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Common Credit Headaches and How to Handle Them

Written by Gulfside-WpAdmin on 2023. Posted in Blog

For many folks, delving into the weeds of their credit is probably the least favorite step in preparing to buy a home – it’s certainly not an exciting one.

And there’s really no question as to why.

Understanding your credit score and all the activities that can hurt it or improve it can be complicated and confusing. It’s stressful, too, because there’s the possibility that you discover your score isn’t as good as you thought, or you find out there are items on your credit report that don’t belong.

But like it or not, credit plays an enormous role in the process of securing a mortgage loan and buying a home.

Since questions about credit come up a lot, we here at Gulfside Mortgage Services decided to write this article to help with the top five credit questions we get.

How do I Check My Credit Report?
This is an easy step but unfortunately many do not realize they can do it for free. You should never have to pay to see your credit report.

One of the best resources you can use to check your credit report is annualcreditreport.com. You can check your report weekly for free. Furthermore, they allow you to check all three reports available from Equifax, Experian and TransUnion.

Additionally, some credit card providers will allow you to check on your credit score for free as well.

How do I Dispute Errors on My Cre-dit Report?
It is important to review your credit re-ports carefully, as this is a major way to catch identity theft and erroneous charges, both of which can hurt your credit score and negatively impact your eligibility for a good mortgage.

If you find what you believe to be an error in your credit report, you can dispute it and have it corrected. Both the business that reported the infor-mation and the credit bureau it was reported to must correct wrong infor-mation, and they have to do it for free.

You will need to dispute the error with each credit bureau that has the wrong information separately. Take the following steps to officially dispute an error:
1) In writing, explain what you believe is wrong, include the bureau’s dispute form (if they have one), and copies (not originals) of documents that support your claim. Make sure you include your full name and address, as well as a copy of your report with the mistakes circled. Keep record of everything you send.

2) So that you know the credit bureau receives the letter, send it by certified mail and pay for a “return receipt.”

3) You can also submit disputes online or by phone, but be sure to have all of the previously mentioned documentation ready to include in the email or at hand while on the phone.Once received, the credit bureau has 30 days to investigate and must get back to you with their decision. To learn more about submitting disputes and other steps you can take, visit consumer.ftc.gov
Does Shopping for Loans Hurt My Credit Score?
The answer is technically ‘yes,’ but only slightly if you’re doing it right.

There are two key factors to understand about how searching for loans impacts your score.

First, all inquiries occurring within 30 days of scoring have no impact on the score at that time. Once more than 30 days have passed, all inquiries within that time frame only count as a single inquiry.

Second, multiple inquiries for loans of the same type (mortgage loans, for example) will also count as a single inquiry if they occur within the same 45-day period. The assumption here, again, is that you are ultimately seeking one line of credit, so looking at multiple loans only counts once.

But all of that also depends on you making your multiple inquiries within the same 30-45 days. If you make multiple inquiries in one month, put your search on pause, and then make more inquiries in the next month, and spread it out, the inquiries will hit your credit more than once, which may start to add up.
So, the best advice is to do your loan shopping in a fairly short time. Make sure you are ready to move forward when you begin searching for specific mortgages, so when you find a good rate, you are jumping on it.
Additionally, note that even when inquiries do hit your credit score, they only have a minimal impact. A single inquiry typically only lowers a FICO score by less than five points, depending on a person’s credit history. Consumers who have a shorter credit history or few accounts may see a greater impact. But among the five categories used to make up a FICO score,journey and discovered that your cre-dit is less than ideal, there are steps you can take to improve it.

First, pay your bills on time. Payment history, including de-linquent payments, hits your credit score.
Lower your debt. Try to keep your credit utilization below 30%. Focus on paying down some of those credit cards.
Don’t close old accounts! Length of credit history matters. While it is tempting to close a credit card account you have fi-nally paid off, DON’T! It can hurt your score. If you don’t want to be tempted to use it, just cut the card up and get its info off any digital payment apps.
Do limit your new credit inqui-ries. Try to keep new inquiries within a short period so that they only count once on your score.

It may take a little time, but taking one or all of these steps will improve your score and you may even see some immediate improvement.

Have More Questions?

