The mortgage application process can be fraught with a lot of stress on its own, but if you've experienced issues with your credit in the past it can be even more taxing. While there may be a lot of things you may not be aware of when it comes to their impact on your credit, here are some things to watch out for if you're planning to purchase a home in the short-term future.
Applying For Extra Credit
Whether you've just been offered a great new deal by a department store or you're not even thinking about it, new credit cards can pop up with deals that are quite enticing at the moment. Unfortunately, applying for new credit can signal to lenders that you've run out of credit on your other cards. Not only that, it will also have an adverse impact on your credit score each time you apply for new credit. If you're considering a mortgage soon, it's a good idea to hold off on any additions to your wallet.
Not Paying Your Bills
It may seem straightforward enough that not paying your bills is going to land you in hot water with your credit score, but many people think paying the minimum at any time will do. The truth is that if you want to keep your credit in line and improve your odds, it's important to pay your minimum before the due date and always pay your bills. The only thing deferring payments will do is add marks against your credit, and this will be damaging come application time.
Don't Avoid Your Credit Report
Many people who have a poor credit history are aware of the situation, but they're also unwilling to address it. While it may be difficult to approach your credit report if you've had some hiccups in the past, it's important to know what point you're working forward from so you can move beyond it. Instead of ignoring it, get a copy of your credit report, and review the numbers. Not only will this enable you to address any errors, it means you'll be facing your issues head on.
There are several factors that can adversely affect your mortgage application, but by avoiding new credit and paying your bills on time you can have a positive impact on the result. If you're currently in the market for a new home, you may want to contact your local mortgage professional for more information.
If you want to experience life in a “real” Western town, Drummond is your place. Its 350 residents are proud of their tight-knit community and welcoming attitude. Driving into town, the stunning backdrop of the Flint Creek Valley and the Garnet Mountains make modern-day stresses melt away. Ranching is still a way of life in Drummond, as you might guess from its motto: “Home of the World-Famous Bullshippers.” The town is small in size but big in hospitality, meaning you'll get a warm welcome, good food, and a place to stay upon arrival. With all the amenities and conveniences one could want, Drummond is sure to please.
Drummond's origins, like many towns in Montana, dates back to the 1800s. Unlike many towns in the region, however, it did not start out as a mining town. Instead, it began as a ranching town when the first ranchers arrived in the late 1870s. Within the first decade that Drummond was settled, the Northern Pacific Railroad began building tracks and train stations throughout the West. More transportation and technology appeared later in the form of an electric train, completed in 1908, that ran from Butte to Missoula and passed through Drummond MT. In the 1920s, US Highway 10 was built through the town center. Now that Drummond was easier to reach than ever, agricultural and ranching operations expanded as more people arrived and product shipments increased. At its peak, Drummond's population reached an impressive 500 citizens!
With its contagious attitude of living life to the fullest, Helena MT is certainly one of the most livable cities in the West. Considering all the amenities it offers, it's not surprising that "Queen City" is listed as one of the “Best Places to Live” by Money Magazine. Located at the crossroads of the majestic Rocky Mountains and the Great Plains, Helena is one of the most scenic metro areas in the US. Between the craft beer scene, nightlife, great shops and fine dining, there's never a dull moment in Montana's capital city. Helena is home to just over 29,000 residents, which makes it the sixth largest city in Montana by population size. Along with people, the city is also populated by a variety of businesses that draw visitors and create jobs. Walking downtown, I'm always amazed at the amount of activity going on, and I'm constantly reminded of how vibrant the city is. But standing there looking at its modern attractions, it's easy to forget that Montana's capital city has such a rich and distinguished past.
Like many towns in the area, Helena was founded during the gold rush. It was officially established as a camp for miners in 1864, and its population quickly swelled. Despite the lack of social media, word still spread rapidly that the area was full of gold. By the mid-1880s, miners extracted over $3 billion in gold! The unprecedented wealth in Helena gave rise to large, ornately decorated Victorian homes, which you can still admire as you're walking through the city's neighborhoods today.
Along with distinguished residences, grand hotels and luxurious inns started to spring up as the city's wealth grew. In the late 1880s, the famous Hotel Broadwater opened its doors for business. In addition to its stunning guest rooms and beautiful architecture, the hotel earned a name for itself by having the first indoor swimming pool. The hotel was destroyed by a devastating earthquake in 1935, but today the site is home to a much-loved outdoor swimming pool with a natural spring.
