Real Estate Investing
“Real estate investor seeks apprentice, 10k a month.” This might sound familiar to some- the token real estate investing advertisement feeding off the ideas of those wanting a piece of a lucrative industry. And it’s well-founded! Real estate investing is a very profitable business but only to a very lucky few does it come in the form of a simple phone call. Investing in real estate requires knowledge and fervor in order to make a serious return. The savvy investor will take advantage of the tools available and exercise every entrepreneurial bone in their body.
There are several avenues to take within the rather large realm of real estate investing. Whether you execute more traditional types of real estate investing such as buying low and flipping or investing in tax liens, there are several profitable routes to take. Another trend forecasted for the coming years is the rise of foreclosure investing. With all the resources available online, foreclosure investing is much easier than once considered. Some services contain listings for foreclosures and tax liens making them a one-stop real estate investment shop.
One truth is that real estate investing will always be a safe bet. With current savings rates as low as they are most investors are scurrying for other investment opportunities. Despite current rumors of the real estate market’s supposed down turn, real estate investing sill provides lucrative profits for those willing to do their homework. Sure, the real estate market may be slow but all these unfounded theories of a crash are better left on the prophesier’s tablet. Certain fluctuations in the real estate market are followed by subsequent market corrections. Whether the entire economy directs these fluctuations or they are triggered by some local cause, there are balances to come.
Look at Florida, for every 10,000 families that leave the sunshine state due to the battering of recent hurricanes there are 15,000 families willing to take their place and bask in the sun. Real estate like any other product of society is still subject to the basic laws of economics- supply and demand. As long as people are seeking to fulfill what Maslow considers one of the most basic and necessary needs then the housing market, and real estate investing, will certainly be a stable sanctuary for your money.
Wednesday, November 28, 2007
Friday, November 23, 2007
Black Friday Foreclosure Shopping
The foreclosure market continues to boom as no relief appears in sight for stretched subprime mortgage holders. As the economy shows more signs of a slowdown, this trend is likely to continue.
Although the real estate industry would prefer otherwise, foreclosures continue to make headlines. The latest data showed superficial relief, with September foreclosures down 8% from some 243,000 in August, but still more than double last year -- and still with more to come.
It may be a harsh analogy, but I often think of foreclosure buyers as the forest-floor ants consuming the dead wood to clean the forest.
That means three things. First, as I see it, the sooner we get through this credit mess, the better. Second, the faster properties get through the foreclosure process and find buyers, the sooner we'll get through the mess. So third, foreclosure buyers clean out the dead wood (I like) and get great bargains in the process (I also like).
I can save how much?
My recent column broadly covers the discount you can expect from market value if you buy a foreclosure. It varies by region, but using information published by real estate portal and foreclosure specialists RealtyTrac, I saw discounts ranging from 15% in Hawaii to 40% in Alabama, with 20% and 25% being a rule of thumb.
Not bad. So then the next question, incidentally raised by several readers, is "how do I find those bargains in my area?"
Finding the for sale signs
To locate specific foreclosures in your area, RealtyTrac is a good place to start. Visit the nations #1 site for foreclosures and find homes for half the price.
The site lists foreclosures by ZIP code and foreclosure stage, ranging from preforeclosure property to bank-owned real estate. It's a broad and fairly deep picture of foreclosure availability in your area.
Some have found RealtyTrac less than precise, as the task of keeping up with foreclosure listing activity across the company is large, to say the least. And to get specific information on the property, RealtyTrac requires a $49.95/month subscription after a seven-day free trial.
But realize that RealtyTrac sits behind other real estate sites, so sooner or later you'll probably run into RealtyTrac. If you're serious about foreclosure shopping, you might want to sign up.
Combining sources
If you aren't ready to make the financial commitment or "come out of the closet" as a registered foreclosure buyer, there are several other paths which work surprisingly well:
Bank sales. To their chagrin, banks and financial institutions are going into the real estate business in a big way. Too bad for them, but you can find a lot of bargains on their Web sites: Bank of America, Countrywide and U. S. Bank have good listings, to name a few. Countrywide, for example, has 300 listings in California alone priced under $170,000.
Agency sales. Banks sell their "REO" (Real Estate Owned) but often hire agencies to do the job. Such agencies include Keystone Asset Management, Lenders Asset Management Corporation and HomeEq Servicing. Some of these agencies may operate bank sites, so you may see a similarity.
Government and government-backed lender sales. Government agencies ranging from FHA and VA to HUD and the Department of Justice sell real estate, visible through a single portal. And government-backed Fannie Mae and Freddie Mac also operate sites. The variety of properties available is, shall we say, wide, but Fannie Mae in particular lists a lot of solid mainstream real estate values.
