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Showing posts from December, 2017

Get A Mortgage Despite Student Loan Debt

Many college grads put off buying a home simply because they face mountains of student debt. The amount people owe on student loans has increased astronomically in the past decade, breaking the $30,000 average per borrower in 2014. While many grads feel they can’t afford a home until they finish repaying these loans, but that isn’t actually always the case. In many instances, individuals and couples who owe student loans can still qualify for a mortgage. Take Stock of Finances & Calculate Your DTI One way lenders calculate whether you can afford a mortgage loan is by looking at how your total debt would compare to your current monthly income. This is known as your debt-to-income (DTI) ratio. Most lenders use a DTI threshold of 36%, meaning your payments on your debt, including student loans, credit card debt, and a mortgage, should be less than 36% of your total monthly income. For instance, if your total income each month is $5000 and you make payments of $250

Credit Reports…Credit Scores…Good Credit…Not So Good Credit

Q:   How important is my credit when applying for a mortgage? A:   VERY! And here is why. What is a Credit Report? According to annualcreditreport.com , it is an organized list of information related to credit activity.   What does this mean? Well, the three credit reporting agencies, Experian, Equifax and TransUnion, receive the information from businesses that lend to you.   These businesses report things like: the date the loan began the original amount of the loan current balance current payment history   This information is reported to one or more of the three credit reporting agencies and is put into an organized list that reflects your borrowing activity. Where does my score come from? The information from your credit report is fed into a mathematical formula that analyzes your information and generates a score.   This score indicates how likely you are to pay your bills in the future.   The mathematical formulas for each of the credit reporting agenci