About Mortgage RefinancingMortgage refinancing generally refers to the process of taking out a new home mortgage loan and using some or all of the proceeds to pay off an existing mortgage (or mortgages) on the property. No-cash-out refinancing occurs when the amount of your new loan doesn't exceed your current mortgage debt (plus points and closing costs). With this type of refinancing, you may be able to borrow as much as 95 percent of your home's appraised value. | |
| Should you Refinance? Refinancing can often save you money over the life of your mortgage loan. However, this savings comes at a price. Typically, you'll need to pay an assortment of up-front fees, including points and closing costs. Some lenders often advertise "no points, no closing costs" refinancing deals, which roll the costs into your overall loan balance or charge a higher interest rate. However, a good interest rate and low fees aren't the only factors to consider. You'll also want to make sure you are satisfied with your current mortgage lender before refinancing elsewhere. Are there any tax issues to consider? For federal income tax purposes, you are generally able to deduct qualified interest you pay on a mortgage to buy, build, or improve your home, provided that the mortgage is secured by your home and meets certain dollar limits. This is known as "home acquisition indebtedness" for tax purposes. Interest on new debt you incur to refinance your home acquisition indebtedness also qualifies, but only up to the amount of the refinanced debt. Reasons to refinance:
An old rule of thumb said that you shouldn't refinance unless interest rates are at least 2 percent lower than the interest rate on your current mortgage. However, even a 1 to 1.5 percent differential may be worthwhile to some homeowners. Actually, a number of factors enter into the decision of when to refinance. The length of time you plan to stay in your current home, the costs associated with getting the new loan, and the amount of equity you have in your home must all be considered. Ultimately, it makes sense to refinance if you're certain that you'll be able to recoup the cost of refinancing during the time you own the home. So, it's important to do the math ahead of time and calculate your break-even point (the point at which you'll begin to save money after paying fees or closing costs). It is often considered ideal if you can recover your refinancing costs within one year or less.
Copyright © 2004 - 2007. DirectLendingSolutions.com | |
Sunday, May 20, 2007
About Mortgage Refinancing
Understanding Credit Reports and Rebuilding Bad Credit
 | By Credit Repair Institute Published: July 17, 2004 |
1. What role do credit bureaus play in an individual receiving credit?
As we Americans sink further into debt and rely on lines of credit for our very livelihood, we become increasingly at the mercy of the gatekeepers of credit: the credit bureaus.
The American economy is highly dependant on credit and the ability to purchase goods that are otherwise unavailable to consumers on a cash basis (e.g., car and house). Presently, the average consumer has three credit cards and has about $4,000 worth of debt. In total, Americans are three trillion dollars in debt. There are thousands of credit bureaus in the United States, but the following three are by far the most prolific in reporting our credit worthiness: 1) TransUnion; 2) Equifax; and 3) Experian (formerly known as TRW).
Each of these credit bureaus has in its databases credit histories for tens of millions of Americans. The information is gathered and given to the credit bureaus from creditors that have extended you credit in the past, such as landlords, credit card companies, the IRS, department stores, and banks. These histories contain information that creditors use to evaluate and make a determination of your ability and willingness to repay the credit. When a subscriber asks for your credit report, it receives information such as your open accounts, credit limits, and present balance. Also included is information on the number of delinquent payments, collection actions, tax liens, and whether you own your home.
2. What are the various negative marks that can appear on my credit and how bad are they?
The following is a list of most of the negative items that could appear on your credit report. They are listed in order of what many creditors would consider as best to worst.
- Credit inquiries
- Credit rejections
- Late payments
- Past due and unpaid payments
- Court judgments
- Collections
- Loan defaults
- Repossession
- Foreclosure
- Bankruptcy
3. How long does information stay on my credit report?
Delinquent payments: Even if you later pay off the account in full, payments to your creditors that are made over 30 days past due will remain on your credit report for three to seven years from the date you first missed your payment.
Collection accounts: After three months of payment delinquency, a creditor can turn your account over for "collections." Your credit report will reflect the collection activity for seven years from the time the first payment you missed was due that led to the collection. Even if you pay off the account after collection activity has commenced, your credit report will still be marked for seven years, but may say "paid collection."
