Blog Category: credit

credit report

Alternative Credit History To Help Qualify For A Mortgage

Can you use an alternative credit history to help qualify for a mortgage? Banks typically want you to have to have at least four pieces of credit. Sometimes when I pull a credit report for a first time home buyer or a younger person, I see a credit report with one credit card on it, and on occasion nothing at all. Some people only use checks, cash and debit cards to pay for things. Without a credit history comprised of at least four different pieces of credit, it may be difficult to get a loan.

Apparently banks want to see more numerous items of credit history, to feel comfortable extending a large piece of credit (like a mortgage).

However, there is a solution. Banks will allow you to build an alternative credit history. This means that we can show them a 12 month (at least, or you can show a longer history if it exists) credit history of things that normally do not show up on a credit report. Read More

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Buying A Home Non-Contingent On The Sale of My Current Home

Buying a home Non-Contingent on the sale of your current home is hard. I often get asked to get a potential buyer pre-approved to buy a new home, without the mortgage being contingent on the sale of the current home that they own. While this is possible, it is difficult.


First, you have to have the cash for the down payment and closing costs for the new home without the benefit of the sale of the current home. Then you would have to be able to qualify to carry the debt of both mortgages at the same time. Read More

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Can paying off a debt help qualify you for a mortgage?

Can paying off a debt help qualify you for a mortgage? When you qualify for a mortgage loan it may not be for the amount you want. Outstanding debts can affect how much you are able to borrow. In some instances you may be able to pay off the debt in order to qualify for a larger loan.

If you reduce the number of installment payments to 10 or fewer, the loan may not be included in your debt-to-income ratios. What if the debt has a large monthly payment? Then an underwriter may consider it a risk in your debt-to-income ratio. Read More

house for sale

Closing Cost Credits: Get Seller Credits or Lender Credits? What is a Lender Credit?

I sometimes have clients ask me how they can reduce the amount of cash they need to pay towards the purchase of a new home. Recently a client who was making an offer on a house that had an asking price of $650,000 wanted to make an offer of only $600,000 figuring that since they were putting 20% down, they’d save $10,000 by paying 20% down on $50,000 less in price. However, the house is worth what it is worth. And a buyer’s cash on hand has no bearing on where the house should be valued. Read More


Credit Score Fall Down And Get Hurt?

Credit Score Fall Down And Get Hurt? You could easily find your credit score falling if you are not careful. And then when that happens? You may fall down yourself and get a boo boo. Credit scores are more sensitive than you know and can quickly drop. Read More

credit cards

Credit Score Simulator

A Credit Score Simulator can help with “What If” scenarios to determine what you could potentially do to raise your credit score. It can also show you what could negatively impact your credit score. It is important to see how your credit choices might affect your credit score because your credit score will impact the underwriting of your loan, your interest rate quote, and even the cost of your mortgage insurance.

Some of the various things a Credit Score Simulator can measure to see how they will impact your credit score are: Read More

credit report

Credit Scores Falling

Are your credit scores falling? Don’t let your credit score fall down. There are many current homeowners who can afford their mortgage, but are upset that their home is not worth what it once was. These people are called “strategic defaulters”. But walking away from a mortgage, especially one you can afford, is a bad idea. Read More

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Don’t Ignore The Collection Agency!

Don’t Ignore The Collection Agency! I think most of us have had a dispute with a creditor, certainly minor ones. Who has not argued over a charge with a credit card company, a cell phone company, a retailer, or argued over a parking ticket. And sometimes we are so sure we are right we just don’t pay. And then we are so sure we are right, we ignore the mail that inevitably comes after the fact seeking payment. Big mistake. Read More

credit cards

Don’t Let Your Credit Cards Drown You!

Don’t Let Your Credit Cards Drown You! This is going to come across as a lecture. And, well, it is. I have had some loans come close to being denied because people cannot control their credit card use. When you apply for a mortgage don’t use your credit cards! Read More

Five FHA Loan Facts to Know Before You Buy A Home


FHA loan facts. FHA, known as the Federal Housing Administration, offers a mortgage loan requiring borrowers to have mortgage insurance on the loan. The FHA loan originated during the great depression and has contributed to the growth of the housing market ever since.  Read More

Debts Paid By Others

How Are Debts Paid By Others Handled On A Mortgage Application?

