Posts tagged "Credit Score"

How Your Credit History Can Affect Premium Amounts for Your Auto Insurance Comparison

Article by Chris Robertson

If you’ve recently read a government-issued consumer guide about car insurance, you may have noticed that these guides often recommend online auto insurance comparisons as a way to shop for the best insurance policy. That’s because the writers of the guides understand that most consumers lead busy lives and need a quick, easy solution to shopping for car insurance. The Internet enables anyone to fill in a short form and quickly obtain general quotes from as many as 10 to 12 insurance companies. Some companies might provide an instant quote while others will e-mail you with a quote and more information.What you might not realize is that many car insurance providers will consider your credit history and/or rating when determining your premium quote. Credit bureau reporting of good credit/poor credit is no longer just a means of getting a loan or credit card. If you have worked hard to keep your credit score high, then your hard work may pay off for years to come by saving you dollars not only on loan interest, but also car insurance premiums.Why Does Credit Matter to Car Insurance Companies?It’s plain and simple….there’s a direct correlation between a person’s credit/loan behaviors and the number of claims they may incur. Based on years of research, many insurance companies feel that consumers with a higher credit rating are less likely to incur high losses in insurance claims. Basically, if you pay your bills on time faithfully for years, then you’re more likely to be a careful driver and of course, pay your insurance premiums on time as well. Not to mention folks with a high credit rating tend to be middle-aged or older, and therefore are in the safer driving age range!Is it Legal for Car Insurance Companies to View Your Credit History?Yes, it is perfectly legal under the Federal Fair Credit Reporting Act. This act states (in a nutshell) that consumer reporting agencies are to use reasonable procedures to meet the needs of commerce for credit, insurance, personnel, and other information. In other words, insurance companies have just as much right to obtain your credit score and history as do creditors and potential employers.Though some car insurance providers will consider your actual credit reports, others may use what’s called an “insurance credit score.” This score is created using various factors such as your public records, type of credit you have including store cards, credit cards, finance company loans, etc., unused credit, open lines of credit, credit inquiries, past payment history, and the length of your credit history. This score helps predict the likelihood of anticipated insurance losses, sort of like lenders determining whether or not you are a high-risk borrower.When you compare car insurance, be sure to ask how your credit score will affect your insurance premium with each company. If you have very good credit, look for insurance providers that put a lot of weight in credit ratings. This can give you leverage when obtaining quotes from these companies. Keep in mind that there are other factors that will determine your premium when you compare auto insurance. Auto insurance comparison companies will also consider the type of vehicle you drive, your age, your driving records, where you live, and whether you are eligible for various insurance premium discounts. The type of coverage you need as well as your deductible will also affect your premium rates.Car insurance comparison websites provide a wonderful opportunity to find the insurance company that’s right for you. Take advantage of this free and easy tool, and use your good credit as a way to maximize your savings!

About the Author

Chris Robertson is an author of Majon International, one of the worlds MOST popular internet marketing companies.For tips/information, click here: auto insurance comparisonVisit Majon’s automotive-parts-accessories directory.

What is the difference between PMI and an 80/20 loan?

Question by dm: What is the difference between PMI and an 80/20 loan?
This ties back to my previous question, my friends are being told their monthly payments will be around $ 1200 for a $ 120K house using a 6.7% interest rate on a 30yr fixed. Seems impossible to me when comparing to amortization tables (I come up with 800/mo).

Some of the answers told me the explanation could be PMI which I know means “Private Mortgage Insurance” but not much other than that…

For my house I have a 80/20 loan since I put no downpayment and my rate is about $ 1300 a month, but my house was $ 185K

I don’t understand how they could pay only $ 100 less than me for a house that costs so cheaper, so please explain this PMI and why they just cant get an 80/20 loan?
Yes, I have two loans. One for 80% at 6.3% and one for 20% at 7.1%

I had 20% for a downpayment but decided to keep that cash for other purposes once I realized I could get two loans instead.
Also, this is definitely for a 30 yr fixed, not a 20 or 15 loan.

Second, my tax rate in my county is slightly higher than theirs.

Best answer:

Answer by f1scrilla
They may not qualify or want an 80/20 loan. 80/20 loans will have a higher “blended” interest rate (the total rate based on combined monthly payment).

For instance, your 80% loan may be at 6.5%, but your 20% at 8.99%, so your blended rate may be in the mid 7′s. Whereas, if you took a PMI loan, your rate may be at 6.5% fixed with a temporary PMI payment for the first 4-6 years you have it.

