Learn How Credit Scores Impact Your Mortgage Rate

Interest paid on a mortgage can add up to hundreds of thousands of dollars over the life of the loan. The most influential determinant of your mortgage rate will be your credit score. The higher your score, the lower the interest rate. On a loan as large as a mortgage, a mere percentage point up or down can add up to a significant amount of money.

Not only are credit scores more vital than ever when it comes to getting a good rate on a home loan, but they will influence whether you can even get a loan at all.

Credit is so tight and lenders are so skittish that buyers below a certain threshold, typically a FICO score of 620, have a better chance of striking oil in their bathtub than securing a mortgage. It's possible, but will require some digging.

Standards have not always been so restrictive; the industry has changed in recent years.

"It's changed twofold: First there is a minimum score that you need to have to even be considered for a mortgage regardless of compensating factors such as your income and your assets. And unless you have top-tier credit, you're not going to qualify for the best programs, terms and conditions," says Louis Spagnuolo, vice president of mortgage banking at WCS Lending in Boca Raton, Fla.

Though the tiers go up all the way to 850 on the FICO scale, a score of 740 or more should qualify for the best mortgage rates from most lenders. Depending on the lender, the mortgage rates offered to the highest and lowest credit tiers can vary as much as a full percentage point and a half, says Spagnuolo.

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Source: bankrate.com

AG Orders Banks, Attorneys to Stop Evictions Violating Federal Tenant Law

Connecticut Attorney General Richard Blumenthal sent cease-and-desist letters to a host of default servicing practitioners this week ordering them to stop “abrupt and illegal evictions” of tenants of foreclosed properties.

According to Blumenthal, evicted tenants are typically current on their rent, but face eviction because of their landlord’s financial troubles. He says in many cases, real estate agents begin eviction procedures immediately upon completing foreclosure despite the 90-day rule, or unlawfully pressure tenants to leave without informing them of their rights under the new federal statute.

Blumenthal has sent cease-and-desist letters to 30 companies that his office alleges may have engaged in eviction practices that violate PTFA, including law firms, real estate companies, lenders, and servicers. Blumenthal is notifying the companies of their legal obligations and requesting that they follow this federal law.

“Tenants have rights to remain until their lease ends-rights that deserve respect and enforcement,” Blumenthal said at a press conference this week. “We’re warning banks and real estate interests: foreclosure is not excuse for illegal eviction. These cease-and-desist letters send a message to powerful property owners that foreclosure gives them no right to engage in automatic eviction en masse.

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Source: dsnews.com

Innocent victims of the subprime crisis What YOU Must Know

In spite of a law protecting tenants, people who rent across the US are being illegally evicted even if their finances are fine.

"What happens often is that after a foreclosure, a broker or an agent comes to the house and, as though the law didn't exist, tells renters the house has been foreclosed and they have to leave," says Judith Liben, senior housing attorney at the Massachusetts Law Reform Institute.

The law Liben is referencing is the federal Protecting Tenants at Foreclosure Act, passed in spring last year and intended to remain on the books until 2012. It was intended to mitigate the collateral damage from the foreclosure epidemic by making banks give tenants on month-to-month leases 90 days notice before evicting them following the home owners' foreclosure; and by ensuring that tenants in good standing with year, or multi-year, leases couldn't be evicted mid-lease following a foreclosure. The new owners would, according to this act, have to honour the terms of the lease, keep up repairs on the property, and repay the tenants' security deposits upon completion of the lease.

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Source: guardian.co.uk

Make Mortgage Companies Prove They Tried to Modify a Borrower's Loan Before Filing for Foreclosure

In a perfect world...

Gov. Martin O'Malley and Rep. Elijah E. Cummings urged Maryland lawmakers Tuesday to adopt a proposal that would require mortgage companies to prove they tried to modify a borrower's loan before filing for foreclosure. The measure would also force companies into court mediation with homeowners who believe they have been wrongly denied relief.

The Democratic governor said his mediation plan is "designed to put homeowners on equal footing with their housing companies." Despite previous state efforts to slow down the foreclosure process and federal legislation requiring banks to work with homeowners, too many people are being put out of their homes, O'Malley and Cummings, a West Baltimore Democrat, told lawmakers at hearings before the House of Delegates Environmental Matters Committee and the Senate Judicial Proceedings Committee.

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Source: Baltimoresun.com