We hope the above guide will help answer some of your more pressing questions regarding credit concerns within the mortgage process.

If you have more questions about how credit factors into mortgage qualification, you can visit our website or give us a call at (941) 485-4222 to learn more!

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How Do Americans Feel About The Housing Market?

Written by Gulfside-WpAdmin on 2023. Posted in Uncategorized

As a trusted provider of home mortgage financing at Gulfside Mortgage Services, we understand that the housing market is a significant concern for many Americans.

Recent surveys and studies have shed light on the public sentiment toward the current state of the housing market, and honestly, public opinion still reflects a bleak outlook. For many of you, this may discourage you from taking that next step toward purchasing a home.

And we get it – we understand that many of you simply want to know: is now a good time to buy a house? And with all the bad feelings out there currently, it can make it seem scary to take the next step.

But is this an accurate way to make your decision? To know the real answer behind whether is now a good time to buy a house or not, it’s important to not just consider how Americans feel about the housing market.

You also must consider what statistics and data have to show about the market, and you also have to consider your own unique situation.

Unfortunately, much of the current public opinion is influenced by those who remember the housing crash of 2008. But, as we have mentioned before, the housing market now is not the same as it was in the early 2000s, and so we would make the case that people should not be anticipating the same thing to happen now.

So, let’s delve a bit into the details. Let’s look at the current public opinion, the influences behind it, and what the reality of the data means for you and/or your real estate clients.

Perception of Risk

A recent report revealed that 44% of Americans believe the housing market is at risk of crashing within the next year. This sentiment is echoed by 36% of homeowners and 35% of Americans overall who actually want the market to crash, believing that a crash is the only way they will be able to afford a home.

This might seem alarming, but it’s important to understand the reasons behind these sentiments.

Anticipating a Repeat of the Early 2000s Crash

As stated above, when we are talking about public opinion, it is heavily influenced by what happened 15 years ago with the 2008 housing crash. Many potential home buyers feel that the significant and quick home price increases we have seen since 2020 are similar to 20 years ago, and so are convinced that a crash is inevitable as well.

However, what many who lived through that don’t recognize is that the current cause for increased housing prices, as well as the handling of home loans, is not at all the same as it was then.

In the early 2000s, loans were being given out with much less regard for the ability of repayment. There was, admittedly, a great deal of irresponsible lending.

However, because of that crash, lending laws changed significantly. Lending has been much more responsible, and so most who have gotten into a mortgage are still capable of affording that mortgage.

Furthermore, while housing prices did fall in 2008, that was truly an unprecedented occurrence. Historically speaking, including in previous times of inflation and economic struggles similar to what we have today, housing prices usually hold steady and even continue to increase, even if it is slowly.

So, if you want history to be your predictor, there are far more examples that would predict housing prices to hold and continue increasing, rather than predicting a drop and crash.

Affordable Housing Concerns

Perhaps just as influential or more than the above, however – one of the main reasons for the current pessimistic outlook is the perceived lack of affordable housing.

A Pew Research Center report highlighted that 49% of Americans consider the availability of affordable housing a major problem. This sentiment is particularly strong among non-homeowners, with 32% believing a market crash is their only way to own a home.

So, as odd as it may sound, for many potential homeowners, a housing market crash is actually wishful thinking.

But wishful thinking is not reliable or predictive data.

Economic Factors

However, there is of course some hard-core data that contributes to current pessimism about the housing market.

Economic factors such as ever-rising mortgage rates, continued inflation, and a worsening economy are also contributing to the negative sentiments.

About 53% of Americans are worried that mortgage rates will remain high, and 79% expect rates to rise for at least another year.

Thus, many potential buyers are waiting till they feel like they can see the light at the end of the tunnel in the form of decreasing mortgage rates.

The Silver Lining

Despite the concerns, there’s a silver lining.

Many Americans still see homeownership as a worthwhile investment, as indeed it is.

Furthermore, about 62% of Americans think home prices will increase in the next year, with two-thirds believing they’ll rise by 5% or more.

Furthermore, as stated above, the historical data indicates that we can anticipate that housing prices will indeed continue to increase rather than fall.

