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By Alex Refintage

 With a home you get the benefits of leverage, You invest a relatively small down payment, yet, you receive returns based on increases in the total value of your home. For a ton of articles, guides, tips and information about mortgage refinancing please visit our website. During this entire- Hi-year period, the DJIA closed no higher than 1051.70, and it fell to as low as 577.60 in 1974. Who has to pay PMI? Most lenders require private mortgage insurance from home buyers who put down less than 20% of the total value of their home or conversely, who borrow more than 80% of the total value of their home. John Morroni is the owner of RefinanceHelp.org, a site dedicated to mortage refinance and home prices. The West was the only region to mark price gains in 2006, with houses selling for 0.4% more than in 2005. Atlantic City and Salt Lake City metro areas saw highest price gains, with more than 20% increases in single family home prices. When do I have to pay the PMI premiums? Most lenders require that you pay the first years premium at closing, so dont forget to add it in when youre figuring out your closing costs. So if someone is about to become a significant customer, do your homework. One small business owner I know has only one employee, but has four different loans related to his business: an equipment loan, a car loan, a business line of credit and a business credit card. I’ve received bills from businesses offering discounts of 1% or 2% for payment within 10 days. Joseph Anthony is a tax professional in Portland, Ore., who writes about finance and tax issues affecting small businesses. One of the challenges of running a small business is dealing with the feast-or-famine nature. So if someone is about to become a significant customer, do your homework. Do your homework and determine what the best scenario is for you. On an after-tax basis, a 10 percent a year return on stocks is considered very good. Will your tax deductions become affected by lowering your interest rate. Do I have to pay for PMI until my mortgage is paid off? No. Good for my bottom line; good for the business’s cash flow. If instead, you had put $10,000 or $20,000 into, say, a home in boom-towns like Portland, Austin, Boston, Seattle, San Francisco, Park Cities, Denver, Boulder, Sarasotaor any one of dozens of other hot housing market citiesyou would have enjoyed a tenfold (or greater) increase in your original down payment investment. At a certain point, when new construction and speculation activity created an inventory that was way too high for the market, buyers, not sellers, became the markets driving force. On a $200,000 mortgage, youll pay about $1,000 for the first years premium. What this all means is in terms of researching your home purchase, be wary of PMI consideration. There are usually other requirements as well, such as no late payments in the year before you request cancellation, and no other mortgages or liens against your property. That result yields an after-tax annual rate of return around 24 percent. That’s not just about the flow of business, but also the flow of cash. When do I have to pay the PMI premiums? Most lenders require that you pay the first years premium at closing, so dont forget to add it in when youre figuring out your closing costs. Create Incentives for Faster Payment Small businesses can sometimes cut the time spent waiting for payment by offering a discount for quick payment. When a home buyer buys a house with less than 20% of the homes value as a down payment, the mortgage lender assumes a larger risk. Portland-Vancouver-Beaverton, El Paso and Seattle-Tacoma-Bellevue metro areas all ranked above the 10% gain level, while Springfield, IL, Palm Bay-Melbourne-Titusville and Sarasota-Bradenton-Venice all saw price drops of more than 10%. What this all means is in terms of researching your home purchase, be wary of PMI consideration. In fact, over the long term, fewer than 2 percent of professional fund managers have been able to consistently earn after- tax returns on stocks of more than 10 to 15 percent a year.

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Owner Builder Loans - Everything You Need to Know About Credit Scores
By Chris Esposito

 With all of the recent changes in the mortgage industry, it can be tough to keep up with the different requirements for the different loan programs available. Owner builder construction loans are probably as complex as residential mortgages can get. But, there are some simple rules about your credit scores that can make understanding the owner builder guidelines a little easier.

The first rule of thumb for an owner builder construction loan is that you will want to have a credit score of at least 620. Obviously, the higher your credit score is, the better it will be for your loan. However, if you want to be an owner builder to build your own home, then you will need to have a middle FICO credit score of at least 620.

Technically, for most owner builder loan programs, there is no strict minimum credit score requirement. In most cases, your loan application will be run through an automated approval system, which will analyze your overall risk factor. However, even without a strict minimum, you most likely are not going to get the approval through the computer system without at least a 620 score.

Along those same lines, an owner builder may not get approved for their financing even with a credit score above 620. In addition to analyzing your credit score, the approval system will also examine your current credit health. In other words, if you don’t have any current, healthy accounts that are at least one to two years old, then having a credit score above 620 probably won’t be enough to get your approval.

Likewise, owner builder construction loans are going to provide better rates in terms for borrowers with higher credit scores. Specifically, having a credit score above 700 will help you get the best rates and terms available.

It is important to remember, though, that a strong credit score will not assure an owner builder of getting approved. In other words, an owner builder with a strong credit score is not going to get through underwriting if he has too low of a documented income or too much debt. Furthermore, a strong credit score won’t be enough to get the loan approved if the project has a poor appraisal or an unrealistic budget. Therefore, a good credit score is just one piece of the puzzle for a strong owner builder file.

In fact, here are some of the specific advantages of having a higher credit score when applying for an owner builder construction loan:

1. An owner builder who has a high credit score can often get approved with less than the normal amount of savings in reserves.

2. If you have a credit score above 700, you will have a much smaller down payment requirement for an owner builder construction loan.

3. Also, an owner builder with high credit scores will get better interest rates as compared to someone with just average credit scores.

So, even though a having a credit score won’t get an owner builder approved if there are other glaring issues with the file, it will certainly provide the three advantages listed above.

Therefore, if you are considering being an owner builder, make sure you have a middle FICO score that is at least above 620. If your score is just barely over the 620 mark, then expect to have stricter down payment and interest rate requirements for your owner builder construction loan. So, if you have a limited amount of savings in the bank, you may want to work to get your credit scores above 700 before applying for an owner builder loan.

Owner Builder 101 and Chris Esposito provide loans for people who want to build their own home without paying the costs of a GC. To learn more about owner builder construction loans and how to save tens of thousands of dollars, visit Owner Builder 101’s website or call (877) 876-3688.

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