Lenders approve loans based on their impression of your ability and INTENT to pay it back.
To figure this out, they look at five things:
creditworthiness
income
job longevity
job stability
and future income prospects.
We'll tell you how to make sure you look good in each of these things, so that you'll get a "YES" when you want to borrow money for your new home.
1. Creditworthiness
Creditworthiness is your history of borrowing and repaying against things like loans, credit cards, rent, and whether you've ever filed for bankruptcy. Lenders refer to your credit bureau for this info.
Order a copy of your bureua today online at http://www.equifax.com make sure you order with the "Score Power".
This is to make sure that there are no errors or surprises that you'll have to explain to the Lender. If there are mistakes, which I often see, it can take a few months to resolve. So it's good to have a compelling explanation ready when the Lender sees it! The best way to demonstrate that you are "creditworthy" is to pay your bills in full and on time, particularly for the year or two before you want to get a loan and don't use more than 60% of your available credit.
2. Income
Lenders want to know that you have a history of sufficient and consistent income - so that you'll be able to repay the loan. So, when you submit your paperwork, make sure to include a letter verifying your employment (how long and what your salary is), your last couple of paystubs, and your last 2 years NOA's (notice of assessment).
3. Job Longevity
Lenders are looking for borrowers who have a stable source of income. If you can show that you've been employed at least 2 years in the same company or industry, you should be fine.
4. Job Stability
Again, lenders like stability - they tend to think that your loan payment behavior will reflect your employment behavior. So, don't make lateral moves between companies just for the sake of change. If you make moves, do it for promotion, or to earn more money.
5. Future Income Prospects
Because most loans are paid back in 15 to 30 years, Lenders are interested in people who will have income for that amount of time. Young professionals, or those with high-demand skills, are the most appealing to Lenders because their income will only increase over time. If you can demonstrate that you have a career plan that only gets better over time, you'll be in a strong position to borrow.
So essentially, pay your bills on time, stay with an employer, have a career path that shows potential, and you'll be sure to get a "YES" when you borrow.
Remember, if your contemplating a purchase of any kind that requires financing, WAIT until after you've bought your home. Otherwise, it will reduce or maybe even eliminate your from the market. Also, stay away from credit applications of ANY kind. The more times you apply for credit, the more times your credit bureau gets pulled and the lower your score will go : (
Now that you have some insider secrets, where is the best place to begin.
The first step is to call me for a FREE consultation at 604-273-2002. If I don't think I'm the right mortgage consultant to help you, I'll let you know immediately - fair enough.
You not only became our broker, but also our friend. It is not very often that someone in your field will put his clients first, but from the first day you thought only of our needs. You were always very informative, patient and totally understanding. You were always there when we needed sound financial advice regarding our old mortgage and helping us to compare numbers for which was the best one to go with. You detached yourself from your business role and became not only our mortgage consultant but also our friend. ~ M. & B. Montgomery
Question: What effect will the HST have on a house buyer’s decision making?
The HST will mean higher final costs for some new home buyers, namely those purchasing more expensive new homes. The final impact, however, will not be as large as the additional 7% provincial portion of the HST.
The province is providing a $20,000 rebate to offset the impact of the HST. Taking the example of a new home priced at $550,000, the additional HST will be $18,500 (7% of the price less the $20,000 rebate).
This, however, is not the net result. When the HST comes into effect, PST will no longer be charged on all the materials used to build the house. The BC Ministry of Finance estimates that this ‘embedded PST’ amounts to 2% of the final cost of a new home. With the HST in place, builders will realize these savings and be in a position to reduce selling prices accordingly. In this example, the embedded PST amounts to $11,000. Therefore with PST removed, the net tax increase from the implementation of the HST on a new $550,000 home will be an additional $7,500 in tax.
The reason we can be confident the savings will be passed on in your question when you suggest that, given the (tax inclusive) price difference between a new and used home, “buyers will flock to buy used homes.” It is precisely this difference that will act as a powerful incentive for builders to pass on the PST savings so that their homes are as competitively priced as possible.
It should be noted that the home building industry believes the 2% figure is too high and that embedded PST in a new home is actually around 1.6%, meaning somewhat smaller savings and price reductions. The home building and real estate industries are currently working with the provincial government to explore measures to reduce the tax impact of the HST. One proposal is a higher rebate threshold or at least a rebate that recognizes regional price differences. Another option would be to phase out the property transfer tax on new homes.
“Your Personal Mortgage Consultant….For Life!”
PS - Please Don’t Keep Me a Secret A REFERRAL is when you INTRODUCE someone you care about to someone you TRUST!
Since I am the “finance guy”, close friends asked me to look at their credit card statement. My friends had reason to be extremely upset.
My friends typically pay their bills on time, however the payment was mailed and ended up being two days late. the card company (Bank) charged $7.40 in interest for a two-day late payment of a huge amount of interest on an amount due on the statement of less than one hundred dollars. My friends immediately called the bank. The Bank kindly reminded them that if you are late paying the balance on the statement they charged interest on all purchases made since the billing date of the original amount due. For clarity, that means if your payment in full is received by the them two days late, and you had added $1000 in additional purchases before you get your next statement, they charge you interest on the additional $1000 for the entire period plus the original amount due. My friends asked me to review their cardholder agreement and in fact it does allow them to charge interest this way, however consider how much interest they would have been dinged for if they had just put that new wide screen TV on their card.