Due to its stunning landscapes and prosperous residents, Helena also developed a reputation for its outdoor activities, which were (and still are) a product of the city's proximity to the Rocky Mountains. Water sports, hiking, fishing, and other forms of recreational activities emerged in the city, and a nearby town was converted into a popular local ski center.
There are so many unfamiliar terms involved in the real estate market that it can be easy to be confused by the jargon. However, some words are more important to learn than others if they can end up benefitting you in the long run. Whether or not you've heard of mortgage refinancing, here are the basics on what this may mean for your home and whether or not it's an option you should consider.
Acquiring A Lower Rate
If you're new to refinancing, the primary reason that most homeowners choose this option is to get a lower interest rate and pay less on the overall cost of their mortgage. Because a lower interest rate means that a higher amount is paid on the principal each month, you may be able to pay off your mortgage at a quicker rate. While this may sound ideal, you'll need a certain percentage decrease in your interest rate in order to make this option financially beneficial.
A Shorter Loan Term
While refinancing doesn't necessarily mean that you'll be paying less on your mortgage payment each month, it does mean that you may be able to take advantage of a shorter loan term. Since the overall amount you pay on your mortgage may be lowered with refinancing, you may be able to pay off your mortgage more quickly without it bumping up the amount of your monthly payment significantly. There may be a slight difference, but the benefits can definitely outweigh the drawbacks when it comes to paying less over time.
Weighing The Refinancing Option
The decision to refinance may very well end up being a boon for your financial well-being, but it's important to consider the pros and cons ahead of time in order to make an educated decision. You'll also want to make sure you'll be staying in your home a while to reap the benefits of your equity. Because there will be fees associated with utilizing this mortgage option, like closing costs and application fees, it's important to look at the numbers and ensure that it works out in your favor at the end of the day.
Refinancing your home to acquire a lower interest rate can be a great financial decision, but it's important to determine whether or not the price is right before you move forward with this option. If you're currently considering refinancing your mortgage, you may want to contact one of our mortgage professionals for more information.
If you've never been to Philipsburg, Montana, you're missing out! With stunning mountain views, quaint shops, a charismatic town center, and easy access to some of the best outdoor recreational areas in the West, our charming town is a place you'll be proud to call home. Old World magic and modern living blend harmoniously in this distinct town, which is proud of its history and its universal appeal, including occasional celebrity sightings. On that note, here's a fun fact: actress Scarlett Johansson chose Philipsburg for her wedding!
Philipsburg MT was settled in the late 1890s. Like many neighboring towns, Philipsburg was once a vibrant mining town. It also contained a number of sawmills, and it was also a regional center for ore smelting. In fact, the town is named after an ore smelter named Philip Deidesheimer, who single-handedly brought the mining industry to town. Philipsburg's prosperity came from nearby mountains filled with minerals and precious metals. Gold, silver, manganese, and sapphire have all been harvested from the lands around Philipsburg. For awhile, the mines and saw mills supported the town's economy. Eventually, both industries collapsed, causing Philipsburg to become a ghost town. The town's luck changed in the 1990s, when a new wave of people arrived with a mission to restore the town's center and infrastructure. The plan was successful, and they revitalized the town with renovated commercial buildings and restored historic buildings. Thanks to their hard work, Philipsburg is now a place where people want to live, work, and visit. It's also designated as a National Historic Business District, which means that special care has been given to keep mementos of its unique history intact.
From 'down payment' to 'adjustable rate' to 'debt-to-income' ratio, there are so many terms involved in the mortgage process that it can be hard to learn them all and keep them straight. However, whether you've heard it, the term 'amortization period' might be one of the most important ones associated with your financial well-being. If you're currently considering the period of loan you should choose, here are some things to think about before taking on a term.
What Is Amortization?
Used to refer to the length of time it takes to pay off your mortgage loan, a typical amortization period is 25 years. However, there are many periods over which homebuyers can choose to pay off their mortgage. While many homeowners opt for what works best for them, it can be the case that a shorter mortgage period will be more financially beneficial eventually. It may not only mean lower overall costs, it may also mean financial freedom from a loan much sooner than originally anticipated.
The 'Principal' Of The Matter
It's important to have a monthly mortgage payment amount that's sustainable, but a shorter amortization period means that you will be paying a higher amount of the principal and paying more on the actual loan amount. While a longer amortization period will add up to more interest payments and less paid on the loan cost each month, a shorter period can end up costing you less for your home when all's said and done.
