Category: EB Mortgage

Credit Scores Explained

Let’s face it, most of us don’t have a couple hundred thousand dollars under our pillow to buy a home or even a new vehicle. We need banks to loan us large amounts of money for big-ticket items. How do banks determine who qualifies for a loan by calculating our credit score?

Your credit score is 100% up to you. How does it work?

First, we explain how the banks obtain your scores. Loan institutions use three credit bureau agencies: TransUnion, Equifax, and Experian, to get your score. They submit your social security number, and each company gives a score from 300-850. The higher the score, the better.

The three credit bureau agencies use FICO and Vantage Score to determine your score. Below are the five items FICO uses to determine your score:

  1. 35% Payment History – Pay down/off loans that are currently outstanding
  2. 30% Amounts Owed – Do not spend more than you make
  3. Keep your loan-to-debt ratio below 30% (not including your mortgage debt) but all other debt owed like vehicle loans, credit cards, student loans, etc.
  4. Experts say to stay below 10% if you want to maintain a credit score in the high 700s
  5. 15% Length of Credit History – Keep the line of credit/loan open, even if the balance is zero
  6. Do not apply for a dozen credit cards just because you can. The credit limit, even though it’s zero, the balance goes against your credit score under income to debt (#2 above.)
  7. Furthermore, do not close a bunch of credit cards either because the score is also measured by history by 15%.
  8. 10% Mix – Keep a mix of credit (a car loan, a credit card, and a mortgage.) Lenders like to see a borrower who can handle a combination of loans.
  9. 10% New Credit – Restrict yourself from applying for credit of any kind unless you have planned this through
  10. Every time a creditor submits your application for a loan, it reduces the current score. They say 5 points or more for every pull.

Keeping a healthy, high credit score takes discipline and constant work. If you have questions or need help obtaining a loan, contact the experts at EB Mortgage today!

EB Mortgage is a locally owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us or e-mail us today! 

Written by the digital marketing team at Creative Programs & Systems: https://www.cpsmi.com/

Common Hand and Wrist Injuries Due to Sports

Playing sports has significant health benefits to a person’s well-being. However, with any physical activity is the possibility of injury. Approximately 25% of all sports injuries are associated with the athlete’s hand and wrist. These damages can create barriers to completing daily tasks- on and off the field. It’s important to understand the symptoms of common hand and wrist injuries and know how to take proper care to limit downtime. Below we discuss the most popular sports-related injuries:  

Skier’s Thumb

Also known as ulnar collateral ligament tear, it is an acute injury of the ligament at the base of a person’s thumb. This injury occurs when the thumb is bent backward, causing the ligament that helps the thumb grasp to tear. Although this injury is most found amongst skiers while grasping a ski pole and falling, it can happen in any sport. Symptoms include pain and swelling at the base of the thumb with low mobility and weakness when attempting to grasp. Tears are best treated with rest and splinting for 4-6 weeks, but a complete tear or multiple injuries may require surgery to reattach tendons.

Finger Jam

This type of injury is also called the “basketball finger,” but it can occur in a range of sports like rugby, volleyball, or football that involves contact with a ball striking the end of an extended finger. The severity of the injury can range. A sprain or dislocation may be corrected by simply pulling on the finger. Symptoms to expect would be joint pain and swelling with the increased difficulty in bending the affected finger. Treatment consists of rest, ice, splints or buddy taping to an adjacent finger.

Scaphoid (Wrist) Fracture

A wrist fracture is an acute injury resulting from the break in one of the many small bones in the wrist. These injuries are not always easy to observe and diagnosed by untrained eyes. The most common cause of a wrist fracture occurs among snowboarders, rollerbladers, and football players, those who extend their arms when falling. Fractures happen when their hand and wrist get hyperextended, and the athlete’s weight is forced onto the palm. Injuries include pain and swelling in the area below the base of the thumb up through the forearm. The pain may increase with the movement of the thumb and wrist. Treatments will vary depending on the severity of the fracture, where most require splinting or casting, but others may result in surgery needed.

