Down 10 to 30 pts. 

Down 25 to 45 pts. 

Down 60 to 80 pts.

Down 90 to 110 pts. 

Down 45 to 65 pts. 

Down 105 to 125 pts. 

Down 85 to 105 pts.

Down 140 to 160 pts. 

Down 130 to 150 pts.

Down 220 to 240 pts. 

Carlsbad, CA - You may know your credit score – but do you have any idea how it is calculated?  In a formula that is so secretive that they could tell you – but then they’d have to kill you, we never know how our actions will affect that score. 

How will your credit score change if you close a credit card?  Should you go through the hassle of a short sale, or just allow your house to go into foreclosure?  What if things are tight, and you go over your credit card limit?

Your credit score is a three digit number normally between 300 and 850.  It is the number used to determine the risk of giving you a loan.Scores over about 715 are considered good scores, and typically will get you the best interest rates.  Scores over 600 and under 715 are moderate scores. 

And although you may get a loan, you may pay a premium interest rate to get it.  Scores under 600 are typically considered to be a high risk borrower.  These borrowers either may not get a loan, or may pay much higher interest rates on their loan.

Although the formula is still a mystery, Fico.com has at least provided a table showing some of the most common penalties to your credit score.

FICO’s information shows that bankruptcy does the most serious damage to a credit score (up to 240 points), followed by foreclosure (up to 160 points) while maxing out a credit card has the least numerical impact (as few as 10 points).

Those with good or excellent credit — so-called prime borrowers — put more points at risk with each mistake. For example, someone with an average credit score of 680 who pays a bill 30 days late will see a drop of 60 to 80 points. But for someone with an excellent credit score — 780 — that same delinquency can cost 90 to 100 points.

If considering whether or not to try to sell your house through a short sale vs. allowing a full foreclosure, please keep in mind that settling a debt (short sale) with a lender can save you 50 to 100 points (and the ability to get another loan in the future) or MORE!  If you have any questions about how this might impact you personally, or how to market your property for a short sale, please contact The Mewborn Team.  We are happy to sit down with you for a no obligation consultation about your best options.

The foreclosure prevention plan, is meant to reduce eligible borrowers’ monthly payments to no more than 31% of their pre-tax income.  In order to qualify, a homeowner must make three on-time monthly payments before they can receive a permanent modification.

Unfortunately there is the typical he said/she said to each loan.  The mortgage companies are complaining that they need more information that the borrowers aren’t providing.  The borrowers are complaining that the mortgage companies keep losing their documents.  So months go by without permanent modifications.

The Obama administration is trying to make changes to their programs allowing mortgage companies to access tax records through the IRS, rather than waiting for borrowers, and approving and moving clients into permanent modifications without their signatures.  They are hoping that this will help streamline the process and help more US homeowners. 

If you are having problems making your mortgage payment.  Contact your mortgage company.  They may tell you that they can not help you until you have missed a payment.  You may want to ask for a forbearance plan.  Although this will still affect your credit, it will allow you to work with your lender to find a more permanent, acceptable solution.

Your home is often the biggest investment you will ever make.  Make the most informed solutions possible.  If you have any Carlsbad or North County Coastal real estate questions, please contact us.

Carlsbad home owners who refinance have an opportunity to reduce their payment on a 30-year, fixed-rate loan for $400,000 by nearly $268 a month from a year ago, when long-term rates averaged 5.94 percent.

Other mortgage averages were as follows:

• 15-year loans fell to 4.33 percent.
• Five-year adjustable-rate mortgages dropped to 4.35 percent.
• One-year ARMs rose to 4.53 percent.

Carlsbad, CA – A fear of overpaying for Carlsbad, Oceanside, or San Elijo real estate is common these days, especially  when prices continue to be unstable.

If you are a San Diego home buyer and are frozen because you are unsure what to do next – and are concerned you may pay too much, here are some items to consider:

1. Waiting for the right time can be expensive. Some Carlsbad real estate buyers would have more equity today, despite falling prices, if they had bought when they first started looking, instead of continuing to pay rent.

2. Financing is not guaranteed. Some people who were highly qualified last year can’t find financing this year because the credit market has tightened or their personal financial situation now makes them an undesirable borrower.

3. Interest rates have no where to go but up. If prices decline by another 10 percent, but interest rates increase by 1 percentage point, the monthly payment will be the same.

Can we guarantee that Carlsbad real estate prices are at the bottom?  No!  Can we say confidently that now is a great time to buy real estate in Carlsbad, La Costa, Oceanside, Encinitas, Vista, or San Marcos – YES!  In most of these areas, prices are at near 2001 levels.  Interest rates are at near all time lows!  This Carlsbad real estate opportunity is unprecedented!  Don’t miss it!

Source: Based on an article in The Wall Street Journal, Douglas Heddings (07/27/2009)

Carlsbad, CA – With Carlsbad and La Costa home prices low, now many parents are thinking of buying their children a home or investment property.

1. Give a cash gift. Although some parents want to (and can afford to) purchase a house for their children, many want to help but are not in the position to gift the entire cost of the home. Parents are allowed to gift up to $13,000 per person per year without incurring gift tax. This means two parents could give their child and spouse up to $52,000 per year to go toward a down payment.

2. Lend money. Rather than gifting, you may prefer to loan money. In order to avoid taxation, the government requires that loans from family members meet or exceed minimum loan rates to avoid having the loan be considered a gift.

If you have any real estate or mortgage questions about Carlsbad, La Costa, or other coastal areas, please contact us.

Before you apply for your next Carlsbad mortgage, consider this advice:

1. Ask for the good faith estimate early.  Ask the mortgage representative to fill it out completely – with the estimated Carlsbad interest rates and closing costs.

2. Ask what you need to do to “lock your rate” and how long the rate lock will last.  Lenders will charge a fee to cover the risk of a change in interest rates between the time you start your transaction and the time the transaction closes.  Normally the longer you want to lock the rate, the higher the potential fees.

3. Ask your Realtor or Financial Advisor to look over your Good Faith Estimate.  There are SO many moving parts in your real estate transaction.  Ask your professionals to check each other.  Checks and balances only protect you – the consumer.

If you have any questions about Carlsbad, La Costa, San Elijo, or other north county coastal real estate or mortgages, please contact us.  We are always happy to help.

The federal tax credit is 10% of the home’s purchase price (up to a maximum of $8,000). 

Please contact us to find out more about the benefits available to you ONLY until the end of 2009!

Combine your unique factors and current San Diego interest rates, and a lender will be able to get you pre-qualified so you know what you can afford before you ever start looking.
There are so many unique mortgage options available. Do you need closing costs to be covered by the seller? Would you like to put a small amount of money down?

We will work with you and a lender to find the right mortgage for your circumstances. If you have any questions about buying or selling in North County San Diego, please give us a call. If we can’t help you, we will point you to someone who can!

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According to Freddie Mac, the average rate on the average Carlsbad or San Diego conventional 30 year fixed rate was 5.29% last week, and is up  to 5.59% this week.  The last time the Carlsbad average 30-year fixed rate mortgage was higher was Nov. 26, 2008, at an average of 5.97%.

On Wednesday, the government was forced to lift the yield on 10-year Treasury notes to 3.99 percent to lure in buyers at an auction. That was the highest yield it’s offered since last August, before it started bailing out the nation’s financial industry.

Although, the indicators show that the troubled U.S. housing market is beginning to stabilize, higher rates mean borrowers can borrow less money and/or may not be able to buy – ultimately threatening any Carlsbad housing recovery.