How Credit Utilization Can Affect Your Mortgage Loan Approval

While you may know that your credit can affect your ability to be approved for a home loan at the Lake of the Ozarks, what do you know about how your credit score is determined? Your credit score is influenced by 5 different factors: payment history, level of debt/credit utilization, age of credit, mix of credit and credit inquiries. Credit utilization is the 2nd largest factor in determining your credit score. Today's blog from your Lake of the Ozarks mortgage lender discusses what credit utilization is and how you can manage it to get the best credit score.

What is Credit Utilization? 

Credit utilization measures the amount of your credit limit that is being used. It is the ratio of your credit card balances to the credit limits. For any easy example, let's say you have a credit limit of $1,000 on your credit card and you have bought $200 worth of stuff on it. Your credit utilization would currently be 20 percent. The lower your credit utilization percentage is, the better the effect it will have on your overall credit score. The FICO credit score model looks at your credit utilization in two ways; it looks at each card's utilization separately, and then it looks at your total credit utilization. A high percentage for either of those will have a negative effect on your credit score. Remember that the purpose of your credit score is to show your mortgage lender at the Lake of the Ozarks how likely you are to repay the money you borrow. High credit card and loan balances make you appear more likely to default on your mortgage loan payments.

Managing Your Credit Utilization 

The best way to manage your credit utilization is by keeping a low credit card balance. Keeping your credit utilization below 30 percent is ideal. One way to do this is to make your payments early, before the billing cycle ends and the payment is due. Just paying your bills in full each month isn't going to work, because the credit card companies send your information to the credit reporting agencies at the end of each billing cycle (which is before you get your bill and likely before you make any payments). The good thing is that high credit utilization won't hurt your credit score in the long run. As soon as you're able to pay down your balances, your credit utilization will decrease and your score will go up.

If you're concerned with your credit utilization and how it will affect your chances at getting approved for a mortgage, contact your local lake lender at 573-746-7211 to discuss your unique situation. Together, we can go over your options and see what needs to happen in order for you to be approved for a mortgage loan at the Lake of the Ozarks. I'm here to help you every step of the way, and get you into your dream home at the Lake!

For Lake area news, resources and tips on financial services, please 

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Michael Lasson

Senior Loan Officer

NMLS #: 493712

4655 B Osage Beach Parkway

Osage Beach, MO 65065

Direct:  (573) 746-7211

Cell: (573) 216-7258

Fax:(866) 397-0318

Email:  mlasson@fsbfinancial.com

**The postings on this site are my own and do not necessarily represent First State Bank of St Charles’s positions, strategies, or opinions.

Completing Your Loan Application

When you're ready to buy a home at the Lake of the Ozarks, one of the first steps in getting financing is filling out the loan application. Today's blog from your Lake of the Ozarks mortgage lender offers some guidance on completing that application.

Meeting with Your Lake Lender 

The first thing you want to do when applying for a mortgage is talk to your local lake lender. Together you will go over everything needed for your loan application. After your application is filled out and has been pre-approved, your lender may ask for additional information to complete the mortgage process. To give you an idea of what to expect, we've put together a document checklist for your review. By gathering as much of the information and documents as possible before sitting down with your lender, you'll be able to speed up the process and likely avoid delays.

Mortgage Document Checklist 

The following information and documents are usually required during the Lake of the Ozarks home loan process. To speed along the process, you'll want to start gathering the information now.

Personal Information: 

• Social Security Number
• Date of Birth 
• Current driver’s license or photo ID
• Current and previous addresses
• Names and information of any co-signers or co-borrowers

Income & Employment Information: 

• Most recent two years W-2
• Current pay check stub reflecting year-to-date income of 30 days or more.
• Present employer’s name, address and phone number. Length of employment, position and salary. If employed less than two years, please provide previous employer’s name, address and phone number to cover two consecutive years.  Exact dates are required.
• Last two months’ bank statements for all accounts.  Please provide explanations of any deposits larger than normal paycheck.
• If self-employed or paid any commission or have any business income, please bring complete copies of your federal tax returns along with all schedules and W-2s for the past two years. Include corporate or partnership returns, if applicable, for your business.  Also include a year-to-date Profit & Loss statement.
• Verification of other income needed to qualify, such as retirement, rental, interest or dividend income.  If receiving Social Security or pension income, please bring current awards letter.