Inquiries: Inquiries are notations in your credit report marking a request by an entity to view your credit report. For example, when you fill out an application for a credit card, the credit card company asks the credit bureau for a copy of your credit report, creating an inquiry notation on your credit report. Most inquiries remain for two years. Note that too many inquires on your credit report can reduce your credit rating.
Charge-offs: These occur when a creditor decides that for whatever reason it would rather write off your debt as a loss than attempt to collect it from you. Such charge-offs remain on your credit for seven years from the time of the first missed payment that led to the charge-off.
Bankruptcy: Chapter 7, 11, and 12 bankruptcies stay on credit for 10 years from the date of filing. Chapter 13 bankruptcy stays on your credit for seven years after the discharge, which is usually three to five years after filing.
Exception: Note that there is a major exception to the above time frame. If you're applying for life insurance for over $50,000 or for a job that pays over $20,000, a credit bureau may provide information that is over 10 years old.
4. I have bad credit, do I have to wait 7-10 years before I can get a loan?
Although negative information stays on your credit for up to 10 years (for exception see #3 above), by following the principles and techniques provided by this web site you can have an "A rated" credit report within 2 years of even a bankruptcy. Creditors are much more interested in your present circumstances than what happened to you 4-10 years ago. Therefore, rebuilding your credit can be done relatively quickly through a systematic plan and a little perseverance. Also, keep in mind that positive credit information stays on your credit report indefinitely.
5. How does a creditor decide if you're "creditworthy?"
By knowing how a creditor will evaluate you, not only is the mystery removed from the process, but more importantly you can take affirmative steps toward improving your "credit profile" and increasing your chances of getting your credit approved.
When you apply for credit by filling out an application, normally the application provides the creditor with permission to retrieve your credit report from a credit bureau. Once your credit report is retrieved, the creditor assesses your credit worthiness based on both objective and subjective criteria.
Many lending institutions will employ a short-term debt-to-income ratio where they calculate your present short-term debt payments (i.e., excluding long-term debt such as a mortgage) and divide it by your total annual income. Generally, creditors will not lend to you if your short-term debt is more than 20 percent of your annual income.
Similarly, a potential creditor will add up all your monthly bills not including rent/mortgage and utilities and divide by your gross income (before taxes). When using this analysis, creditors are looking for a ratio of under 35%. By consolidating your debt you can usually lower the amount of your monthly payment (even though your debt doesn’t change). This way you can decrease your ratio and increase your chances of procuring credit.
6. What are common objective criteria creditors use to qualify me for credit?
In addition to these common ratios, most lending institutions employ their own version of a credit worthiness scoring system where they assign your credit information points based on objective criteria. Common criteria include the following:
- Number of years at your present job: creditors believe consistency makes you a better credit risk (this also applies to numbers 6 and 7 below).
- The kind of work you do with the following from least to most desirable: 1) manual work, 2) clerical, 3) self-employed, 4) managerial, 5) professional.
- The number and nature of the "blotches" on your credit history. The following are the worst blotches to have roughly in this order: 1) bankruptcy, 2) charge-offs, 3) collections, 4) court judgments, 5) IRS liens, 6) 120 days late payment, 7) 90 days late payment.
- The amount of credit you presently have. Here, they are concerned about how much debt you could go into if you maxed out your present cards. Many times, creditors will judge you as if you had already maxed out your available credit cards. It is a good idea to look through your credit report and find the credit card accounts that you no longer want (e.g., department store cards) and cancel them.
- Savings and/or checking account with lender.
- Telephone in own name.
- Length of time at present address.
- Own your home.
7. When trying to get approved, should I apply for as many credit cards as possible?
Although this practice may be tempting, avoid it, as it decreases your chances of getting approved. For one thing, many creditors will look at your total unused credit line on all of your cards. For example, if you have the ability to charge $40,000 on your credit cards, but in fact only owe around $1,000, a potential creditor may look to the $40,000 spending power as if you already owed that money in deciding whether to give you additional credit.