Auctions and auction houses. Local and regional auctions are becoming bigger as banks and others pile up inventory. A real estate auction specialist will announce an auction of dozens, maybe hundreds of properties in a large region or metro area. Auctioneers include Real Estate Disposal Corporation (REDC) and Williams & Williams. Experience helps in playing this game, although the auctioneer sites walk you through the process.
Local real estate specialists. A lot of agents know about action in a particular area and can hook you up with the sellers. Good agents have their eyes and ears to the ground at all times, and get tips and hear about stuff coming on the market. You can often Google "foreclosures (area)" to get local listings.
Don't forget: reward comes with risk
Remember that, while foreclosure properties often sell at a healthy discount, you may run into poorly maintained properties. There may be other foreclosures in the immediate area, hurting the quality and value of your investment. Double check other adjacent listings and visit the area if you can.
Remember: Good value investors buy assets at the right time in the right place at the right price. Real estate is no different.
Although the real estate industry would prefer otherwise, foreclosures continue to make headlines. The latest data showed superficial relief, with September foreclosures down 8% from some 243,000 in August, but still more than double last year -- and still with more to come.
It may be a harsh analogy, but I often think of foreclosure buyers as the forest-floor ants consuming the dead wood to clean the forest.
That means three things. First, as I see it, the sooner we get through this credit mess, the better. Second, the faster properties get through the foreclosure process and find buyers, the sooner we'll get through the mess. So third, foreclosure buyers clean out the dead wood (I like) and get great bargains in the process (I also like).
I can save how much?
My recent column broadly covers the discount you can expect from market value if you buy a foreclosure. It varies by region, but using information published by real estate portal and foreclosure specialists RealtyTrac, I saw discounts ranging from 15% in Hawaii to 40% in Alabama, with 20% and 25% being a rule of thumb.
Not bad. So then the next question, incidentally raised by several readers, is "how do I find those bargains in my area?"
Finding the for sale signs
To locate specific foreclosures in your area, RealtyTrac is a good place to start. Visit the nations #1 site for foreclosures and find homes for half the price.
The site lists foreclosures by ZIP code and foreclosure stage, ranging from preforeclosure property to bank-owned real estate. It's a broad and fairly deep picture of foreclosure availability in your area.Some have found RealtyTrac less than precise, as the task of keeping up with foreclosure listing activity across the company is large, to say the least. And to get specific information on the property, RealtyTrac requires a $49.95/month subscription after a seven-day free trial.
But realize that RealtyTrac sits behind other real estate sites, so sooner or later you'll probably run into RealtyTrac. If you're serious about foreclosure shopping, you might want to sign up.
Combining sources
If you aren't ready to make the financial commitment or "come out of the closet" as a registered foreclosure buyer, there are several other paths which work surprisingly well:
Bank sales. To their chagrin, banks and financial institutions are going into the real estate business in a big way. Too bad for them, but you can find a lot of bargains on their Web sites: Bank of America, Countrywide and U. S. Bank have good listings, to name a few. Countrywide, for example, has 300 listings in California alone priced under $170,000.
Agency sales. Banks sell their "REO" (Real Estate Owned) but often hire agencies to do the job. Such agencies include Keystone Asset Management, Lenders Asset Management Corporation and HomeEq Servicing. Some of these agencies may operate bank sites, so you may see a similarity.
Government and government-backed lender sales. Government agencies ranging from FHA and VA to HUD and the Department of Justice sell real estate, visible through a single portal. And government-backed Fannie Mae and Freddie Mac also operate sites. The variety of properties available is, shall we say, wide, but Fannie Mae in particular lists a lot of solid mainstream real estate values.
Auctions and auction houses. Local and regional auctions are becoming bigger as banks and others pile up inventory. A real estate auction specialist will announce an auction of dozens, maybe hundreds of properties in a large region or metro area. Auctioneers include Real Estate Disposal Corporation (REDC) and Williams & Williams. Experience helps in playing this game, although the auctioneer sites walk you through the process.
Local real estate specialists. A lot of agents know about action in a particular area and can hook you up with the sellers. Good agents have their eyes and ears to the ground at all times, and get tips and hear about stuff coming on the market. You can often Google "foreclosures (area)" to get local listings.
Don't forget: reward comes with risk
Remember that, while foreclosure properties often sell at a healthy discount, you may run into poorly maintained properties. There may be other foreclosures in the immediate area, hurting the quality and value of your investment. Double check other adjacent listings and visit the area if you can.
Remember: Good value investors buy assets at the right time in the right place at the right price. Real estate is no different.
Thursday, November 15, 2007
Is Flipping houses a lucrative investment?
