How FICO Scores Can Help First time Home-buyers

scoreIn our over committed society, our time is precious and few of us want it wasted. Some who feel it most keenly are those who are seeking to purchase their first home.

What it requires to gather documentation, for credit scores and going through the credit check process,  may not seem like time well spent if they discover a lower credit score than anticipated. All is not lost however.

What is FICO score? The Original name of the company was the Fair Isaac Company. They  looked at specific credit data to predict consumer behavior. Using that they were able to determine the likelihood of a borrower’s ability to assume a larger line of credit, which would go bankrupt and those who would be profitable.

Are FICO scores important? While FICO has been the gold standard of scoring for about 90% of lenders, it had been the only qualified scoring system for years. When purchasing your credit score from Equifax, Experian and TransUnion, you’re more likely to receive a Vantage score.  In recent years, there has been controversy over the accuracy of other scores. Overall, the numbers are accurate. Though some differences exist, Fico treats missed mortgage payments the same as other missed payments. With VantageScore, late mortgage payments are more damaging. See the comparison chart here.

What factors affect my number? A lot of factors go into a score, but two that can really knock it down are high credit card balances and debts turned over to collections. Others include payment history recency, frequency and severity.

How to look at a low score: Although it is possible to buy a home with a low credit score, the interest rate rises significantly the lower it is. Additionally, a higher down payment will likely be required. Lower scores indicate to lenders that the buyer is a high risk candidate. What that also means, is that if your credit rating stays low, you will pay significantly more over the life of a home loan than another buyer with a better score.

How low is too low? Even though an FHA loan has the lowest credit requirements, a  score under 500 is generally considered to be a bad loan. Since the housing crash, President Obama signed the Dodd-Frank Wall Street Reform into law. This made it a lot tougher to qualify for a home loan. That said, it is quite often difficult to get approval for a home loan with a credit score between 500 and 579. Coming up with a 10% down payment usually stands in the way of most low-score home loans.

cycling-bike-trail-sport-161172Timely habits that improve score.  Lenders look at other factors when you begin to reestablish credit. If you have moved on from an economic hardship, that would be in your favor. Having low debt to income (under 30%) can be an attractive counter balance. Compensating factors that reduce the lender’s risk give lenders more latitude to approve the loan. Additionally, a strong, yearlong payment history with no collections or late payments plays a significant role. Ideally, the buyer should have a strong track record at their job of two years or better.

How long does score improvement take? Putting an exact time limit on how long it takes to raise a score is tricky. It depends on the reasons for a low score. If you’ve had wages garnished, declared bankruptcy or defaulted on a loan, these can affect your credit for years.

Each month that bills are paid on time raises the score. Paying down credit cards use accounts for 30% of your score. The higher your balance, the lower your score, so it makes sense to get these as lowered as quickly before applying for a mortgage.

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Collections on your credit report negatively  impact your credit score. But, these are not impossible to clear up and have removed from  your account, however  you must call them directly. Ask them if they’ll agree to a pay for delete. This is an agreement (in writing) that you agree to pay the balance and in return, the creditor removes the account from your credit report.  Paying collection accounts doesn’t improve your score and unless the lender directs you to pay it off, without the agreement in place, there’s no reason to do so.

We want to see you succeed in owning the home of your dreams. If you have questions regarding credit repair services, we can help. Call our office today at (614) 891-9000. We can provide numbers to trustworthy resources that can help not only repair credit but maintain an excellent score.  Stop by our Facebook page, we’d love to say hello!

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HAPPY THANKSGIVING!

Thanksgiving Day with Ohio Capital Mortgage

Whether you celebrate the holiday with a traditional roasted turkey,  a little more daring (deep fried!), or you’re  serving a vegetarian  feast, all of us at Ohio Capital Mortgage Family wish you a very

Happy Thanksgiving!Ohio Capital Vegan PizzaPlease take a moment and tell us how you celebrate your Day of Thanks. Are you a traditionalist? Vegan or Vegetarian?  What side dish can you not do without? Maybe it’s the cranberry sauce, or the twice-baked potatoes. Help us get to know a little more about you! And if you’re going on shopping, travel safely.

~ Brian Flaherty & the Ohio Capital Mortgage Team

HOLIDAY NETWORKING

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Holidays present a cornucopia of opportunities for meeting new people and forging new relationships. With so much goodwill in the air, it’s a fantastic time to strengthen or renew long-standing relationships. You can do this by attending office parties, business get-togethers and open houses. Or, host a gathering of your own.