The payment can be higher on an 80/20, but it also can be higher with the PMI, it depends on other factors like credit score, income verification, job history, property type.

PMI is insurance, its based on the amount of coverage, $ 400 for $ 120,000 in coverage is astronomical. As I said earlier, I’m a mortgage broker and the most I’ve seen for that kind of loan amount if $ 150.00 per month. Thus, there is probably something else going on with your friends.

Know better? Leave your own answer in the comments!

Strategies On Finding Home Insurance Quotes For Home Insurance

You want to make confident your residence is effectively insured. InsureMyHouse.com has helped hundreds of thousands of home owners locate regional property insurance quotes. Since 1999, they have realized the internet is a beneficial tool for buyers to research and purchase residence insurance while at the identical time receive an insurance coverage quote on their house. 

All zip codes are registered to exclusive insurance coverage agents considering that there is only 1 agent representing your zip code. When selecting your zip code you are assured your interest is the agent’s amount one particular priority. The last factor an insurance agent wants to do is offer you a horrible home insurance quote. When dealing with a neighborhood agent you can be certain they are just a phone call away giving you the piece of mind you deserve. In addition, it’s usually great to know your agent operates around the corner in situation you require to visit their place of enterprise. In the unfortunate event you want to file a property insurance claim, your agent can come out and asses the harm to your property.

Did you know that most homeowners insurance businesses provide a lot more than one house owners insurance coverage policy? The value of the policy and the coverages offered can differ significantly depending on the kind of home, the form of roof, your credit score, the age of the residence and many other issues. 

That’s why if you are in want of a house insurance coverage quote, visit InsureMyHouse.com at http://www.insuremyhouse.com/home-insurance-quotes.html and talk to your agent.  Mention combining your automobile and residence insurance for a multi-policy quote discount. In addition, you can discover data in the Discover the Basics section which provides an education about residence owners insurance quotes.

Buyers Being Creative in a Soft Real Estate Market With a Challenged Credit History

The stars have lined up against many would be buyers with the amount of baggage they bring to the table in the way of challenged credit. They want to buy something. They need to buy something. Whether it be a recent bankruptcy, repossession, foreclosure, large medical bill collections, identity theft or judgements or recent unemployment any one of which can plummet a credit score and put the would be buyer in a financial hole. In a soft real estate market where owners need to sell and have a high degree of motivation to dispose of their property. This is the opportunity that a buyer with challenged credit history can seek to “help” a seller out of their current dilemma by arranging sale terms that will help both buyer and seller. These scenarios may not work for anyone who has zero options, zero income and zero means to pay anything back. It is rather, for those who are fighting their way back and do have options, have income and now have means to meet their obligations on a negotiated deal. This will not work if a buyer throws their hands up and gives up to the possibility of buying a property. This opportunity will work for those buyers who have a need as well as a burning desire in their belly to buy something that will meet their family goals and will do what is necessary to make it happen.

A buyer needs to be aggressive in their efforts to take advantage of this temporary real estate market. Some areas of the country have more opportunities than other areas. However, there are deals in every area. A buyer needs to find them. There is little reward for a buyer to deal with an unmotivated seller. There must be pressure on the seller to move the property. Whether it be for reasons of health, estate situation, job loss, divorce, out of state move, downsizing, upsizing, budget, cash flow or other reasons if a buyer with checkered credit has a shot of doing something. A buyer early on will need to come to the conclusion that the chance of matching the perfect house with the perfectly motivated seller will be slim. Therefore, from the get go the buyer must be willing to compromise on the purchase. The buyer must realize that this is not the last home they will buy, it is the first home they will buy with a high degree of challenged credit. The buy decision, although well thought out, must recognize the purchase is not permanent and is not fatal. It is simply a means to get into a property and get on the equity accumulation train, which will help them over time. So the search begins to find a motivated seller while being somewhat flexible while not having unreasonable expectations that will not fly with the current credit circumstances.

