There is a direct link between your credit card and your Oklahoma City mortgage and it does not have to do with using your credit card with a 30% rate of interest to purchase your new home. The link between your card and your mortgage lies in your credit rating. If your credit is out of whack you are not going to be able to qualify for a mortgage. If you want to buy a house and get approved for a home loan you need to make sure that your credit card bill payments reflect responsible credit ownership so that the lenders consider you a good risk.

Credit card problems

If you have any credit card problems at all these will be reported to the credit agencies. Just by paying one payment late on your credit card bill reflects badly on your credit history. Any time you make a late payment it shows up as a black mark on your credit file and too many of these marks will influence your ability to get an Oklahoma City mortgage.

Always make your credit card payments on time. By doing so, lenders will look at you as a responsible cardholder that knows how to handle credit. When you apply for a mortgage, your credit file will be pulled and these things will be assessed. Having a good credit history is one of the most essential components of being approved for a mortgage.

Purchasing with your credit card

Another thing that will be accessed when you apply for a mortgage is how much credit you have available. If you are thinking about purchasing a large screen TV with all the bells and whistles and using up the credit left on your card, it is best to do so after you have purchased your house. The lender wants to see that you have available credit.

Applying for new cards

Don’t apply for any new credit cards when you want to get an Oklahoma City mortgage. You need to assume the position of not needing any extra credit at the time. Applying for too much credit at the same time will appear desperate to many lenders.

When you are applying for an Oklahoma City mortgage it is best to lay low with your credit and don’t do anything that will possibly raise any red flags. Make sure that you make all of your payments on time on your credit card, don’t apply for any extra credit and don’t make any big purchases. These steps will help you when you are trying to get approved for a new mortgage. yment for expenses related to moving to the new property, appliances etc.

If you have a Oklahoma City home loan you will be paying interest monthly on the whole balance that is still owing. At the beginning almost all of your payment will be put towards paying off the interest. As the years go by, however, less money is put towards the interest and more gets put towards the principal.

If you have a 30 year mortgage to pay off, for example, at a 7% rate, you will still be paying more towards the interest than the principal, even when you are halfway through the payments. When you are fifteen years into the mortgage only about 75% of your payment will apply to the interest. At this point only 1/4 of your payment is building up the equity in your Oklahoma City home.

You will not see more than half of your payments being put towards the principal until you are in your 22nd year. That is when the equity continues to build at a rapid pace and everything gains momentum.

With this 30 year loan, you do not own half of the home until the 22nd year or so. There are a couple of ways to reduce this time, however, if you can afford them.

Extra payments

As long as there is no clause on your mortgage for prepayment penalties, you can make extra payments when you have extra funds at hand. This will speed up the process so that your payments go towards building up equity in your home faster.

15 year mortgage

You will save an incredible amount of money on your Oklahoma City home loan by taking out a fifteen year loan at the beginning. If there is any way to afford it, this is your best option in terms of long-term savings.

As an example, if you have a Oklahoma City home loan at 7% for $150,000, a 15 year mortgage will save you about $117,000 dollars over a 30 year loan. This is a staggering amount of savings and makes a 15 year loan well worth your consideration when you are first looking for a mortgage.

You will have to take another look at your budget to see where you stand before making a final decision about your mortgage. If you can’t afford a 15 year Oklahoma City home loan, you’ll still have the option of making extra repayments when possible with a 30 year term.

There has been so much talk about the super low interest rates that I thought you might be interested in seeing how it affects your payment.  So, I calculated these payment amounts as principle and interest in a matrix with loan amount going down on the left and interest rate across the top.  So if you were getting a $150,000.00 30 year fixed rate mortgage loan at 8.00% your payment would be $1,101.00.  What is striking is that you see that your payment almost doubles from 4.5% to 10%. Read the rest of this entry »

This in from the Associated Press

NEW YORK — The price of money for American consumers went on sale in a spectacular way Tuesday after the Federal Reserve cut interest rates to their lowest level on record and promised to keep them low for a long time.

In response, most banks cut the rate they charge their best customers, known as the prime rate, to 3.25 percent from 4 percent. The last time it was that low was in 1955, according to data from the Federal Reserve Bank of St. Louis.

What does this mean to you as a Buyer?  It means that the money you need to buy a new house is cheap.

How Low are interest rates you ask?

Here is what a local lender here in Oklahoma City was quoting today with no points.

5% Fixed Interest Rate on an FHA Loan. And are you ready for this on a 95%LTV with a 740 FICO score we are at (drum roll please) 4.875% Fixed Interest Rate.

That is right 4.875%!

These rates are historically speaking about as low as they get. See chart below from  Freddie Mac.

Monthly Average Commitment Rate And Points On 30-Year Fixed-Rate Mortgages Since 1971

If you took a close look at the above table you will notice that you did not see any loans under 5% and you definitely did not see any under 5% with no points.

If you were looking for the perfect time to buy a house.  Look no Further.

It was reported today that new housing starts are at their lowest since they started tracking them in 1959.  What does that mean?  That means there are very few new houses being put out there which will lead to decreasing inventories leading to a stabilization of home prices and possibly in the near future increasing house prices.  In short it means we are at or near the bottom of housing devaluation.  Throw in the lowest mortgage interest rates ever and a $7500.00 Tax Credit and those sitting on the sideline are going to look back on today with regretful nostalgia.

Don’t miss out on a once in a lifetime opportunity and I won’t have to say “I told you so.”

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Get a Loan Quote Here.