Even though the very mention of “networking” may strike fear in the hearts of some, go with the intent of having a good time and connecting with new people. Don’t pressure yourself by thinking of making a sale or landing a new client, relax and build relationship. Prepare to introduce yourself and share your personal elevator pitch, what you do and who you do it for. Two or three quick sentences.

We all want to be found interesting. Show interest in another person, and treat each with dignity and respect. Ask about their family, job and aspirations. You can never go wrong being kind. You never know where it will lead.

Handing out your business cards is like sowing seed. You never know when the plant will spring to life. Have them with you everywhere you go.

Chat up More People at Mixers and Staff Gatherings

Present the best version of yourself. Wear appropriate clothing. Some people don’t talk business at celebrations. Not to worry. You want to build a connection. So relax and have a pleasant conversation. Keep them talking by asking open-ended questions to gather more information. Be a great listener and they’ll remember you as a great conversationalist.

  • office partyBe prepared with a short list of conversation starters
  • How do you know the host/hostess?
  • Who else do you know at this event?
  • Where would you most like to travel?
  • What is the most interesting place you’ve visited?
  • What has been the highlight of your year?
  • The craziest job you’ve ever worked?
  • What’s the worst gift you ever received?
  • The most bizarre food you’ve ever eaten?

 

Scheduling One on One Meetings

For some businesses, the holidays offer a slower pace. You may find it simpler to gain access and develop contacts with coffee meetings. In our busy society, not everyone has the flexibility to do this. But, by reaching out to an individual for a brief meeting, you may connect in a more meaningful way. Your prospect may even appreciate getting out of the office and away from ringing phones. If you like more quiet meetings, consider targeting individuals you want to work with.

After meeting someone remember these tips:

  • Capture their contact information, get their card and offer yours.
  • Consider inviting them to your LinkedIn network. Remembering what people are interested in can help you connect more throughout the year,.
  • Occasionally share articles or posts that might interest them.
  • Better yet, send business referrals.
  • At the end of the event, thank the host or hostess.  Go the extra mile by sending a thank you card.

Surprise with a Giftturkey

  • Consider giving small thoughtful gifts or cards.
  • Make time to show appreciation for those who have helped you throughout the year.
  • A holiday card with a personal note or even a New Year’s card would be a nice touch.

Stay in Touch

Remember to follow up. A pocket full of business contacts are useless if you fail to reach out and connect. Find a way to assist with information or a connection to keep the relationship mutual. Add value for the other person.

It’s never too late to catch up.

Life happens and time passes far too quickly. Before you throw out that business card, give them a call or shoot them an email. If you reach them mention how you met and briefly acknowledge the passage of time. Offer to reconnect over coffee or a meal. People move on, pick up different skills and change jobs. The person you met 6 months ago or even a year ago may have a new circle of influence and new connection possibilities. Schedule a lunch or coffee meeting and get together or chat on the phone.

Sending a thank you note can make a lasting impression. I have a box of thank you notes and carry some with me stamped so I can jot a quick note and mail one out the day of the meeting. Most people will share a business address if you don’t meet at their work location. Don’t be afraid to send your gratitude. People realize how little of it there is in the world. It sends the message that they are worth investing time and effort.

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Not everyone follows you on all your social media channels. Be sure to let those closest to you know that you’re growing your side hustle. They can be an enormous support system and encourage you in your new endeavor.

With remote work and telecommute people are networking in ways that they weren’t even ten years ago. You might be shocked to discover how connected your inner circle is once you begin sharing about your business.

A compliment, a friendly smile can go a long way toward breaking the ice. Contacts are everywhere.  Introduce yourself wherever you go and have something short and sweet to say and have a great holiday season!

 

Holiday Overload? Zap Potential Danger and Power Through Holidays Worry-Free

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When I was a kid, my dad used to drive our family around the snowy neighborhood to see all the ways people decorated their homes with Christmas lights.  We were bug-eyed and enthralled with the home of a dentist whose yard was lit up with dozens of scenes, animated and still. Since those days, many folks have turned Christmas lighting into its own art form and synching lights with music .

If you’ve moved into a new home, star showering the front of the house, or covering every inch of your roof, bushes and trees may sound appealing.  But, before you start stringing miles of glittering lights together inside and out, you may wonder if your circuits can handle the load. If you have an considerably older home (75years or older) your circuit box capacity could be as low as 60 amps. If your home was built over 20 years ago or employed natural gas, it might be wired for 100 amps. And if it’s more recent, take heart!  For the last 20 years, most newer homes rely almost completely on electric and 200 amps has become the new standard.

