Is it better to pay off all debt before buying a house or save for a house?
You could qualify for an FHA loan that requires a low down payment - IF you have a good credit score. To get those 800+ scores you need to pay your credit card bills in full each month. You can do this. Pay off those credit cards and save a ton in interest. Then, continue using your card for things you need like gas, and pay in full when the bill comes in. Never carrying a balance or paying interest. Never close your oldest credit card account - even if it's paid off. Length of credit history is 15% of your fico score Don't close old credit cards - banks like to see a lot of unused credit. Don't make any new "big" loans 18 months before buying your house. Don't open any new credit cards 6 months before purchase. Any credit card debt will directly reduce the amount you will qualify for in a monthly mortgage payment. Pay those cards off - carrying balances is only hurting you. /
Should I pay off my credit card before buying a house?
Absolutely, you do not want to get into home ownership while you still have credit card debt. Plus, it WILL lower your mortgage rate if it increases your FICO score. If your loan to credit ratio decreases, your FICO score rises, meaning if your credit line is $5000, but your card balance is $100, your FICO score will be much higher than if your card balance is $4000. Buy the book, Total Money Makeover, and get on a written budget and out from under all credit card debt. Then save up to put 20% down on a house you can afford to keep and care for into the future. Good luck!
I'm buying a house soon. Should I pay off my credit cards or save for down payment?
dont do anything until you talk to your mortgage broker. do not go to your bank for a loan, consult a reputable mortgage broker who works for a reputable well established firm. it is a GREAT time to buy and a great time to get a loan. lenders do like to see some debt so dont do anything until you talk to your mortgage broker. they will need to pull your credit and show you loan programs, they will then make recommendations as to how to boost your credit. if you have more for your down payment though you will need as much money to borrow which will lower your payment. you are not locked in to a mortgage broker or loan unless you sign a lock in agreement and pay to have your loan locked at the lowest interest rate available to you. i do recommend that you do that when you are ready as we are in a volitale financial market right now and rates fluctuate, bottom line get approved for a loan even if you are just looking at the idea of buying in the next few months and your mortgage broker will be able to give you the best info. good luck. ps I have been working in real estate for over 12 years
Can I buy a house using a credit card?
Technically, yes. The snag in that process would be the processing fee that the credit card company would charge the seller. They may be unwilling to pay the 2%-3% fee. You could eliminate the fee to the seller by taking a cash advance, putting the money in your bank, then paying cash for the house with a cashier’s check (the escrow company will always require “good funds” for the purchase.This brings up another problem, though: if you were to make a very large deposit (let’s say $100,000) to your bank account, you may trigger a Suspicious Activity Report under the current anti-money laundering laws. That would be a major pain for you.Let’s say you were able to pull this off. You would be able to apply for a new mortgage and get cash from your unencumbered property as though it were a purchase, not a cash-out refinance.Here is what might be a better scenario: see if you can arrange an unsecured line of credit with your bank. Given that you have a credit card with a high limit, I’d assume your credit is very good. With a line of credit, you would be able to have your bank wire funds to the escrow to complete your purchase. You’d have the negotiating advantage of buying without a mortgage, then complete your delayed financing to pay off your line of credit.
Is it better to pay Off a Credit Card in Full Each Month or Leave a Balance?
I hear two schools of thought on this subject. Some people say to leave a small balance on your credit card because even though you ll accrue some interest your score will increase faster due to the fact that the lender makes money which in turn makes the Credit Beuros money. It also increases your credit history which i lack in. Other people say to pay off bills in full each month so there's no interest to pay. I just want to know which strategy increases my credit score the fastest. The only reason i even acquired the credit card is to increase my score. It jumped about 30 points on each beuro just for getting the card. I have a $1500 limit and never use more than 30%
Pay off credit cards or save for a downpayment on new house?
