life. I hate to admit this, but I don’t remember anything from the classroom lectures when I look back.
Why did I attend college?
I earned my degree in business so that I could tell people that I got my degree in business. Plus, I was the oldest boy in my family and the first to attend college. Making my parents proud was priceless. Oh, and I didn’t want to get kicked out of the house.
The world’s not going to end because your degree isn’t in the most profitable field. You’re not a failure because you studied something that interested you. It’s your life. You did what you wanted to. If you didn’t study anything specific then that’s okay because you’e not restricted to one field of work. You just need to decide on what you’re going to do next.
Are you using your college degree? Why or why not? Do you have useless college degrees?
The above is a post from Martin of Studenomics, where you can read about financial freedom and not have to worry about missing a party. Martin has just launched, Next Round’s On Me, where he helps you with your financial journey in your 20s.
The post How Do You Use a Degree That Isn’t Very Specific? appeared first on Making Sense Of Cents.
Source: makingsenseofcents.com
6 Things Your Mortgage Lender Wants You To Know About Getting a Home Loan During COVID-19
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Getting a mortgage, paying your mortgage, refinancing your mortgage: These are all major undertakings, but during a pandemic, all of it becomes more complicated. Sometimes a lot more complicated.
But make no mistake, home buyers are still taking out and paying down mortgages during the current global health crisis. There have, in fact, been some silver linings amid the economic uncertaintyâhello, record-low interest ratesâbut also plenty of changes to keep up with. Mortgage lending looks much different now than at the start of the year.
Whether youâre applying for a new mortgage, struggling to pay your current mortgage, or curious about refinancing, hereâs what mortgage lenders from around the country want you to know.
1. Rates have dropped, but getting a mortgage has gotten more complicated
First, the good news about mortgage interest rates: âRates have been very low in recent weeks, and have come back down to their absolute lowest levels in a long time,â says Yuri Umanski, senior mortgage consultant at Premia Relocation Mortgage in Troy, MI.
That means this could be a great time to take out a mortgage and lock in a low rate. But getting a mortgage is more difficult during a pandemic.
âAcross the industry, underwriting a mortgage has become an even more complex process,â says Steve Kaminski, head of U.S. residential lending at TD Bank. âMany of the third-party partners that lenders rely onâcounty offices, appraisal firms, and title companiesâhave closed or taken steps to mitigate their exposure to COVID-19.â
Even if you can file your mortgage application online, Kaminski says many steps in the process traditionally happen in person, like getting notarization, conducting a home appraisal, and signing closing documents.
As social distancing makes these steps more difficult, you might have to settle for a âdrive-by appraisalâ instead of a thorough, more traditional appraisal inside the home.
âAnd curbside closings with masks and gloves started to pop up all over the country,â Umanski adds.
2. Be ready to prove (many times) that you can pay a mortgage
If youâve lost your job or been furloughed, you might not be able to buy your dream house (or any house) right now.
âWhether you are buying a home or refinancing your current mortgage, you must be employed and on the job,â says Tim Ross, CEO of Ross Mortgage Corp. in Troy, MI. âIf someone has a loan in process and becomes unemployed, their mortgage closing would have to wait until they have returned to work and received their first paycheck.â
Lenders are also taking extra steps to verify each borrowerâs employment status, which means more red tape before you can get a loan.
Normally, lenders run two or three employment verifications before approving a new loan or refinancing, but âI am now seeing employment verification needed seven to 10 timesâsometimes even every three days,â says Tiffany Wolf, regional director and senior loan officer at Cabrillo Mortgage in Palm Springs, CA. âTodayâs borrowers need to be patient and readily available with additional documents during this difficult and uncharted time in history.â
3. Your credit score might not make the cut anymore
Economic uncertainty means lenders are just as nervous as borrowers, and some lenders are raising their requirements for borrowersâ credit scores.
âMany lenders who were previously able to approve FHA loans with credit scores as low as 580 are now requiring at least a 620 score to qualify,â says Randall Yates, founder and CEO of The Lenders Network.
Even if you arenât in the market for a new home today, now is a good time to work on improving your credit score if you plan to buy in the future.