Other Information/Documents: 

• If applying for an MHDC grant, the past three years’ federal tax returns are required.
• Evidence of child support payments for the last 12 months, if applicable, along with divorce decree and court order for child support payment and alimony.
• Divorce decree order or any financial obligation incurred through a court order, if applicable.
• If you have a property for sale, please bring the accepted offer to purchase or copy of listing contract.
• If you own investment properties, please provide address, name of mortgage lender, mortgage statement and lease agreement on properties.
• If any judgments or bankruptcy has been filed, please supply a copy of the judgment or bankruptcy discharge and petition.  Also, furnish a letter of explanation of the same.
• For a VA Loan, please provide a certificate of eligibility and a copy of DD 214. 
• Copy of the trust papers if you want the property held in a trust
• Copy of accepted contract signed by purchasers and sellers, copy of earnest money check

Please keep in mind that some documents may not apply to you or may be difficult to provide. If you have questions about these items, or have trouble collecting them, please contact your mortgage lender at the Lake of the Ozarks for assistance. 

As your local lake lender, I'm committed to working with you every step of the way! I'll discuss your Lake of the Ozarks home financing options, offer competitive interest rates and back it up with the first-class service you deserve! Give me a call today at 573-746-7211 to discuss your home financing needs. 

For Lake area news, resources and tips on financial services, please 

LIKE my Facebook Page, Follow me on Twitter or Connect on LinkedIn

Michael Lasson

Senior Loan Officer

NMLS #: 493712

4655 B Osage Beach Parkway

Osage Beach, MO 65065

Direct:  (573) 746-7211

Cell: (573) 216-7258

Fax:(866) 397-0318

Email:  mlasson@fsbfinancial.com

**The postings on this site are my own and do not necessarily represent First State Bank of St Charles’s positions, strategies, or opinions.

5 Tips for Maintaining a Good Credit Score

One of the most important aspects of applying for a mortgage is having good credit. If you have bad credit, you'll need to work on improving your score in order to get a better interest rate, and in some cases to even obtain a mortgage loan at the Lake of the Ozarks at all. If you have good credit, then it's important to maintain that credit rating. While it can take time and patience to improve your credit score, it's unfortunately easy to mess it up. Keep reading for some tips to help you maintain a good credit score from your Lake of the Ozarks mortgage lender.

1. Setup Payment Reminders. 

One of the biggest factors contributing to your credit score is making all your payments on time. If you're one of those people that has too many things on their plate (which is most of us), consider setting up payment reminders so that you don't miss any payments. Depending on the type of bill, you have other options as well. Some companies will let you schedule a payment for the future instead of having to wait until payday to pay it. In addition, you may be able to setup automatic withdrawal or charge. This is a great option as long as you know you'll have enough money in your account to cover the bills.

2. Keep Credit Card Balances Low. 

Even if you pay your credit card bill on time each month, having high balances on your credit cards can affect your credit. Keep the balances on credit cards and other "revolving credit" as low as possible. If you can pay off your cards in full each month, that's the best way to go. Then you don't have to worry about high credit card rates increasing your balance. Keep your credit cards under control and maintaining your credit score will be a lot easier.

3. Don't Move Your Debt Around. 

The most effective way to improve your credit score is by paying down revolving debt. Rather than moving your debt around, for example consolidating it onto one card or a personal loan, you should work to pay it down. Owing the same amount, but having fewer accounts may actually lower your credit score. Work on paying your smallest balance first and work your way around the rest of the payments. Moving the debt from one place to another isn't going to decrease the amount you owe. Paying off debts will take time, but you're sure to see your credit maintaining and eventually improving.

