As newspapers and real estate gurus tell us everyday, the housing bubble has deflated some as 2006 draws to a close (if not burst completely in some areas of the country). This has created a “buyer’s market”, where there is an over-supply of homes for sale, and because of that, prices are often below market value.
I never thought I would be able to buy a home. I groused about my poor credit scores and bemoaned all of the poor financial decisions I had made in my college years. Our employment “titles” as writers and artists wasn’t going to get us very far, we thought, with banks.
The American dream of homeownership, cheap mortgage money (bigger is better), and relaxed lending criteria has kept our economy chugging along. Everywhere you look there are programs and seminars for “first time” homeowners or “low income” buyers offered by housing organizations, real estate brokers, mortgage brokers, lawyers, and insurance providers. They all tout the move from tenancy to homeownership and in some cases will subsidize the cost that can help you buy, build, or rehabilitate a home.
Mortgage rates can greatly affect the amount of house that you can afford. Whether you are talking about over the life of the loan, or the amount of your monthly payment, mortgage rates can make or break your ability to purchase.
There are a variety of reasons why you may be considering debt consolidation. With the average American carrying at least some credit card debt, and often possessing up to eight credit cards in his or her wallet, it is easy to understand how credit card debt has grown out of control.
A few years ago you ran into some debt problems, your credit (FICO) score took a nosedive, and you had to take out a second mortgage to cover all the bills. Since that time, you’ve managed to recover financially, religiously paid all your bills on time and wonder if you might not be able to refinance that high-interest second mortgage.
Home equity loans and lines of credit are often both referred to as 2nd mortgages today. The language that surrounds home equity loans has gotten a little sloppy, which is not good because a home equity loan—traditional second, and a home equity line of credit are quite different programs with vastly different implications. Essentially, there are two different types of home equity loans: term, or closed-end loans, and lines of credit.
I have never been good at numbers. And to top off my inability to understand basic arithmetic, I have a horrible relationship with money. I relied way too heavily on credit cards after college and I have paid way too many fees for being behind on payments or late with arrangements made. This wasn’t by choice, mind you. It was a combination of making a few bad decisions and, simultaneously being thrown a few curves balls that set us back quite a bit. After two years of being in complete survival mode we are finally on the road to better times (we have actually managed to become artists with a steady paycheck and 401k plan! Imagine that!).