Also, when you apply for credit, the card issuer requests a copy of your credit report. These requests show up as inquiries on your report. Since creditors assume that many of the inquiries on your report have resulted in credit being extended to you, they may refuse to grant you more credit based on this assumption. Alternatively, they may assume that since there was an inquiry and no new account was issued that a creditor must have turned you down for credit. Thus, based on this inference, subsequent creditors are more likely to turn you down.
Tip: Before applying for credit to several different creditors within a short period of time, find out the credit bureaus to which each one subscribes. This way you can spread out your inquiries and avoid having too many on one report for it to be a basis for denial. Remember that the credit bureaus don’t normally share information with each other.
8. What if I’m turned down for credit?
By law the creditor must do two things along with your rejection letter: 1) provide you the specific reasons why you were rejected; and 2) provide the name and address of the credit bureau used to make the decision.
If the reason the creditor gives for your rejection sounds inaccurate, immediately get a copy of your credit report from the same bureau that the creditor used and closely scrutinize it for errors. If you find an error, follow the steps below to have the erroneous information removed or explained. Next, reapply to the same creditor attaching an explanation and an updated/corrected copy of your credit report.
If you were rejected based on accurate data, you may still appeal the rejection by sending a letter to the creditor explaining why you are a better credit risk than your credit report may indicate. However, most likely you will have to follow certain steps to rebuild your credit before they will approve your application. The good news here is that if you follow the steps outlined by us, creditors will be begging you rather than vice versa.
9. Can I get a free copy of my credit report?
If you have been turned down for credit within the last 30 days based on a report issued by a credit bureau, that creditor must inform you of that fact and provide you with the name and address of the credit bureau. By law you can get a free copy of your credit report if a potential creditor used that credit bureau's report to turn you down for credit, employment, or insurance within the last 30 days.
Experian seems to extend this period to 60 days. I personally received all three credit bureau reports just by writing in (without being denied credit within the last 30 days). It seems that if you write in to all three credit bureaus, there is a very good chance that at least one credit bureau will provide you with a free report, but they are under no legal obligation do so.
The following are the addresses and phone numbers of the major nationwide credit bureaus:
Trans Unio
Customer Disclosure Center
P.O. Box 390
Springfield, PA 19064-0390
(800) 851-2674
Experian
P.O. Box 2104
Allen, TX 75013-2104
(800) 392-1122
Equifax
P.O. Box 105252
Atlanta, GA 30348
(800) 997-2493
If you have been turned down for credit within the last 60 days, call the phone numbers provided and order that way. Otherwise, you can see if they will send you a report simply by writing.
10. When writing in for a credit report, what information should I include?
If you're writing in you must provide the following information:
Full name
Current address
Previous address if moved in the last 5 years
Social Security number
Date of birth
Copy of your valid drivers license, billing
statement, OR utility bill with your current
address clearly marked
Signature
If you have a letter turning you down for credit within the last 30 days, include it. Within 10-30 days of writing in, you should receive your report(s).
mproving Your FICO®
Improving Your FICO®
http://www.myfico.com/CreditEducation/ImproveYourScore.aspxIt’s important to note that raising your score is a bit like losing weight: It takes time and there is no quick fix. In fact, quick-fix efforts can backfire. The best advice is to manage credit responsibly over time. See how much money you can save by just following these tips and raising your score.
Payment History Tips
- Pay your bills on time.
Delinquent payments and collections can have a major negative impact on your score. - If you have missed payments, get current and stay current.
The longer you pay your bills on time, the better your score. - Be aware that paying off a collection account will not remove it from your credit report.
It will stay on your report for seven years. - If you are having trouble making ends meet, contact your creditors or see a legitimate credit counselor.
This won't improve your score immediately, but if you can begin to manage your credit and pay on time, your score will get better over time.
Amounts Owed Tips
- Keep balances low on credit cards and other “revolving credit”.
High outstanding debt can affect a score. - Pay off debt rather than moving it around.
The most effective way to improve your score in this area is by paying down your revolving credit. In fact, owing the same amount but having fewer open accounts may lower your score. - Don't close unused credit cards as a short-term strategy to raise your score.