Wrist Ligament Tear

Wrist ligaments and cartilage can experience tearing for many different reasons. The two most common are acute trauma caused by a hard fall on an outstretched arm, causing the wrist to twist abnormally. Secondly, repetitive stress injuries (RSIs) can gradually pull on tendons and tear during exercise or other recreational activities.

Total prevention of sports injuries may not be possible, but taking the proper precautions, will likely lower your risk. Always wear well-fitting sports equipment and protective gear like wrist guards and gloves. Sports tape can help make a big difference in keeping your muscles in check. Remember to warm up, stretch, and take breaks to allow proper body functionality.

Have an injury to your hands or wrist? Contact the experts at Michigan Hand & Wrist for a free consultation!  

Michigan Hand & Wrist was founded in 2001 with the mission to provide the highest-quality care for patients seeking surgical or non-surgical hand or upper extremity relief. Our goal is to exhaust all non-operative measures before discussing or moving on to surgical interventions. We offer on-site physical therapy from therapists committed to improving your quality of life. Our individualized treatments are modern, progressive, and exceptional. Call us at 248-596-0412 for further questions.

Written by the digital marketing team at Creative Programs & Systems: www.cpsmi.com

Experts Spot Recession Signs in Michigan

Soaring prices for items such as gas, airline tickets, food, and more are signaling alarms to economic experts. According to a June report by the University of Michigan Surveys of Consumers, buyer sentiment decreased by 14.4 percent in June, and roughly 79 percent of consumers anticipate bad times for business conditions in 2023. 

University of Michigan economist Joanne Hsu said, “As higher prices become harder to avoid, consumers may feel they have no choice but to adjust their spending patterns.” Some economists project a 50 percent chance that the United States economy will slide into a recession before 2024. 

For Michigan, the automotive industry is a telltale sign of a potential recession, as huge layoffs generally begin there. When people are out of work, they swiftly cease taking out vehicle loans. 

Strong consumer demand has outpaced supply, as semiconductor shortages have put auto production behind for nearly two years. This unusual trend is leaving automakers with empty lots. Car sales in April and May of 2022 were ultra-low due to lack of supply, not demand. 

According to some consumers, a recession is already happening due to the United States jobless rate being 3.6 percent in June for the fourth month in a row. For Michigan specifically, the jobless rate was 4.3 percent in May. 

Technically, a recession is labeled as an economy that shows negative growth for two consecutive quarters. It is possible that the United States economy could slip into this trend, but the stark recession in 2020 lasted only two months at the beginning of the COVID-19 pandemic. 

The Great Recession took place between December 2007 and June 2009. The jobless rate stayed around nine percent and higher for most of 2009 and 2010. 

Gabriel Ehrlich, director of the University of Michigan’s Research Seminar in Quantitative Economics, says he doesn’t see a recession as inevitable. He warned that a recession could be sparked by the Federal Reserve’s effort to fight inflation along with the war in Ukraine. 

“All bets are off if supply chains have major problems. That’s the number one wild card.”

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EB Mortgage is a locally owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us or e-mail us today!  

Written by the digital marketing team at Creative Programs & Systems: https://www.cpsmi.com/ 

Alternative Loans Explained

Conventional loans are not the only way borrowers can get approved – alternative loans include non-conforming loans, stated income loans, Alt-A loans, portfolio loans, and others. Where conventional loans cannot provide purchasing power, alternative loans can work for the right buyer. 

Alternative loans are meant to assist unconventional borrowers to secure financing. Atypical buyers can include those who are self-employed, receive income from unconventional sources, don’t have established credit, have high debt-to-income ratios, credit struggles, or exhibit other unique life experiences that complicate securing a traditional loan.

For certain property types, it can be challenging to secure a traditional or government-backed loan; alternative loans are also useful in these cases. 

