Interest rates continue to stay down in the high 6's and low to mid 7's depending on the loan size, the time of the lock commitment, and weather you want to pay points or not. I don't think that I have ever seen them so low for so long.

The constant uncertainty of whether the Fed's are going to raise rates or not has left all of us with an uneasy feeling as to what is really going to happen. As a result, the majority of my clients are choosing to lock as soon as they possibly can or when they like the current rate or feel comfortable with the payment they want. No more waiting for the rates to hit the bottom.?

Back in January the rates were great and then jumped almost over night and many of the refinances had to wait for this period of time to get them back down again. Now we are back to where they were then and in some cases even better.

The "firm adjustables" as they are being called, 3/1, 5/1, 7/1, 10/1 aren't necessarily a lot lower than the 30 years fixed rate loans are, but they do make a difference if you are pretty sure that you are not going to be in the property for much longer than that specific time frame. Many of my first time homebuyers who plan on moving up in a short period of time are using these to close their purchases and keep their payments down.

15 year fixed rate loans are doing well with those individuals who desire to retire in approximately 15 years and want to own the home free and clear when that Blessed time comes. Or for some, it is a forced savings if they want the equity to build fast. Rates are tremendous. The alternative is to just have me do an amortization schedule for you with the current balance of your mortgage and just pay the difference on a monthly basis as you can. That way it is not forced and if needed you can cut back for a month or two to pay for an unexpected emergency and then just go right back to it the next month. It's amazing how just that little bit of money every month can save you literally thousands of dollars over the life of the loan.

Computer technology and the "FICO" scores being newly used in Mortgage Lending is continuing to be a double edged sword. For individuals who have very high scores, and are pristine in their clean and limited use of credit, there is very fast approvals and exceptional rates to go along with it, and rightfully so. But for those who have neither clean credit or are high users of credit, or individuals who for whatever reason have less than perfect, or flawed credit, there is much more reason to take action if possible, as soon as possible, to get the problems fixed and pray for an early repaired score, because the interest rates and terms will be much less desirable if left unchanged.

It is becoming increasingly harder for individuals with low scores, under approximately 620 to get desired loan rates that are quoted daily in the newspapers. Everything is more and more "Risk management" so that the lending institutions can get the most yield for their money. More and more, getting a home loan will be determined by your individual credit history, as they determine your score to be, with proprietary information that they refuse to let us know. Gone are the days of a client asking, "What is your rate today?"

The rates will no longer be "set." We will need to run a credit report on you instantaneously be- fore we can even ascertain what type of quote to give you, or if we can even give you a loan at all.

You might have paid every single payment on time and still not get a reasonable loan because you have too much credit usage. The balances are too high to the credit limits. So what is one to do? 

First, make sure that if you have any outstanding balances that are unpaid charge-offs or delinquent balances, that you pay them off and be sure to get receipts and letters that they will remove the derogatory credit item, if they will. Once a letter is in hand, never, never give it away to anyone. Give out copies and keep the original in a safe place where you will not loose it.

Second, if you have any accounts that are opened and you don't use very often, close the account and then check back to make sure that they really closed the account. Also be sure that the creditor cleared up any inaccurate information with the three major repositories, TRW, Equifax, and TU. Typically they fail to go back and make the information correct. Ultimately it is YOUR responsibility to make sure that it is accurate, not the Repositories. 

Third, keep only a few major credit cards with relatively high credit limits but keep the balances owed as low as possible or pay off monthly. Try not to use finance companies such as Morris Plan, Beneficial Plan, etc. That will cause your scores to go lower. Also, put your credit charges on the best of the Visa's etc, rather than using department store cards.

Fourth, keep your inquiries to a minimum! Any time you have someone run a credit report on you, it affects the score downward. As an example, I pulled a report up on a client and we inadvertently put the last four numbers of the phone number in place of the last four numbers of the social security number. We had to run it over again to make it right and it lower the score by over 5 points. And that was an accident. There was no way to correct it or change it. What an eye opener that was for me as a loan officer of 23 years!!!

You can get your own credit report by writing the various bureaus and in some cases paying a small fee so that you can check and see if the report is accurate, but they will not let you see the actual "FICO" score. That's for "our eyes only." How ridiculous. I can see what they are, but you can't know your own score. I would like to do whatever I can to change that little rule! Just like it used to be when you couldn't even see your own appraisal when you were the one who paid for it. Well, we at least know there can be changes with lots of work and lobbying.

I will continue to give you updates as things change. God Bless and if I can be of any assistance to you or your friends and family, give me a call! I appreciate the opportunity to work with you and them.