Maine Real Estate For Sale !

head_left_image

Highest-Possible FICO Score Is 850 But Even People With The Best Credit Don't Usually Exceed 825.

You are the one in 1300 folks that keep their credit score nose clean, with a FICO credit score over 800.

judge wapnerYou have a home mortgage that you pre-pay lump sums, make larger monthly payments than it was written for to get it off your back. Refinancing all along the way to land the cheapest money for that loan as rate drops open up opportunities to do so.  Your car is paid for, you credit cards are used mainly on a trip and sparingly with monthly charges cleaned right up. No balance carried and  the payments like clock work mailed out the day they arrive. No revolving minimum paying for you with lots of interest assessed. You save money, live within your means which is so not American it seems. You are a credit user dinosaur, and just don't get behind the wheel of that vehicle. And 99% are a pay as you go mild mannered guy or gal. You happen to be a real estate broker too.

     So you go to refinance to tap in to those incredibly low mortgage rates for your own home mortgage to take advantage of the cheap money. And your credit score that was always always over 800 comes up in the lower 700's. What happened? It seems in your travels as Joe Real Estate Broker, you have many transactions. Most marked sold, some that don't get to the closing table. A few where the deposit put down to take the propertyoff the market is held in escow until the deal unravels, falls apart despite all efforts with jumper cables and life support property attention. And the property buyerand seller decide to wrestle over the small five hundred dollar deposit. Both want it, feel ruffed up from the hard path with obstacles hurting their feet along the way. And small claims court, a judge is given the task of flipping the coin, determining who the real estate broker, you, are to release the deposit too.

     It's not the broker's money, he is holding it in his trust account until which way the deposit wind is blowing is decided. Judge Judy or Wapner say, award it to the real estate buyer in this case. Move on. No harm, no judge judy fowl, just part of the daily job as a real estate agent. Write the trust account check. And then during personal refinancing to lower your home loan rate, to follow the decline in interest your current mortgage holder is charging, suddenly red "credit tilt" lights go off, smoke flares head skyward.

Your stellar 825 credit rating is now in the mid 700's. How can that be, there must be a mistake? Nope.

     It seems that five hundred dollar deposit contest tug of war between the buyer and selleryou brought together is showing up as a court judgment on the real estate broker's credit reportsays Mr Banker. And you still get a great rate reduction on the refinance with the mid 700's credit score and this solitary small caliber gun shot bureau wound. But not quite as stellar as they would hand out to the 800+ gold star credit merit badge holders in the class.

     So you open up an investigation, show that it was not a judgment against you personally, but on behalf of the sellerthat you represent. It's part of your job, not dereliction or negligence on your part. Just comes with the territory of listing, marketing, selling real estate. You go thru thick and thin to represent and protect your seller in this case but not to the extent to take a presidential bullet so to speak. Not pledging to take hits on your own credit score on his behalf right? Maybe not.

     After opening up an investigation, showing the judgment was satisfied, not something the real estate broker could have avoid when a conflict between the buyer and seller came up and a stratch of the head on why the seller's credit did not take the ding, and you the broker was on the front line? The court release, the story of the process leading up to the credit reduction cross roads gets you a release, a removal of the blemish on a picture perfect credit canvas after a year of automation, faxes, time and frustration. You are out of the woods right? Maybe, maybe not. Check that score again, you get one free credit report from the major reporting firms each year. And should check to see how your sharp credit marksmanship is or is not. Credit restoration and removal of reported burdocks that may not be you is a hobby that can save lots of money when borrowing some is necessary.

     In this scenario, back to Trans Union to fax, email, call and show the event was resolved, removed, and should not have had you in the fray all done two years before.

But just because paperwork you secure spells out you have had it removed successfully, that it is deleted, removed, don't believe them. Because when you go to refinance again to follow down the new low bank rates, you may learn gee, they did not resolve it afterall.

And you have to jump now before rates increase and have to settle for a lower rate, but not as low as you would have had if the credit score was accurate. If you don't care, seven years later it falls off the report like dead skin on its own. But when you have a super credit score in a time when many folks don't due to indifference or just too many black financial clouds like repossessions, loss of job and divorce, it hurts. The government is pretty busy with health care, nation building and ramping up spending with new programs springing up daily. Others being heavily funded that are already set up. Wouldn't it be nice to have laws, protections that the credit reporting agencies abided by to save John Q Citizen money with the better credit scores, accurate figures they try to restore. But that in reality are hard to hand stand, go to the ends of the earth to get corrected, adjusted, or errors removed. This is an excellent run down on credit scores, the FICO A-Z. A better score means a better deal from landlords, lenders, insurers and other creditors.

I'm Maine REALTOR Andrew Mooers

info@mooersrealty.com | 207.532.6573

Log on www.mooersrealty.com   www.ownmainerealestate.com

www.youtube.com/mooersrealty

youtube icon chicklet,mooers realty youtube videos  twtter icon chicklet,mooers realty twitter  flickr icon chicklet,mooes realty flickr photostream  facebook icon chicklet,mooers realty facebook page  linkedin icon chicklet,mooers realty linkedin activerain blog rss feed, feed icon mooers chicklet blogger icon chicklet,mooers realty blogger site wordpress icon chicklet,meinmaine blog digg icon chicklet,digg mooers realty  google ning chicklet   mooers realty tumblr site  maine listings real estate logopinterest logo chicklet

 

 

 

Comment balloon 9 commentsAndrew Mooers | 207.532.6573 • March 30 2010 11:52AM

Comments

In this economy, and with all of the challenges facing lenders and the banks, a healthy credit score provides confidence for consumers.

