There is good news for the VA mortgage market as of February 24, 2010.  The Chairman of Federal Reserve, Ben Bernanke, announced to Congress that “record-low interest rates are still needed to ensure that the economic recovery will last and to help ease the sting of high unemployment.” He seemed certain that recovery would continue, but it would be a slow process. He insisted rates need to stay low for time being, but didn’t indicate how long that would be.

It was then reported home sales hit a low in January, making a new record, which goes to show it will be hard to improve our fragile economy even with the government’s assistance. It fell 11.2% in January, which is the third consecutive month it has dropped, even though Economist was predicting an increase. Not only that, but unemployment is at 9.7%, foreclosure of homes are still at record highs, and it is extremely hard for businesses and individuals to get loans.         

It also was reported that as an effort to increase the economy’s situation, that a bill was passed to help produce more jobs. Not only that, but legislation is planning to help businesses by giving tax breaks to those who choose to help our economy by hiring more employees.

Ben Bernanke promised that the Fed would keep the interest rates as low as possible (near zero) for an “extended period.”  Some think that this “extended period” will last a few months. There will come a time when this will have to reverse once the economy is on more solid ground. The timing is tricky, as waiting too long can cause problems such as inflation, whereas raising rates too soon can disrupt the improvement that will be made.  Bernanke also urged the Congress to act on restoring the nation’s financial structure to avoid events that, in Dec 2007, put us in a recession.

Due to Chairman Ben Bernanke’s speech on February 24, 2010, the Tuesday drop of 101 points was raised on the Dow Jones on Wednesday (the day he gave his speech) by 100 points. This has been great news to the mortgage market! These lowered rates will continue to improve our economy. Our economy is recovering, but since it is still very weak and fragile, the lowered rates need to stay low.

Veterans please keep in mind that interest rates on VA home loans are normally .25%-.50% lower on VA loan than loans made to civilians.

We depend on credit for so many important things in life — whether it’s for buying a car, house or computer or getting a student loan. A three-digit number — your credit score – can determine whether you can do these things and even how much it will cost you.

How can a simple number determine whether you can buy a house or car? If you’ve read How Credit Reports work, you know that your credit report contains a history of how you’ve paid your bills, how much open credit you have, and anything else that would affect your creditworthiness. Your credit score boils down all of that information to a three-digit number. Using the credit score, lenders can predict with some accuracy how likely the borrower is to repay a loan and make payments on time. It’s how electronics and department stores can offer instant credit.

This incredibly important number, which affects how much you pay for credit, insurance and other life necessities, used to be hidden from consumers. Until recently, only lenders and other businesses that used the score could access it. Fair Isaac and Company, which developed the score, felt that the score would only confuse consumers since there was nothing to tell them what it meant or what lenders were looking for.

In 2001, however, all of this changed due to pressure from the U.S. Congress and industry and consumer groups. Now you can view your credit score from credit reporting agencies and credit monitoring services.

But to help us understand that number and ultimately know how to improve it, we’ll need to find out how it’s calculated.

Credit Score Breakdown

Your credit score is calculated by weighing information in your credit report.

Although there are several scoring methods, most lenders use the FICO method from Fair Isaac Corporation. Each of t­he three major credit bureaus (Experian, Equifax and TransUnion) worked with Fair Isaac in the early 1980s to come up with the scoring method.

A credit score is determined much like a grade in school. Just like a teacher calculates grades by taking scores from tests, homework, attendance and anything else they want to use, weighing each one according to importance to come up with a final, single-number score. It’s the same for a credit score. But instead of using the scores from pop quizzes and papers, it uses the information in your credit report.

The number ranges from 300 to 850. Although the exact formula for calculating the score is proprietary information and owned by Fair Isaac, here’s an approximate breakdown of how it is determined:

35 percent of the score is based on your payment history. This makes sense since one of the primary reasons a lender wants to see the score is to find out if (and how promptly) you pay your bills. The score is affected by how many bills have been paid late, how many were sent out for collection and any bankruptcies. When these things happened also comes into play. The more recent, the worse it will be for your overall score.

