How does my credit score impact my purchasing ability?

If you’ve decided to buy a home this year, you may have some questions about how your credit score will impact your purchase ability. This is a common question for many potential homebuyers, so here, I will discuss some of the primary things that you’ll need to know once you start the homebuying process.

Credit scores and credit reports will affect a borrower’s ability to purchase a home in a few different ways. Credit reports are a footprint that allow banks to review a borrower’s credit history. The information found in these reports will give them the information they need to determine the level or risk they’re taking by loaning money to this person. The higher the credit rating, the lower the risk for the bank. The lower the credit score, the higher the risk for the bank. In addition, remember that your credit score will affect the interest rate of the loan you obtain.

Here are some helpful tips on how to bolster your credit score and secure a good loan on the home of your dreams.

  • Make on-time payments on all borrower accounts
    • Missed or late payments will negatively affect your credit score
  • Satisfy unpaid collections, judgements and tax liens (even if these are medical in nature, it’s ideal to pay them off or settle prior to purchasing a home)
  • Establish a credit history by opening a credit line. We are often taught that credit cards are bad. However, they’re essential for establishing a solid credit rating to borrow future funds. The key is to keep the balance below 30% of the allowed limit, always. It’s ideal to pay the balance off each month as well.
  • Minimize credit iniquities. Too many inquiries can cause credit scores to drop.
  • Don’t close existing revolving trade lines if they’re in good standing. When you close a credit card you lose the on-time payment history which influences your credit rating. (1)

The specific details as to what credit scores are needed to obtain a specific home loan:

– Conventional Mortgage: credit score of 620
– FHA Mortgage: credit score of 580
– Veteran Affairs (VA) Mortgage: While the VA does not have a minimum credit score requirement, Quicken Loans requires a 620 credit score on all VA loans. (2)

The bottom line: the better your credit score, the easier it will be to get a loan for your home. Contact me today for information on what it will take to embark on your journey in buying or selling a home.

 

  1. Information courtesy of: Aaron Hicks, Mortgage Consultant with Homestreet Bank
  2. Information courtesy of: Jevon Domench of Academy Mortgage Corporation
Posted on February 20, 2018 at 5:04 pm
Nancy Johns | Category: Home Buying Tips, Selling Your Home | Tagged , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Story of a Client’s Housing Adventure

This is the story of a family of four: Dad works in Portland, Mom works in Camas, and their two kids are in elementary and middle school. This family had lived in their 1966 home for 14 years and were ready for a change— they wanted more space, new features, and a change of schools.  But like many of us, they had to sell to buy, even though their equity position was a good one.  With the tight market of 2017 (predicted to be the same in 2018), they knew they might not be able to “step across” from one home to the other.

Their first job was to get their current house ready to put on the market. This included yard cleanup, carpet stretching, some minor paint touchup, and some other small things.  These to-do items were not expensive, but they were important to make the home look “crisper” and more appealing to a buyer.  In working with me on home value, we discovered the previous listing had overstated the square footage by several hundred square feet.  We knew the real square footage from a more recent refinance appraisal, so we used that to determine value.  Checking this is an important part of the buying process!

In mid-May, we launched the home on the market and had lots of showings with five offers in just a few days.  This can be quite overwhelming.  With my help, we dealt with all the complexity of evaluating these offers and selected one to accept.  Meanwhile, another buyer who just missed out, decided to write a backup offer just in case something happened with the first accepted buyer.

Now, came time for the home inspection. The inspector said there were “sink holes” in the crawlspace! So, the buyer backed out.  Now what?  Something as serious as this needed to be investigated.  We just don’t have “sink holes” in Clark County, so we believed there was another explanation.  Turns out, when this house was built in the mid-60’s several large trees were cut down and the stumps were not removed.  As they rotted over time, what was left was a hole – one particularly large one even had the trenches from large roots.  We worked with the backup buyer who understand the issue, got the holes filled in with gravel, and then we closed in late June.

Next came the question of where to move. Nothing had turned up in the target location for the next home, so these folks signed up for the adventure of moving temporarily into a rental.  They did this once we were through home inspection with the backup buyer, so they would have time to overlap and move over several weeks.  There are several places around town that will do leases shorter than a year.  Although the rental was smaller, they used the garage for storage of their many boxes. Now, finding the new house became our top priority.

It took a couple of months and we looked at many properties as they came onto the market.  Eventually we found one, got our offer accepted and negotiated home inspection items including unpermitted square footage.  The happy ending is that this family moved into their new place by the end of September, just in time for school to start and before the holidays!

Hopefully you will find this a positive story.  Yes, it took commitment on their part to go through the ups and downs of buying, selling, and moving into the rental, but in the end, this family is “living the dream” and everyone is excited about their new future in their new home.

Thank you to these special clients for letting me share their story! Where does your new home story begin? Contact me today for information on what it will take to embark on your journey in buying or selling a home.

Posted on January 15, 2018 at 7:30 am
Nancy Johns | Category: Home Buying Tips, Selling Your Home | Tagged , , , , , , , , , , , , , , ,

Getting Ready For the New Year: Tips That Can Help Get Your Offer Accepted

The holidays are a very busy time of year for most people, but before you know it, decorations will be put away and 2018 will be in full swing. If you’re planning to be a buyer in the new year, it’s helpful to start reading now on how to make an attractive offer to a seller in a competitive real estate market. Here are some tips that can help you make the best offer.

