Mortgage News Roundup - 6 Reasons Credit Scores Aren't Always Fair

This week’s FOMC meeting has adjourned with no change to key short-term interest rates which was expected. The post meeting statement indicated that a strong majority of voting Fed members believe they will remain at current levels until sometime next year.

The surprises came in the updated economic projections, which indicated the Fed felt the economy was going to grow at a slower pace than previously thought. The biggest change came in the overall Gross Domestic Product (GDP) that was revised from a 2.8 – 3.0% annual rate of growth to only 2.1 – 2.3%. They also said that the employment rate will likely fall to 6.0% when previous forecasts predicted 6.1 – 6.3%. Furthermore, their confidence in the path the economy is heading showed in another $10 billion reduction in monthly bond purchases (now $35 billion).

Top 10 Real Estate Investor Mistakes

Real estate investing is never as easy as it seems. (Did you read our series on it?)

1. Tips for Avoiding Pitfalls in Owning Rental Property
2. Rental Property As Retirement Income
3. Real Estate Investment Secrets
4. Pro’s and Con’s of Flipping Homes

Zillow Blog provided their top ten real estate investor mistakes in no particular order.

1. Not penciling out your real estate deal
2. Not penciling out your deal with conservative numbers
3. Getting renovation costs wrong
4. Underestimating renovation time
5. Thinking something can only cost ‘that much’
6. Thinking that stocks, bonds and real estate are all comparable investments
7. Thinking it’s a “turn-key” real estate deal
8. Believing that flipping properties is investing
9. Thinking that real estate is low risk
10. Believing what others say about their “profitable” real estate investing acumen

6 Reasons Credit Scores Aren’t Always Fair

Your credit score is one of the most important numbers in your life. Generally, if it’s under 640 you may have difficulty qualifying for a mortgage loan. And if you do get a loan, you may pay higher interest rates.

Unfortunately, your score could be lower even if you appear to be doing everything correctly, and that’s not fair. Here’s some areas where it’s especially unfair.

• Not all on-time payments are considered equal. An example is if you always pay your utility bills on time. It doesn’t count towards increasing your score.
• Your score doesn’t care about your salary or job. When you get a raise, your ability to pay increases but doesn’t count for anything in your score.
• Scores care as much about your past as your present.
• Credit scores don’t like it when you don’t use credit cards.
• Your score doesn’t care if you lost your job.
• Your score doesn’t care if you are a good saver

Talk with a reputable loan officer to find out options for mortgages. They spend quite a bit of time each week staying on top of the latest market trends as well as options from multiple lending sources.