Tax Refunds: Your Savings & Down Payment Secret Weapon

Tax Refunds:  Your Savings 

& Down Payment Secret Weapon

Socking away money for any reason is no small fete these days ...  


But when the savings are for the purchase of a home ... especially if your first home, the act of saving money can seem even more challenging ... and take on an even higher importance.  

The act of obtaining the "golden carrot" of homeownership can become all-consuming and almost a life-altering spiritual journey.  As a result, the journey can seem  overwhelming at times and become even a bit frustrating for some.

As a Loan Originator, I know I can sound a bit like a broken record.  But seeking advice and having a preliminary conversation with a mortgage lender (well in advance of starting a home search) provides a defined path of action and valuable help in achieving your down payment goals.  

Knowing what kind and how big of a down payment you will need can speed your goal of home buying along ...  

Through that conversation, you also give yourself a more clear and precise financial target.  You clarify what financing options are available to you, which is most quickly achieved, and which will benefit you the most.  That's unbelievably valuable and can help relieve some of the stresses associated with saving for a down payment.

Plus ... a Lender will help you assess your credit standing.  They'll also go over your finances with you in order to make sure that both finances and credit are at optimum advantage, both in the long and short term.  

Here are some examples of how a Lender can help.  They can:

• Get you on-track for savings 
• Reveal errors on a credit report
• Help establish a vigorous plan for addressing debt
• More ...

Truth is, there are many "tools" and resources economically and easily available to home buyers and those hoping to save money.  If you conduct a quick search, you'll find that the internet is full of helpful informational sites offering saving and budgeting tips, calculators, education, and more to help you achieve your goals.   

But right now ... at tax time ... there is one resource available to you that may provide you a larger chunk of savings.  It can help move the goal post of homebuying closer to reality ...  

That's your tax refund ...

If you're someone receiving a tax refund this year,  you've got funds already "saved" and available for down payment use.  

This is an often-overlooked bonus associated with tax refunds and one that can help make saving for a down payment immensely easier.  Your tax refund is a mandatory "built-in" form of saving for many hoping to buy a home and many of my clients have used it successfully to do just that.  

Another "bonus" of tax time shouldn't be overlooked ...  

That is that immediately following the filing of your taxes, your Federal Tax Return (which is a required portion of application paperwork along with all Schedules, W-2's, 1099's and IRS confirmation regarding those figures via tax transcripts) are easily found and provided to a Lender for mortgage pre-qualification and approval.  Makes for perfect timing. 

However, an aggravating and persistent myth regarding down payment continues.  Many potential home buyers still believe it.  The myth is  particularly pernicious, as it keeps too many from reaching out to a lender for the facts regarding home buying and financing.  

That myth?  

That you need a 20% down payment to buy a home!  It's simply NOT true ...

Many options for low-and-no down payment mortgages are available.  Those include: 

• 3.5% Down Payment FHA loans 
• 0% Down Payment VA loans (Qualified Veterans) 
• 3% Down Payment Conventional loans 
• 0% Down Payment USDA loans (Eligible Applicants – Eligible Locations)
• Many States/local municipalities have Grants or resources available for Borrowers in need of Down Payment Funds  

It also must be pointed out that down payment funds are allowed from many and varied sources.  A home buyer doesn't have to go it alone.  They can receive "assistance" in this regard.  

Some of the sources available include:

• Gifts from relatives
• Loans from Retirement Funds
• Life Insurance Policies with Cash Value
• Stocks
• Bonds
• Inheritance
• Traditional Sources of Savings, Checking, Mutual Funds, Money Market Accounts, and documentable  Bonuses from Employers

So I ask ... 

• Are you currently trying to save money for a down payment on a Chicagoland - IL or WI home?  
• Are you thinking that you might like to buy a home at some point in the future?  

Talk to a Lender ASAP!

The info your lender you receive will be specific to YOU and YOUR individual finances and needs.  It will be a roadmap to successful saving, buying, and financing.  

There's no doubt in this day and age that each can be challenging.  So why not secure the help and counsel you need to smooth your path at the earliest possible time?  

I (and most lenders) provide this information and assistance at no cost.  So don’t give up.  Don’t get discouraged.  

Take action.  Reach out to me or your own local lender today.  Tax Time and your Tax Refund make it the perfect time and your super-weapon for success ...

* Are you dreaming of buying or refinancing a home or Investment Property in New Lenox - Will County - Chicago - Chicagoland - IL/WI?

Contact me today! I'll put my 40 years of mortgage experience and expertise to work on your behalf.
I'm easily found at:

Gene Mundt

Mortgage Originator - NMLS #216987 - IL Lic. 031.0006220 - WI License #216987

American Portfolio Mortgage Corp.