While this may seem discouraging, particularly to those struggling to purchase their first home, it means that the housing market is stable.

It means that working hard for that investment will pay off – a home purchased today will continue to appreciate and grow equity after purchase – its value will not plummet, leaving the buyer “upside down” in the house. Rather, it will be a true investment, increasing the owner’s net worth.

So What Does It All Mean?

What does that mean for you or your clients?

It means that, as much as we may not like current interest rates or inflation, now is the time to buy a home if at all possible.

Home prices will only keep going up – but we can anticipate that interest rates will eventually come down, at which time a homeowner can refinance if need be. A house that is within reach today may not be next year, so waiting may be riskier than buying now.

At Gulfside Mortgage Services, we’re committed to helping our clients navigate these challenges. We provide the lowest rate home mortgage financing by accessing wholesale rates and passing the savings on to you.

Our team of experienced professionals is ready to guide you through the process, providing personalized service to meet your unique needs.

Remember, every housing market has its ups and downs. Staying informed and making decisions based on your unique circumstances and long-term goals is essential.

If you have any questions or need assistance, don’t hesitate to reach out to us at Gulfside Mortgage Services.

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For Potential Home Buyers in Florida: Additional $36 Million Hometown Heroes Funds Available November 6th

Written by Gulfside-WpAdmin on 2023. Posted in Blog

Breaking News, Florida Home Buyers: Additional $36 Million Hometown Heroes Funds Available NOW!

Florida Housing Lenders have reason to celebrate as an exciting development has just been announced that could make homeownership dreams come true for many individuals in the Sunshine State.

At its October 27th meeting, Florida Housing’s Board of Directors approved the allocation of an additional $36 million to the Hometown Heroes (HTH) Loan Program.

This program has been a remarkable success, assisting over 13,000 eligible first-time borrowers who live and work in Florida. The news of this financial boost is set to bring renewed hope to potential homebuyers across the state.

What is the Hometown Heroes Loan Program?

The Hometown Heroes Loan Program is designed to support those who are diligently serving their communities but who are in need of financial assistance to purchase their first homes.

The additional $36 million allocated to this program is a testament to its effectiveness and the positive impact it has had on aspiring homeowners in Florida.

You Must Act NOW

The most crucial piece of information for prospective homebuyers is that this additional funding will become available on Monday, November 6th.

However, it’s important to act swiftly because the demand for HTH funds is expected to be high, and the available funding may be committed quickly after its release. This means that if you are considering applying for this program, it’s essential to get prepared and ready to move forward as fast as possible.

It is also important to note that additional funding for the HTH Program is not expected to be available until sometime in 2024.

A Narrow Window of Opportunity

The opportunity to secure a portion of this $36 million is a limited one.

Reservations should only be made for loans that can meet the program’s timeline, which stipulates a 60-day window from Loan Reservation to Loan Purchase by the servicer, Lakeview.

Who is Eligible?

To be eligible for the Hometown Heroes Loan Program, borrowers must be employed full-time by a Florida-based employer and work 35 or more hours per week. This is an essential requirement to keep in mind when considering your eligibility for this program.

This additional funding is a fantastic opportunity for potential homebuyers in Florida, particularly those who have been tirelessly serving their communities.

Whether you’re a first-time homebuyer or you know someone who is, this financial boost to the Hometown Heroes Loan Program offers a chance to achieve homeownership dreams.

Florida Housing encourages all potential applicants and housing lenders to review the HTH Program Guidelines to ensure they meet the program’s requirements. It’s crucial to be well-informed and prepared to take advantage of this limited-time opportunity.

A Ray of Hope

With the increase in interest rates and home prices in Florida over the last two years, home ownership has felt like a pipe dream to many.

But this news is undoubtedly a ray of hope for those who have been struggling to make their homeownership dreams a reality. With the allocation of $36 million in additional funds, Florida Housing is demonstrating its commitment to supporting the residents of the state in their pursuit of homeownership.

Florida Housing expresses gratitude to all those who have supported the Homebuyer Loan Program, and they are excited to continue helping residents achieve the dream of owning their own homes.

With the Hometown Heroes Loan Program’s success and this additional funding, the path to homeownership in Florida just became a little brighter.

