As the economy changes there are many opportunities that surface that can allow us to move ahead financially. In this post we wanted to share a couple of ideas that can help our members take advantage of these ongoing changes.
Refinance
Now is time to refinance and get some of the best rates before interest rates begin to move up. There are some phenomenal rates available right now if you move quickly. However, qualifying is harder than it was only a few years ago. The best rates are going be found with loans that are backed by FHA, Fannie Mae or Freddie Mac. In other words these would be conforming loan limits of $625,500 for high-cost areas like California. Loans amounts above this limit are not going to find as favorable rates, but you have to shop around.
These days to qualify for a refinance you credit score will have to be at least 720 and you should have 20% or more equity in your home. Although Fannie and Freddie only require 5% equity in a primary home and you will have to purchase private mortgage insurance unless you have 20% equity.
Credit Cards
The new credit card reform law gives consumers more rights when the new rules take effect. In the meantime you have to be careful and keep an eye out for changes that your bank may impose on your credit card. Yes, you can always reject the new terms on your credit card but be aware that often the issuing bank may close your account and that will have an effect on your credit score.
Also, don’t let your credit cards sit with zero balances for too long. These days banks are closing accounts that consumers are not using. Use more than one or two cards in case you lose access to one account.
If you are thinking of getting a new credit card stay with a credit union or a local regional bank. You will find that they offer lower rates and better terms than the big banks.