Tag Archives: making
Know when to get a home loan modification
If life is throwing you lemons and it’s hard to make lemonade, especially when that lemonade is your livelihood,then you need to step back and look at what is going on. 9.2% of Americans today are unemployed. 23% of Americans are “underwater” in their homes. 5.3 million homes in America are in foreclosure.
Lets face it, if you have a family and no place to live, then you are in trouble. So let’s start with the basic necessities, you need your home. Lets try to save it from going into foreclosure and keep you in your home.
The government has a program called Making Home Affordable that helps home owners modify their mortgage. There are requirements you must have in order to qualify you for the program. One of the main requirements is that your payment on your first mortgage (including principal, interest, taxes, insurance and homeowner’s association dues, if applicable) is more than 31% of your current gross income. So that means to help you qualify, you need to lower your debt. Once the service provider can verify your debt-to-income ratio or DTI, they have to also verify that you can pay the new amount. So in order to do that you must lower your debt.
The most important thing is to look for non-essential items to eliminate from your debt. Such items as a car could be a huge debt that when eliminated may increase your chances greatly for the home loan modification.
Most people have a car that they commute with to work. The car could easily take up a big chunk of your monthly nugget. If you factor in insurance and very high gas prices then that nugget could reach between $800-$1200. Think of any possible way to lower that payment monthly because the goal is to decrease your debt. If you can decrease your monthly debt then you are more likely able to get a loan modification by showing the bank that you have saved money in one place and are able to apply that money saved to your home loan. The bank is more willing to qualify your loan modification if they see that you are making an effort to pay the newly reduced monthly mortgage payment. If this means that you have to sacrifice waking up late and leisurely take the car to work and now you must wake up an hour earlier to catch the bus, then just do it.
There are many other subjects to learn about the Making Home Affordable program.
For more information, please visit
Boost Your Credit Score
Boost your credit score by collecting all your bills and financial papers and giving them a spring cleaning, regardless of the time of year. Everyone wants a perfect credit score of 850 or to increase their credit rating to the best possible credit score. This is the main factor lending agencies consider when extending a loan or approving credit cards. Lenders want to know your payment history and credit scores are the way they get this information quickly and easily.
What makes up a person’s credit score? How it becomes part of their credit history? A credit score is based on information gathered by the three U.S. credit bureaus: Equifax, Experion and Trans Union. Your credit score history began with the first purchase you ever made using credit. You didn’t do anything for the credit information to get into your credit history. You simply signed a credit note or credit agreement promising to repay the credit lender the funds of the loan or credit card through payments of a specific minimum amount over a specific period of time. The credit lender extending the credit, whether is was for an automobile, furniture or something else, automatically entered your credit information into the credit bureau systems and your credit payments were recorded and monitored until you paid in full. When you paid a loan in full, that account was marked “closed”. In the case of a credit card, the account would remain open as long as you are authorized to use that credit card account.
If you made no late credit payments, the credit entry became a good reference for your next purchase. All late or insufficient payments were noted and if there were many, a bad mark was placed on your credit history. As you began to use more credit, your credit history grew. The credit bureaus generated a credit score based on your credit repayments. Today, a credit score of 750 is considered a very good credit rating; a credit score over 750 is excellent while a credit scores below 600 is poor.
Boost your credit score by keeping your credit history up-to-date and making every credit card or other credit payment on time. Commit to avoid making any late credit payments. Pay off some of your credit debit completely. Reduce your overall credit debt to income ratio.
You should obtain a copy of your credit score report. Credit reports are now available, at no cost to you except postage and handling, once per year by requesting them from the credit bureaus. Check each credit entry, making certain that all credit entries actually belong on your credit record, that credit accounts you have paid off are marked ‘closed’ and clear up any errors or credit entries that haven’t been recorded properly. You might even find credit history that has not been recorded at all. The credit bureaus will send a form to request any corrections; simply fill out this form and return it by mail. After a few months, obtain another credit report and verify correction to your credit records. Check to see if you have successfully increased your credit score. By increasing your credit score even a few points at a time, you will be able to gain more buying power through prudent use of credit.