Flipping houses is one of the most lucrative investment strategies you can make. I stress that statement with one caveat, though: You absolutely must do your due diligence and your homework before you invest. Contrary to conventional wisdom, the hardest part about flipping houses is not the financing. (That's actually the easy part, because you don't even need to use your own credit or your own money.) The hardest part is not even doing the actual rehab work to fix up the foreclosure property and getting it back on the market. The hardest part is not even the negotiation or the bidding process. If you've done your homework, negotiation is really a matter of having the interpersonal communications skills to convey to the seller that you want to help them out.
The hardest part about flipping houses is doing the research and making the determination whether or not a particular property is worth investing in. Once you make the decision to either pass on a particular house or to go forward with the negotiation process, it becomes a matter of statistical numbers, salesmanship, and a bit of luck.
Many a time have foreclosure real estate investors been burned by neglecting to do their homework before investing in a particular parcel of real estate. Novice investors have a tendency to get emotionally attached to particular deals for some reason. Perhaps they like the house. Perhaps they think this house is a guaranteed home run and will net them with a nice decent five- or even six-figure profit. But when they actually sign the paperwork and handover the money to do the deal, the nightmare begins.
The house may need far more repairs than originally anticipated, and the investor had not bothered to do a visual walk-through of the house, or did not buy the house with a low enough loan-to-value (LTV) margin to leave room for repairs before flipping it. Or, the house is in a neighborhood or market where homes are sitting for upwards of six months at a stretch before being sold, and the investor ends up making monthly payments on the house that eat into his or her profits, and ends up having to rent out the place for less than the monthly payments on the mortgage are.
The house may have had an encumbrance on it such as a judgment lien or a second or third mortgage, and the investor didn't bother to conduct a title search to ensure clean title.
Or quite simply, the homeowner just didn't do a CMA (comparative market analysis) properly and didn't buy the house at a low enough percentage below market value in order to make the deal profitable.
You may have heard the expression from various foreclosure gurus that you make your money on an investment when you buy it, not when you sell it. In other words, what that means is that you should only be buying assets that have equity that can be realized.
Research is one of the single most important aspects of the foreclosure investing business. When done properly, you will find riches beyond your wildest dreams. When done improperly, you are digging a deeper hole for yourself financially. I know from personal experience, having done foreclosure investing, the sad reality of this fact. As a rookie investor, my first couple of deals I barely made a few pennies on. I was lucky that I didn't end up losing my shirt. I walked away with a few bucks. This was because I hadn't done the math right in my calculations because more was owed on the house than I previously thought. On another deal, I ended up paying more in repairs than I had anticipated, because I had never been inside the house before the homeowner deeded the house over to me. But then on my next deals, because I had done my homework properly (having learned from my mistakes with my previous deals), I was able to get into deals with a much healthier profit margin. A healthy profit margin is very important to maintain when doing your calculations. You can almost always expect that, due to factors beyond your control, you have the potential to make less on a deal than the numbers tell you that you will on paper. If you think you will net $20,000 on a particular property, you might end up only making $10,000 or $15,000, or who knows, maybe even less.
That is why research is important. That is why it is important to use a reliable foreclosure listing service that provides reliable and accurate data. Yes I could go to the courthouse and research the deals myself, but rather than spend countless hours looking through files from 8am to 4pm on weekdays, I would rather use my valuable time to evaluate pre-researched deals, make go / no-go decisions on each deal based on the researched information, and then focus more of my time on the actual process of making offers. If you want to be a successful real estate investor, you will learn that if you want to do a volume of deals, you will need to outsource some of your tasks. The easiest one to outsource is the compilation of foreclosure listings and researching of the deals. (You don't have to train anyone to do it, because there are services out there that already do this for you.)
Learn more about foreclosures and get access to all the tools you need to get started investing today at http://www.thenoteservice.com
The hardest part about flipping houses is doing the research and making the determination whether or not a particular property is worth investing in. Once you make the decision to either pass on a particular house or to go forward with the negotiation process, it becomes a matter of statistical numbers, salesmanship, and a bit of luck.
Many a time have foreclosure real estate investors been burned by neglecting to do their homework before investing in a particular parcel of real estate. Novice investors have a tendency to get emotionally attached to particular deals for some reason. Perhaps they like the house. Perhaps they think this house is a guaranteed home run and will net them with a nice decent five- or even six-figure profit. But when they actually sign the paperwork and handover the money to do the deal, the nightmare begins.
The house may need far more repairs than originally anticipated, and the investor had not bothered to do a visual walk-through of the house, or did not buy the house with a low enough loan-to-value (LTV) margin to leave room for repairs before flipping it. Or, the house is in a neighborhood or market where homes are sitting for upwards of six months at a stretch before being sold, and the investor ends up making monthly payments on the house that eat into his or her profits, and ends up having to rent out the place for less than the monthly payments on the mortgage are.