Tip #1: Know what you can afford.
How much do you owe in debt? What are the ins and outs of your monthly expenditures? Understanding your finances should be the first step in your home searching process, then getting a pre-approval letter from a lender will help you know what you can afford. In addition, this letter will show sellers that you’re serious about buying a home and you can put your offer in with the confidence, knowing that you can afford the monthly payment.

Tip #2: Create a stand-out offer.
When you find the home of your dreams, be ready to make a great offer right off the bat. Your agent will help you figure out what offer is the best one and will take into consideration other home sales in the area, as well as the condition of the home, and what your overall budget is.

Tip #3: Be ready to act quickly and possibly negotiate.
The Clark County real estate market is still hot, meaning that inventory is low and buyer demand is high. Because of this, buyers many times need to compete to get the home that they want. This is where working with a real estate agent is incredibly valuable. Your Realtor® will work with you on creating a great offer and will present it to the seller as soon as possible. If it’s a situation where there are multiple offers, then your agent will walk you through the process of counter-offers, if needed. The bottom line: when you find a home you love, you must be ready to act fast before it’s gone and have patience with the process, because sometimes it will take some negotiation to get your offer accepted.

Buying a home is very exciting and 2018 will be a great year to get out there and find a home that checks all the boxes on your wish list. Contact me when you’re ready to get the ball rolling on house searching so we can create a great offer that gets accepted.  In the meantime, my hope is that you have a happy holiday season that’s full of things that are warm, fun, and fulfilling.

Posted on December 18, 2017 at 7:05 am
Nancy Johns | Category: Home Buying Tips, Selling Your Home | Tagged , , , , , , , , , , , , , , , , , , , , , ,

Learn More About SW Washington Schools

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The strength and potential of a community is reflected in an area’s education system and we are fortunate to live in a place that values education through diverse programs and exceptional instruction.  Southwest Washington public schools are among some of the best in the state. Each school district is home to high-ranking, award winning teachers, administrators, and support staff. Whether it’s science and technology programs or culinary arts classes, Southwest Washington school districts are exemplary. Here is some basic information about each of the districts in the area.   

Vancouver School District
The first school in this district was founded in 1832 and since then, it has worked on pioneering innovative programs that have evolved with the times. Over the years, programs have started that engage the community and inspire young learners. Recently, a community-approved technology levy was passed and students from grade 3 to 12 will have one-to-one digital learning tools by next year.  In addition, magnet programs exist at the High School level for the Arts, medical and science.

Evergreen School District
The district is home to 35 schools that are supported by more than 1600 teachers. This district is incredibly diverse with 52 languages spoken and one in four students in an ethnic minority.  There are more than 26,000 students in the district.  As the district continues to grow, teachers and administrators continue to charge into unexplored territory to develop plans and instructional lessons to help children expand their knowledge and connect with the world around them.

Camas School District
Camas School District Superintendent Mike Nerland shared in a December 2015 letter to patrons that a community wide survey found that 70% of families moving to Camas in the last 10 years did so because of the quality of the school district. In a recent poll, 84% of community members gave the district a grade A or B. (1) This school district is made up of a variety of high-ranking teachers that are involved in the advancement of each student’s personal growth, making it a close-knit educational community that is dedicated to teaching kids self-confidence, respect, and quality communication as key parts of the learning experience.   

Battle Ground School District
Spanning 273 square miles, Battle Ground is one of the largest and most diverse districts in Washington that serves over 13,000 students in 18 schools. In 2010, the district celebrated 100 years operating in the community and it is not uncommon for former students to return to Battle Ground to raise their families there. There are more than 1400 highly trained staff members in the school district and there are a wide range of programs that integrate technology, vocational skills, as well as award-winning music and theater programs that received top state honors in competitions and individual performances.

Washougal School District
Washougal School District opened its first school in 1852 and has since grown to include thousands of students, including those that extend into Skamania County. The mission of this district is to develop supportive and welcoming school environments in order for students to succeed. This district is also active in the community, working with local businesses and agencies to introduce students to occupations so they not only have knowledge, but hands on, real work experiences. 

La Center
The Schools of La Center are a hub of the community and offer diversified learning opportunities including Advanced Placement, La Center Home School Academy, Running Start, and much more including award-winning athletic, music, and drama programs. It is a small district that services just over 1500 students and the district boasts small class sizes and low employee turnover rate, making it one of the most well-respected districts in the area.

Ridgefield
Similar in size to La Center, this district is a small one — one high school, one middle school, and two elementary schools. It aspires to be the state’s premier district by leveraging strong community partnerships and has been consistently one of the highest performing school districts in Clark County with some of the highest performing test results in reading and math. One thing unique to this district is that it employs full time art specialist teachers in the elementary schools, where students receive over 270 hours of high=quality art instruction during the course of their elementary career. Ridgefield is also the only Clark County school district that still offers “outdoor school”, where 5th graders have a week of outdoor, hands-on learning opportunities.  

  1. Camas School District Website. Accessed January 18, 2016. http://www.camas.wednet.edu/superintendent/

Written by Brooke Strickland (www.brookestrickland.org)
Photo courtesy of Battle Ground Public Schools

Posted on January 26, 2016 at 6:02 pm
Nancy Johns | Category: Home Buying Tips, Selling Your Home, Vancouver History | Tagged , , , , , , , , , , ,