What is the FICO Credit Score? Why do I need good credit?

Tu Casa

By Nathalia Cruz-Edmonds

The best way to obtain anything material or services in life is with cash.  If you don’t have cash, you may be able to obtain them with credit.  Credit by definition means to obtain an item or services before payment based on trust of future payment, but not everyone can get credit.  Some individuals cannot get credit because they are too young, they never had credit before, they have bad payment history, or they don’t make enough money.  But what is credit?  Why do you need it?  Who created credit?  But why is it soo important?

Due to the fact that the majority of individuals do not have $30,000 in cash in the bank or under a mattress to buy a brand new car or $250,000 in cash to buy a home, people rely on banks, investors, family members and other ways to borrow that money so they can obtain stuff and then they will pay whom lend them the money later with or without interest.  Credit is needed for various reasons but mainly to borrow large amounts of money.  Others, such as landlords and employers, use it to see your payment history because when you pay on time it translate that you are responsible and trustworthy.

In 1956 Bill Fair and Earl Isaac founded FICO in San Jose, California.  They started a software company that measures the consumer’s credit risk and worthiness.  The FICO Score which is a given value to the consumer’s credit risk and worthiness was introduced in 1989.  The score ranges from 300 to 850.  Depending on where your FICO score lands will dictate if (1) you will be able to borrow any money (2) How much your security deposit will be, if renting a home (3) How low or high your interest rate will be and (4) How much money you will be able to borrow.

Each individual credit score consists of several items:

• 35% Payment History - As agreed with the lender, do you make your payment before or after the scheduled date?
• 30% Debt Burden - How much money have your borrow and how much do you still owe
• 15% Length of Credit History - How long have you been borrowing?
• 10% Type of Credit Used - Do you have credit cards, personal loans, car loans, mortgage,
• 10% Recent Credit Searches - Are you shopping around to get credit?

Currently there are three companies that provide you with scores, Experian, TransUnion and Equifax.  The majority of banks when pulling your credit will pull all THREE credit score companies and pick the middle score.  Do you know what your credit score is?  By law, each credit score company will provide you with a ONE FREE credit score a year.  It is imperative for you to use this free service because you want to make sure your information is correct.  Meaning, all payments have been reported correctly, no new accounts have been added.  A great free way to monitor your credit is by creating an account with Credit Karma, www.creditkarma.com.  You might not see all three Credit Bureaus but you get a good overview which you can monitor monthly for FREE!

There are some cool tricks to help you keep your credit score high besides paying your debt in time!  If you have a credit card, maintain the balance below 10%.  So, if you have a $1,000 credit card with Bank of America.  You should keep your balance lower than $100 every month.

If you had some issues in the past where you lost your job and couldn’t pay on time, if it has been more than seven years, you are allowed to ask the Credit Bureau to remove that trade line from your credit history!  If you have a trade line that is older than seven years but you paid on time, DO NOT REMOVE IT!

If you do not have savings, having a good credit history is important for others to lend you money!  The internet have instructions and ideas on how to clear your credit BUT if you do not have the time and need your credit score improved in less than 9 months there are companies that can help you.  Max Score Credit (www.maxscorecredit.com) is a minority owned company with offices in Silver Springs and Baltimore who can help.  They will pull your credit and help you contact the Credit Bureaus to correct any incorrect information by not adding information that can potentially harm your credit.  For more information contact Ana Garcia, Senior Credit Advisor at 410-864-8600 or via email at agarcia@maxscorecredit.com.  Their rates are reasonable and their results are life changing.

If you would like to learn how to buy a home and create a plan to achieve it, please give me a call at (410) 350-5848.

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Nathalia N. Cruz-Edmonds is a REALTOR with Berkshire Hathaway HomeService PenFed Realty.  To schedule a meeting call (410) 350-5848, at her office (410) 464-5500 or via email at nathalia.edmonds@penfedrealty.com.  You can follow her on Facebook at http://facebook.com/NathaliaEdmondsRealtor.   

Renting a property that is being sold. What happens next?

Tu Casa

By Nathalia N. Cruz-Edmonds

The market to buy a home is “sizzling” hot but for some reason you cannot do it at this time therefore you are renting.  You have lived inside your home for about a year and a couple of months and you love it.  Out of the blue, the owner asks to enter the property to do an inspection the next day.  The owner and other people enter your home, they tour the home and they leave.  A couple of weeks later you get the notification that someone new owns your home.  Now what?