NMLS #175656

Direct: 815.524.2280

Cell: 708.921.6331

eFax: 815.524.2281

gmundt@goapmc.com

www.genemundt.com

          

       

Gene Mundt, Mortgage Originator, an Originator with 40 years of mortgage experience, will offer you exemplary mortgage service and advice when seeking:  Conventional, FHA, VA, Jumbo, USDA, and Portfolio Loans in
Chicago and the greater Chicagoland region, including:
The Lincoln-Way Area, Will County, (#New Lenox, #Frankfort, #Mokena, #Manhattan, #Joliet, #Shorewood, #Lockport, #Crest Hill, #Plainfield, #Channahon, #Bolingbrook, #Romeoville, #Naperville, etc.), #DuPage County, the City of #Chicago, Cook County, 

and elsewhere within IL & WI.  

Your Referrals & Testimonials are Greatly Appreciated!

Financial Markets and the Mortgage Process: What You Need to Know

Financial Markets and the Mortgage Process:

What You Need to Know

The speed and ferocity with which the financial markets have been moving as of late have been mind-boggling ...  

Even consumers that are typically only casual observers of the financial markets, not participants in them, are aware of the market's recent erratic and volatile behavior.  Reports of the markets are everywhere.

The level and the speed of the changes taking place have been alarming ... so much so that the trading markets have actually shut down twice (so far).  

Hopefully, brighter and calmer days are ahead.  But until that takes place, special precautions and actions by those in and entering the mortgage process ... and their lenders and real estate team ... are needed.

One such way that special precautions can be taken is for borrowers (first-time and step-up) taking actions to proactively prepare and plan prior to their entering the home buying/mortgage process.  Doing so heads off a myriad of issues and problems.  

Mortgage Lenders can play a big part in this, and as a result, I've addressed and written on the topic countless times before.  But now, because of the market's most recent behavior and the votality presently being experienced, I'm adding a special appeal to all my clients (and all consumers) currently in mortgage processing ... plus those hoping to enter it in the future.  

Again, I offer this additional word of caution and appeal as a result of the drastic and swift pace in which the markets are presently changing ... and how those changes can affect a prospect's mortgage approval, interest rates, and monthly payments.  

My plea?

Please ... stay engaged and respond quickly to all questions and correspondence from your lender and real estate team.

With the market in its current state ... time and the timing of a response are absolutely critical.  Hesitate or wait hours to reply to a request or communication?  Things could change dramatically for you.

I had two applicants learn that the hard way just yesterday.  Both saw doors of opportunity close and their interest rate fluctuate higher in a matter of hours.  

And while it's true that there are times that a lender can intercede on a client's behalf, there are other times when that is simply not possible.  Answers and confirmations are needed to facilitate actions.


Such was the case with both of these clients.  Time will tell if market corrections occur and assist them moving forward.

It is always important for borrowers to stay engaged, focused, and participatory during their mortgage process.  But right now?  It's imperative.

So heed this plea and stay available.  Stay in touch with your lender.  

Educate yourself ... prepare ... discuss ... pre-plan ... and stay as accessible as possible throughout the entirety of your mortgage process.  

Be ready to make decisions and act quickly.  Your financing experience will go much more smoothly and successfully ... and you may save yourself big money.

* Are you dreaming of buying or refinancing a home or Investment Property in New Lenox - Will County - Chicago - Chicagoland - IL/WI?

Contact me today! I'll put my 40 years of mortgage experience and expertise to work on your behalf.
I'm easily found at:

Gene Mundt

Mortgage Originator - NMLS #216987 - IL Lic. 031.0006220 - WI License #216987

American Portfolio Mortgage Corp.

NMLS #175656

Direct: 815.524.2280

Cell: 708.921.6331

eFax: 815.524.2281

gmundt@goapmc.com

www.genemundt.com

          

       

Gene Mundt, Mortgage Originator, an Originator with 40 years of mortgage experience, will offer you exemplary mortgage service and advice when seeking:  Conventional, FHA, VA, Jumbo, USDA, and Portfolio Loans in
Chicago and the greater Chicagoland region, including:
The Lincoln-Way Area, Will County, (#New Lenox, #Frankfort, #Mokena, #Manhattan, #Joliet, #Shorewood, #Lockport, #Crest Hill, #Plainfield, #Channahon, #Bolingbrook, #Romeoville, #Naperville, etc.), #DuPage County, the City of #Chicago, Cook County, and 

elsewhere within IL & WI.  

Your Referrals & Testimonials are Greatly Appreciated!

What to Expect From the New FICO 10 Scoring Model

What to Expect From the New

FICO 10 Scoring Model

Hotter temperatures aren't the only thing that will soon be rolling in.  A hot new FICO Scoring model will also make its entrance at some point during the upcoming summer months ...

A new credit scoring model isn't that surprising of a development.  Since its inception in 1989, FICO Scoring has evolved and changed many times.  

This new and latest version, called "FICO Score 10 and FICO Score 10 T", is to be released to credit bureaus this coming summer or early fall.  It will feature some broadened elements to the calculation of credit scores.

The latter version ... FICO Score 10 T ... will utilize what is called "trended data".  As the tag-name suggests, this scoring model will use a wider scope when taking consumers' financial actions into account.  Trended data reveals just how a consumer uses their money and the credit they have available to them.

