Maine Real Estate For Sale !

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You Set Out To Buy Real Estate. But The Interest Rate Is Higher Due To Your Credit Score!

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Sometimes is it like not seeing the forest for the trees.

Case in point...stimulating the economy...putting more dollars in John and Jane Citizen's wallet to spend on necessities. Say you live with in your means. You have savings. You look good on a net worth analysis. You use your credit card but only when you are on the road traveling. You check into the motel with it, you pay for gas and meals with it.  But only on a trip..that's it.  And when you get the bill in a month, you pay it. No remaining balance, no minimum payment.  You don't carry credit card debt.  You've never been late on a payment.  You have a zero outstanding balance month after month, year after year. Your home is paid for. And you decide to get an equity loan because of the low rates out there now for a new garage or to spiff up the family room.  Surprised when you thought your credit score was 850...and suddenly closer to just a tad over 700.  No big deal right?  Well if you interest rate is a half a percent higher for that loan due to something on your credit report, you get excited. Say you are a broker who has a sale that falls thru and the buyer and seller are wrestling over the $500 deposit.  It escalates to the point of small claims court and the deposit is released in accordance to the judge's ruling.  That judgement, even if it was not against you but because you held the deposit and were brought into the fray can affect your credit..and remain on your credit report for seven years.  Getting it off by certified letters, emails, phone calls and faxes with all the court documents and a reader's digest version of the chain of events is not like snapping your fingers and voila..fixed. 

In Maine you can get a free once a year credit report to see what barnacles or burdocks are on that report that may or may not be accurate. I think you the person with the credit score should be able to access his/her own rating and details for free  to monitor if erroneous additions are removed or if new ones creep into play affecting your cost of money when your borrow with terms based on that credit score.  And access it any time of the year for free for your own personal information.  Also with identity theft, monitoring this is more important than ever. Have signed up for free credit report service but after the intial introductory period, like the free magazine that really is not free maine real estate agent, maine broker andrew mooersand hard to shake loose, it comes with a cost.  If you think how many folks in this country are paying a higher rate than they should based on incorrect credit reports or ones that issues that have been resolved but linger like a hangover, that is something to address in legislation along with the billions and billions in bail out money. 

There are so many positive moves Congress could make that do not involved handing over money or pumping in billions to stimulate the economy that would help the average guy. Making credit reports freely accessed by folks trying to improve their scores rather than paying millions over the country in higher rates than they should have had. A half a percent here and half a percent there on the final cost of financing and that is billions and billions that would not come out of the government..but from lower financing rates from the banks we are now bailing out left and right for other reasons. In the rush to infuse dollars into the economy, there should be a push of companion legislation that would save the tax payer money any way possible in their every day lives so the money left over in their wallet at end of the month could be used by themselves to stimulate the local economy on their own without the government trying to orchestrate it. Check out this in depth explanation on the financing process and FICO scores from Yahoo.

Maine REALTOR Andrew Mooers - Maine Real Estate And Area Information

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Comment balloon 7 commentsAndrew Mooers | 207.532.6573 • January 30 2009 09:42AM

Comments

What a great explanation for any home buyer. Buyers also need to realize that the rules for lending are also changing by the day.
Posted by Jim Crawford, Jim Crawford Atlanta Best Listing Agents & REALTOR (Maximum One Executive REALTORS®) over 11 years ago

thanks for the explanation

Posted by Lise Howe, Assoc. Broker in DC, MD, VA and attorney in DC (Keller Williams Capital Properties) over 11 years ago

It can take 20 years to build credit and 20 minutes to derail it.  The problem is once a buyer has a problem legit or otherwise on that report, the whole operation comes to a conveyor stop. Or they reach into their pocket and pay a higher rate on that loan they need NOW and then set out on the task to work to improve or remove items that should not have been on that report.

Posted by Andrew Mooers | 207.532.6573, Northern Maine Real Estate-Aroostook County Broker (MOOERS REALTY) over 11 years ago

Hey, Andrew.

It's a federal law that you get a free credit report once a year, so it applies to all 50 states, not just Maine.

Additonally, you get a free credit report once a year from each of the three credit reporting agencies, so the thing to do is to order one every four months but from a different agency. That will give you your three free reports at intervals so that you can monitor your credit report fairly well.

All three agencies get the same information. The difference is in how many points they award, or deduct, for the information that's in your report.

Posted by Not a real person over 11 years ago

Thanks Russel. In Maine your one time has the reporting bureaus on it. Knew other states did it but was after a way today, to verify who are who you are, to be able to today at this computer go on line and be able to in your case punch in Russel Ray and see today anything and everthing on it. So when you see hey, three laps tops from best buy transaction...you can say something's up...as it happens or see if something was removed that was posted more than once a year in this case. Splitting the agencies up not quite the way to go once a year as one could have something posted, another does not...I see your point to try to break them into one at a time thru out the year. Thanks for posting!

Posted by Andrew Mooers | 207.532.6573, Northern Maine Real Estate-Aroostook County Broker (MOOERS REALTY) over 11 years ago

Hi Andrew, Thanks for the post. Here's a great site to pull your annual credit report for free

https://www.annualcreditreport.com/cra/index from all three credit bureaus. We must remain vigilent and constantly monitor our credit.

Posted by Sandy Shores FL Realtor®, Melbourne Real Estate, Brevard County Real Estate, Florida's Space Coast (M & M Realty of Brevard Inc.) over 11 years ago

Hey Andrew,

Good post and true.  I understand the reasons for constantly changing the requirements but their scoring information should be available just like taxes.  Both change every year and we have the ability to see the changes in the tax structure, its our future and money we should be able to review our own FICO score in detail, not just guess on how they got that number.

Posted by Jim & Barbara Reedy (Country Club Estates) over 11 years ago

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