In the state of Maryland, each county deals with a resale of an investment property differently.  But if you are living in Baltimore City, the owner of the home has to provide you with a “Baltimore City Exemption of Tenant’s Right of First Refusal”.  This form must be sent to you via certified mail within forty-eight (48) of the home going on the market.  Why do REALTORS have to do this?  Because in the government believes the Renter must be given a fair chance at buying where they currently live.  It gives a fair advantage to everyone, specially those who are currently living inside the property.  This form also provides the name, address and phone number of the Baltimore City Department of Housing and Community Development which can help you by providing you with information on how to buy that or other homes.

If you haven't’ received this form and you know the property you live at has been sold, please contact the Maryland Real Estate Commission.  They are located at 500 North Calvert Street 3rd Floor in Baltimore.  You can also call them at (410) 230-6230.  You may also visit their website at http://www.dllr.state.md.us/license/mrec/.

What happens if the Listing Agent did send the form and you decided to not buy the property?  There are many scenarios.  The Good Scenario is when the new owner decides to keep you as a tenant with the same terms.  Meaning, same rental price and same lease dates.  Perfect!  Have a new lease signed with the new owner and get the address of where you can make your rental payments.  Read your lease agreement well and ask questions if you do not understand.  If you paid a Security Deposit, you DO NOT need to pay a new one.  The Security Deposit must have been given to the new owner as part of the sale.

The Bad Scenario is when the new owners decide to let you complete the lease but provide you with a sixty (60) day notice to vacate sixty (60) days before your lease expires.  There is no law that protects you against this.  This is every landlord’s/owner’s right to do when the lease is about to end.  The Ugly Scenario is when the Landlord/Owner decides to file a “Wrongful Entry & Detainer”.  Unlike the “Tenant Holding Over” which is done after a tenant stays inside the property after the scheduled move out date, the Wrongful Entry & Detainer the new owner does NOT want any residents inside the property.  The Wrongful Entry & Detainer as well as the Tenant Holding Over work just like an eviction for failure to pay rent.

The Landlord or Owner must go to the District Court and fill out the proper documentation and pay a fee.  The Clerk’s Office then accepts the request, which is a lawsuit, and schedules a date.  A copy is sent to the house in question stating which date the case is.  The court might send the court date in the mail or the Sheriff might tape it to the door.  Once the court date arrives, if you do not show up because (1) you forgot or (2) you never got the notice, that will be in your disadvantage.  Some procedures provide you with a four day appeal but a judge still has to approve it.  Once the judge approves the judgement to have the request from the Landlord or Owner to remove you from their property the case will be transfer to the Sheriff’s office.  To get a date as to when the Sheriff will knock on your door and ask you to leave the premise can take up to an additional four (4) to six (6) weeks.  When the Sheriff knocks on your door, he will ask you to take your most valuable possessions and immediately leave the premises.  The new Landlord or Owner will then change the locks to the house.  If you  have furniture and clothes inside, in Baltimore City you will lose everything once the Sheriff ask you to leave the home.  In other counties the Landlord or Owner will bring people to remove your items for you and place them in the curb.  After twenty-four (24) hours have passed the Landlord or Owner can place any items in the curb inside the trash can.  Please seek legal advice if any of these two forms have been given to you.

Nathalia N. Cruz-Edmonds is a REALTOR with Berkshire Hathaway HomeService PenFed Realty.  To schedule a meeting call at (410) 350-5848, or at her office (410) 464-5500 or via email at nathalia.edmonds@penfedrealty.com.  To learn about available properties or read her blog please visit http://nathaliaedmonds.penfedrealty.com.  She is also the owner of Clearview Real Estate Management LLC a third party real estate management company in Maryland for more information visit http://clearviewREM.com.

Contratistas y Permisos: Que necesitas para poder referir TU negocio y para vender tu inversión!

Tu Casa

Por Nathalia N. Cruz-Edmonds

¿Sabía usted que si usted tiene una empresa de pintar casas en Maryland pero no tiene la licencia de la Comisión de mejoras para el hogar o como se llama en ingles, Maryland Home Improvement Commission, o por sus siglas en inglés MHIC, un agente de bienes raíces no puede referir futuro negocio? En noviembre de 2014, la Comisión de Bienes Raíces Maryland creó un reglamento que prohíbe a los agentes de bienes raíces y con penalidad de multas si es encontrado culpable de referir proveedores de servicios sin licencia. Este reglamento requiere que para para poder hacer un referido, los agentes tiene que hacer los referidos por escrito, tiene que verificar que el proveedor de servicios tiene una licencia del estado actual, informar la fecha en que el agente verificó por última la base de datos de licencias de estado y proporcionar un enlace electrónico al registro de licencias.