4. Don't Open & Close Credit Accounts. 

The more available debt you have, the more likely you are to put your credit score at risk. Each time you open a new credit account, your credit score gets dinged slightly. Opening a new account also lowers your average credit age, another contributing factor to your credit score. To maintain a good credit score, only open new credit accounts when absolutely necessary. In addition, you don't want to close any unused accounts. After time, that account will drop off your credit report, which can shorten your average credit rating.

5. Watch Your Credit Report. 

While you may be doing everything right in regards to your credit, mistakes can be made. Errors on your report could lead to a drop in your credit rating. In addition, identity theft and credit card fraud can also lead to mistakes on your report. Therefore, it's important to check your credit report regularly and look for any issues. The sooner you can correct them, the easier it is to maintain a good credit score.

If you have your credit in order and are ready to apply for a home loan at the Lake of the Ozarks, I'm here to help. As your local mortgage professional, I'll work with you every step of the way. I'll discuss your Lake of the Ozarks home financing options, offer competitive interest rates and back it up with the first-class service you deserve. Give me a call at 573-746-7211 today!

For Lake area news, resources and tips on financial services, please 

LIKE my Facebook Page, Follow me on Twitter or Connect on LinkedIn

Michael Lasson

Senior Loan Officer

NMLS #: 493712

4655 B Osage Beach Parkway

Osage Beach, MO 65065

Direct:  (573) 746-7211

Cell: (573) 216-7258

Fax:(866) 397-0318

Email:  mlasson@fsbfinancial.com

**The postings on this site are my own and do not necessarily represent First State Bank of St Charles’s positions, strategies, or opinions.

Refinancing Your Home at the Lake of the Ozarks

Buying a brand new home isn't the only reason you would need a home loan at the Lake of the Ozarks. Today's blog from your Lake of the Ozarks mortgage lender discusses how refinancing your home works. Keep reading to find out if refinancing may be right for you.

What is Home Refinancing? 

Refinancing is when you get a new mortgage to replace the original one you had on your home. This is done in an effort to reduce the monthly payment amount, lower the interest rate or take cash out for larger purchases. In today's economic conditions, it can be difficult for some to make the monthly payments on their mortgage. Should you find yourself in a situation where you're struggling to make your mortgage payments each month, refinancing is something to consider.

How Does Refinancing Work? 

When refinancing a home at the Lake of the Ozarks, the first loan is actually paid off, allowing the second loan to be created. Therefore, there will be costs associated with creating a new loan. It's important to make sure that the benefits of refinancing will outweigh the associated costs. You will need to consider all of the closing costs, such as application fee, title insurance and title search fees, attorney review fees and points and fees incurred in loan origination. Run the numbers and see if refinancing makes sense for you. Talking to a mortgage professional at the Lake of the Ozarks and discussing your options will also help.

Advantages of Refinancing 

There are a variety of advantages to refinancing your home. The main advantage is being able to reduce your interest rate. Whether interest rates have dropped since you first got your mortgage or your credit score has improved allowing you to qualify for a better interest rate, refinancing might be a great option for you. A lower interest rate can have a huge impact on your monthly payments, potentially saving you hundreds of dollars each year. This brings us to the next advantage, the ability to reduce your monthly mortgage payment. Whether you took a pay decrease or just want to be able to set money aside in savings, a reduction in your monthly mortgage payment by refinancing could be a great solution.

If you're considering a Lake of the Ozarks home refinance, give Michael Lasson a call at 573-746-7211. As your mortgage lender at the Lake of the Ozarks, I'm committed to working with you every step of the way, from deciding if refinancing is right for you to closing the loan. I'll discuss your options, offer competitive interest rates and back it up with the first-class service you deserve!

For Lake area news, resources and tips on financial services, please 

LIKE my Facebook Page, Follow me on Twitter or Connect on LinkedIn

Michael Lasson

Senior Loan Officer

NMLS #: 493712

4655 B Osage Beach Parkway

Osage Beach, MO 65065

Direct:  (573) 746-7211

Cell: (573) 216-7258

Fax:(866) 397-0318

Email:  mlasson@fsbfinancial.com

**The postings on this site are my own and do not necessarily represent First State Bank of St Charles’s positions, strategies, or opinions.