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Ellie Kravets' Blog

By Ellie Kravets, Realtor, ABR | Agent in San Francisco, CA

Mortgage Rates Low, Tips To Qualify

Mortgage rates continue to remain low despite a recent slight increase. The 30-year fixed rate increased just a bit at the end of November but that comes on the heels of setting a record low of 3.31 percent. The 30-year fixed rate is still lower than it was this time last year, when it was at 4 percent.

While many people are taking advantage of the low rates and either refinancing or shopping for a home, some are finding it difficult to qualify. The tightening of credit and the increased lending restrictions have made the effort to get a new mortgage a headache for some.

The good news is there are tips to help you qualify for a mortgage. Here are a few that you should consider before you head to the bank or a mortgage company.

Get your finances in order. Know your financial situation. That means not only your income, spending, debt, but also your credit status. In a downturned economy many crooks are looking for ways to make a buck and they're coming up with more scams that can negatively affect your credit. Debit and credit card skimming is one way that thieves are stealing credit card numbers and then charging up expenses on the stolen account. Even if you never lost your credit/debit card, that doesn't mean you're safe. It can happen when you use the card at a store, restaurant, or other retail outlet.

If your bank is on the ball, it will alert you, maybe even before you realize your card has been compromised. This is why credit reports can offer valuable information before you apply for a mortgage. Getting your credit report and reviewing it carefully provides you with the opportunity to see if there are errors or problems that need correcting.

Reduce your debt. This is a tough one. A lot of people are refinancing because they're hoping to get funds back to help them do this very thing, lower their expenses and reduce what they owe. However, if you carry a high debt, you'll have trouble refinancing or getting a mortgage to buy a home.

The optimal thing to do is to start conserving and looking for ways to save. It's not about how much you make, but how much you save that can help you find ways to reduce your debt.

Look for expenses to cut. Many people are opting to no longer use phone landlines or even cable. If you're working a lot and you don't watch much TV, cut the line. News and other features you watch on TV can also be accessed online on your computer. Keep only what's necessary. Sustainable living and conservation are becoming very popular. Check with your local utility company to see how you can reduce power usage in your home. Start by unplugging electrical appliances that aren't in use. These appliances, when plugged into an electrical outlet and even though not in use, use electricity which translates to you having to pay more on your utility bill for energy you're not even using.

Get educated. The loan terms and restrictions change all the time. Meet with qualified expert professionals to help you through the process. Just because you don't qualify today doesn't mean it will always be that way. Find out what you need and can do and start moving toward your goal. Sometimes the best thing you can do is gain knowledge. The information that you get from real estate professionals will allow you to develop a plan to achieve success.

Don't give up. The difficult economy has been discouraging but situations change and more opportunity will come. Be patient. Seek advice. Stay informed. Follow your plan, even if at first it seems like a long-shot before you'll get your goal.

by Phoebe Chongchua


By Torang | AATRealty,  Mon Dec 10 2012, 13:35
great info.

By Ellie Kravets, Realtor, ABR,  Mon Dec 10 2012, 14:05
You are welcome! And thank you for visiting my blog, Torang :)

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