How are debts paid by others handled on a mortgage application? Sometimes when someone applies for a mortgage with me, they mention they have a debt paid by a parent. They may have a school loan that a parent pays. Or people may tell me they co-signed for someone else’s mortgage, but they do not make the payments. Read More

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Interest Rates And Your Monthly Mortgage Payment

Many people are very focused on interest rates these days and are wondering where they are headed next and how it may affect their mortgage payment. Interest rates have been historically low for a very long time. And people are starting to fear that they may increase and have an outsized impact on the cost of purchasing a home.

You can see a chart of the long-term history of interest-rates by clicking here.  This chart shows that we are definitely near the bottom of where interest-rates have been over a long period of time. On the other hand, if interest-rates start to go up does it have as much of an impact as people think? Read More

credit score

Is Your Credit Active Enough?

Is your credit active enough? I have a client who did not have active enough credit, and got a loan declined. Fortunately there were enough other lenders that saw the situation differently, but the topic merits discussion. Read More


Is Your Credit Score Holding You Back?


Justin: We are on. Hey Brian, how are you?

Brian Martucci: Hey, good, Justin.

Justin: Good. Well, happy Thanksgiving to you. I know this is kind of a holiday weekend, but what you have to say is pretty important, especially with everyone hitting Black Friday today.

Brian Martucci: That’s right. Sure is.

Justin: Okay. So let’s talk a little bit about credit scores. Read More


Late Payments On Your Mortgage

Some people do not realize how late payments work on their mortgage. Your mortgage is legally due on the 1st of each month except on a home equity line, which may be due at almost any time of the month. I am focused in this blog post more on regular mortgages. Read More

Minimum Credit Scores

The latest minimum credit scores are simple for an FHA loan. If you have at least a 620 credit score, you can get an FHA loan.

With Conventional loans, a 720 credit score is preferable. You may get a loan with a lower credit score, but it would cost more points (i.e. an “add-on”).

There are complicated matrices used on Conventional loans and those may show that a lower credit score can still get a Conventional loan, but trust that if you are going for a Conventional loan its best to have a 720 credit score.

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Mortgage forbearance

Forbearance – you should only do it if you absolutely have to. Some people are taking a forbearance on their mortgage as a way to take a break on their mortgage payment when they really do not need to.

Forbearance does not mean you can skip mortgage payments and never pay them back. You have to repay any missed or reduced payments in the future. So, if you’re able to keep up with your payments, keep making them.

It will also impede your ability to refinance. Having a forbearance on your credit report means you cannot get a new mortgage. You have to bring the loan current to do so. Read More

no money

Mortgage Forbearance in 2020

Forbearance, only do it if you absolutely have to. Some people are taking a Forbearance on their mortgage as a way to take a break on their mortgage payment when they really do not need to.

But forbearance does not mean you can skip mortgage payments and never pay them back. You have to repay any missed or reduced payments in the future. So, if you’re able to keep up with your payments, keep making them.

Taking a forbearance will also impede your ability to refinance. Having a forbearance on your credit report means you cannot get a new mortgage. You would have to bring the loan current. Read More

credit report

My Credit Score Is 760. No It Isn’t.

If you’ve looked up your credit score on your own before then you know your score, right? Well, you may not know your accurate score. You may only know one score instead of all three. Mortgage lenders use all three scores, one from each of the large national credit bureaus. These are Equifax, TransUnion and Experian. So if you see a 741 score on a consumer credit report you pull, a mortgage lender may see a 698, a 723, and a 741. And the mortgage lenders use the middle credit score, or the 723. That may cause a change in the terms that are being quoted to you. Read More

credit score

New Credit Score Requirements

Fannie Mae has announced new credit score requirements. There are new rules regarding credit scores that will impact the terms you get on a mortgage. For many years there have been rules that say you pay a higher rate with a lower credit score. Now Read More


Paying Close To The 15th Saves No Money On Your Mortgage!

Paying Close To The 15th Saves No Money On Your Mortgage! I get asked what I think if a client pays their mortgage on the 14th of each month right before the payment is considered late. This is usually done because people think they are going to save money by keeping the money in their bank account from the 1st of the month through the 14th of the month. It saves $1.25, and that is all! “How so?” you might ask. Read More

credit cards

Paying Off Credit Cards Monthly

There is a new underwriting rule change that is going to be very painful for mortgage borrowers. It has to do with open 30 day charge accounts. This relates to paying off credit cards monthly. The rule says for open 30 day charge accounts that do not reflect a monthly payment on the credit report, or 30-day accounts that reflect a monthly payment that is identical to the account balance, lenders must verify borrower funds to pay off the account balance. The documented funds must be in addition to any funds required for closing costs and cash reserves. This is very important. It used to be Read More

credit report

Problems With Your Credit Score? No Credit Score??