The requirements for alternative loans differ from those for conventional loans. Usually, they are more relaxed and do not make the same requisites. For example, buyers might not have to show all of their income sources or might be able to receive a loan even if their employment history is inconsistent or challenging to verify.

Some alternative loans include: 

  • Low Down Payment: Borrowers can apply for a low- to nonexistent down payment. Since there is no official governmental oversight, the requirements vary between lenders, but overall, the rules are more flexible. 
  • Credit: Buyers with credit issues (no credit established, short credit history, credit problems, etc.) can benefit from alternative loans. Usually, this happens when the borrower is very young or has no credit cards or other debt in their name.
  • Debt-to-Income: A high debt ratio to income can immediately disqualify a borrower for standard loans. Stated income loans are an alternative that does not subject the buyer’s income to verification. 
  • Employment: People who are self-employed, newly employed, promoted, career change, etc., might struggle to secure a traditional loan. In these cases, an alternative loan is best to get them into a house they truly love. 

The right lender can help you apply for an alternative loan. Work with an experienced mortgage advisor to ensure you fully understand the fine print and can be led in the right direction. 

Unconventional loans often include a higher interest rate; even with a good rate and adequate terms, it is important that borrowers applying for alternative loans are honest and truthful about what they can afford. 

Are you looking to secure an alternative loan? Contact the experts at EB Mortgage today. 

EB Mortgage is a locally owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us or e-mail us today!  

Written by the digital marketing team at Creative Programs & Systems: https://www.cpsmi.com/ 

Four Ways to Improve Curb Appeal

Making a first impression with potential buyers can be a hit-or-miss scenario. In today’s seller’s market, it’s important to hook buyers…but how? The simplest answer: curb appeal. 

Your home’s appearance can have a huge impact on how much money a potential buyer is going to fork over. Houses with a poor exterior sell for seven percent less than those that are polished and attractive, according to a recent study

Business professor Sriram Villupram at the University of Texas at Arlington programmed computers to recognize features such as trimmed shrubs, manicured lawns, and inviting flowers on more than 400 Google Street View images. 

Villupuram said, “The value of curb appeal could be as high as 14 percent during cold residential markets. This study also brings to light the value of homeowners’ associations and their covenants, which tend to maintain a uniformly positive curb appeal for the neighborhood as a whole.” 

Read on for seven tips and tricks for making your home more appealing to potential buyers.

Landscape
A 2019 survey of real estate agents found that well-landscaped homes sell between one and 10 percent more than those with no landscaping. Potted plants, window boxes, hanging planters, trimmed and edged grass, raked leaves, pruned trees, etc. are all surefire ways to boost curb appeal. If you have a patio or deck, don’t leave it empty. Add a bench or some chairs to invite buyers. 

Polish
Pull out your (or rent a) powerwasher and start cleaning your driveway, porch, siding, etc. Use some elbow grease and wipe all windows, clean walkways, handrails, and more. Sparkling clean windows let more natural light into your home, making it much more appealing. 

Replace
Swap out old light fixtures for new ones, paint (or replace) your front door, and add bright, LED light bulbs throughout your home to make it appear more refined. If your home has drab, old house numbers, replace those with new ones as well. Don’t overlook your mailbox, either! 

Upgrade
If your appliances are even slightly out-of-date, try updating some – or all – to give your home a sleeker look. If your home is not energy-efficient, consider upgrading windows, smart thermostats, light bulbs, and home appliances. 

Are you looking for a mortgage? You’ve come to the right place. Contact us today.

EB Mortgage is a locally owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us or e-mail us today! 

Written by the digital marketing team at Creative Programs & Systems: https://www.cpsmi.com/

Do High Interest Rates Mean Cheaper Houses?

The housing market has never been as hot as the last couple of years. A combination of a low inventory, supply chain issues, and high demand has sent prices through the figurative roof at a record pace.