Posted by David Saks over 8 years ago

Andrew, I never would have guessed an escrow deposit in dispute would have any baring on my personal credit score. I'll have to check into my own score now!

Posted by Steve Loynd, 800-926-5653, White Mountains NH ( Alpine Lakes Real Estate Inc., ) over 8 years ago

David. Agreed if the credit score you live and die by, that controls the cost of the financing. They talk truth in lending with buyers...borrowers, but accurate credit reports and heel dragging to correct mistakes, burrs on that report that is the end all for everything from insurance, whether you get a rental and not just the rate you qualify for in a standard loan. If your credit rating is going to be the end all, that figure better be accurate and up to date if disputes are resolved, the negative event removed. The fair credit reporting act provides 30 days to update...this one above outlined started in the fall of 2007 and still coming up on credit radar. David, thanks for stopping by.

Steve. Maine has provisions now for an owner financed sale where the buyer/borrowed in the take back with the seller's lack of paying taxes can affect the seller's credit rating, the record owner as of April 1st say. Maine has a law where that buyer HAS to help restore the credit rating that lack of payment, or report of no or late payment caused. I think how it is put on the small claims court docket and whether the courts that report the judgement bother to report the outcome, resolution. Like a tax lien that is paid but never record to show the world. Thanks for popping in.

Posted by Andrew Mooers | 207.532.6573, Northern Maine Real Estate-Aroostook County Broker (MOOERS REALTY) over 8 years ago

Andrew, 

Very cool post.  We have worked on keeping a good credit score.  I had never heard a broker dispute could end up on there.  Thank goodness, none of those.  

I had also heard the 1 in 1300 number for scores in the 800's.  I was wondering if that is a current number, as I would guess it had dropped.  

As a side note, we property manage executive lease homes and I have a ton of 750+, a bunch in the 800's tenants.  I pretty much know if they have a fabulous score I am going to get the home back in great condition. 

All the best, Michelle

Posted by Michelle Francis, Realtor, Buckhead Atlanta Homes for Sale & Lease (Tim Francis Realty LLC) over 8 years ago

Andrew,

Great post and it helped me. I have never been able to get my score above the upper 700's and am not quite sure why except possibly it is all the investment properties I own. My wife once had the challenge of having her credit comingled with a person who had the same name. I was a real challenge to get it straightened out, but having great credit is well worth it, as you have pointed out.

Cal

Posted by Cal Yoder, Homes For Sale in Lancaster PA - 717.413.0744 (Keller Williams Elite) over 8 years ago

I had a buyer who's loan was denied for excessive credit. He did not have too much owed but the ability to in one afternoon go on a spree and charge up $300,000. I have had a local banker tell me he has called/emailed/faxed a credit card company that automatically ups your credit line to tell them no thanks, reduce it to make him look leaner, meaner on potential spending limits he is never going to limbo over anyway. The credit limit bar is so high he won't ever need it or would go a conventional bank route to raise the funds. Buying a home with a credit card on the ones in the teens in Maine sometimes, even with higher rates, the cheapest, quickest way to roll. This link article says the credit limit size does not matter but there was a school of thought not long ago that said it was one of many factors used when they eye ball a platic card holder. If your credit is a little below blue ribbon, the thought the risk is greater so let's charge this cat a higher rate. They make more off the guy with a low 700 score than the 800 but this assumes you carry a balance to charge interest on. I don't, never have, do not like owing money and scurry to eliminate it. Four college funds does that to a guy.

Posted by Andrew Mooers | 207.532.6573, Northern Maine Real Estate-Aroostook County Broker (MOOERS REALTY) over 8 years ago

I learned some very interesting things here.  Thanks

Posted by Ann Dail, Broker/Realtor,CRS, ePRO, SRS, B.A.Chem (Baton Rouge Area Homes, Louisiana, USA, 225-761-0551) over 8 years ago

There are a lot of things that surprise people about credit if you want some more information on credit scores check out this free website I found www.thecreditguy.tv

Posted by Dave Sullivan, Michigan Realtor with an investor viewpoint (Real Estate One) almost 7 years ago

Ann ... roll up your sleeve (blood pressure cuff pumped up with air, tightening) Check your er, credit score and keep it clean as a whistle. Or pay for for services, interest if you don't.

Dave ... Thanks. Will scope it out. Everyone should be concerned about their credit, what the report says that is accurate or whoa, (static radio cutting in and out) Roger "Whiskey, Tango, Foxcroft...." where the heck did this, this and that credit entry come from can happen!

Posted by Andrew Mooers | 207.532.6573, Northern Maine Real Estate-Aroostook County Broker (MOOERS REALTY) almost 7 years ago

This blog does not allow anonymous comments