If it were a year ago and you could have made an absolute killing on selling your house, I'd have said go for it (save for down payment) and use the profit from selling the house to pay off your credit cards before buying a new house. However, housing markets in most areas of the country now are not as good. Houses are on the market a lot longer now than they were last year. If houses in the Houston area are still selling strong, get a realtor to come and give you an estimate on how much they think you could sell your house for and how long it might possibly take to sell your house. You might be unpleasantly suprised... Right now, I think your best solution has already been given by others. Pay off the credit cards and sit on your house for another year or two so that the housing market has time to recover. Make some improvements to your home if need be, but be prudent about it, you may not see as great a return on your improvements during the next year or two if you decide to sell.
Is it better to pay off a car payment or a credit card payment?
I am 23 years old and just bought my own house. I have several credit cards and a car payment. As long as you have been paying your credit card on time and above the minimum payment due you will be fine. It will not hurt you to have a balance on the credit card or the car payment. I would recommend if you have the money to pay down on the credit card then I would. Then when you get your house you can purchase furniture or decorating items with it. Do not close any credit cards this will lower your credit score and it also helps to use your credit cards every once and awhile and pay it off. Your car you only owe 8,000 on and if you pay a little over the actual payment every month you will get that paid off in no time also. I would not worry about paying off either to increase your chances. I didn't even do a down payment on my house all 0% financing and rolled in closing.
Should I pay off credit cards or save? Why?
Step 1: Stop spending everything you earn (and then some with credit cards). That will cause money to accumulate. If you don't have at least 10% of your gross pay leftover every month, you're doing something wrong. Aggressive folks I know easily live 20% below their means and the ones that work at it are living 30% or more below. Don't think of that as savings, think of it as creating a stream of cash you can point at things.Step 2: Use that stream to put out your credit card fires first. High interest debt is burning up your money. It's also highly unlikely you'll out earn 15 - 18% returns even with brilliant investments. That goes for most other loans too. If your interest rate is 7ish-% or higher on anything from car and house to school loans, put out those fires and pay off the debt first before doing anything else with your cash stream.Step 3: Once the high interest debt is paid off, then worry about building a cash buffer and investing. Point the stream at a savings account until you have enough to go a few months without work. Bad things happen and you need cash on hand to fix them. A pile of money also lets you make better long term decisions about what to do about more money.Once you've put out the credit card fires and filled up your savings account, then you can figure out what types of investments make sense to point your cash stream at next.
If I pay off my credit cards how long until my credit score goes up?
I am doing the same thing...My score goes up every 3 months....started about 9 months ago...I charged my cards up alt then paid them down to 0...then I was doing it over and over...my credit limit went up..and my score..it was 606 when I started..now its 705...so almost 100 points..Im not sure everyone is the same...When you pay them off and let then stay that way..i think its bad to build credit...they want to see it go up,up,up and then 0..lots of times...it shows them you have money all the time.....I charge stuff even if i have the cash..then at the end of the month use it to pay it off.Good luck...and now buying a house is tuff...they want to see a score of 750 to get a ok rate
Is it better to pay down credit card debt or to put the money towards a down payment when buying a house?
If you are looking for an economical solution, the answer depends on what the interest rates are: for credit cards and for mortgage.If credit card rates are higher, then you pay them off first; if mortgage rates are higher, then you put it towards the downpayment. The wording of your question suggests that you came across some money - otherwise you would have already spent it on paying down your credit card debt or even not accumulating any credit card debt since you would have had cash on your hands.It also means that you might be inexperienced with handling money.The reason is this: if you are about to purchase a property, you will have to provide evidence to the bank/lending institution that you can handle your regular bills AND your new mortgage payments.Since you don't appear to have your credit card debt under control, you might have an issue there. I suggest that you pay off your credit card debt (thus surrendering your existing cash and future prospects of the downpayment to past purchases/decisions) and learn to live as a cash-only person. It also means that you have to start saving for that downpayment from scratch. Well, at least you don't have any of the debt anymore (and don't accumulate it again).