What makes this particular instance more interesting is that they had checked their account balance on-line the day they wrote the cheque and had included payment for their new purchase up to the date they had wrote the cheque. Not only had the card company charged them interest for the period from the date of the new purchase to the date they had received payment they also charged interest on those paid for purchases for nine additional days to the next billing date as if they had not received the money. I prepared an Excel spreadsheet and calculated the actual interest based on their current account balance. For that nine-day period the interest is not the 18.5% the card company claims it to be on the statement. The actual interest for that period worked out to be 92.4% per annum. My friends faxed a memo to the card company asking why they were charged this interest for the period of time the amount due was already paid. The bank has responded offering to reverse the credit charges as a good will gesture because the account is normally kept current, yet were silent about charging interest on the paid amount.
The point of this email is to remind everyone just how the credit card companies’ policies are usurious and the drastic effect that can have on your wallet. If you were late on a small amount and then charge a significant purchase to your card it would incur a substantial interest charge that is totally inappropriate. We know the governments will not fix this. Maybe it is time for the consumers to protest by boycotting one specific card company for an entire month. We would pay our accounts on time, however we would not use their card to charge anything for that month. That would hurt them where they pay attention. It might even cost the Vice-President of that division his/her huge annual bonus!
What are your thoughts?
Mark Fidgett | 604-273-2002
"Your Personal Mortgage Consultant....For Life!"
PS - Please Don't Keep Me a Secret A REFERRAL is when you INTRODUCE someone you care about to someone you TRUST!
It was a little less than a year ago that the global financial crisis began to hit home, which is to say that mortgage rates spiked higher.
Now, the cost of mortgages is coming down. If you’re buying a home or renewing a mortgage, it’s time to review your options at www.notapennydown.com
Fixed-rate mortgages declined a little last week, but the most dramatic changes can be seen in variable-rate mortgages. For the first time in almost a year, it’s possible to get a variable-rate mortgage at the prime rate used by most major financial institutions, which is currently 2.25 per cent.
Pre-crisis, variable-rate mortgages came with discounts that ranged from 0.75 percentage points to as much as 0.9 points off prime. By late last fall, crisis conditions prompted lenders to start charging prime plus a full percentage point or more. Now, some lenders are starting to unwind their crisis-rate premiums.
Variable-rate mortgages are all over the map right now, but we have a few at prime with some lenders.
Can variable-rate mortgages fall back to their pre-crisis lows any time soon?
I think NOT and we may even see them dip below prime.
If you’re carrying any high interest debt this is a great time to look at the following strategy
A man fills out his SuperEnalotto lottery ticket in a shop in central Rome on August 12, 2009. Italy's lottery prize has risen to a world record-breaking 131.5 million euros (186 million dollars) since no ticket holder claimed the winning numbers. No-one in the country has had the six winning numbers in the SuperEnalotto game since January, which has caused this year's prize to break World records. The lottery has also attracted interest from neighbouring countries and visitors have reportedly come to Italy to place their bets in the hope of choosing the right six numbers.
Photograph by: ANDREAS SOLARO, AFP/Getty Images
ROME — A betting frenzy among Italians is set to continue after the record-breaking state lottery again failed to produce a winner on Tuesday, sending the jackpot up to almost 144 million euros ($203.6 million).
No-one has picked the winning 6-number combination since January and the rising jackpot has tempted unprecedented numbers of Italians to take their place in queues for tickets at bars and tobacconists to try to land the life-changing prize.
The SuperEnalotto jackpot, at 143.9 million euros, is the biggest ever in Europe and has even drawn tourists from neighbouring countries across Italy's borders to try their luck.
A phone-in contest in Germany offered the winners 140 free return airline tickets from Berlin to Milan's Malpensa airport to play the lottery, the popular daily Bild reported.
The jackpot has not been won since Jan. 31, despite draws being held three times a week, every Tuesday, Thursday and Saturday.
However the SuperEnalotto already has one big winner -- the hard-pressed Italian Treasury, which has seen lottery money go some way to compensate for a slump in tax revenues as Italy grapples with its worst post-war recession.
The Treasury will keep about half of more than 2 billion euros of bets laid since the last jackpot in January.
The rest is paid out in winnings and divided between ticket vendors and lottery organiser Sisal SpA.
The SuperEnalotto fever saw monthly bets on the game rise to 441 million euros in July from a more usual 200 million euros as Italians, lured by the massive prize, are clearly happy to spare the minimum of one euro for a lottery ticket.
Betting rose a further 67.8 percent in the first half of August from the same period in July, and has risen 13.2 percent in the last week from the week before, Italian state television RAI reported on Tuesday.
The World Lotto Corporation (WLC) is an official European lottery site and platinum marketing partner of Europe's most respected lottery organisation, the International Lottery in Liechtenstein Foundation (ILLF), which launched the world’s first Internet lottery, PLUS Lotto, in 1995. WLC was established to provide customers with secure access to play lottery games that offer the opportunity to win millions. The larger Jackpot prizes are insured by a Lloyds of London broker to ensure guaranteed Jackpot prize payouts.
As a portion of every ticket you purchase goes to support charitable and worthwhile causes worldwide, WLC thanks you for your support. Read more...
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
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