We all have questions when it comes to financing. Whether it be how much of a down payment we need to how much of a monthly mortgage can we qualify for. To get a definite answer for Home Financing, feel free to contact Tyler Arnaiz of Prospect Mortage. Contact Tyler Here
Together, C&C Real Estate Group and Tyler Arnaiz set up a game plan for you. We asses your goals, determine your wants, needs, credit score and lastly administer your purchase power.
For most of us, Real Estate is going to be the biggest asset we are to ever known, so it is crucial to have a real estate team and lender to work hand in hand together looking after your best interest.
Here is some useful information and Quizzes that help you better understand the financial aspect of Buying a Home.
Everything you ever needed to know about your Credit Score can be found at one of the two links below. There is considerable confusion on Credit Scores because there are at least two different scales that are used by different lending organizations. The FICO Score is most widely used, however, the three Credit Bureaus have developed their own scale and sometimes use (VantageScore) which, they claim, is a better judge of your credit standing. The important point to all consumers is:
Picture Courtesy of http://www.lendingclub.com
WHICH scale is being used?
The FICO scale ranges from 300 (poor) to 850 (perfect). The VantageScore scale ranges from 501 (poor) to 990 (perfect). The midpoint of each is approximately 575 (FICO) and 745 (VantageScore). You need to understand your score relative to each scale and communicate it to whomever needs it. Don’t expect a Lender to offer you superior credit for a 745 VantageScore when they use FICO. You will be shocked when they refuse credit or charge a higher rate.
Everybody should check their credit reports on an annual basis.
Do not be misled by FreeCreditReport.com, their reports ARE NOT FREE.
Follow the link below to AnnualCreditReport.com to request a copy of your report from each of the three credit reporting agencies. Those reports are truly FREE. There are four areas that Lenders review when a loan application is made. Think of them as the Four Cs.
CHARACTER – Job History, years with your employer, years in the same field. FICO score: 620 to 770 (mid score) are the usual parameters. Below 620 FICO makes it harder to qualify, but it can be done.
CAPACITY – Income, pension, social security. There are two ratios used by lenders: Front End and Back End DTI. Front End is your total payment (PITI) on your new loan divided by your gross income. The Front End DTI should be 31% or less. Back End is all of your debts (credit cards, car payments, child support, house payment, etc.) divided by your gross income. Back End DTI should be 43% or less.
CAPITAL – Money in the bank after down payment. IRA, 401K, savings. The higher the better. This answers the question, What if there is a job loss? Best to have 4 to 6 months reserves, but not necessarily required.
602-577-5797