Today is the day the funds are released, so act swiftly, and let the journey to homeownership.

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Homebuying for the Self-Employed

Written by Gulfside-WpAdmin on 2023. Posted in Blog

The self-employed represent a growing number of Americans. According to Gallup estimates, approximately 36% of US workers function as gig workers in some capacity, and over 17 million people categorize themselves as self-employed.

Yet, despite this significant portion of the market, lending and homebuying continue to be an exceedingly confusing, daunting, and frustrating experience for these individuals.

But it doesn’t have to be this way.

So, we’d like to take a look at what the challenges for self-employed buyers actually are and clear up some misconceptions about these perceived challenges. And we want to provide you with some key do’s and don’ts of mortgage basics for self-employed borrowers, whether you are a realtor wanting to better serve this client group, or you are a self-employed home hunter.

Challenges for Self-Employed Buyers

There are two main difficulties that self-employed home buyers face.

Unpredictable/inconsistent income
Lack of traditional tax documents that fairly represent their income

The first problem tends to be especially true for newer business owners, while both new and long-standing business owners deal with the second.

Even when a business is thriving, tax returns will not necessarily represent their ability to pay on a loan, since many business owners take every possible deduction they can on their taxes.

A self-employed individual may have a take-home of over $200K, but after deductions, their tax return may only reflect $60K. The difference in loan amounts available based on those numbers is obvious.

Furthermore, many self-employed buyers are working with 1099s rather than W-2s, further complicating the ability to provide the necessary documentation for traditional home loans.

Misconceptions about Lending Options for Self-Employed

Too often, self-employed home buyers, and even realtors, do not recognize that there IS a solution to this predicament.

Many are stuck with some of the following misconceptions:

Business owners should stop claiming deductions on their taxes for a couple of years so their tax returns reflect higher income before they can buy a home.
Buyers can’t be approved for a loan without traditional tax documents, like W-2s.
Buyers can only get a home loan based on tax returns.
Alternative loans, such as bank statements and cashflow loans, are too hard to close.
Self-employed buyers can’t get pre-qualified for a loan because of unpredictable monthly income.

These misconceptions are causing many small business owners to miss out on the opportunity to buy the home of their dreams and are leading a lot of realtors to miss out on a significant portion of the home buyer market.

It should not be hard for self-employed individuals to buy a home. There are many excellent mortgages for self-employed borrowers that look at cash flow and bank statements rather than tax documents to determine eligibility.

So don’t be discouraged, and don’t turn your self-employed clients away! Instead, give us a call and we can walk you through home loan options for self-employed individuals, like bank statement loans.

What is a Bank Statement Loan Program

Bank statement loan programs are designed for buyers who don’t have the traditional tax documents or proof of income that standard buyers have.

Rather than relying on W-2s and tax returns to determine a client’s eligibility for a loan, these lending programs review the potential buyer’s bank statements and cash flow during a period of time, often up to two years or more, to determine the size of loan they qualify for.

Furthermore, at Gulfside, we have tools that can help you and/or your client review bank statements to help accurately determine what they will qualify for beforehand. This will help you know what can honestly be afforded so that the home search is better focused.

With self-employed mortgage options and tools like these, the home of your or your client’s dreams may actually be well within reach, and much sooner than you realized!

Some Do’s and Don’ts for Self-Employed Home Buyers

All of this said, there are still steps that you, or your client, as a self-employed home buyer can do to make the loan process much smoother and successful. There are also things to avoid.

Let’s look at some do’s. DO:

Look into bank statement lending programs.
Look for a realtor or lender who offers bank statement loans and other self-employed mortgage options.
Be prepared to collect two years of bank statements and other documents proving your business’ legitimacy.
Work hard to maintain an excellent credit score to further demonstrate your ability to pay the mortgage.
CALL US at Gulfside to learn more about self-employed home loan options and the best way to navigate the process.

Let’s also look at the “don’ts.” If you are self-employed or a realtor, DON’T:

Quit taking deductions on your income!
Rely on tax returns for getting approved for a loan.
Settle for a realtor or lender who wants you to quit taking deductions or won’t work with you based on your business income.
Turn away good clients/buyers because they are fully or partially self-employed.
Wait to contact us to discuss self-employed home loans because you think you have to have a certain amount in cash or wait for tax returns to reflect higher income.