- Don't open a number of new credit cards that you don't need, just to increase your available credit.
This approach could backfire and actually lower score.
Length of Credit History Tips
- If you have been managing credit for a short time, don't open a lot of new accounts too rapidly.
New accounts will lower your average account age, which will have a larger effect on your score if you don't have a lot of other credit information. Also, rapid account buildup can look risky if you are a new credit user.
New Credit Tips
- Do your rate shopping for a given loan within a focused period of time.
FICO® scores distinguish between a search for a single loan and a search for many new credit lines, in part by the length of time over which inquiries occur. - Re-establish your credit history if you have had problems.
Opening new accounts responsibly and paying them off on time will raise your score in the long term. - Note that it's OK to request and check your own credit report.
This won't affect your score, as long as you order your credit report directly from the credit reporting agency or through an organization authorized to provide credit reports to consumers.
Types of Credit Use Tips
- Apply for and open new credit accounts only as needed.
Don't open accounts just to have a better credit mix - it probably won't raise your score. - Have credit cards - but manage them responsibly.
In general, having credit cards and installment loans (and paying timely payments) will raise your score. Someone with no credit cards, for example, tends to be higher risk than someone who has managed credit cards responsibly. - Note that closing an account doesn't make it go away.
A closed account will still show up on your credit report, and may be considered by the score.
Three Steps to a Better Mortgage Rate
Three Steps to a Better Mortgage Rate
Before you apply for a mortgage, there are three key things you can do to lower your rates and get a better deal. Reducing your mortgage rate by just one percent can save you thousands of dollars! Credit.com gives you the information you need to maximize your home financing.
Step 1: Understand and improve your credit
Your credit reports and credit scores are a major part of your mortgage application. A mortgage lender will usually check all three of your credit scores – based upon data from Equifax, Experian, and TransUnion – and use the middle score to calculate your rates. A credit score over 650 will help you get good rates on your mortgage. Having an even higher credit score (750 or above) can lower your rates even more.
If your credit score is below 650, you can try to give it a quick boost by:
- Reducing your credit card balance below 35% of the credit limit
- Keeping your accounts stable
- Making all of your payments on time
- Avoiding unnecessary applications for credit
- Correcting negative inaccuracies.
Checking your credit reports and scores 3-6 months before a mortgage application will ensure that you have enough time to fix any problems you find.
Step 2: Reduce your debts
Mortgage lenders look at your debt-to-income (DTI) ratio to determine how much you can afford to borrow. This ratio is calculated by dividing your monthly pre-tax income by the amount you use to pay off debts such as auto loans, student loans, and credit card balances each month. Your credit card payments are calculated in this formula as the minimum payment required, not the amount you usually pay each month.
Borrowers with a debt-to-income ratio below 30% will have an easier time getting a good deal on a loan. If your DTI ratio is too high, you should consider paying off some small loans (such as electronics or personal loans) or credit card balances before you apply for a mortgage. Don’t close the credit card accounts when you pay them off, however. Closing credit accounts can damage your credit score. You can also improve your DTI by increasing your income. Usually, this is done by co-signing with a spouse.
Step 3: Improve you loan-to-value ratio
Your down payment amount is the third key element the interest rate calculation process. In the loan world, your down payment is calculated by looking at your loan-to-value (LTV) ratio. Lenders calculate your LTV ratio by dividing the amount you are asking to borrow by the price of the home you want to buy. If you are buying a house for $100,000 and want a mortgage for $90,000, your loan-to-value ratio is 10%.
Ideally, lenders look for borrowers with an LTV over 20%. However, many borrowers these days only put down a 5% down payment or obtain special financing with a no-down payment loan. It’s especially common for first-time borrowers to buy a home with little or no down payment. If your LTV is below 20%, you will probably be expected to pay private mortgage insurance on your loan. You can improve your LTV ratio by increasing your down payment or choosing a less expensive home to purchase.