Buyers can try to do it themselves or choose to bring in a professional realtor who knows the market. Right now a lot of realtors have a lot of time on their hands. Six months ago when the market was raging, that was not the case. What a difference a day makes. The criteria then on a broad based approach would be to find a vacant home, on a realtor lock box, with a lower mortgage balance and with a high seller motivational to move the property. If a property is not listed, then the seller may not be motivated enough for a buyer’s purposes. They are not serious enough. If a property has had three or four price reductions in the last few months in the Multiple Listing Service this would be a sign of a motivated seller. Likewise if a seller has indicated a willingness to pay for buyers closing costs, hold a second mortgage, consider a lease option or a lease purchase, these are all signs of the degree of seller motivation necessary for a buyer with challenged credit to find a workable property. Early on in the realtor selection process, a working relationship must be established with a realtor who is willing to make multiple offers and does not take rejection personally until an acceptable deal can be negotiated.

At the same time, a mortgage broker will need to be contacted to determine exactly what is possible in the way of a first mortgage. Banks are not geared to do what will be required to make a deal with challenged credit. It will be assumed that in spite of the past history, the buyer now can make a monthly mortgage payment and may even have some cash to work with. Cash can be gifted from parents or other sources if necessary. The results of the mortgage broker interview will dictate what and how the deal will need to be structured. Pulling credit will determine if the housing history is 0 x 30 (meaning no housing payments more than 30 days late in the last twelve months) or worse. Collections, judgements, repossessions or any other adverse challenge the buyer may face will be noted. From this exercise, a buyer will have a payment number in hand for their monthly housing expense including principal and interest, taxes and insurance and perhaps a maintenance fee (as found in an association or condo) all inclusive in the monthly housing expense. The mortgage broker and realtor will need to work in tandem to structure the deal that is achievable on part of the buyer. Many times, in the market place the deal is negotiated without any thought to the financing. Here it will be necessary to fix the financing first THEN find the house. Most buyers with a 580 score or better can get a 95% Loan To Value first that allows a 100% Combined Loan To Value. This will no doubt be a subprime type loan with the first being one loan with no Private Mortgage Insurance (PMI). An offer might look like something like this:

Purchase price would be at say $225,000 with a 95% LTV first mortgage of $213,750 and allow a 5% LTV seller held second of $11,250. The rate on the first would be for this scenario 8.5% on the first and aggressively negotiate the same for the seller held second or less. A seller may rationalize that they were going to reduce the price another $10,000 in 30 days anyway and this way I get most of their cash now. Following then, the first mortgage of $213,750 with a rate of 8.5% with payments on a 2-year fixed ARM of $1,643.55/month. The second of $11,250 at say 8% on a 10 year basis would be $135.95/month for a total principal payment of the first and second of $1,779.50/month plus taxes of $300/month and insurance of $220/month for a total housing expense of $2,299.50/month in housing expense. With a subprime loan, collections and such are not included in the debt service calculation if they are old enough. So for a working couple if the lender allows a 50% debt ratio to income the minimum income on a full documented loan would be $2,299.50/. 50 = $4,599/month. Say the wife makes $3,000 per month and the husband makes $1,599/month then they would just make it. The seller would need to pay all the buyers closing costs and prepaids (tax and insurance escrows and advanced fees) and any buyer cash can be used for monthly lender reserve requirements.

In summary then, this is a temporary buyer’s market in most areas and to be successful buyers need to focus on motivated sellers. Even before looking at any property the seller’s agent must be interviewed to determine if there is a high motivation of selling the property by paying all the buyers closing costs and prepaids and perhaps hold a 2nd mortgage. If there isn’t, the buyer should not be looking at that property. If the buyer has a vacant lot, a small mortgage note, income property or anything of value like a boat or motorcycle can all be brought to bear on a deal. The barter and trading process is how America was built. Working in tandem with a professional realtor and a mortgage broker a buyer can enlist some professional help to meet the needs of their family even with challenged credit. It is not a static situation. During the first two or three years of this scenario the buyers need to put their financial house in order through family budgeting and planning with discipline to qualify for a better rate and terms on their mortgage and other credit needs for their families future. In a few years through a lot of hard work and sacrifice they can be out of their financial hole and back on an even keel.

Dale Rogers
http://www.brokencredit.com
http://www.sellerhelpsbuyer.com

Dale Rogers
http://www.articlesbase.com/credit-articles/buyers-being-creative-in-a-soft-real-estate-market-with-a-challenged-credit-history-65249.html

How much is home insurance per year in South Florida ?

Were purchasing a home around 300,000 how much is insurance yearly ? Anyone pay around this much ?

It doesn’t work that way. It’s ALSO based on the age of the house, YOUR CREDIT SCORE, the claims history of both you and the house, etc.