The house may have had an encumbrance on it such as a judgment lien or a second or third mortgage, and the investor didn't bother to conduct a title search to ensure clean title.
Or quite simply, the homeowner just didn't do a CMA (comparative market analysis) properly and didn't buy the house at a low enough percentage below market value in order to make the deal profitable.
You may have heard the expression from various foreclosure gurus that you make your money on an investment when you buy it, not when you sell it. In other words, what that means is that you should only be buying assets that have equity that can be realized.
Research is one of the single most important aspects of the foreclosure investing business. When done properly, you will find riches beyond your wildest dreams. When done improperly, you are digging a deeper hole for yourself financially. I know from personal experience, having done foreclosure investing, the sad reality of this fact. As a rookie investor, my first couple of deals I barely made a few pennies on. I was lucky that I didn't end up losing my shirt. I walked away with a few bucks. This was because I hadn't done the math right in my calculations because more was owed on the house than I previously thought. On another deal, I ended up paying more in repairs than I had anticipated, because I had never been inside the house before the homeowner deeded the house over to me. But then on my next deals, because I had done my homework properly (having learned from my mistakes with my previous deals), I was able to get into deals with a much healthier profit margin. A healthy profit margin is very important to maintain when doing your calculations. You can almost always expect that, due to factors beyond your control, you have the potential to make less on a deal than the numbers tell you that you will on paper. If you think you will net $20,000 on a particular property, you might end up only making $10,000 or $15,000, or who knows, maybe even less.
That is why research is important. That is why it is important to use a reliable foreclosure listing service that provides reliable and accurate data. Yes I could go to the courthouse and research the deals myself, but rather than spend countless hours looking through files from 8am to 4pm on weekdays, I would rather use my valuable time to evaluate pre-researched deals, make go / no-go decisions on each deal based on the researched information, and then focus more of my time on the actual process of making offers. If you want to be a successful real estate investor, you will learn that if you want to do a volume of deals, you will need to outsource some of your tasks. The easiest one to outsource is the compilation of foreclosure listings and researching of the deals. (You don't have to train anyone to do it, because there are services out there that already do this for you.)
Learn more about foreclosures and get access to all the tools you need to get started investing today at http://www.thenoteservice.com
Monday, November 12, 2007
Secrets to Finding Foreclosure Deals
Secrets to Finding Foreclosure Deals
With experience comes knowledge. And Louis Butler certainly has the experience to give him ample knowledge about how to find foreclosure bargains. After purchasing more than 25 foreclosure properties in the Little Rock, Ark., area, Butler can spot a deal from more than a thousand miles away — literally.
“I don’t need a spreadsheet or software to spot a deal,” said the San Dimas, Calif., native who buys foreclosures in a town that is nearly 1,600 miles from where he lives and works. “I have a local real estate agent in Little Rock, and local title and loan people that help put together my foreclosure deals.”
Butler originally lived in the Little Rock area, so he knows the good locations and neighborhoods. He said he looks for properties with 30 to 40 percent equity. Then, he puts together wholesale deals that are 20 to 30 percent below market value in certain areas and zip codes that he is familiar with.
“I pencil it out, look at the comps, search for liens and rely on my local realtor to send me photographs,” he explained. “Then, I contact the owner and negotiate a price. A lot of my deals I don’t even inspect the property. I look at photographs sent to me from my realtor and study the comps.”
To accommodate his long-distance investing, Butler sometimes receives closing documents via overnight couriers and has to sign the documents and ship them back immediately. The mailing costs are a small price to pay for the benefits of investing in a market that produces so many good deals for him.
Targeting a less-expensive housing market across the country has helped Butler locate a plethora of bargain buys, but that’s not the only way to find great deals on foreclosures. There are as many strategies for finding great deals as there are foreclosure investors. Below are a few key strategy secrets from experienced investors across the country.
Handwritten letters stand out
While many investors use printed form letters to contact homeowners in default, investor Michelle Mangione relies on handwritten envelopes to drive her foreclosure business. Mangione’s letter-writing strategy got her the dream home she currently lives in four years ago when she first started investing in foreclosures. She purchased her Fallbrook, Calif., home in 2003 for $655,000. In March and April 2007, two homes down the street sold for more than $1.5 million.
“I target pre-foreclosures and send out handwritten envelopes with a form letter inside,” said Mangione, a licensed realtor who invests in foreclosures full-time. Mangione mails 500 to 1,000 letters at a time to homeowners in the early stages of default. Typically, she gets a response rate of about 1 to 3 percent per mailing. Many conversations with distressed homeowners go nowhere, she said. “When I get a telephone call back, then I check out the property and start the dialogue with the owner.”