Circuits: How much is too much?

We use more energy  in the fall and winter because it’s dark when we leave and come home. We may use  our stoves, slow cookers and hot beverage makers more than usual. For those in colder climates like Ohio, we use more electric heating our homes.

alex-robert-133579With escalating power usage, it makes sense that those pretty little lights and illumined decorations add another burden to your electrical system. Fortunately, circuit breakers are usually assigned to rooms and even particular appliances.   Learning which outlets and light switches are controlled by which breakers can be done easily. Turn off each breaker, and plugging a lamp or night light into each outlet, top and bottom. Mark these on paper so you’ll have a diagram or outline. (It’s helpful to have two people and each using cellphones.)

Any electrical circuit with too many electrical devices turned on can exceed the limit. When it’s maxed out, the breakers automatically trip, shutting off the circuit in the main panel. But not always. Even if your outlet can handle it, cheaply made strings may overheat and fail. We recommend buying and using only UL listed products.  Many counterfeit products are simply unsafe fire hazards according to Consumer Product Safety Commission.

If you’re tripping breakers even before adding holiday lights, you might try moving some of your smaller appliances to other convenient outlets. Outside, try using fewer strings per outlet to resolve the issue. Or use compact fluorescent bulbs or LED lights which use considerably less energy than incandescent bulbs.

Some people might be tempted to replace a 15 amp fuse with a 20 amp—don’t do it! Wires inside the walls can heat up and melt or worse, catch fire and burn the house to the ground. If your breaker still trips, we recommend talking with a qualified electrician about your options. You might need one or more dedicated  lines added to your panel or a bigger breaker box.

A circuit is overloaded when:

  • The total load exceeds 1,800 watts . On a multiple-outlet circuit, energy hungry appliances should have their own dedicated circuits.
  • any appliance or piece of equipment rating exceeds more than half the circuit rating i.e. 900 watts for a 15-amp circuit.
  • a 15-amp circuit, 120 volts x 15 amps = 1,800 watts.
  • a 20-amp circuit, the load limit is 2,400 watts.

Keep these simple calculations in mind: amps x volts = watts

Staying in the safe zone:

The amp rating of the circuit is located in tiny numbers on the circuit breaker switch or fuse. In most new homes, it’s very hard to overload with Christmas lights, and even less so with LED lights. Light strings should list recommendations on the box for how many can be linked together.  (For Safe wattage guidelines multiply the total wattage by 0.8 to find the safe wattage: 1800 x 0.8 = 1440 watts.)

lights.jpegWhile you can use exterior Christmas lights inside, interior Christmas lights are not weather sealed for outdoor use.  When they get wet, they will short out and likely trip your breaker.

It’s wise to keep outlets in use clear of papers fabrics and anything else that could  catch fire and check daily on those plugged in items that run longer than a few hours at a time. Keep in mind that overloading a circuit should cause the breaker to trip. However, they don’t always. And if you smell smoke, or suspect arcing, turn off the main power switch and call 911. If you see fire, exit the house immediately!

In the meantime, what are your holiday lighting plans? Do you decorate a little or a lot? If you have further questions, please comment on our Facebook page or visit us at OhioCapitalMortgage.com.

Jeff Harrison’s Chicken Reuben Casserole

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Our own Jeff Harrison contributes this recipe, from his childhood. Jeff has been with Ohio Capital Mortgage for almost 8 years and in the mortgage game since 2000. He is a husband and doting father of a beautiful little baby girl. When he’s not with family or at work, he just might be flying over head.

Impressively, Jeff knew every ingredient of this twist on a classic by heart. Incidentally, his wife suggested using more seasoning on the chicken, so try it out and tell us what you think!

Ingredients:

  • 1 pkg. (about 2.5 lb) chicken breasts
  • 1  8 oz packages of Kraft sliced Swiss cheese
  • 1 12 oz. bottle Thousand Island Dressing
  • 1 16 oz jar of sauerkraut (drained and pressed)

Place chicken in a lightly oiled 9×13 inch baking dish. Sprinkle with salt and pepper. Spoon sauerkraut over chicken. Place cheese slices over kraut. Pour dressing over all and cover dish with aluminum foil.

Bake in 350 oven for 60 minutes, or until juice is clear and fork is easily inserted. Garnish with caraway seeds,  dill pickle or tomatoes.