Your credit score reflects how much debt you currently have and your performance in repaying other debts. Knowing your credit score is important for practical purposes, and here is a list of several reasons why…

1. It provides a better idea of what sort of mortgages and other credit offers you should be eligible for. People with high credit scores typically receive better interest rates. Without knowing the score, it is easier for a high-interest lender to deceive you into believing that loans that are more desirable are beyond your reach.
2. When you aren’t sure if your record has improved enough to make applying for loans worthwhile, knowing the credit score will clarify this. For example, if you made several late payments a few years ago, the score will reveal how much your eligibility has recovered since then.
3. If you are young and/or haven’t used credit much (or for very long), knowing this score is important for determining if you have conducted sufficient financial activity yet to qualify for a mortgage or other major loan. Banks are typically quite willing to offer credit cards to people with no credit history, but reluctant to allow other borrowing.
4. Knowing the score will let you discern if it is currently important to take steps aimed at improving your credit record. Such measures may include looking for and correcting important errors on the record, consolidating multiple debts, or putting a greater emphasis upon paying off your existing debt.
5. Keeping a high score isn’t as simple as some people would suggest. Factors like the number of separate debts and the amount of credit record inquiries (from lenders you have applied to) can influence these scores. It is important not to assume that the score is good, average, or poor without verifying this assertion by actually knowing what it is.

Knowing how favorably the reporting agencies have evaluated your debt management is also interesting, along with discovering how effective your financial strategy has been in this regard. Services are available that continually monitor the score, making it easier to see the impact of paying off debts, submitting late payments, or other financial changes.

The only reasons why you would forgo knowing your credit score would be because of the fee to obtain this information, or if it’s not important because you don’t plan to apply for any type of loan.

With today’s market there are a number of attractive homes in the foreclosure market. However, buying a foreclosed home is much more risky and complicated than the traditional home buying course. There are a few tips that you should know before trying to buy a foreclosed property.

First you can buy a home when it’s in the pre-foreclosure stage, or when the owner of the house has been given a certain amount of time depending on the state to become current with the mortgage or give up the home. Buying a house in this time period often is easier for experienced buyers because you have to deal directly with the homeowner. Not only are they likely upset about losing their home, often homeowners don’t know their properties were made public in a foreclosure listing. Another thing that makes buying homes during this period difficult is the time constraints. Some states give homeowners only 30 days before the bank puts it up for auction. Not a lot of time to make a deal and transfer the mortgage.

If a home does go to auction, the next stage in foreclosure, buying the home then can again be risky. The auction usually happens on the steps of a local courthouse and is difficult because you usually have to pay cash for the home. Homebuyers can’t finance auctioned homes. Additionally you have to buy the house without seeing it. And beyond all of that you can’t get title insurance so if the house has a tax lien attached to it the new owner, you, has to pay it off.

If no bids are high enough to pay for the outstanding loan or no one shows up to the auction then the next step is taken. This means the bank will take ownership of the home and use a real estate broker to sell it. This is the best way to buy foreclosed properties in terms of ease. However, you’re not likely to get a discount any longer because the bank usually tries to sell for right at or close to the market value. Try negotiating though because if a bank has a number of properties they are more willing to chance their asking price.

Another type of foreclosed properties is the homes that were bought with FHA or Department of Veterans Affairs loans. When these homes go into foreclosure they are put up for sale by the government. These listings are updated daily and come with a detailed property report, but can only be bid on by HUD-registered brokers. Better yet, for the first 45 days they are up for sale the listing is only for homeowner occupancy, which means you don’t face competition from foreclosure investors. This means the best chance for the good properties at a reasonable price.

You can find listings of foreclosures at Foreclosure.com, Foreclosures.com and RealtyTrac.com All of these sites list foreclosed properties and charge monthly subscription fees for access to their databases.

Some lenders offer a 40-year mortgage option as an alternative to the more common term lengths. These loans frequently have a fixed interest rate, but adjustable rate versions remain available as well. Large national lenders are more likely to offer them than small banks or credit unions. Read on to learn about the pros and cons of a 40-year mortgage, compared to a fifteen or thirty year loan.

PROS

1. The monthly payments on a 40-yr. loan are lower than payments on a shorter term mortgage. This can make it possible to purchase the same home with lower monthly earnings, or to have more funds to use for other purposes.

2. Although the total interest expense is higher on this type of loan, part of the interest can be deducted from federal income taxes. Generally, this deduction is only useful for people who are fairly wealthy.

3. If the owner eventually decides a shorter term is best, perhaps after an increase in earnings, he or she may be able to refinance it to a shorter term such as 15 or 30 years. Having a 40-yr. loan isn’t necessarily permanent.

Clearly the most significant of these pros are the lower monthly payments. An example of this would be the payments on a $92,000 mortgage at seven percent interest. With a 40-year term, the monthly payments would be about $40 less (compared to a 30-year term).

CONS

1. It will take longer to pay off the mortgage, which could make it more difficult to attain sufficient income for retirement. Another one of the cons for a forty year term is that it takes more time to build equity. This increases the number of years before a reverse mortgage can be used, which also makes it harder to retire.

2. Because of interest, the overall cost of a 40-yr. mortgage is substantially higher. For example, a $170,000 loan at 6.5% interest will cost almost $91 thousand more with a 40-year mortgage than it would with a thirty year term. Compared to a 15-yr. term, the same 40-yr. loan costs about $211,000 more.

Basically, a 40-year loan features more affordable monthly payments, but has a greater total cost and builds equity at a slower rate. Based upon these pros and cons, such loans are more desirable for young home buyers who have a relatively low income and/or want to purchase an expensive property. Lenders which offer this type of mortgage include Countrywide, Wells Fargo, and Bank of America.