Sarasota Paradise Group's Blog
It’s a good financial practice to check your credit report and score periodically. You want to be sure that no one has stolen your identity and that all the information on the report is correct. It may sound simple to check your credit, but there are so many sources that you can get it from and so many options that it can be a dizzying process. Read on to learn more about the basics of checking your credit and credit score.
Your Credit Score Comes From Different Sources
You can check your credit score from one source and find that the score varies from place to place. Why? There are a few different scoring models that are used to calculate scores. There could be as much as a 50 point difference between sites. There are also three credit reporting agencies. Each one uses a different method to calculate credit scores. Each method provides lenders with different information to allow them a picture of what type of borrower you will be.
Checking Your Score
Many different apps allow you to check your credit score. These enable users not only to see their scores but to see what can be done to improve the user’s credit report and score. You can’t see your credit report on these apps, but you can always head to annualcreditreport.com to check the full scope of your report. This is the only official site to pull your credit report fro the credit bureaus. Finding the right app to check your credit score is simple, it only takes a few minutes to sign up.
How Are Credit Scores Calculated?
Your credit score is calculated using a few different factors. Each credit bureau uses the formula a bit differently. Scores range from 300- 850. It’s pretty rare to see perfect credit at 850. Anything over 700 is considered “good” or excellent” credit. You need at least a score of 600 to obtain loans in most cases. The higher your score, the better the interest rate will be.
When Is The Best Time To Check The Score?
Before you apply for any large loan, it’s a good idea to check your credit rating. Taking a peek will allow you to see where you stand. You don’t want to apply for a loan and end up being surprised by problems with your credit. Many apps allow you to check your score on a monthly basis. It’s easy to stay on top of your credit score and especially important to know where you stand when you buy a home.
It’s the holiday season! Your parents and grandparents want to gift you with funds to purchase your first home as your gift this year. So how does that work?
Can you just take the money and sign an offer on a house?
Well, maybe... maybe not.
When applying for a mortgage loan, the source of your down payment often is as important as the amount. Lenders look at your income, credit score and assets to determine creditworthiness. It is necessary to ascertain that you can afford the home and its associated expense: closing costs, principal, interest, property taxes, insurance, homeowner’s association fees, maintenance, and repairs.
Underwriters want to know that large deposits into your account, other than your paycheck or regular income, belong to you outright and are not loans. If you plan to use gift money toward part or all of your down payment, it’s important to account for it correctly.
Make a list!
While gifts toward a down payment can come from various sources (family, friends, your employer), mortgage lenders need to know that the gift isn’t wrapped in contingencies. The donor needs to supply a gift letter that clarifies the money is a gift and not a loan and that it doesn’t have other strings that could negatively impact your ability to pay your mortgage and turn it into a lump of coal.
Here’s what the letter needs:
- The giver’s name, address, and contact information, including a phone number.
- Your relationship to the giver.
- The gift’s dollar value
- A message that specifies it is a gift, not a loan requiring future payback
- The giver’s signatures
- The address of your intended purchase
Each gift needs a separate letter. FHA loans require extra paperwork and bank statements from the person gifting funds, and some mortgage companies also require additional proof, to clarify all of this information with your lender or mortgage broker before accepting the gift.
Check it twice!
Check with your CPA or tax advisor to make certain there are no tax implications with accepting the gift. Remind the giver to do the same. Having to pay a portion of the gift in taxes could derail your plans.
Wrap it up!
Keep great records of the gift. Rather than just transferring funds, request the gift in the form of a check so that you can keep copies. Deposit the check in a single transaction, by itself, with no other funds so that the paper trail is clear. If possible, deposit the funds into a separate account that you’ve set up for your down payment (a savings account will do). Get a receipt from your bank for the deposit. Make copies of all receipts, letters, and checks to give to the lender during the underwriting process.
For other ideas about how to come up with a down payment, ask! Your real estate professionals can point you in the right direction.
More Info on this Property | Sign up for Updates
You likely aspire to sell your house as quickly as possible. However, you may not need to set a deadline for selling your residence to achieve your desired result. In fact, there are lots of things you can do to speed up the home selling journey, including:
1. Boost Your House's Curb Appeal
A home that boasts amazing curb appeal may draw buyers' attention as soon as it becomes available. Lucky for you, it may be easy to bolster your house's curb appeal in no time at all.
To improve your home's curb appeal, you may want to complete assorted home exterior upgrades. Mowing the grass and eliminating weeds, for example, could make your front lawn stand out to buyers. Or, if you have cracked or damaged home siding, you can always devote time and energy to repair it.
Of course, if you need help with home exterior enhancements, you can reach out to home improvement professionals. If you have home improvement pros at your side, you can accelerate the process of upgrading your house's curb appeal.
2. Establish a Competitive Initial Asking Price
The initial asking price of your home should account for the age and condition of your residence, along with the current state of the real estate market. That way, you can set a price for your home that falls in line with buyers' expectations.
Generally, it helps to conduct an appraisal before you list your residence. An appraisal report is based on a wide range of factors, including the prices of comparable homes in your city or town. Therefore, if you perform an appraisal, you could receive a property valuation that helps you determine how to price your home competitively.
3. Work with a Real Estate Agent
As a home seller, it never hurts to receive expert support as you navigate the property selling journey. Fortunately, real estate agents are available nationwide, and these housing market professionals can offer great insights into what it takes to quickly sell a house.
A real estate agent first will learn about you and what you hope to accomplish. Next, a real estate agent will develop a plan designed to help you achieve your home selling goals. You and your real estate agent then will put this plan into action and adjust it as needed. Perhaps best of all, if you receive an offer to purchase your home, a real estate agent can help you decide whether to accept, reject or counter this proposal.
Furthermore, a real estate agent can help you bolster your home's curb appeal, establish the optimal initial asking price for your home and much more. And if you have any concerns during the house selling journey, a real estate agent is ready to respond to them right away.
For those who want to speed up the home selling journey, it helps to prepare. Thanks to the aforementioned tips, you can list your home, ensure it generates significant interest from buyers and move quickly to finalize a house sale.