If you are setting aside your desire to own a home because poor credit has deterred you, we can teach you some simple steps to help repair the damage and ease your way back into the credit world. It is not a quick fix that happens overnight, rather it is a process that you must abide by and you will begin to see changes in your credit. It all boils down to habits- good money management skills reap good credit, whereas poor management or the lack of can harm your financial situation.
Please contact a Five Star Realtor today to get this invaluable information that will make the road to homeownership a pleasant journey.

Credit Tips:

1. Aim to raise your credit score to above 650 in order to qualify for the best mortgage rates and loans.
2. If your credit scores are not at 650 or above, focus on paying all your bills early and on time. Late payments drastically damage your scores.
3. Reduce the amount of your outstanding balance. By paying more than your minimum due each month, you can help raise the numbers of your credit score.
4. Avoid applying for new credit cards. These inquires on your report can have a negative impact.
5. Make sure the information that is on your credit report is accurate. If you find any errors, take immediate action to have those items deleted.
6. Remember your habits! It is possible to improve your credit score quite a bit in just a few months.

How much house you can afford:

1. A good rule of thumb is that most people can afford a home that is two-and-one-half times their annual salary. For example if you make $50,000 per year you can roughly afford a home that is $125,000.
2. Your loan to value ratio determines how much you can afford to borrow. Divide the loan amount by the property's value. If the LTV is above 80% your rates may increase significantly. You may want to find a less expensive house or save for a bigger down payment to lower this number.
3. Adding up your monthly debts/bills and dividing by your monthly income can calculate your debt to income ratio. A good debt to income ratio is under 20-39%. This will help you to be perceived as financially stable.

Take control of the lending process and your finances. By lowering your loan rate by even a half point can save you thousands of dollars over the life of a loan!

Start saving now. Every little bit helps to build toward your financial goal. Having good savings habits will elevate you to a solid financial platform that will help in all areas of your life. Teaching your children the importance of saving and credit will also ensure that they develop healthy habits as well.

info@fivestar-realtors.com