FICO Score 10 T will analyze and weigh:

• A consumer's credit habits
• HOW consumers utilize their monies to address their debt(s)
• HOW account payments were made over a 2-year period (thus establishing a trend)
• Delinquencies (if any), will be weighed more harshly than in the past
• The RATIO of Debt Utilization VS Available Credit
• The LENGTH of a consumer's credit history
• Personal Loans, often seen as riskier, will now be flagged and considered
• The "cocktail" or mix of your credit usage 

Just how much benefit a consumer realizes (or doesn't) from this new credit scoring model will be mainly dependant on how they've handled their credit/debt over a trended data 2-year window.  

• If a consumer has managed their credit/debt well, utilized lesser amounts of available credit, and avoided payment delinquencies ... they may see a small modest boost in their credit score
• If a consumer struggles with the management of their credit/debt, has higher credit utilization ratios (higher balances), or has late/missed payments ... they will most likely see a drop in their credit score

When a consumer may see a change or benefit from the new scoring model is also dependant on many things.  That's because there are so many older versions of FICO Scoring available and still in use. 

It's quite feasible that an applicant might receive a lower score from one lender using the new "FICO Score 10 T" model ... and not run into issues when applying for a new loan or home mortgage from other lenders.  

Why?  Those Lenders could still be utilizing an older credit-scoring model that would award the applicant a higher score.  This aberration might occur until all lenders are using the newer FICO scoring model.

But until that time, most mortgage lenders continue to use credit-scoring models that are mandated Fannie-Mae and Freddie-Mac compliant.  They do this because they "sell" their loans to these government-sponsored enterprises (commonly known as GSE's).  These enterprises guarantee loans in the secondary market.

Both Fannie-Mae and Freddie-Mac require that an available or usable score is utilized during the underwriting process for loans.  Most mortgage lenders currently receive their "usable" credit scores from the 3 major credit bureaus ... Experian, TransUnion, and Equifax.  And as of this writing, all three (3) of the credit bureaus are still using an older FICO Scoring model, not the latest/new version(s).  

With so many credit scoring models out there and being used, it's easy to understand why consumers get somewhat confused and maybe even a bit frustrated when trying to learn their credit scores.  In today's world, a consumer can ... at the same time ... carry one credit score via a credit card company, have another score reported to them by an auto dealer, and still a third set of scores utilized by their mortgage lender when applying for a home loan.  

Again, this is the case because each entity is using a different scoring model.  This is an issue and conversation often raised by my clients when they're applying for their mortgage.  And while I agree it can all be a bit confusing, the advice I offer on this matter never waivers.

Especially for those hoping to secure a home loan in the near future, their focus needs to remain steadfastly on the credit scores I'll use as their mortgage lender.  They are the only ones that matter during the time of application.  

In order to determine what those important credit scores are, home buyers and those hoping to refinance need to get out ahead of the mortgage application process.  Planning and preparation needs to be completed.  

Hopeful buyers and applicants should always:

• Check their credit well in advance of application.  (6 months to a year is recommended)
• Get a FREE credit report at:  annualcreditreport.com  (Free reports can be performed every four months, if staggering requests to the major credit bureaus)
• Thoroughly review their report for errors and correct them, should they appear
• Focus on reducing the ratio of debt held
• Reduce spending, when and where possible
• Pay all bills on time
• Don't apply for new debt
• Do NOT close old accounts out
• Hold a preliminary conversation with a Mortgage Lender
• Develop and maintain good credit practices

Benjamin Franklin once said, “By failing to prepare, you are preparing to fail.”

Ben was one smart man, especially as it pertains to mortgage application.  Preparation is key to the success you'll find and the ease and fluidity with which you'll find it.

Plan and prepare well and it will not matter which scoring model is being used.  You will successfully reach your financial goals ...

* Are you dreaming of buying or refinancing a home or Investment Property in New Lenox - Will County - Chicago - Chicagoland - IL/WI?

Contact me today! I'll put my 40 years of mortgage experience and expertise to work on your behalf.
I'm easily found at:

Gene Mundt

Mortgage Originator - NMLS #216987 - IL Lic. 031.0006220 - WI License #216987

American Portfolio Mortgage Corp.

NMLS #175656

Direct: 815.524.2280

Cell: 708.921.6331

eFax: 815.524.2281

gmundt@goapmc.com

www.genemundt.com

          

       

Gene Mundt, Mortgage Originator, an Originator with 40 years of mortgage experience, will offer you exemplary mortgage service and advice when seeking:  Conventional, FHA, VA, Jumbo, USDA, and Portfolio Loans in
Chicago and the greater Chicagoland region, including:
The Lincoln-Way Area, Will County, (New Lenox, Frankfort, Mokena, Manhattan, Joliet, Shorewood, Lockport, Crest Hill, Plainfield, Channahon, Bolingbrook, Romeoville, Naperville, etc.), DuPage County, the City of Chicago, Cook County, and 

elsewhere within IL & WI.  

Your Referrals & Testimonials are Greatly Appreciated!