El agente de bienes raíces que se han encontrado violando esta regulación podría ser multado hasta $ 5,000 por infracción. Esto hará que conseguir nuevos clientes a través de una colaboración con agentes sea muy difícil. ¿Por qué es esto? Debido a que los consumidores siguen siendo afectados por los propietarios de negocios sin escrúpulos que hacen trampa, estafa y roban a la gente de buen corazón. El estado de Maryland ha considerado agentes inmobiliarios como una fuente de confianza, por lo tanto es responsable de proporcionar información precisa a sus clientes.

La siguiente es una lista de los negocios que necesitan ser adecuadamente licencia:

• Se requiere una licencia MHIC al instalar cualquier cosa que se convierte fijada permanentemente a la casa o propiedad, como baldosas y suelos de madera o un sistema de aspiración central, etc.
• Edificio o reforzar la chimenea, o la instalación de un casquillo de la chimenea, entonces se requiere una licencia de mejoras para el hogar. Servicio de limpieza no está incluido.
• Si el contratista realiza cualquiera de los servicios de reparación en la casa, entonces se requiere una licencia MHIC. No, demolición y trabajo de limpieza no se considera dentro de la definición de "mejoras para el hogar." Por lo tanto, el contratista no está obligado a tener una licencia MHIC para realizar estos servicios.
• La Comisión ha determinado que la instalación de televisores montados en la pared en las residencias no se considera "mejoras para el hogar"; por tanto, no se requiere una licencia MHIC.
• Pintura de casas se incluye dentro de la definición de "mejoras para el hogar." Esto incluye pintura interior y exterior y la pintura decorativa también.
• Sí, caminos de entrada, incluyendo caminos de grava, están dentro de la definición de "mejoras para el hogar"; por lo tanto, se requiere de un contratista autorizado para realizar el trabajo.
• No, una licencia MHIC no es necesaria para los tratamientos de ventanas interiores, como la instalación de cortinas o persianas. Esto se considera la decoración y no está dentro de la definición de "mejoras para el hogar."
• Trabajo realizado en la comunidad de bienes no cae dentro de la jurisdicción de la Comisión de mejoras para el hogar. Si un propietario contrata a alguien para construir un columpio o en el gimnasio de la selva en su casa, entonces se requiere una licencia MHIC, si la estructura se fijará de forma permanente a la tierra.
• Se requiere una licencia mejoras para el hogar, si la nave se instalará de forma permanente por el contratista en los terrenos adyacentes a la residencia. Si el contratista vende y entrega el cobertizo y simplemente lo coloca en el suelo, o sobre una base no permanente, como bloques de cemento, el contratista no está obligado a tener una licencia MHIC.
• Sí, se requiere una licencia de contratista de mejoras al hogar o subcontratista para instalar paneles solares para un dueño de casa, sin importar si los paneles se instalarán en el hogar o una dependencia adyacente a una residencia, o se adjuntará a la tierra al lado de la residencia. Se requiere un maestro electricista con licencia para conectar los paneles para el sistema eléctrico.
• Mientras que los contratistas del paisaje son licenciados por MHIC, el Departamento de Recursos Naturales de Maryland es responsable de los expertos de árboles de licencia. El trabajo de un experto árbol incluye el recorte, poda, raleo, el cableado, la conformación, la eliminación o la reducción de la corona de los árboles que son 20 pies o más de altura.

Una buena guía para saber si su empresa tiene que ser una licencia es responder a esta pregunta, es la mejora o reparación va a estar conectado permanentemente a la estructura? Si la respuesta es sí, usted necesita una licencia MHIC. Si usted tiene alguna pregunta con respecto a la regulación de licencias para en hogar, póngase en contacto con mhic@dllr.state.md.us correo electrónico o visite en línea en http://www.dllr.state.md.us/license/mhic/

Para recibir ayuda y educarse o capacitarse para aprender sobre esta licencia, favor de llamar a Hispanos Sin Fronteras al (301) 933-4447 o búsquenlos en Facebook https://www.facebook.com/SomosHispanosSinFronteras.

La siguiente lista son los proveedores de servicios que el agente inmobiliario necesita buscar que tengan licencia, incluye, pero no se limita a, las referencias a los prestamistas hipotecarios, corredores de hipotecas, tasadores de bienes raíces, los inspectores de viviendas, contratistas de mejoras al hogar, fontaneros, electricistas, calefacción, ventilación y aire acondicionado contratistas y todos los demás que se requiera ser licenciado. El Reglamento cubre referencias proporcionadas en relación con "la prestación de servicios de corretaje de bienes raíces."

Otro aspecto muy importante es que al hacer renovaciones en su casa, el contratista deberá ponerse en contacto con la ciudad o el condado donde se encuentra la casa y pedir permiso o “permits” en inglés.  

