February 9, 2019
Well, then you’ve come to the right place because I’m going to give you 8 strategies to follow.
Hi everybody my name is Ty Eden. I’m with Exit Realty Redefined, here in Wheaton Illinois. I’ve been a Realtor for about a year and half and I’ve been an investor for virtually my whole life. I work with Buyers, Sellers and Investors. I’m sharing with you 8 tactics to follow or 8 strategies to follow in this video series.
Now, I’m not going to cover all 8 in this one segment. I’m going to cover 2 and then I’ll have 3 more additional videos after this. So, keep an eye out. Watch this video to the end in order to get all the stuffs you want to get.
Point number 1 (Strategy)
Pull your credit.
You can do that thru credit karma/ bank rate. There is a variety of free credit services out there that you can go pull your credit from. Make sure they’re FREE! Don’t pay the sign up for some sort of membership because they’re just going to intimidate you with emails.
Check what your score is. If the score seems low and low means below 640, then you might want to reach out to the credit bureaus that reporting to find out why are those credit scores are being reported so low.
Credit score is where the moneys at! You want to be able to have a score of minimum 640. Anything higher than that, just is better for you. What I mean by better for you is this:
The higher your score, the lower the payment, the better the terms you can get on your mortgage loan. This is true for every loan. Whether your getting a car, your getting just a personal loan, the better your credit score is the better the terms will be. It’s going to be better overall.
If you do have some issues on your credit, you don’t know what to do?
Reach out to a mortgage lender. If you don’t know one, your welcome to reach out to me. I’d be happy to share 2-3 close mortgage people that I work with and they have contacts that work well and easy to work with that can help making the effort of doing whatever is necessary to clean your credit up. It might take a couple of months and its going to cost you some money, its not for free. But they will get all those bad marks off your credit. Your score will go high and the higher your score is, you’ll be at a better position to start applying for those mortgage loans and get your house.
So, credit score breakdown. Here is some thing that you want to be aware of.
That is 35 percent of your credit score. So, pay your bills on time.
Now what this means is if you got a $1000 worth of available credit and that’s on different credit cards or loans. Whatever the case may be. You only using 30% of it then that gives you with 30% of a score towards your credit score. If that makes sense.
You don’t want to be using 70% and so if you got a $1000 worth of credit available. You don’t want to be using $700 - $1000 all the time. Because the credit bureaus don’t like that. So, keep your credit usage down.
Length of Credit History
Certain loans you have for 10 – 20 years? That’s great! Credit bureaus love that. Your creditors love it and its going to reflect on the credit score as well. About 15% of your credit score goes towards length of credit history.
Type of Credits
You want to have lower interests type credit on your credit report. Loading up on the credit cards is a No-no. Car loans are good. A mortgage loan but that is what your going after so the best you can do is get some credit cards. Build up some credit card debt or history. Not a lot of debt but just history and then get a car loan. It looks good too but keep it current. Always keep your loans current.
A real small percentage of what goes into your score.
Now for that negative credit that is being reported. Here is what you want to do. You want to try and refinance all that high interest rate stuff that is making all those payments real high and put it on a lower interest rate loan of some kind. Consolidate that debt and try and get it down to 30% usage. That’s going to help with the reporting and your overall credit score.
When you’re in the process of cleaning up your credit, which goes for about a year. You want to start with cleaning up your credit and have it stay consistent for about a year. That are what mortgage lenders want to see.
Don’t make any excessive purchases. Don’t go out there and buy a new furniture. Don’t go out there and buy a trip. You want to draw back. You want to conservative with all that money your spending. Because all that is going to be is reflecting on your credit report and these mortgage lenders are going to see that. There will be a lot of questions and its going to hit your credit as well because inquiries go against your score.
No new credit for at least a year before buying or applying for the loan to buy a new house.
Alright, now that we’ve gotten all the credit information out of the way. So now we’re going to move on to:
Point number 2 (Strategy)
Now you’ve got to get your budget in order. Now one thing that’s out there that you mind find is that there are people who are talking about this 28-36 rule. So, what is a 28-36 rule is, well I don’t know let me read my notes.
So, the 28% is, you don’t wat to spend more than 28% of your gross income on household expenses. So, what is household expense, if you haven’t bought a house, that’s rent, utilities, insurance. So, you don’t want to be spending more than 28% of your gross income.
So, 36% is no more than 36% of your monthly income is to be spent on both household expenses and living expenses. Living expenses – credit cards, card payments, groceries, just your everyday living and you have to start to really paying attention to where your spending your money. Again, for how long? For at least a year before you apply to get a mortgage and then find a house.
In addition to the 28/36 rule, you also want to start saving some money. And why do you want to save money? Because you’re going to have a down payment, you’re going to have closing costs, there’s going to be different expenses associated in buying a house. You want to be prepared for that.
So that goes into paying attention to your budget today, so that a year from now you’re all set. You’re ready and good to go.
That’s what I’ve got for you guys on this video today. I hope that you’re able to pull something away from it and pay attention to video number 2 which is going to cover our 3rd and 4th point in our “8 Point Strategies” of: Are you buying your first home EVER! Stay tuned if you like this please like it. If you want to subscribe to this series of videos or my channel, hit the bell and subscribe and you will be notified of all new videos that come out.
So again, my name is Ty Eden, exit realty redefined in Wheaton, Illinois and thank you for checking in.