Auction deals can amaze
Like Mangione, Michigan real estate investor Nancy Levin also purchased her dream home in foreclosure. Levin found a foreclosed home in an affluent Detroit community.
“The property was in pre-foreclosure when I first saw it online,” explained Levin. “I kept tracking it on the Internet. My agent didn’t even know the property was in foreclosure. Finally, it went to auction — and to my surprise — I was the only one who showed up at the auction. I paid cash at the auction and bought the house for $260,000.”
Levin said the 2,800 square foot Bloomfield Hills home, which appraised for $430,000, was totally remodeled and featured three baths and three bedrooms. She bought the redemption rights from the previous owner for another $20,000 and moved in.
“I got this place for a steal,” Levin said. “Right now, Michigan is foreclosure heaven. It’s raining foreclosures here. I’m looking to do another one soon. If I can find a deal like the one I’m living in, I’ll definitely buy it.”
Strike while the iron is hot
Glen Miller, a 39-year veteran of foreclosure investing, believes now is a great time to buy foreclosures.
“After I look at the properties on RealtyTrac, I then go the courthouse and look for properties that have low mortgage balances and I look for any outstanding liens,” said Miller, who currently owns 20 foreclosure properties in and around Vero Beach, Fla. Miller owns eight duplexes, four single family homes, a condo unit and has just flipped five foreclosures. Now, Miller is finishing rehabbing another foreclosure that he will sell soon.
“I’m putting on a new roof on this four-bedroom, two-bath home in Fort Pierce I bought for $60,000,” Miller said. “I’ll invest another $20,000 and put it on the market in the next three weeks and list it for $130,000. I should sell this one fast because the other homes on the market are listed for $160,000 and more.”
While there’s no one secret to buying foreclosure property at discounted prices, Miller and the other investors agree that it’s important that investors jump in and find out what works for their personality and target market. Once they find a strategy that works, investors should stick with it.
“You got to have common horse sense. This isn’t rocket science,” Miller said. “You just have get off your behind and go out and attack the market.”
With experience comes knowledge. And Louis Butler certainly has the experience to give him ample knowledge about how to find foreclosure bargains. After purchasing more than 25 foreclosure properties in the Little Rock, Ark., area, Butler can spot a deal from more than a thousand miles away — literally.
“I don’t need a spreadsheet or software to spot a deal,” said the San Dimas, Calif., native who buys foreclosures in a town that is nearly 1,600 miles from where he lives and works. “I have a local real estate agent in Little Rock, and local title and loan people that help put together my foreclosure deals.”
Butler originally lived in the Little Rock area, so he knows the good locations and neighborhoods. He said he looks for properties with 30 to 40 percent equity. Then, he puts together wholesale deals that are 20 to 30 percent below market value in certain areas and zip codes that he is familiar with.
“I pencil it out, look at the comps, search for liens and rely on my local realtor to send me photographs,” he explained. “Then, I contact the owner and negotiate a price. A lot of my deals I don’t even inspect the property. I look at photographs sent to me from my realtor and study the comps.”
To accommodate his long-distance investing, Butler sometimes receives closing documents via overnight couriers and has to sign the documents and ship them back immediately. The mailing costs are a small price to pay for the benefits of investing in a market that produces so many good deals for him.
Targeting a less-expensive housing market across the country has helped Butler locate a plethora of bargain buys, but that’s not the only way to find great deals on foreclosures. There are as many strategies for finding great deals as there are foreclosure investors. Below are a few key strategy secrets from experienced investors across the country.
Handwritten letters stand out
While many investors use printed form letters to contact homeowners in default, investor Michelle Mangione relies on handwritten envelopes to drive her foreclosure business. Mangione’s letter-writing strategy got her the dream home she currently lives in four years ago when she first started investing in foreclosures. She purchased her Fallbrook, Calif., home in 2003 for $655,000. In March and April 2007, two homes down the street sold for more than $1.5 million.
“I target pre-foreclosures and send out handwritten envelopes with a form letter inside,” said Mangione, a licensed realtor who invests in foreclosures full-time. Mangione mails 500 to 1,000 letters at a time to homeowners in the early stages of default. Typically, she gets a response rate of about 1 to 3 percent per mailing. Many conversations with distressed homeowners go nowhere, she said. “When I get a telephone call back, then I check out the property and start the dialogue with the owner.”
Auction deals can amaze
Like Mangione, Michigan real estate investor Nancy Levin also purchased her dream home in foreclosure. Levin found a foreclosed home in an affluent Detroit community.
