I need help on credit counseling because I would like to buy a home some time in the future.
I need help on credit counseling because I would like to buy a home some time in the future, but my credit is SHOT! 4 years ago, I lost my home do to sub prime lending and my husband's job loss. Is it possible for me to ever buy a home again?
Credit counseling, or signing up for a debt management plan, is a very common form of online debt consolidation. There are many companies offering online credit counseling, which is essentially a way to make one payment directly to the credit counseling agency, which then distributes that payment to your creditors. Most times, a credit counseling agency will be able to lower your monthly payments by getting interest rate concessions from your lenders or creditors. It is important to understand that in a credit counseling program, you are still repaying 100% of your debts – but with lower monthly payments. On average, most online credit counseling take around five years. While most credit counseling programs do not impact your FICO score, being enrolled in a credit counseling debt management plan DOES show up on your credit report… and, unfortunately, many lenders look at enrollment in credit counseling akin to filing for Chapter 13 Bankruptcy – or using a third party to re-organize your debts.
I do have to give you the negative information, however, that many lenders view Consumer Credit Counseling as a negative factor... many lenders that Bill knows say that they treat consumers enrolled in Consumer Credit Counseling just as if they had filed Chapter 13 Bankruptcy, which is a consumer debt re-organization.
If you should be one of the minority of consumers placed into a DMP (debt management plan) who completes the plan, you will then be free of the debt included in the plan. Having little or no debt will allow you to begin rebuilding your credit. Bills.com has an entire section on the website dedicated to give you tips on how to improve your credit rating.
If you are interested in credit counseling, Bill is partners with Care One Credit, a leading firm in the business of credit counseling. You can read more about them at www.careonecredit.com.
After, say, 10-12 months of consistent timely payments to one or two unsecured credit cards, you should begin researching the mortgage finance market for a lender offering the best terms. You can become pre-qualified by that lender to purchase a residential property in a given appraised value range. With the hardest part done, you are in a position to bargain with confidence to buy the best property in your range. You can take your time and make that seller come down in asking price or the real estate agents’ commissions, or both.
There is however, another option you might want to consider which is debt settlement. Debt settlement, also called debt negotiation, is a form of online debt consolidation that cuts your total debt, sometimes over 50%, with lower monthly payments. Debt settlement programs typically run around three years. It is important to keep in mind, however, that during the life of your debt settlement program, you are NOT paying your creditors. This means that a debt settlement solution of online debt consolidation will negatively impact your credit rating. Your credit rating will not be good, at a minimum, for the term of your debt settlement program. However, debt settlement is usually the fastest and cheapest way to debt freedom, with a low monthly payment, while avoiding Chapter 7 Bankruptcy. The trade-off here is a negative credit rating versus saving money.
I suggest that you get a free consultation from one of our approved debt help partners to fully explore all your options so that you can decide which one is best for you based on how much money you can afford save on a monthly basis. Just fill out your information here: Debt Relief Savings Quote, and a debt help professional will get in touch with you to discuss your options.
I wish you the best of luck in improving your credit and for your eventual home purchase, and hope that the information provided helps you Find. Learn. Save.
Mortgage market: a pulse check
No surprise that mortgage rates fluctuate. If you are thinking about purchasing a home or maybe considering refinancing your current mortgage, then you want to be up to date on mortgage rates.
Mortgage rates February 21, 2024
According to Freddie Mac, the 30-year mortgage rate for the week of February 21, 2024 stands at 6.9%. This 13 basis points increase from the previous week's rate.
Additionally, Freddie Mac reports that the 15-year mortgage rate for February 21, 2024 is 6.29%, indicating a 17 basis points increase from previous week’s rates.
Note: A basis point is equal to one-hundredth of one percent (0.01%). In numerical terms, if the mortgage rate changes by 20 basis points, it means the rate has changed by 0.20%.
What does the mortgage rate mean for you?
Mortgage rates play a vital role in determining your monthly payment. Let's take a look at the avergage interest rates (APR) for February 25, 2024 based on Zillow data for borrowers with a high credit score (680-740) in the United States:
- For a 30-year conventional loan, the interest rate is 6.88%.
- If you opt for a 15-year conventional loan, the interest rate stands at 6.08%.
Using the rates mentioned above, a $279,082 30-year-year mortgage would result in a monthly payment of $1,834. On the other hand, a 15-year mortgage would require a monthly payment of approximately $2,367.
Explore your options and secure pre-approval today!
To make your life easier, we highly recommend shopping around for mortgages and getting pre-approved. This will streamline the home-buying or refinancing process and make it a breeze. Ready to get started? Check Out mortgage rates now for the best options available.