Jeff Underwood Personal Finance Expert and Mortgage Professional

http://theuglytruthaboutmoney.com/
http://www.facebook.com/TheUglyTruthAboutMoney

Quick update on the story about the 59.9% and 79.9% credit cards……..

Stay Informed throughout 2011!
Join me for an exciting year of fun education on money, debt, real estate, credit, mortgage, the economy, and how they all work together!

Also find Jeff on internet radio and iTunes….. http://www.blogtalkradio.com/jeffunderwood  – The Ugly Money Show
iTunes – The Ugly Money Show

Jeff Underwood, The Street Economist
The Ugly Truth About Money

http://theuglytruthaboutmoney.com/
http://www.facebook.com/TheUglyTruthAboutMoney

Small Business takes yet another hit! It looks like small businesses across America have had a hard time getting credit and loans to help expand during these tough times. This is just another example of how the big companies have an advantage over the smaller competition.

Stay Informed throughout 2011 with Jeff Underwood.
Join me for an exciting year of fun education on money, debt, real estate, credit, mortgage, the economy, and how they all work together!

Also find Jeff on internet radio and iTunes….. http://www.blogtalkradio.com/jeffunderwood  – The Ugly Money Show
iTunes – The Ugly Money Show

Jeff Underwood, The Street Economist
The Ugly Truth About Money

http://theuglytruthaboutmoney.com/
http://www.facebook.com/TheUglyTruthAboutMoney

Would you believe there is a company that has been offering a 79.9% interest rate credit card?

Stay Informed throughout 2011!
Join me for an exciting year of fun education on money, debt, real estate, credit, mortgage, the economy, and how they all work together!

Also find Jeff on internet radio and iTunes….. http://www.blogtalkradio.com/jeffunderwood  – The Ugly Money Show
iTunes – The Ugly Money Show

Jeff Underwood, The Street Economist
The Ugly Truth About Money

Also visit TheUglyTruthAboutMoney to follow The Street Economist

Black Friday is 3 days away. It’s the official start of the 2010 Holiday Shopping Season.

Sales are expected to top $111 billion this year and, already, businesses are vying for shoppers and their dollars. Newspaper circulars are getting larger, and in-store discounting is more prevalent.

But one discount that shoppers should think twice about is the popular “Open A Charge Card, Save 20%” promotion. The short-term savings may be tempting, but the long-term costs may be huge.

It’s because of how credit scores work.

According to myFICO.com, “new credit” accounts for 85 out of 850 possible credit scoring points, with new credit defined by such traits as:

• Number of recently opened accounts
• Number of recent credit inquiries
• Time since recent credit inquiries
• Proportion of new accounts to all accounts

These traits are negatives against a FICO score so with each new, in-store credit card application, a person’s credit score will fall. The fall will be especially pronounced for persons lacking credit “depth”, or who have made a disproportionately large number of new credit applications recently.

For soon-to-be homeowners, or would-be refinancers in Chandler , credit scores are worth keeping high. This is because credit scores change the mortgage rates and/or loan fees for which an applicant is eligible.

As an illustration, assuming 20% equity on a $200,000 conforming loan:

• 740 FICO : No added loan costs
• 720 FICO : 0.250% increase in loan costs, or $500
• 700 FICO : 0.750% increase in loan costs, or $1,500
• 680 FICO : 1.500% increase in loan costs, or $3,000
• 660 FICO : 2.500% increase in loan costs, or $5,000

It’s expensive to have a low credit score — more expensive than the money saved by opening a card at the mall, anyway.

That said, if you know you won’t need your credit for a mortgage within the next 6 months, the risk of applying for in-store credit cards is likely small. But if you’ll need your FICO soon, consider paying for your gifts full price.

Thank you for reading and following.

Jeff Underwood, The Street Economist

Licensed Mortgage Professional And Personal Finance Expert

Also visit http://theuglytruthaboutmoney.com/ or TheUglyTruthAboutMoney

Follow The Street Economist at http://www.facebook.com/TheStreetEconomist

http://www.blogtalkradio.com/jeffunderwood

Also visit TheUglyTruthAboutMoney to follow The Street Economist

This week marks the start of the Refi Boom’s 7th month; rates have been falling since early-April 2010. Whether you’re looking to refinance or buy a home, however, know that not everyone will qualify for today’s low rates.

Mortgage approvals are primarily based on good income, good equity and strong credit, and, without all three, the best rates of the day remain out of reach. Now, you can’t always ask for a raise and equity is a function of the housing market, but you can do something about your credit score.

In this 4-minute segment from NBC’s The Today Show, you learn some credit basics to help propel your score higher:

• There’s no “quick fix” for credit. Time + Good Credit Behavior = Better FICOs.
• Pay every bill when it comes due. Even one late payment can damage your score.
• Don’t close old credit cards

Also among the segment’s advice is to stop worrying about whether rates have bottomed. Refinance today if it makes financial sense. Then, if, by chance, rates fall in the future, just refinance again.  Don’t be greedy, we’re told.

Thank you for reading and following.

Jeff Underwood, The Street Economist

Licensed Mortgage Professional And Personal Finance Expert

Also visit http://theuglytruthaboutmoney.com/ or TheUglyTruthAboutMoney

Follow The Street Economist at http://www.facebook.com/TheStreetEconomist

As the federal home buyer tax credit nears its April 30 end-date, there’s a lot of would-be home buyers still working to get under contract.

A piece of advice for all of them : If your pre-qualification and/or pre-approval letter is more than 8 weeks old, it would be prudent to have your lender “re-pre-approve” you. Mortgage guidelines have been in flux and your original lender letter may now be invalid.

For example, over the past half-dozen months, the majority of mortgage lenders have reduced their risk tolerance with respect to:

• Maximum debt-to-income ratios
• Minimum allowable credit scores
• Calculation of “assets in reserve”

For buyers of condominiums and co-ops, even the subject property itself is coming under tougher scrutiny.

Today’s mortgage applicants need to be a complete package. It takes more than just good income and credit to get approved anymore and today’s buyers should revisit their qualifications. What passed underwriting in January may not pass in May.

Being pro-active brings other advantages, too. If a mortgage re-pre-approval does unearth an issue, it’ll be easier for every party to the transaction to address and correct it up-front versus trying to clean up a mess once a home’s already under contract.

Talk to your agent and your loan officer about your pre-qualification/pre-approval letter before you bid on a home.