“The property was in pre-foreclosure when I first saw it online,” explained Levin. “I kept tracking it on the Internet. My agent didn’t even know the property was in foreclosure. Finally, it went to auction — and to my surprise — I was the only one who showed up at the auction. I paid cash at the auction and bought the house for $260,000.”
Levin said the 2,800 square foot Bloomfield Hills home, which appraised for $430,000, was totally remodeled and featured three baths and three bedrooms. She bought the redemption rights from the previous owner for another $20,000 and moved in.
“I got this place for a steal,” Levin said. “Right now, Michigan is foreclosure heaven. It’s raining foreclosures here. I’m looking to do another one soon. If I can find a deal like the one I’m living in, I’ll definitely buy it.”
Strike while the iron is hot
Glen Miller, a 39-year veteran of foreclosure investing, believes now is a great time to buy foreclosures.
“After I look at the properties on RealtyTrac, I then go the courthouse and look for properties that have low mortgage balances and I look for any outstanding liens,” said Miller, who currently owns 20 foreclosure properties in and around Vero Beach, Fla. Miller owns eight duplexes, four single family homes, a condo unit and has just flipped five foreclosures. Now, Miller is finishing rehabbing another foreclosure that he will sell soon.
“I’m putting on a new roof on this four-bedroom, two-bath home in Fort Pierce I bought for $60,000,” Miller said. “I’ll invest another $20,000 and put it on the market in the next three weeks and list it for $130,000. I should sell this one fast because the other homes on the market are listed for $160,000 and more.”
While there’s no one secret to buying foreclosure property at discounted prices, Miller and the other investors agree that it’s important that investors jump in and find out what works for their personality and target market. Once they find a strategy that works, investors should stick with it.
“You got to have common horse sense. This isn’t rocket science,” Miller said. “You just have get off your behind and go out and attack the market.”
Thursday, November 8, 2007
How To Dramatically Increase Your Credit Score
Of course, one of the obvious ways to increase your credit score is simply to pay your bills on time, which of course you need to do. However, there's a more proactive approach to raising your credit score that's easy to do and makes the process quicker!
Let's say you have a Visa card with a $1,000.00 credit limit. Starting today you can use your $1,000.00 line of credit to increase your credit score and it doesn't matter if the credit card is secured or non-secured. The only thing that matters is that your credit card payments are reported to the credit bureau.
Each month you probably pay an electric bill, phone bill, water bill, car insurance and other types of bills which are generally not reported to the credit bureau unless you have an outstanding balance and refuse to pay it. The trick is to pay all these bills each month using your credit card, which does report to the credit bureau. Remember, you can even pay your groceries and fuel purchases for your car using a credit card. As long as the bill can be paid using a credit card you're ok. The next step is to apply the same money you were going to spend for the bills directly to your credit card bringing the balance to zero each month. Each month you charge your credit card then pay it off to reflect a positive payment history and you'll increase your credit score.
If you have a credit card with a large enough credit line, you can easily pay your car payment or even a mortgage payment. Even if you don't have a large enough credit line or can't get a non-secured credit card, you can still get a secured credit card from your local bank. Once this is done, deposit the same money you were going to use to pay your bills into your secured credit card account and simply use your secured credit card to pay your bills.
When using this method you can also use two credit cards showing more accounts with positive activity, which can work in your favor. However, don't get carried away! Having too many active credit card accounts or open lines of credit will also work against you.
Note: Debit cards with the Visa logo that come directly out of your checking account don't count. The credit card you're using must be set-up as a true credit card with the payments reported to the credit bureau.
Now your bills are being paid on time and you're maximizing your credit score with every bill you pay using your credit card reflecting a positive payment history for both your bills and your credit card.
Remember, this costs you very little to accomplish. All you may end up paying is a few dollars in interest, if that. The benefits you'll receive as your credit score increases will far outweigh a few dollars per month.
THE KEY HERE IS TO ALWAYS USE THE MONEY YOU WERE GOING TO ALREADY USE TO PAY YOUR BILLS TO PAY THE CREDIT CARD YOU'RE NOW USING TO PAY YOUR BILLS, BRINGING THE BALANCE TO ZERO EACH MONTH. NEVER MAKE THE MISTAKE OF THINKING YOU HAVE ALL THIS MONEY AT THE END OF THE MONTH AND ONLY PAYING THE MINIMUM PAYMENT TO THE CREDIT CARD. PAY THE CREDIT CARD DOWN TO A VERY SMALL BALANCE EACH MONTH! I CAN'T STRESS TO YOU ENOUGH HOW IMPORTANT THIS STEP IS. BY NOT DOING SO, YOU'LL END UP MORE AND MORE IN DEBT.
