FB's, Feedback, and support your favorite blogs
Bwr has a FICO score in the 530's, 2x60 mortgage lates and several 30 day lates in the past 12 months. They needed to do a refi to get about $5000 or so cash out to pay their taxes. The problem is that the rate would be too high for them to afford the payment, even at 80% LTV. If the bwr had paid their mortgage on time, or at least not had the 60 day lates, I could have gotten them the cash out they needed, AND lowered their payments.
That reminds me. Here is the ORDER in which you should pay your debt:
1. pay your MORTGAGE first!!!!
2. pay your installment debt (car payments, etc) next.
3. pay your revolving debt (credit cards, store cards) next.
4. pay student loans next
5. pay medical bills last
I'm not telling you this from MY perspective, I'm telling you this from the perspective that mortgage companies look at your credit. You should pay all your bills every month. BUT, I know that things happen. Sickness, accidents, etc. When these happen, follow the guide above, and you will do the "least" amount of damage to your ability to get a mortgage.
Most lenders do not care about "medical collections". I'm not saying it is right to pay your student loans and doctors last, but that is pretty much how the industry looks at credit reports and extends credit. Most lenders care about your MORTGAGE HISTORY first and foremost. Their rationale is that, "if you paid your mortgage before, you will pay it again"...nevermind that you can't make car payments, credit card bills, or medical paymets. They are not lending you money on those things, so they don't care. Again, this is from a subprime lenders perspective. There are many different lenders, each with different guidelines, but that is how the companies I have dealt with look at credit.
Ok, back to FB's...
I think these people are in the hurt locker. They have a FICO score in the 560's, and they need a stated loan to 90% at about $420-430k on their primary residence to get some cash out. The only problem is that they would only be able to pull out about 10-12k. That 10-12k wouldn't really help them pay off the $50,000 or so of car payment and revolving debt they are carrying. They also have an "income" property that isn't. They have a stated loan on that property in the mid $300,000 range. So far, they have paid their mortgage on time, but with 2 stated income loans, a rental that doesn't cover the costs, and lots of revolving debt, I don't see a "soft landing" for them. Even if I could refi them, their rates would be higher and their payments would go up a few hundred a month. Hopefully they will find a way to work things out.
It's feedback time again. Let me know what you like, don't like, general thoughts and comments are always welcome
I know people have requested statistics and such, but I'm not really in a position to get the numbers that you need (aside from articles that come out like the PIMCO one below). It would take lots of time and money, and it would still be difficult to compile some of the info people want to see. Prof Piggington has some good stats for paying members.
Also, one other quick thing. Aside from comments and e-mails there is one other thing you can do to show your support. If there are blogs that you visit on a regular basis and you like what you read, show your support by going through the blog to get to the e-tailer of your choice. I know Ben's blog has Wal-mart, myself and others have Amazon. I know people hate ads and such, but if you are going to do some Christmas shopping, why not help out a blogger that you read on a regular basis. It takes quite a bit of time to compose posts, reply to e-mails, and keep good content flowing on a blog. I know it is a little thing, but all of us bloggers really appreciate it. To those of you that already do it...thank you!
Have a great weekend everybody! Only a few days left to get your shopping done!