Considering Your Loan Period
It is understood that a shorter amortization period will pay down the principal sooner and cost less over time, but that doesn't mean that it's the best choice for you. Because your monthly payment will be taking a sizeable chunk out of your salary, it may be difficult to swing a higher payment to pay off your loan in 10 years. If it's doable without compromising your quality of life, you may want to choose this option, but if there's too much sacrifice you may want to opt for a longer loan period.
Everyone has a choice in the amortization period that works for them, but it's important to make your decision based on what works for you and will be beneficial for your finances. If you're currently getting prepared to invest in a home, you may want to contact one of our local mortgage professionals for more information.
If a “simpler way of life,” and a “less corporate” way of living is what you're seeking, come to Townsend, Montana. Once you arrive, it won't take long to see why this picturesque Montana town is called the “Valley of Adventure.” Here you'll find small-town charm, friendly locals, and spectacular natural landscapes that are nature's quintessential playground. Time seems to slow down here when you're coming from the outside world, but that doesn't mean there's a shortage of things to do. In fact, quite the opposite is true. With places to sleep, shop, eat, and play while you're visiting, (and ultimately, once you move here), you'll never sit around twiddling your thumbs in Townsend.
Like many places in the area, Townsend was established as a mining town in the 1800s. The town was part of the route followed by famous explorers Lewis and Clark. Although the intrepid pair passed through the town in 1805, however, the town wasn't officially incorporated until the mid-1800s, when it was selected as a base for gold miners due to its abundance of lucrative natural resources. In support of the gold mining operations, a railway station and small businesses began to spring up in the area. Once Townsend had the foundations of a “real” town, and it had more promise than just a pass-through point, it was given a name. Its name was chosen to honor the wife of Charles B. Wright, who was the president of the Northern Pacific Railroad Company in the late 1800s.
Although the Gold Rush came and went, Townsend's appeal never wavered. Today, it's home to about 2,000 residents, who are proud to call this special town home. One major benefit of Townsend is that it is strategically located within easy reach of Montana's larger cities and popular recreation areas. From here, it only takes about 35 minutes to reach Helena MT, and you can make it to Bozeman in an hour. The beautiful Missouri River, which is a hotspot for both fishing and water activities, is virtually right in Townsend's back yard. Canyon Ferry Lake, another popular recreation area, is just a 15-minute drive from town. Job opportunities are available in the nearby cities, which means the sky's the limit when it comes to employment options. But if you'd prefer to work closer to home, there are job openings right in Townsend, too. Agriculture, mining, and timber are some of the major industries in the area. There's also a modern health center in town and quality schools, which support residents' needs and offer employment opportunities as well. The town has a welcoming attitude towards small businesses, which means that you'll be well-received here if you have an entrepreneurial spirit.
As a potential homebuyer who is new to the market, many of the terms and mortgage products available to you can be more than a little confusing. Piggyback loans might be a little less familiar than many other options, but if you're ready to jump into the housing market this type of mortgage can be useful for you. If you're hoping to invest in a home sooner rather than later, here are the details on this type of loan.
What's A Piggyback Loan?
While most mortgage loans require one loan and one lender, a piggyback loan is used for homebuyers who don't have 20% to put down but want to avoid private mortgage insurance (PMI). Because a mortgage with less than 20% down will require the homebuyer to pay PMI, a piggyback loan can assist in avoiding this. For example, if the homebuyer is putting down 10%, their primary mortgage will cover 80% of the purchase price while the piggyback loan will cover the remaining 10%.
What Are The Requirements?
Since there have been many issues with piggyback loans in the past, there are more requirements for this type of loan than there used to be. While it varies from lender to lender, most homebuyers will be expected to put down at least 10% to qualify for this loan. In addition, they will be required to have a good credit score to ensure they are a good risk. While the debt-to-income ratio will fluctuate from lender to lender, potential homebuyers will have to prove that they can make their monthly payments.
Is This Loan Right For You?
It's important before deciding on a piggyback loan that it's the right choice for you. Since a piggyback loan will require you to pay down two different loans, it means that you will not be able to tap into your home equity if you want to free up funds. It can also put home ownership in harm's way if there are any financial setbacks. As well, while PMI can be cancelled after the equity in your home is at 20%, a piggyback loan does not provide this option.
A piggyback mortgage can be a good option for homeowners who want to get into the market, but it's important to determine if it's a financially solid choice before wading in. If you're currently getting prepared to buy, you may want to contact one of our mortgage professionals for more information.