These three improvements can help you save big on your home loan. Reducing your interest rate by just one percent can translate into thousands of dollars in savings over the life of the loan. As part of your loan preparation, you can also use Credit.com’s free online mortgage calculators to easily estimate how much you can afford to borrow, what rates you deserve, and what kind of loan is best for you. When you are ready to apply for a loan, you can apply here for no- obligation loan offers from competing lenders online. A home is often the largest purchase people make in their lifetime. Credit.com wants to help you make this important process as easy and as affordable as possible.
Five Steps for Improving Your Credit Rating
Five Steps for Improving Your Credit Rating
Blemishes on your credit report can cost you, but don't despair. It's never too late to become credit worthy. You just need to get started, using our five steps for improving your credit rating, and remember that results won't happen overnight.
1. Order you credit reports
Find out what the top three credit bureaus (Equifax, TransUnion and Experian) are saying about you. And remember that your information on file is likely to be at least slightly different at each one. Since credit reporting is voluntary, creditors aren't required to report to all three bureaus, but most large national lenders do. However, smaller lenders will typically report only to the one to which they also subscribe for pulling reports. Therefore, it is preferable to order a three-bureau, merged credit report or all three individually from www.annualcreditreport.com. Credit reports should be reviewed at least twice a year for accuracy.
If you've been denied credit, insurance or employment because of your credit report, you are entitled to a free copy of your report from the reporting agency the lender/insurance company used. The company you applied to must supply the credit bureau's name, address and telephone number. You have 60 days after receiving the denial notice to request your copy.
2. Examine your reports carefully
Nearly one-third of credit reports contain serious errors that could cause consumers to be denied access to mortgages, car loans and credit cards. That's because credit bureaus don't verify the information they receive from your creditors. Like it or not, keeping your credit report clean and true is your job. Once you get your three reports, look carefully for everything from typing errors to outdated and incomplete information. Make a thorough list of items you dispute and why.
If the negative information in your report is true, only time and improved habits can change that for the better. Late payments and charged-off accounts remain on your report for seven years, bankruptcies for 10 years. Most creditors, however, look for a steady pattern of payments rather than focusing on one-time or rare occurrences, so consistent on-time bill payments will improve those blemishes.
3. Dispute and document
Since a bad report can cost you money, it pays to be thorough. You can either complete the dispute form provided with your credit report or write a letter. Clearly identify each mistake and state why it's wrong. One recommendation is to send a photocopy of your credit report with the mistakes circled to the reporting credit bureau with copies of your supporting documents.
Keep copies and records of all the forms, letters and documentation that you send the credit bureaus, plus dates sent. In short, document, document, document. The credit bureau must investigate any relevant dispute within 30 days of receiving your letter. Any item that is not verified as accurate by a creditor is removed. If the credit bureau makes any changes to your credit file, it will send you the results along with a free, updated copy of your credit report. Once a negative item is removed from your report, the credit bureau cannot put it back on unless a creditor verifies its accuracy and completeness after the fact -- and sends you written notice.
4. Dissolve your debt
The next task is to devise a spending plan that reduces your debt and allows you to pay on time, all the time. If you're having difficulty making payments, be proactive. Call your creditors and negotiate with them to keep your accounts current and not be reported as delinquent or "bad debt." You can ask for reduced monthly payments, or even change due dates to balance out your monthly bills. The same strategy can be used for fixed-loan payments, but it should only be used for the short-term. You'll pay more interest to extend the repayment schedule, but it allows you to stay current and save your credit rating. Use the extra money to pay off debts one at a time, gradually increasing payments to other debts.
Slowly phase out the use of unneeded credit card accounts. But remember to NOT CLOSE THE ACCOUNT. Simply stop using it and pay it off. If you make the very common mistake of closing accounts you will almost certainly negatively impact your credit scores, which strongly considers the ratio of total credit card debt to total available credit or credit limits. A good rule of thumb is to keep your revolving credit card debt to less than 10 percent of your available credit. However, it’s optimal if you keep your balances low so you can avoid revolving balances. This will save you the interest charges
5. Add stability to your credit file
You can also work to add positive information to your credit file. You may have been denied credit because of an insufficient credit file, even though you do have credit. That's because some creditors (local banks, credit unions, and travel, entertainment and gasoline card companies) may not report your credit history to the bureaus. Try asking the credit grantors to report your account information and monthly payment history to a credit-reporting agency. This is not a requirement and you will not be able to force them to do so. In the future, before opening a new account, ask if your on-time payments will be reported monthly to all three credit-reporting agencies. If the answer is “no” then think about using another lender who will.