âThese changes are temporary, but I would expect them to stay in place until the entire country is opened back up and the unemployment numbers drop considerably,â Yates says.
4. Forbearance isn’t forgivenessâyou’ll eventually need to pay up
The CARES (Coronavirus Aid, Relief, and Economic Security) Act requires loan servicers to provide forbearance (aka deferment) to homeowners with federally backed mortgages. That means if youâve lost your job and are struggling to make your mortgage payments, you could go months without owing a payment. But forbearance isnât a given, and it isnât always all itâs cracked up to be.
âThe CARES Act is not designed to create a freedom from the obligation, and the forbearance is not forgiveness,â Ross says. âMissed payments will have to be made up.â
Youâll still be on the hook for the payments you missed after your forbearance period ends, so if you can afford to keep paying your mortgage now, you should.
To determine if youâre eligible for forbearance, call your loan servicerâdonât just stop making payments.
If your deferment period is ending and youâre still unable to make payments, you can request delaying payments for additional months, says Mark O’ Donovan, CEO of Chase Home Lending at JPMorgan Chase.
After you resume making your payments, you may be able to defer your missed payments to the end of your mortgage, OâDonovan says. Check with your loan servicer to be sure.
5. Don’t be too fast to refinance
Current homeowners might be eager to refinance and score a lower interest rate. Itâs not a bad idea, but itâs not the best move for everyone.
âHomeowners should consider how long they expect to reside in their home,â Kaminski says. âThey should also account for closing costs such as appraisal and title insurance policy fees, which vary by lender and market.â
If you plan to stay in your house for only the next two years, for example, refinancing might not be worth itâhefty closing costs could offset the savings you would gain from a lower interest rate.
âItâs also important to remember that refinancing is essentially underwriting a brand-new mortgage, so lenders will conduct income verification and may require the similar documentation as the first time around,â Kaminski adds.
6. Now could be a good time to take out a home equity loan
Right now, homeowners can also score low rates on a home equity line of credit, or HELOC, to finance major home improvements like a new roof or addition.
âThis may be a great time to take out a home equity line to consolidate debt,â Umanski says. âThis process will help reduce the total obligations on a monthly basis and allow for the balance to be refinanced into a much lower rate.â
Just be careful not to overimprove your home at a time when the economy and the housing market are both in flux.
The post 6 Things Your Mortgage Lender Wants You To Know About Getting a Home Loan During COVID-19 appeared first on Real Estate News & Insights | realtor.com®.
Source: realtor.com
I Was Denied an Auto Loan. Now What?
Youâre in the market for a new car but youâve been denied an auto loan. Now what? Hereâs what you need to know about why you may have been denied and what to do to make sure it doesnât happen again.
Why Do I Keep Getting Denied for Auto Loans?
Unfortunately, there are many reasons a bank might reject your application for a car loan. If your loan application has recently been denied or you keep getting denied, it might be due to one of these common reasons:
- Application errors. Sometimes, the application could be rejected because of an error you made when filling it out. A missed section, some incorrect information, a missing form or another mistake can mean your loan is ultimately denied.
- Bad credit. Bad credit is a common reason for auto loan denial. A score below 670 is usually considered a bad credit score, and this damages lenders’ trust in your ability to pay off a loan.
- Too much debt. A high debt-to-income ratio can make lenders leery. If you have a number of loans or credit cards with large amounts of debt, this raises your DTI and may lower your chance of getting approved for future loans, car loans included.
- No credit. Lenders look for proof of consistency in paying off past loans when reviewing your application. If you have no credit history, lenders may feel they donât have enough information about your ability to pay off a future loan.
What Can I Do If My Loan Application Is Denied?
You have a few options when you’ve been denied an auto loan, depending on the reason you were rejected.
Application Error
If you were rejected because of an application error on your part, you should contact the bank as soon as you can. Hopefully, the mix-up can be resolved and your request will be approved. If not, the lender will tell you when you can reapply.
Poor Credit
If you were rejected because of poor credit, check your credit report so you can determine what is negatively impacting your score. Depending on what your report says, look into ways to improve your credit so you can be approved next time. Pay your bills on time, and use your credit cards to make and then repay smaller purchases. Keep in mind that building or rebuilding your credit can take a while. Don’t be disappointed if it takes months or even a year or two to really get your score where you want it.