Note: The reason it is important to leave a small balance every month on your credit card is that banks like to see that you are paying interest, which helps raise your credit score. A $20 or $30 balance will work fine.
Of course, the only bills this will work on are those you can use a credit card to pay. I believe you'll find you can pay most of your bills with a credit card.
Once again let me remind you AS STATED THROUGHOUT OUR WEBSITE YOUR CREDIT HISTORY HAS NO IMPACT ON ACQUIRING REAL ESTATE WHEN YOU WORK WITH US.
This information is provided as a gift to you with no strings attached.
I hope to hear from you soon.
Let's say you have a Visa card with a $1,000.00 credit limit. Starting today you can use your $1,000.00 line of credit to increase your credit score and it doesn't matter if the credit card is secured or non-secured. The only thing that matters is that your credit card payments are reported to the credit bureau.
Each month you probably pay an electric bill, phone bill, water bill, car insurance and other types of bills which are generally not reported to the credit bureau unless you have an outstanding balance and refuse to pay it. The trick is to pay all these bills each month using your credit card, which does report to the credit bureau. Remember, you can even pay your groceries and fuel purchases for your car using a credit card. As long as the bill can be paid using a credit card you're ok. The next step is to apply the same money you were going to spend for the bills directly to your credit card bringing the balance to zero each month. Each month you charge your credit card then pay it off to reflect a positive payment history and you'll increase your credit score.
If you have a credit card with a large enough credit line, you can easily pay your car payment or even a mortgage payment. Even if you don't have a large enough credit line or can't get a non-secured credit card, you can still get a secured credit card from your local bank. Once this is done, deposit the same money you were going to use to pay your bills into your secured credit card account and simply use your secured credit card to pay your bills.
When using this method you can also use two credit cards showing more accounts with positive activity, which can work in your favor. However, don't get carried away! Having too many active credit card accounts or open lines of credit will also work against you.
Note: Debit cards with the Visa logo that come directly out of your checking account don't count. The credit card you're using must be set-up as a true credit card with the payments reported to the credit bureau.
Now your bills are being paid on time and you're maximizing your credit score with every bill you pay using your credit card reflecting a positive payment history for both your bills and your credit card.
Remember, this costs you very little to accomplish. All you may end up paying is a few dollars in interest, if that. The benefits you'll receive as your credit score increases will far outweigh a few dollars per month.
THE KEY HERE IS TO ALWAYS USE THE MONEY YOU WERE GOING TO ALREADY USE TO PAY YOUR BILLS TO PAY THE CREDIT CARD YOU'RE NOW USING TO PAY YOUR BILLS, BRINGING THE BALANCE TO ZERO EACH MONTH. NEVER MAKE THE MISTAKE OF THINKING YOU HAVE ALL THIS MONEY AT THE END OF THE MONTH AND ONLY PAYING THE MINIMUM PAYMENT TO THE CREDIT CARD. PAY THE CREDIT CARD DOWN TO A VERY SMALL BALANCE EACH MONTH! I CAN'T STRESS TO YOU ENOUGH HOW IMPORTANT THIS STEP IS. BY NOT DOING SO, YOU'LL END UP MORE AND MORE IN DEBT.
Note: The reason it is important to leave a small balance every month on your credit card is that banks like to see that you are paying interest, which helps raise your credit score. A $20 or $30 balance will work fine.
Of course, the only bills this will work on are those you can use a credit card to pay. I believe you'll find you can pay most of your bills with a credit card.
Once again let me remind you AS STATED THROUGHOUT OUR WEBSITE YOUR CREDIT HISTORY HAS NO IMPACT ON ACQUIRING REAL ESTATE WHEN YOU WORK WITH US.
This information is provided as a gift to you with no strings attached.
I hope to hear from you soon.
Wednesday, November 7, 2007
Mortgage rates fall to May 2007 levels
Mortgage rates fell last week to their lowest point in nearly six months according to the results of Freddie Mac's Primary Mortgage Market Survey for the week ended November 1.
The average rate for the 30-year fixed-rate mortgage (FRM) dropped to 6.26 percent with an average 0.4 point from the average the previous week of 6.33 percent with 0.5 point. This was the lowest average rate for the 30-year FRM since the week ended May 17 when it averaged 6.21 percent. One year ago this product carried an average rate of 6.31.
The 15-year FRM was down eight basis points to 5.91 percent with an average 0.4 point, a decrease of 0.2 point from the week ended October 25. This was the lowest rate for the 15-year FRM since the week ended May 10 when the average was 5.87 percent. One year ago the average was 6.02 percent.
The five-year Treasury-indexed hybrid adjustable rate mortgage (ARM) averaged 5.98 percent with 0.4 point compared to the previous week when it averaged 6.03 percent with 0.5 point. This is the lowest rate for this category of loan since May 17 when the average was 5.92 percent.