No longer bound to downtown offices, remote workers can save thousands on housing costs by migrating to the suburbs and beyond. The most significant contributor for those moving has been record-low interest rates on mortgages.

But with news that the Federal Reserve is raising interest rates on fixed-rate home loans, many are wondering if housing prices will fall as a result. Unfortunately, the truth is that the answer isn’t a universal one as some markets will see slow growth while others may not even notice.

Right now, the interest rate increase is driving demand from those who don’t want to miss out on locking in a low rate for the next 30 years. While higher lending costs tend to make buyers require a lower sales price, the focus has instead been on taking the plunge solely for the interest rates.

The interest rate of a mortgage makes a massive difference in the overall cost. For example, a $400,000 home at 2.8% will end up with about $200,000 in interest over the life of the loan. On the other hand, if interest rates hit 6%, the total interest paid would exceed $450,000. That’s an additional $250,000 for the same house, which is why buyers are so keen to snag the lowest rate possible.

Another area impacted by interest rates is the rental industry. If interest rates increase too much, potential home buyers may rent instead. This possibility has many looking to invest in rental properties with historically low rates.

EB Mortgage is a locally-owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at 866-246-0516 or e-mail contact@ebwmtg.com today.

Written by the digital marketing team at Creative Programs & Systems: www.cpsmi.com.

Federal Reserve Raises Interest Rates for First Time Since 2018 to Combat Inflation

In March, interest rates were increased – with six more increases scheduled before year end – marking the most aggressive pace in over 15 years. The Federal Reserve hopes to thwart rising inflation, which is at its highest levels in four decades.

Rising to a point between .25 percent and .5 percent, the benchmark federal-funds rate is increasing for the first time since 2018.

When the coronavirus pandemic hit the United States in 2020, rates were nearly at zero. Now, officials have hinted at raising the rate to nearly two percent by the end of 2022. By the end of 2023, rates could inflate as high as 2.75 percent, the highest since 2008.

Federal Reserve Chairman Jerome Powell said, “As I looked around the table at today’s meeting, I saw a committee that’s actually aware of the need to return the economy to price stability and determined to use our tools to do exactly that.”

The ballooned interest rates are a sharp reversal from only two years ago, when rates were near zero and the economy received a plethora of support as countless shutdowns plagued the country. Record job losses were recorded, along with a severe two-month recession.

Economic output has since recovered, thanks to huge federal stimulus and vaccination availability, but Federal officials were weary that inflation might not diminish as quickly as they once expected. The annual wage growth is near its highest pace in years, and the unemployment rate has fallen to 3.8 percent in February.

The average 30-year fixed-rate home loan jumped above 4.25 percent recently, according to the Mortgage Bankers Association. This escalation is an increase of almost a full percentage point since late 2021.

Housing vacancy rates have been at their lowest levels in decades due to a limited supply of homes and apartments combined with steady job gains. Through the past six months, rates went up at a 5.5 percent annualized pace, the largest increase since 1986, according to the Labor Department.

EB Mortgage is a locally owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at (616) 228-8797 or e-mail contact@ebwmtg.com today.

Written by the digital marketing staff at Creative Programs & Systems: www.cpsmi.com.

Securing an Energy-Efficient Mortgage

There are plenty of reasons to have an energy-efficient home, one of which includes lower electrical bills. The Energy Efficient Mortgage (EEM) program from Fannie Mae, titled HomeStyle®, is a great way to go green, but what does it consist of, exactly? Read on to find out.

Energy-Efficient Mortgages are used to finance houses that are already energy-efficient (Energy Star-certified) or those that need energy improvements. These loans allow borrowers to qualify for a larger mortgage than they would otherwise.

Energy-efficient mortgages can be for purchasing or refinancing and allow approved borrowers to buy energy-efficient homes or pull cash out of their equity to fund energy-efficient repairs or updates to the landscaping.