30 percent of the score is based on outstanding debt. How much do you owe on car or home loans? How many credit cards do you have that are at their credit limits? The more cards you have at their limits, the lower your score will be. The rule of thumb is to keep your card balances at 25 percent or less of their limits.

15 percent of the score is based on the length of time you’ve had credit. The longer you’ve had established credit, the better it is for your overall credit score. Why? Because more information about your past payment history gives a more accurate prediction of your future actions.

10 percent of the score is based on new credit. Opening new credit accounts will negatively affect your score for a short time. This category also penalizes hard inquiries on your credit in the past year. Hard inquiries are those you’ve given lenders permission for, as opposed to soft inquiries, which include looking at your own score and have no effect on the score. However, the score interprets several hard inquiries within a short amount of time as one to account for the way people shop around for the best deals on a loan.

10 percent of the score is based on the types of credit you currently have. It will help your score to show that you have had experience with several different kinds of credit accounts, such as revolving credit accounts and installment loans.

This information is compared to the credit performance of other consumers with similar histories and profiles. The three major credit bureaus each have their own version of the credit score, all of which are based on the original Fair Isaac scoring method. Equifax has the BEACON system, TransUnion has the classic FICO Risk Score system, and Experian has the Experian/Fair Isaac RISK system. Some lenders also have their own scoring methods, which may include information such as your income or how long you’ve been at the same job.

We depend on credit for so many important things in life — whether it’s for buying a car, house or computer or getting a student loan. A three-digit number — your credit score — can determine whether you can do these things and even how much it will cost you.

How can a simple number determine whether you can buy a house or car? If you’ve read How Credit Reports work, you know that your credit report contains a history of how you’ve paid your bills, how much open credit you have, and anything else that would affect your creditworthiness. Your credit score boils down all of that information to a three-digit number. Using the credit score, lenders can predict with some accuracy how likely the borrower is to repay a loan and make payments on time. It’s how electronics and department stores can offer instant credit.

This incredibly important number, which affects how much you pay for credit, insurance and other life necessities, used to be hidden from consumers. Until recently, only lenders and other businesses that used the score could access it. Fair Isaac and Company, which developed the score, felt that the score would only confuse consumers since there was nothing to tell them what it meant or what lenders were looking for.

In 2001, however, all of this changed due to pressure from the U.S. Congress and industry and consumer groups. Now you can view your credit score from credit reporting agencies and credit monitoring services.

But to help us understand that number and ultimately know how to improve it, we’ll need to find out how it’s calculated.

Credit Score Breakdown

Your credit score is calculated by weighing information in your credit report.

Although there are several scoring methods, most lenders use the FICO method from Fair Isaac Corporation. Each of t­he three major credit bureaus (Experian, Equifax and TransUnion) worked with Fair Isaac in the early 1980s to come up with the scoring method.

A credit score is determined much like a grade in school. Just like a teacher calculates grades by taking scores from tests, homework, attendance and anything else they want to use, weighing each one according to importance to come up with a final, single-number score. It’s the same for a credit score. But instead of using the scores from pop quizzes and papers, it uses the information in your credit report.

The number ranges from 300 to 850. Although the exact formula for calculating the score is proprietary information and owned by Fair Isaac, here’s an approximate breakdown of how it is determined:

35 percent of the score is based on your payment history. This makes sense since one of the primary reasons a lender wants to see the score is to find out if (and how promptly) you pay your bills. The score is affected by how many bills have been paid late, how many were sent out for collection and any bankruptcies. When these things happened also comes into play. The more recent, the worse it will be for your overall score.

30 percent of the score is based on outstanding debt. How much do you owe on car or home loans? How many credit cards do you have that are at their credit limits? The more cards you have at their limits, the lower your score will be. The rule of thumb is to keep your card balances at 25 percent or less of their limits.

15 percent of the score is based on the length of time you’ve had credit. The longer you’ve had established credit, the better it is for your overall credit score. Why? Because more information about your past payment history gives a more accurate prediction of your future actions.

10 percent of the score is based on new credit. Opening new credit accounts will negatively affect your score for a short time. This category also penalizes hard inquiries on your credit in the past year. Hard inquiries are those you’ve given lenders permission for, as opposed to soft inquiries, which include looking at your own score and have no effect on the score. However, the score interprets several hard inquiries within a short amount of time as one to account for the way people shop around for the best deals on a loan.