At Gulfside Mortgage in Venice, Florida, our team of experts is eager to help you navigate the self-employed home loan process.

We can help you determine what you may be approved for so that you have a satisfying home search process, and we can lead you to the best mortgage options so that you can get into the house of your dreams.

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Why You Need to Bid Over Asking Price in Today’s Housing Market

Written by Gulfside-WpAdmin on 2023. Posted in Blog

If you are looking to buy a home in 2023, you may have noticed that the housing market is very competitive.

There are more buyers than sellers, which means that many homes receive multiple offers and sell for more than the asking price. In fact, according to the National Association of Realtors (NAR), the median existing-home sales price in July 2023 was $410,200, up 15.8% from a year ago.

So how can you stand out from the crowd and increase your chances of getting your offer accepted?

One strategy is to offer over the asking price from the start.

Why You Need to Bid Over Asking Price in Today’s Housing Market

Here are five good reasons why this may be a smart move in today’s market.

5 Reasons to Bid Over Asking Price

Low inventory: As briefly stated above, competition for houses right now is fierce, despite the higher interest rates and inflation.

The most recent report from Existing Home Sales shows that the existing inventory of available homes is very low – less than 1 million homes – and some of these are already under contract!

And this inventory issue is not going to improve for two main reasons:
First, as inflation trends slow and interest rates start to come back down, there will be more people able to buy.
Second, in general, the U.S. population is increasing by leaps and bounds. And if you are thinking about buying a home in Florida, then you know our population is on a constant growth trajectory.
There are more buyers every day with fewer available homes. Competition is only going to get tougher. You have to bid over asking price out of the gate to set yourself apart from the competition.

Avoid a bidding war. A bidding war is when two or more buyers compete for the same property by raising their offers until one of them wins. Bidding wars can drive up the price of a home and cause a lot of stress and uncertainty for buyers.
By offering over the asking price from the start, you show the seller that you are serious and motivated, and that you are willing to pay a premium for their home.
This may convince them to accept your offer right away, or at least give you priority over other buyers.

Show your love for the home. Sometimes, sellers are motivated by emotion and not just money. They may have a sentimental attachment to their home and want to sell it to someone who will appreciate it and take good care of it.
By offering over the asking price, you demonstrate that you love and highly value their home. This may appeal to the seller’s emotions and make them favor you over other buyers.

Compensate for a lower appraisal. An appraisal is an estimate of the home’s value by a professional appraiser. It is usually required by lenders to ensure that they are not lending more money than the home is worth.
However, in a hot market, appraisals may not keep up with the rising prices and may come in lower than the agreed-upon sale price. This can create a problem for buyers who need a mortgage, as they may have to come up with extra cash to cover the difference or renegotiate with the seller.
By bidding over the asking price, you can anticipate this scenario and show the seller that you are prepared to pay more than the appraised value if necessary.
Potentially beat cash offers. Cash offers are offers that do not depend on financing from a lender.
Cash offers are attractive to sellers because they eliminate the risk of financing falling through and speed up the closing process. However, cash offers are not always the highest, and they may not reflect the true market value of the home.
By offering over the asking price, you can compete with cash offers and show the seller that you are willing to pay more than what cash buyers are offering.

Of course, offering over the asking price is not always the best strategy for every buyer and every situation. You should always consult with your real estate agent and your lender before making an offer, and stick to your budget and your goals.

At Gulfside Mortgage Services in Venice, FL, we are available to help you navigate this process and develop a strategy that will work for you or your clients.

Why You Should Not Wait to Buy

Despite higher interest rates and inflation, if you are teetering on the fence – STOP. Now is the time to buy in Venice, Florida and not wait for a few very good reasons:

Historical data shows that housing prices will not go back down but will continue to increase. Stop hoping that you can get a house you love for less than current prices.
As explained above, inventory will not get better, so stop waiting for that.
Interest rates, however, will get better, at which time you can refinance. Go after your dream house now before it goes up in price and out of your range. You can refinance later for a better interest rate.

Now is the Time to Buy!

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