Some energy-efficient improvements include:

  • Water efficiency devices
  • Renewable energy sources (solar panels, wind devices, geothermal)
  • Storm surge barriers
  • Earthquake foundation retrofitting
  • Brush and tree removal in fire zones
  • Mud and water retaining walls
  • Air sealing, insulation, windows, doors, etc.
  • Radon remediation

Energy-efficient mortgages can be financed for up to 15 percent of the appraised property value. There are a multitude of advantages when it comes to energy-efficient mortgages, including lowering monthly mortgage payments, decreasing utility bills, and offsetting your initial investment through the years.

Looking for loan options to meet your needs? Contact the experts at EB Mortgage today to learn how we can help you go green.

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EB Mortgage is a locally owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at (616) 228-8797 or e-mail contact@ebwmtg.com today.

Written by the digital marketing staff at Creative Programs & Systems: www.cpsmi.com.

Home Equity 101

The word “equity” is synonymous with home loans, but many people aren’t fully aware of what the term means. Have questions? We’ve got answers. Read on to learn everything you need to know about home equity.

Home equity is an asset; a part of your property that you own, it can fluctuate based on the property’s market value and how much of the loan balance remains. Your home is considered collateral for the loan given to you through the mortgage company.

To calculate home equity, subtract the overall property value by your loan balance. For example, if the loan balance is $150,000 and the property value is $500,000, the equity totals $350,000. Your Loan-to-Value (LTV) ratio is an equation used by lenders and can affect loan terms. LTV is a percentage calculated by dividing the loan balance by the property’s appraised value.

Equity can be accessed and used toward buying a new home or borrowed against and used for a cash-out refinance, Home Equity Line of Credit, or HELOC. Accumulated equity can be used to help fund retirement through a reverse mortgage.

To build equity, the property value needs to be increased while debt decreases. Significant improvements such as kitchen or bathroom remodels, new heating/cooling, landscape enhancements, smart home devices, new roof, etc., can add to the value of your home. Basic routine maintenance can also help in markets with increased redevelopment or job opportunities, as potential buyers are more likely.

Making monthly payments will steadily reduce your debt and build equity. If you make extra principal payments, your mortgage debt can be lowered even further. To pay less in interest over the life of the loan, you can swap a 30-year fix-rate or adjustable-rate mortgage for a 15-year fixed-rate mortgage. However, keep in mind this will increase your monthly payments.

Are you ready to invest in your home’s equity? Contact EB Mortgage today to get started.

EB Mortgage is a locally owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at 616-228-8797 or e-mail contact@ebwmtg.com today.

Written by the digital marketing staff at Creative Programs & Systems: www.cpsmi.com.

Understanding DTI

Mortgage companies often require specific documents to analyze the borrower’s financial situation prior to approval. One of the most important aspects of getting approved for a mortgage is your credit score, which shows how well the borrower can meet their financial obligations. In addition to considering your credit score, lenders look at the borrower’s DTI ratio to determine whether they can monetarily handle a new loan.

DTI stands for Debt-to-Income and is calculated by adding all monthly debt payments together and dividing that by the borrower’s monthly income before taxes. DTI does not account for expenses not listed on credit reports, such as groceries, entertainment, and small purchases.

Lower DTI signifies a healthy balance between debt and income. The lower the DTI, the more likely the borrower can qualify for the loan they want. A DTI of 28 to 36 percent or lower is ideal; however, lenders accept higher DTI ratios depending on the type of loan, credit score, savings, and down payment.

There are two ways to lower your DTI ratio: decrease your debts or increase your income. To drive your debt down, pay off existing debt and do not accrue new debts. Increasing your monthly income can be tricky; try working freelance in your free time or find a better-paying job.

Are you thinking about purchasing a home and have a low DTI? Contact the mortgage experts at EB Mortgage today to get pre-approved for the house of your dreams!

EB Mortgage is a locally-owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at 866-246-0516 or e-mail contact@ebwmtg.com today.

Written by the digital marketing staff at Creative Programs & Systems: www.cpsmi.com.