10 percent of the score is based on the types of credit you currently have. It will help your score to show that you have had experience with several different kinds of credit accounts, such as revolving credit accounts and installment loans.

This information is compared to the credit performance of other consumers with similar histories and profiles. The three major credit bureaus each have their own version of the credit score, all of which are based on the original Fair Isaac scoring method. Equifax has the BEACON system, TransUnion has the classic FICO Risk Score system, and Experian has the Experian/Fair Isaac RISK system. Some lenders also have their own scoring methods, which may include information such as your income or how long you’ve been at the same job.

As a VA loan specialist, I spend a good portion of my day speaking to Veterans about interest rates for their VA loans. Sometimes I am able to deliver good news that the market has moved in their favor and the VA rate is now lower than I had previously offered. Sadly, I am forced to share bad news that rates have increased.

In May of this past year VA rates skyrocketed following the Memorial Day Holiday. Over a three day period the lowest available rate went from 4.5% to 5.25% on a VA loan. Many Veterans ask: What causes these wild swings? The answer is not nearly as straight forward as the question.

Much like stocks, mortgage bonds are traded on the open market. The price of these bonds is what determines the rates on any given day. Also like stocks the prices, these mortgage bonds fluctuate in price from second to second. If the price is high the interest rates get lower.  If the price is deflated the interest rates rise. On a daily basis bankers look at the return of their mortgage bonds to determine where their rates for the day will be.  but these prices are affected by any number of economic reports, as well as simple mass hysteria when bad news hits the market. (think 9/11) thus trying to outthink the market is anything but simple.

As VA mortgage professionals we spend our days watching rates, so that Veterans can spend time concerned with other things. Because of the constant watch that we keep, VA loan specialists are in a particularly good position to help Veterans get the lowest available rate on a VA mortgage.

Don’t waste the opportunity to get a rate below 5% on your VA loan. It may be the last opportunity we see to do so for a very long time.

A fortunate Utah military family will receive a FREE Thanksgiving dinner courtesy of LowVARates.com.  Families can apply by submitting a 200-300 word essay to PR@LowVARates.com.

Nov. 3, 2009, Lehi, UT- Thanksgiving Day dawns the beginning of the holidays and represents the season to give.  It’s almost as if giving and the holiday season have become synonymous. 

 However, the men and women of our U.S. Armed Forces dedicate the entire year in our behalf, giving their lives to ensure our safety and comfort. 

 This year LowVARates.com has decided to give back to one of our loyal military families through the “LowVARates.com Thanksgiving Feast Giveaway.”

 The winner of the giveaway will receive a free family dinner on Thanksgiving Day November 26, 2009.  The restaurant chosen will include an exclusive banquet room for the winner and their family.

 Owner of LowVARates.com, Eric Kandell, hopes the contest will give a deserving Utah military family an extravagant Thanksgiving dinner.

 “Hopefully we can help a family in Utah receive a Thanksgiving dinner that otherwise would not get one,” Kandell said.  “Everybody deserves a Thanksgiving feast and we want to make that a reality for a Utah military family in need.”

 According to the Department of Defense, the U.S. military is deployed in over 150 countries with around 25% of its active duty soldiers serving in foreign countries. 

 Many military families spend holidays, like Thanksgiving, with a family member deployed on military service.  This can make the holiday season a particularly tough time to have a loved one away from home.

 The contest is designed to help a Utah military family to have an enjoyable Thanksgiving Day dinner even amidst sad or tough times. 

 Families can nominate themselves or another military family in need.  To enter the contest, please submit a 200-300 word essay to PR@LowVARates.com and tell us why the military family should be selected.

 Please include the following information:

1)      Your Name

2)      Address

3)      Contact Information (Phone # or Email)

4)      200-300 word essay

5)      Name of Family You are submitting for the contest (You can submit your own family or another family in need)

 “If we can just help one military family have a happy Thanksgiving that will be worth it,” Kandell said.  “We just want to thank the men and women of the U.S. Armed Forces.”