Problems With Your Credit Score? It seems all banks and all types of loans today require a credit score to get a mortgage. I know of only one bank that still allows what is called “an alternative credit history”, it seems 99% of all banks now mandate the need for a credit score. But there are a few people, very few, who don’t use credit, have not gotten a credit card, and pay cash or write checks for everything. I find these people to be younger, or much older. The younger people still have not considered building a credit history, and some much older people just never used credit or were never comfortable with it. Read More

credit score

Rapid Rescore And Improving Your Credit Score

Mortgage lenders have the potential to improve a mortgage borrower’s credit score. A rapid rescore can improve your credit score. Having an improved credit score can possibly lower your interest rate and/or your Private Mortgage Insurance (PMI) if your loan has PMI. However, improving a credit score is no guarantee of getting lower mortgage terms. Also, improving your credit score may not even be needed. Why? Read on. Read More



Are you self-employed during Covid? Need a mortgage? There are newly revised mortgage guidelines for self-employed people due to the Covid-19 pandemic.  There are temporary requirements for assessing income derived from self-employment.  The additional due diligence is due to the disruption from the pandemic.  Mortgage lenders now need to consider if and how a business has been impacted and the likelihood of income continuance.

There is additional income documentation required. You may need an audited Profit & Loss statement with supporting documentation for the Profit & Loss statement.  The continuity and stability of income is what will be considered. Read More

Grinch That Stole Christmas Statue

The Grinch That Stole My Mortgage

The Grinch, which in this story is Fannie Mae, just stole Christmas. I must admit, that is dramatic, and not literally true. But they did potentially just steal your mortgage.

Fannie Mae’s current rules allow an underwriter to exclude revolving debt (i.e. credit card debt) from the debt-to-income (DTI) ratio if there are ten or fewer payments remaining. Fannie Mae will now require all revolving debts to be included in the DTI ratio regardless of Read More

credit reports

Three Credit Reports to Get a Mortgage?


A lender pulls three credit reports to issue a mortgage? Yes, potentially. One when you get pre-qualified. Then another at loan application, if loan application and settlement happens 120 days or more after pre-qualification. And then the third check is just before settlement! Yes, now Fannie Mae, Freddie Mac, FHA, and all the rule makers require lenders to check for credit activity just a day or two prior to settlement. Read More

condo building

Waiving Contract Contingencies On A Condo

When buying a condo, you may find yourself in a competitive bidding situation. And your realtor may ask you about waiving some or all the contingencies in your contract. These contingencies are usually things like a home inspection contingency, appraisal contingency, and financing contingency. But waiving contract contingencies on a condo can be risky. Read More

contractual consent

Waiving Financing Contingencies

I sometimes get asked about waiving one or all contingencies in a real estate contract. This helps make for a more aggressive offer in a competitive sellers’ market. The main contingencies in most real estate contracts are the appraisal contingency, the financing contingency, the termite inspection contingency, and the home inspection contingency. I am not a proponent or an opponent of any of these strategies. I simply want to discuss the pros and cons of each since it is a question I do get. Let me take these one at a time. Read More

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What Can Stop You from Buying a House? Common Obstacles and How to Overcome Them

You have a down payment saved up, a good credit score, and a low debt to income ratio. It is time to buy your dream home. However, something prevents you from buying the home. What can stop you from buying a house? In this article we will explore some common obstacles and how you can overcome them.

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What Is A Credit Inquiry

What Is A Credit Inquiry?

When you apply for credit you are authorize the creditor to “inquire” to a credit bureau to get a copy of your credit report. You would later notice that their credit inquiries show as an “inquiry” on your credit report.

Read More

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What Portion of My Income Should I Spend on a Mortgage?

What portion of my income should I spend on a mortgage? Deciding on how much mortgage you can afford is very complicated with several things to consider. Before you plan to spend the maximum amount you’ve been approved for, consider what you feel comfortable with. And don’t treat your home purchase like a zero-sum game. Consider spending a sufficient amount to buy enough house to keep you happy for a longer period of time. This is due to the hefty transaction costs of real estate. Read More

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Why Do Sellers and Realtors Want Me To Be Pre-Approved?

Always get your mortgage pre-approved! Homeownership is a major component of the American dream. It provides you with your own piece of property to put down roots and live your life. You might think the process starts when you first go out hunting for houses or condominiums. But it often begins long before the initial meeting with a realtor when you contact a lender for pre-approval. Here are a few reasons why the seller and listing agent might want you to get pre-approved. Read More