The one-year Treasury-indexed ARM averaged 5.57 percent, nine basis points lower than a week earlier. The average point was unchanged at 0.6. This rate tied with the last low that was recorded during the week ended May 31.
"October's consumer confidence fell to its lowest level since October 2005 as mortgage rates continued to decline this week to their lowest level in almost six months," said Frank Nothaft, Freddie Mac vice president and chief economist. "Continued market concerns about weaker economic growth and further declines in the housing market have kept mortgage rates low over the last few weeks.
"Although the third quarter gain in real gross domestic product (GDP) of 3.9 percent was stronger than market forecasts, the housing market has subtracted from GDP growth over the past twenty-one months ending in September. In its most recent policy announcement, the Federal Open Market Committee (FOMC) noted that the rate of expansion in the economy will most likely slow in the near term, due in part to a reflection of the intensity of the housing correction."
The survey of lenders conducted weekly by the Mortgage Bankers Association (MBA) showed a very slight increase in average rates for two of the three categories of loans it tracks.
The 30-year fixed rate mortgage had an average contract interest rate of 6.16 percent compared to 6.15 percent a week earlier. Fees and points, including the origination fee, increased to 1.08 from 1.05.
The average rate for the 15-year FRM decreased from 5.79 percent to 5.77 percent with fees and points unchanged at 1.10.
The one-year ARM also increased one basis point to 5.94 percent with points decreasing to 0.9 from 0.93.
All MBA figures are for 80 percent loan to value originations.
Mortgage loan applications decreased 1.6 percent on a seasonally adjusted basis from a week earlier and 2.4 percent on an unadjusted basis. Application volume was 8 percent higher than that recorded during the same week in 2006.
Applications to refinance represented 49.1 percent of all mortgage applications compared to 49.6 percent a week earlier while the market share of adjustable rate mortgages decreased to 14.2 percent from 14.7 percent.
The average rate for the 30-year fixed-rate mortgage (FRM) dropped to 6.26 percent with an average 0.4 point from the average the previous week of 6.33 percent with 0.5 point. This was the lowest average rate for the 30-year FRM since the week ended May 17 when it averaged 6.21 percent. One year ago this product carried an average rate of 6.31.
The 15-year FRM was down eight basis points to 5.91 percent with an average 0.4 point, a decrease of 0.2 point from the week ended October 25. This was the lowest rate for the 15-year FRM since the week ended May 10 when the average was 5.87 percent. One year ago the average was 6.02 percent.
The five-year Treasury-indexed hybrid adjustable rate mortgage (ARM) averaged 5.98 percent with 0.4 point compared to the previous week when it averaged 6.03 percent with 0.5 point. This is the lowest rate for this category of loan since May 17 when the average was 5.92 percent.
The one-year Treasury-indexed ARM averaged 5.57 percent, nine basis points lower than a week earlier. The average point was unchanged at 0.6. This rate tied with the last low that was recorded during the week ended May 31.
"October's consumer confidence fell to its lowest level since October 2005 as mortgage rates continued to decline this week to their lowest level in almost six months," said Frank Nothaft, Freddie Mac vice president and chief economist. "Continued market concerns about weaker economic growth and further declines in the housing market have kept mortgage rates low over the last few weeks.
"Although the third quarter gain in real gross domestic product (GDP) of 3.9 percent was stronger than market forecasts, the housing market has subtracted from GDP growth over the past twenty-one months ending in September. In its most recent policy announcement, the Federal Open Market Committee (FOMC) noted that the rate of expansion in the economy will most likely slow in the near term, due in part to a reflection of the intensity of the housing correction."
The survey of lenders conducted weekly by the Mortgage Bankers Association (MBA) showed a very slight increase in average rates for two of the three categories of loans it tracks.
The 30-year fixed rate mortgage had an average contract interest rate of 6.16 percent compared to 6.15 percent a week earlier. Fees and points, including the origination fee, increased to 1.08 from 1.05.
The average rate for the 15-year FRM decreased from 5.79 percent to 5.77 percent with fees and points unchanged at 1.10.
The one-year ARM also increased one basis point to 5.94 percent with points decreasing to 0.9 from 0.93.
All MBA figures are for 80 percent loan to value originations.
Mortgage loan applications decreased 1.6 percent on a seasonally adjusted basis from a week earlier and 2.4 percent on an unadjusted basis. Application volume was 8 percent higher than that recorded during the same week in 2006.
Applications to refinance represented 49.1 percent of all mortgage applications compared to 49.6 percent a week earlier while the market share of adjustable rate mortgages decreased to 14.2 percent from 14.7 percent.
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