If you need a loan sooner, consider adding a cosigner to your application that can be your backup if you fail to pay the loan. Lenders feel more comfortable with this method, and it’s a good way to prove dependability.
Debt
If you were rejected because you already have too much debt, it’s important to reduce that amount in steady increments. Set a budget and stick to it, tackling the largest debts first. Avoid adding any debt to what you already have. Examine your credit card usage for any unnecessary expenses and cut back on those in the future.
No Credit
If you donât have a credit history, nowâs the time to start. There are a lot of ways to start building your credit: you might be able to become an authorized user on someone elseâs credit card or find a co-signer for your loan, for example. You also might want to apply for a secured credit card or credit card for no credit.
Find the right credit card for your needs. Learn more.
Does Getting Denied a Loan Hurt My Credit?
Getting denied for an auto loan doesn’t in itself hurt your credit score. The lender didn’t extend anything, so there’s nothing that can hurt your score. However, multiple denied applications at once could hurt your score.
A bank conducts a “hard inquiry” when you apply for a loan. This can cause a drop in your credit score slightlyâabout five to ten pointsâwhether you’re accepted or not. If you apply for too many loans, numerous hard inquiries on your credit can cause a larger drop.
What Are My Other Options?
If you donât have time to build or rebuild your credit, canât get a co-signer, and need a car fast, there are two options to be considered as a last resort.
âBuy Here Pay Hereâ Dealers
Stop by your neighborhood âBuy Here Pay Hereâ (BHPH) auto dealer, and one way or another, it will probably get you into a car. It won’t be a new car, and it will probably have lots of miles on it, but at least you’ll get a car you desperately need to get you to and fro.
The BHPH dealer won’t want to talk to you about interest rates. Your local BHPH will focus on your expected monthly payment and ask for a really big down payment. They mostly care about whether or not you have a current, steady income. Based on that, theyâll determine how much they are willing to lend and which car options are available to you. It’s not a great way to buy a car, but for millions of Americans, it is the only way they can make this significant a purchase.
Unfortunately, purchasing a car at a BHPH dealer isn’t a credit boost at all. They usually don’t report anything positive to credit reporting agencies, but they will report negative actions like a missed payment or repossession. Always ask about their late payment policies before making a decision.
Alternative Credit Bureaus
If your credit score is low or your credit history is light based on traditional credit trade lines (credit cards and loans), but you have a solid history of paying your everyday bills, you may be able to take advantage of alternative credit scoring methods. If you can prove your creditworthiness by having your everyday bills verified, some companies will work with alternative credit scoring methods to offer credit. Alternative credit generally doesnât carry the same weight as traditional credit lines, so interest rates likely will not be as competitive.
At this point, you can go to any dealer and buy the car you really want instead of being limited to the inventory on a BHPH lot. If you can afford the payments, you can buy a new car that’s under warranty and has no mileage on the odometer. If you can continue to work on your credit and improve your credit score, refinancing may even be available down the road.
However, many lenders still do not use alternative credit and don’t view it as proof of reliability. Most of these alternative credit companies also don’t report your findings to the major credit bureaus. So, while these alternative creditors may be a short-term option, building credit through traditional methods should be a priority.
Why Would I Get Rejected for a Car Refinance?
If you were denied for refinancing, it’s probably because of a poor credit score or a high DTI. Usually, these are the same as the reasons you might be denied an auto loan. Your score may have been satisfactory when you purchased the vehicle but taken a few hits since its purchase.
How to Get Approved Next Time
Before you reapply for an auto loan, make sure all your information is in order. Gather your records and make sure everything is ironed out and correct before you go to a lender. For a better shot at loan approval, your credit score should be in a comfortable range, and you shouldn’t have any large outstanding debts. Always check your credit score before you apply. If itâs not high enough for loan approval, work to improve your credit first. Then, make sure you’ve determined what type of payments and interest you can afford.
If you do get denied, don’t worry! By making sure you meet all of the income, credit and debt requirements for an auto loan, you can increase your chance of getting accepted the next time you apply.
The post I Was Denied an Auto Loan. Now What? appeared first on Credit.com.
Source: credit.com