 The family must be associated or enlisted with the military or they will not qualify for the prize.  All entries must be submitted by November 20^th to enter the giveaway.  LowVARates.com will pay for dinner for up to 10 individuals.  Any number more then 10 will not be compensated.

CONTACT:

Craig Walton

Director of Public Relations

LowVARates.com

PR@LowVARates.com

Office:  801-341-7048

Wartime is generally perceived as a time of great duress with incredibly high stakes. It can be tough to think that some of the most important scientific advances in human were born in the throes of war. But if war (ideally) is the ultimate expression of necessity, and necessity is the mother of invention, this point may find greater traction. Historically, in times of war, production goes up, spending goes down, the nation is mobilized and focused toward progress and supportive of innovation. What does than mean? Consider the list below and decide for yourself.

1. Atomic Energy – Absurdly efficient energy source capable of powering (or obliterating ) a large city. Used widely throughout the world. WWII

2. Anesthesia – the use of Chloroform began in the Civil War to aid Battlefield Surgeons efforts to cleanly and humanely process the injured soldiers. Shortly thereafter the movement began to gain traction in the private sector, improving medical care by cleaner surgeries and fewer infections. US Civil War.

3. Computer – We live in a wired society. Computers are part of the fabric of our daily lives at work, in the car or at home. Originally conceived and designed during WWII as a code breaking aid. WWII

4. Internet – Conceived and designed in the late 1970’s during the height of the cold war as a defense against nuclear war. The thought was that if vital government information could be stored in a virtual environment, it would be impossible to take out communications at one location. The effect of this advancement is obvious to anyone reading this.  Cold War

5. Satellite Technology – The “Space Race” fueled by the underlying Cold War gave rise to an invention that facilitated better, safer, and more meaningful intelligence gathering activities. Modern day commercial applications have expanded to include the advent of GPS, and of course cable television and wireless internet. Cold War

6. Penicillin – Discovered around the turn of the 20^th century, this simple drug which came to prominence during WWII has saved Billions of lives from previously deadly bacterial infections. WWI and WWII

7. Rubber – As the Allied forces scrambled to produce the equipment that would facilitate victory against the Axis powers, a major breakthrough came with the invention of synthetic rubber. Prior to this rubber was harvested via “rubber trees” in the South Pacific and Latin/South America. The invention allowed commercial ventures to explode and grow the American economy to the world’s leading economic power. The most obvious application? Automobile tires. WWII

8. Jet Engine – Aeronautic technologies were able to “take off” in WWII & the Korean War Conflict with the invention of higher octane, more efficient super fuels, stronger and lighter engines and advances in aerodynamic engineering. Howard Hughes, the filmmaker, billionaire industrialist and international playboy pioneered many technologies which ensured unrivaled American Air superiority to this very day. WWII & Korean Conflict

9. Submarine – Incredibly, while the notion of maritime submersible vehicles have been “floating” around since the early 1600’s, the first rudimentary (yet viable) submarine was launched in 1775. American Revolutionary War

10. Pepto Bismol – Pink Bismuth may not mean much to most, but for those of us this summer who suffer with the occasional post-hot dog heartburn this is a lifesaver. Originally conceived during WWII, this product was introduced commercially directly after the war. And the rest is

By Craig Walton

LowVARates.com donated 250 hot dogs to military personnel at the Hogle Zoo in Salt Lake City Utah. Veterans and active military personnel were honored with a number of activities, including the free hot dog.

(Salt Lake City, Utah, July 6, 2009) – Nothing is better, or more American, then eating a hot dog in the blistering heat of July. If you don’t believe it, ask any of the 250 military families who chowed down their FREE hot dog at the Hogle Zoo this past Friday.

In association with the Hogle Zoo’s Military Appreciation Days, LowVARates.com honored our country’s armed forces with the ultimate American gift, the hot dog.

The day was memorable as thousands of military personnel poured through the crowded front gates of the Hogle Zoo to enjoy the various festivities.

As the families entered the zoo, they were surprised with a coupon for a free hot dog courtesy of LowVARates.com.

“Everyone loves a free hot dog,” said owner of LowVARates.com Eric Kandell. “When we heard the Hogle Zoo was honoring our country’s armed forces, we really wanted to be a part of the activities.”