+ 100% FREE
+ Unlimited Credit Reports
+ Unlimited Credit Scores
+ Credit Monitoring Protection
+ Credit Improvement Tips
+ Automatically Finds Savings
No credit card needed
This card was excellent.
I've had a Capital One credit card for sometime now, and they have always been very easy to deal with. I originally went into a branch location to put in my application, and I received my card in the new few days. Their online service is easy to use, and straightforward. I've only had to go back into a branch one, when my card cracked. It was replaced promptly and I got back to using it as normal. Great company to get a credit card with.
I've been a Bank of America customer for a few years now. On the whole they've done a good job, but I was unhappy when I heard my account would have a monthly fee tagged onto it. When I called their customer service asking about the new fee, their representative calmly explained that I would likely have to pay the new fee, but he wasn't sure. The uncertainty really bothered me, I called to get a simple answer, instead I was left more confused than before with no clear way to find out what I needed to know.
GEICO has been very easy to work with. My monthly rate has been very, very low; even after shopping around I didn't find another company who offered even close to the rate I was getting. Service has been very efficient; each time my policy has come up for renewal I've received a notice a month in advance with clear instructions on how to renew. So far, so good, I have no complaints on GEICO at all.
On average, a mortgage broker will get paid somewhere between 1% and 2% of the total value of the loan, which can obviously be a substantial sum. Brokers collect their income in a variety of different ways, and some of the most common fees are listed below:
If you do choose to use a broker, you should be direct and ask what types of fees your broker charges. A trustworthy broker will usually be forthcoming, letting a borrower know just how much they will make off of a loan. Less scrupulous brokers might jack up a borrower’s interest rate and load the loan with extra fees. As with any product shopping around among different brokers is your best protection.
When pricing a mortgage broker, a borrower will generally have to choose between paying higher upfront costs or paying a higher interest rate over the life of their loan. The decision for most borrowers will come down to how long they expect to maintain their loan. If they are expecting to keep a loan for its full course, then paying more upfront for a lower interest rate might make sense. If they expect to refinance, then lower upfront fees might make better sense, so that they won’t have wasted thousands of dollars paying for a loan that lasts only a few years.
The ultimate question you have to ask yourself is if a broker is really worth the cost. And while that’s a question you’ll have to answer yourself, people often use them if they:
If you need a little bit more information about mortgage brokers you might read ‘Why Use a Mortgage Broker’, but in the end you’ll have to make the decision yourself.
The price of a land survey varies considerably based on the type of survey you have conducted and the amount of time a surveyor will have to spend at your property. You should expect to pay somewhere between three hundred and a few thousand dollars. The two primary types of surveys differ mostly on the amount of detail that goes into their reports:
The price of a survey also depends on the features of your property:
Since you are purchasing the home, I would encourage you to try and negotiate for the seller to pay for the survey. In bad housing markets, where the seller has few or no offers, many will be willing to foot the bill for a survey if it means keeping a prospective buyer. Press the homeowner, and you might just be able to save yourself a little bit of money.
A title search on its own generally will cost you somewhere between $100 and $250, though that number varies by location, company and whether the title search cost is baked into a package deal.
There are several ways you can try to lower the cost of a title search; the most obvious being a simple comparison among title professionals such as title companies, mortgage brokers, real estate attorneys and real estate agents in your area.A lesser known strategy is to contact the company that currently holds the title insurance policy on the home in question; since they still have the old title search on file, they will often offer you a lower price or they might give you a better title insurance policy at the same price.
As you probably already know, most mortgage lenders will require a new title search on any property you hope to buy.A properly conducted title search will establish an unbroken chain of ownership going back 40 to 60 years, depending on your local requirements.This chain is important because any improper transfer of property will void the entire line of ownership, and the title could revert back to its last legal owner.A title search will also show any outstanding debts on the property including mortgages and liens and any back property taxes owed by previous residents.Knowing these details in advance is important because if you end up buying a home with old debts, you become responsible for paying them.
Most companies that offer title searches also offer title insurance, which is a product that can protect you in case their search was incomplete.Your lender will also likely require you to take out a title insurance policy before they will offer you any financing.In most cases, a basic title insurance policy will protect only your lender in case there is an ownership dispute in the future; if you lost the home in a dispute, the typical title insurance policy would pay off your mortgage but offer you no compensation.Many title companies will offer owner title insurance policies that protect not only a lender, but the homeowner too, though these policies are more expensive than a basic plan.
Who pays for a title search is also not necessarily set in stone.The buyer of a home traditionally pays for a search, but if your housing market is in particularly bad shape, you might be able to convince the home owner to pay up for a search themself.Most will be reluctant to do so, but depending on your circumstances, you just might be able to save a few hundred dollars with good negotiation.After all, your lender will only require that a new title search be conducted on property, and they will rarely be adamant about who must conduct it.
