pre-approval when buying a home

Mortgage Update Summer 2021

Now is Your Unique Opportunity to Cash Out

Earlier this year, rates started moving higher because of inflation fears. Since that time, the Federal Reserve is done a good job of telegraphing that this inflationary pressure we are feeling is likely transitory. Because of this, investors have become comfortable with this synopsis and rates have dropped, since March. We have seen an uptick in our clients using this as an opportunity to pull cash out, while at the same time they are refinancing to get a better rate. Some examples of the reasons that you would pull cash out are as follows: remodeling, debt consolidation, pay for kid’s college, buy a second home or rental property, buy a car, pay off a home equity loan, down payment for a home for your parents or children, pay off student loans or use it to invest in other opportunities. Median home prices have been going up for many years now but were supercharged last year. In the Atlanta metro area, prices were up 24.6% from May 2020 to May 2021, which is mind boggling. This presents a unique opportunity to pull cash out at historically low interest rates. Likely, as the year progresses, we will see rates begin to inch up. We see the current environment as a unique opportunity. Please give us a call and we can explore your options.

Don’t let Collections Undermine Your Credit

In our business, there is nothing more frustrating than pulling someone’s credit and seeing a small medical collection. What’s crazy is many of these collections are less than $100 and they can have a radical impact on your credit score. We have seen credit scores drop as much as 80 points when a collection shows up like this. Most of the time this happens because the customer believes that the insurance company will pay the bill or has an obligation to pay the bill. So, what should you do? The first thing is, don’t assume that the insurance company will cover a bill that you get in the mail. Call your insurance company and find out whether it’s covered and how it will be paid. If they tell you that it is not covered, you can always call the hospital or doctor’s office and try to negotiate a better deal but once you determine that, make sure to pay the bill promptly. We also see this with utility companies and telecom companies like AT&T, Verizon, etc. Even if you believe that you do not owe the money, it is not worth a significant hit to your credit to withhold payment. They will not hesitate for one second to put collection on your credit report. In other words, pay the bill and fight about it later. Finally, we have seen a significant uptick in 30-day late payments on credit cards that are not used at all or infrequently, due to an annual fee being assessed in the customer not aware that they owe it.