If you have really bad credit or even filed for bankruptcy, don't let your credit status go dormant. The faster you jump back in and begin to re-establish good credit by paying regularly on time, the faster you'll improve your credit scores. A secured credit card offers those with no credit and those rebuilding their credit an opportunity to start over and establish a new and solid credit history. Shop around for the best deal available, but limit your applications. Credit scoring models look at how many new accounts you've opened, as well as the number of "inquiries" for those new accounts. A sudden flurry of inquiries can result in a lower score.
Friday, May 18, 2007
KPR
Sumber http://www.bankekonomi.co.id/pinjaman/kpr_i.html
Kredit yang diberikan kepada debitur yang ditujukan untuk pembelian atau renovasi rumah. Penarikan dapat dilakukan sekaligus (satu kali penarikan) atau bertahap dan pembayarannya diangsur bulanan dengan sistem angsuran (anuitas).
- Waktu : Lebih dari 1 tahun
untuk KPR maks. 12 tahun
untuk renovasi/refinancing KPR maks. 5 tahun
- Pemakaian kredit : Non Revolving
- Tujuan penggunaan : Pembelian rumah pertama (rumah baru/lama)
- Resiko kredit : Langsung (Direct)
- Jenis komitmen : Committed
- Cara penarikan : - Sekaligus / bertahap
- Cara pembayaran : Sesuai tabel angsuran/cicilan yang ditentukan
- Jumlah pembayaran : Sesuai pembayaran dengan tabel angsuran yang telah ditentukan.
- Jumlah suku bunga : Dapat berubah setiap saat
- Mata uang : IDR
Ketentuan
- Rumah yang dibeli telah dilengkapi sertifikat pecah per kavling dan IMB (kecuali pengembang yang bekerjasama dengan Bank Ekonomi)
- Debitur memiliki rekening tabungan atau giro di Bank Ekonomi WNI, menikah, usia minimal 21 tahun, maksimal 55 tahun
- Nilai pinjaman minimal sesuai kebijakan Direksi Bank Ekonomi
- Pemberian KPR untuk rumah bekas hanya untuk yang memiliki Sertifikat minimal HGB dan memiliki IMB.
- Tidak dianjurkan untuk lease back rumah yang telah dibeli, kecuali dalam bentuk pinjaman yang lainnya.
- Surat keterangan diri debitur dan atau pemilik rumah yang dijaminkan serta sertifikat yang bersangkutan dan IMB harus lengkap dan diklarifikasi dahulu keabsahannya.
- Debitur menandatangani perjanjian kredit atau pengakuan hutang surat Kuasa Memasang Hak Tanggungan, Akta pemberian Hak Tanggungan, surat aksep dan surat atau akte lainnya.
- Pelunasan sebagian fasilitas kredit dapat dilakukan setiap saat setelah pinjaman berjalan minimal 6 bulan dan dikenakan biaya administrasi.
- Pelunasan seluruhnya sebelum jatuh tempo dikenakan biaya administrasi.
- Debitur harus menempatkan asuransi jiwa kredit dan jaminan harus diasuransikan melalui bank.
- Jaminan harus ditempatkan ke APHT (Akte Pengikatan Hak Tanggungan)
- Debitur diwajibkan menempatkan dana sebesar 1 x angsuran direkening yang bersangkutan di blokir, dana ini dipergunakan untuk keperluan darurat jika debitur menunggak angsuran atau biaya lainnya.
sign in
Wow, seneng juga akhirnya bisa sign in di blooger.com
Maklum ane khan kerja di industri yang suka ngasi kredit.... yach itung -itung share my pengetahuan , kali-kali ada manfaat-nya ...
Sekarang Sabtu malem jam 10.10 waktu di Bogor West Java, hujan gerimis wuah kagak ada habisnya nich hujan.....dari jam 16.00 petir juga ada guaddddee banget. iichhh serremmm.