Transfer taxes are any type of tax charged when the title of a property changes hands. For types of property that require a legal title (like real estate, bonds, or stocks) there is usually a surcharge by the state or local government to process the change. The federal government also charges transfer taxes, through estate and gift taxes, but these are far less common than the real estate transfer tax that you are likely to face.
Location is vital to figuring out how much transfer tax you will have to pay. Each state charges a different amount, as does every county. Some charge nothing, others have simple flat fees, and a few charge exorbitant percentages (2.65% in certain parts of New York). Finding out yours should not be difficult, your local real estate agent or the attorney used in closing should know your local area’s rates.
Transfer taxes are usually assessed on the sale of the property; however, in most locations it is not set in stone whether the buyer or the seller must pay. All that is required is that a payment must be made to the governments involved, which is why transfer taxes usually become a negotiating point during closing. In strong markets, usually the buyer pays the tax, since the seller can choose between multiple buyers until they find one who will pay. However, in today’s typical real estate market, the seller ends up paying the tax because they simply do not receive many offers, and must take what they can get. There are some locations that dictate who must pay the tax; in that situation your only wiggle room will be risking a higher asking price to cover the tax.
In general most home appraisals cost somewhere between $325 - $450. However, home appraisal costs vary depending on several different factors about the property.
If you take out a government loan like those from the FHA, VA, or USDA, you will likely be required to take out mortgage insurance, which these agencies refer to as a Mortgage Insurance Premium (MIP).You will usually have to make two different payments for mortgage insurance, one upfront at closing and the other on a yearly basis.Both payments are tax deductible, though the rules for each are different.
The most important consideration is when you took out your loan.During the Great Recession, Congress temporarily made mortgage insurance payments tax deductible starting on loans made in 2006 or later.However, they did not renew the deduction for 2012, and there has been no indication that they intend to do so.As it stands, if your loan was taken out between 2006 and 2011, then mortgage insurance payments made during that time frame can be tax deductible.
The next important restriction is how much you make each year.If you and your spouse make less than $100k combined ($50k for single filers), then you are entitled to deduct the full cost of your mortgage insurance. However, for every $1k dollars over that limit you are, you lose 10% of your deduction, meaning if your joint income is more than $110k, you cannot make any deductions for mortgage insurance.
The complications with MIP come from the upfront payment you must make at the loan’s closing.Since this payment is meant to cover a portion of your mortgage insurance payment over the life of the loan, you can deduct only a proportional amount of it each year.To find out how much you can deduct for this upfront payment, first divide the total amount of your payment by the length of your loan in months.For instance, if you paid $5k upfront for a 15-year loan (180 months), then you could deduct $27.77 dollars per deductible month.The next step is to figure out how many deductible months you have.Since the mortgage insurance deduction was only allowed between January 2007 and December 2011, count every month you’ve had your loan for during that period. Continuing the above example, if you took out your loan in January 2008, you would have 48 deductible months, and could deduct $333.24 per year for the upfront payment.
Like with any other potential tax deduction, you have to itemize your taxes to benefit from the MIP tax deduction.To figure out if this is a good idea, you should add up your potential deductions (mortgage interest, mortgage insurance, etc.) and make sure they are larger than the standard deductions allowed currently ($11k for couples, and $5.5k for single filers).If your itemized deductions are not larger, then it will not benefit you to itemize your taxes, making the mortgage insurance deduction worthless.
Yes, a second mortgage holder can foreclose, even if you are current on your first mortgage. Just like any type of loan, if you are behind on your payments, the lender has the legal right to take whatever property was offered as collateral on the loan. In the case of a second mortgage, that means they have the right to foreclose on the house and sell it to recoup their losses. However, in many cases second mortgage holders are might not do so because there might not be any money left for them after the sale of the home.
When a house is sold by a lender there is a significant amount of expenses that need to be paid (real estate fees, taxes, etc.) before any monies can go to paying off mortgages. After taking care of expenses, the mortgages will be paid off in order of priority; until the first mortgage is fully paid off, the second mortgage holder will not receive any funds. This situation where a home is worth less than the mortgages held against it has become very common after the Great Recession.
That’s why second mortgage holders are far more likely to negotiate and work with a borrower to arrange a new payment plan. If you are behind on a second mortgage, simply communicating with your lender can often save your home. With good communication, even serious problems like losing your job or medical issues may be handled so that you can keep your home, and avoid a foreclosure. However, if the borrower has a track record of late payments, or a bad credit history a lender might not be willing to negotiate a new repayment plan. Still, explaining your financial situation honestly to your lender is your best protection against second mortgage foreclosure.
A credit report contains basic information from four broad categories: personal information, credit history, public records, and credit inquiries. The type of record determines how long the record stays on your credit report; positive information will remain on your record indefinitely as long as there has been activity on the account within 7 years, while negative information varies.