And the bad news is, there isn’t any competition for homeowners insurance in FL – you’re GOING to end up with the state fund, Citizens. The HOMEOWNERS part of it will cost you about $3,000 a year. The FLOOD insurance part will likely cost you about $1500 – but the MOST flood coverage you can get is $250,000, so you’ll be needing to put at least $50,000 down on the house or you won’t be able to get the mortgage. Then the WIND coverage is probably going to run you about $5,000.

Total insurance cost . . . budget $10,000, and you should be slightly under.

What is an Average Home insurance rate of a 2 story house?

4.5 baths
5 beds
3000 sq feet
finished basement
3 decks
1 fenced in gorund pool
Please, just and average for 1 month home insurace.
No super valuables or anything. (It’s for a project) I just can’t find anything that won’t just give me a chart or some thing. In class we had to make up an imaginary house and get all this different stuff for it. I’ve found everything,but home insurance rate without having to put in my personal info.
the home would be located in southern michigan

It doesn’t work that way. Rates are HEAVILY based on your credit score, and the cost to rebuild the home. You also need to know how old the house is. You can’t buy homeowners insurance for one month at a time. If you’re doing a budget for a school project, figure $2500 a year for insurance, but that’s a WAG (wild a** guess). Figure property taxes at 3 – 4 times that, for your school project.

Reverse Mortgage Purchase Program

Purchase your next home with no monthly mortgage payments! The Federal Housing Administration will now allow seniors to use the revolutionary Reverse Mortgage program to purchase real estate. New enhancements to the government program allow seniors to purchase a home with no monthly payments. Why not move into your next home and have no mortgage payments for the rest of your life!

Eligible Property Types Include:
• Single Family Residence
• Condo
• Townhouse
• 2-4 Unit Multi Family
• Manufactured home

Who Qualifies?
• Minimum Age 62
• Must Occupy property as primary Residence
• No Income or Credit Score is needed to qualify
• Good credit is not required
• Can own up to 4 dwellings

Using a Reverse Mortgage to purchase a home allow seniors to purchase a new home as if they paid cash. After the home is purchased they never have to make a monthly mortgage payment on the outstanding balance. Income, good credit and credit score are not required for qualification and the same property types for the current program qualify for the new Reverse Purchase program.

Why not move close to family when the need arises, down size into something smaller or just get a home that is newer and better then what you currently own. The only monthly out go would be taxes, homeowners insurance and HOA dues if the home is located in a Home Owner Association.

The down payment requirements are based on age. The older the senior, the less of a down payment. Age should be based on the youngest senior if they are married.

Seniors can also make payments on the Reverse Mortgage to get a tax deduction after the program is in place. In other words, they can treat it like a regular mortgage and make regular monthly payments if they want, but if they would rather keep their money in their pocket they can. A Reverse Mortgage will never be foreclosed upon due to non-payment if the senior is living in the home.

Robert E. Jones
http://www.articlesbase.com/mortgage-articles/reverse-mortgage-purchase-program-730867.html

What would a typical home insurance payment be on a home valued at $60,000?

My wife and I are looking to buy a home, but we want to find out what a typical home insurance payment looks like.

Your homeowners insurance premium is going to be based on a wide variety of factors. Among the factors the location, including protection class which factors in how far the house is from the nearest fire department and fire hydrants, how far the house is from a body of water, construction materials of the house, i.e. whether it is masonry or frame, the age of the home, if it is under 10 years old it usually gets a discount, if it is over 40 years the company will be looking at whether it has been updated (some companies will give discounts if it has been completely updated) safety features such as sprinklers, central station alarm, etc., your history of prior property claims, prior claims at that specific home (contained in a CLUE report), a multi-policy discount if you have automobile insurance with the same company, a senior citizen discount if you are over 65 and where allowed your credit score are all factors that could cause wide variations in homeowners insurance premium.

Also the most important point–your homeowners insurance premium is going to be based on the replacement value (what it would cost to re-construct the home if it were a total loss) not your purchase price. Lastly the low value of the home does not in and of itself mean that it is a high risk home or that it is much more likely to have claims filed–the CONDITION of the home its proximity or location in a risk zone in terms of weather–near water, high wind area, brush fire zone, etc. are what would make the home a high risk.

Check out this site, if you want to find the cheapest home insurance just in one minute,

http://best-cheap-home-insurance-usa.blogspot.com/

Here you can get free quotes from different home insurance companies in your area, its the best way to find an afforable home insurance with a reliable company.

Best Wishes,