Credit History: Your credit report will contain your pay history, credit limits, and other information about all of your accounts with financial companies like:
Especially important on your credit history is any history of defaults, in general this type of information will remain on your credit report for seven years since the last activity on those accounts. These include:
Public Records: Public records that reference your finances will be kept on your credit history. The time negative information takes to expire varies:
Inquiries: “Hard” credit inquiries, those made by companies evaluating you for new loans, remain on your credit report for two years. Having too many credit inquiries can damage your credit rating and history.
Reviewing your credit report regularly can save you huge headaches down the road. If you discover incorrect information there is a simple dispute process to get it removed from your credit report. That process and the steps a credit reporting agency must take are spelled out here.
1. What is a credit score?
Your credit score is a number that lenders and creditors use to quickly evaluate whether or not they should extend credit to you. It’s how you can get pre-approval letters for credit cards, car loans, student loans without ever filing out an application. Credit scores are creating using a mathematical formula, which assigns value to different things like timely payments, bills being sent to collections, or bankruptcies, etc.
2. Your Credit Score Helps Determine Interest Rates
You probably don’t need to be told your credit score is important, but most consumers don’t realize just how much it can cost or save them. Your credit score is often the deciding factor in how much interest a lender will charge you, for instance a borrower with a score in the lowest range might have to pay 4% or more extra interest on a loan. If that was on a $200000, 30 year mortgage, the lower credit score borrower would have to pay back $175,462.90 extra in interest.
3. What is factored into a credit score?
There are many different credit scoring systems out there today: each of the three major credit reporting agencies has their own score, while a number of other small agencies operate independent systems. These smaller systems might specifically target how you have managed rental and lease payments, while others look at your telecommunications payment histories. The major agencies, however, agree on the basic components of your credit score, but they weight each one differently. The most common components are listed below in order of their importance:
A. Payment History – The most important piece of your credit score is how you’ve handled your bills in the past. Prompt, timely payments will raise your score significantly, while regularly missing payments or being late will cause it to fall. Having any of your account sent to collections or declaring bankruptcy can wreck your credit score for years. Your most recent information is given extra weight, while older accounts and payment histories are less important.
B. Total Debt and Available Credit – the next most important part of your credit score is how much total debt you have, compared to how much credit you have available. To keep their score high, a consumer needs to both keep open lines of credit, while not getting close to their maximum credit limit. The actual amount of debt you have is less important than how it compares to your income and your maximum available credit.
C. Length of Credit History – simply put, the longer your active accounts have been open, the more valuable they become. Creditors are evaluating how much money they could potentially make by lending to you, so having a long, stable history makes you more appealing to them.
D. Types of Credit – having a wide variety of different types of accounts will raise your credit score. For instance a consumer who has successfully managed a mortgage, a car loan, student loans and credit cards will appear more appealing than a consumer than only has used credit cards.
E. Credit Inquiries – A small component of your credit history, how many credit applications you’ve filled out recently will impact your credit score. This is especially important for a consumer that is already close to reaching their maximum credit limit. There is an exception for consumers who are obviously shopping rates for mortgage, car loans, etc.
What is a loan to value ratio?
Your loan to value ratio (LTV) is a number used by mortgage lenders to figure out how much money they can lend on a particular property based on the home’s appraised value. A lender will take their loan to value ratio and multiply it by the value of the house, which becomes the maximum amount they will lend on that property. For instance if a home was worth $200,000 and the lender used a loan to value ratio of 80%, then they would be willing to loan $160,000 on the home.
The loan to value a lender will use depends on several things:
How does loan to value work?
For most residential mortgages, lenders would like to give new loans using an LTV of 80%, however, an LTV of 90% is the most common seen on the market today. A higher loan to value ratio is riskier for a lender because it means the borrower has less invested in the property. As such a lender is only willing to extend a loan with a higher LTV ratio to someone with better credit or someone willing to pay for mortgage insurance.
Despite mortgage lenders reluctance, there are many mortgages given at very high loan to value ratios. For instance, some FHA-backed loans have an LTV ratio of almost 97%, meaning the borrower only has to place a 3% down payment. However, this type of FHA loan comes with a steep up front mortgage insurance premium, monthly mortgage insurance payments, and requires a special type of home inspection.
How to calculate your loan to value ratio?
To find the original loan to value ratio that your lender used on your home, you’ll need to find out how much your home was appraised at when you purchased it. Then you’ll need to find out the original value of your mortgage. Once you’ve got those numbers, you can find your LTV ratio by dividing the original amount of your mortgage by the original value of your home. The resulting number is the loan to value ratio your lender used when evaluating your mortgage.
Using the above example:
For a home worth $200,000 with a $160,000 mortgage;
160,000/200,000 = 0.8, or 80%
If you want to find the loan to value ratio than a lender is using for a new purchase or for a refinance, you can simply ask your loan officer and they will be able to provide you with the highest LTV ratio their bank is willing to accept for a person with your credit profile.