Usualmente, hay que pedir permiso para hacer cambios eléctricos, instalación de refrigeración y calefacción, insolación, añadiduras o remover parte de las estructura de una vivienda, plomería, entre otras cosas.  Para un listado en específico, usted debe buscar la lista en el condado donde se encuentra la propiedad.  Si usted quiere comprar una propiedad para alquilar o para vender usted se debe de seguir estas normas para evitar problemas en el futuro.

Se requieren permisos de construcción para lo siguiente:

• Estructuras de accesorios (cobertizos, garajes, pérgolas, etc.) más de 120 pies cuadrados
• Todas las estructuras accesorias situadas en la inundación de la zona A o ubicadas en los barrios históricos
• Garajes y cocheras asociadas a viviendas unifamiliares
• En la tierra piscinas de más de 250 pies cuadrados con lámina de agua de 24 pulgadas o más
• Todas las piscinas enterradas: una barrera de seguridad de 48 pulgadas con, puertas de cierre automático de auto-bloqueo se requiere
• Muros de más de 36 pulgadas: se requieren dibujos de ingeniería desde hace más de 48 pulgadas
• Cercas más de 42 pulgadas de altura
• Cubiertas superior a 16 pulgadas sobre el grado más bajo y excede 120 pies cuadrados
• Estufas de leña, estufas de pellets y chimeneas
• Las adiciones y modificaciones estructurales en las viviendas existentes
• Encerrando de porches abiertos y cubiertas
• Excavaciones Sótano
• Cambio de uso de la estructura
• Permisos de demolición
• La clasificación más de 5.000 pies cuadrados
• Alteraciones de casas históricas

Estados y condados proporcionan números de teléfono o sitios web para el consumidor de encontrar si la empresa está licencias o para verificar si se solicitaron y aprobaron los permisos. Para algunos puede ser demasiado y demasiado caro, pero al final se le proporciona una paz de la mente. El costo de hacer negocios es alto, pero la tranquilidad de saber que la posibilidad de su quema de casa porque de no ser correctamente cableadas disminuye en gran medida.

Nathalia N. Cruz-Edmonds es un REALTOR® con Berkshire Hathaway HomeService PenFed Realty. Para programar una llamada de reunión (410) 350-5848, en su oficina (410) 464-5500 o por correo electrónico a nathaliaedmonds@gmail.com. Ella es también el dueño de Clearview Real Estate Management LLC una compañía de bienes raíces para la manejación de propiedades.

Why should you hire a REALTOR?

With shows like BravoTV’s Million Dollar Listings New York, Los Angeles and Miami the perspective of a Real Estate Agent or REALTOR is pretty impressive.  Big houses, expensive clothes, fast cars and tons of money on commissions.  Last month, in the Baltimore Metro area the average sold price for a three bedroom townhome was $172,676.00 and for a 3 bedroom single family home was $244,773.00.  Out of 539 transaction of 3 bedroom single family homes sold, 24 were above $500,000.00!  That is only 4%!  

What does that mean?  REALTORS earn about the same as you do!  The difference is that our profession is about providing a home to our clients, or a business location for your growing business.  Like with anything, it’s about the effort you put into your work that will make the difference in your paycheck.  Like when buying an expensive item, such as the newest television or a car, you will do your research but ultimately you will ask the expert.  The expert that has been to the factory where the car or television that is being made.  For a REALTOR is the same BUT BETTER!  Why is it better?  Because the sale of real estate is regulated by the state and federal government for YOUR protection.

In the state of Maryland a REALTOR or Agent, must be licensed and affiliated with a licensed Broker.  Meaning the Agent cannot work on their own.  An Agent has to be affiliated with a company like Long and Foster, Coldwell Banker, ReMax or Berkshire Hathaway HomeService.  There are other real estate brokerage that are smaller that can and will provide the same services as the big national franchises.  The most important aspect when learning this information is that when you hire an Agent you are the Broker’s client, the Agent is a representative of the Broker to help you during your transaction.

For example, if you choose to hire me as your Agent when either buying or selling your home, I will represent you but you are a client of Berkshire Hathaway HomeServices PenFed Realty.  My Broker’s responsibility is to make sure I follow the law and represent you as best as we can.  Both the Agent and the Broker has to take classes in order to renew their license every two years and the Maryland Real Estate Commission oversee the rules and regulations of all real estate transactions in the state of Maryland.  This has been created in order to protect the public of anything and everything that can cause the client to lose money and to make the real estate profession an honest one.

Are the services of the REALTOR free?  If not, who pays for them?  A REALTOR is paid, a great number of times, by the seller.  Sometimes, the buyer pays the REALTOR.  Please understand that there is no law regulating how much you need to pay your REALTOR but you should NEVER EVER pay your REALTOR in advance.  A honest law abiding REALTOR will get paid when the transaction closes.  Meaning, when you get or give keys to the home at settlement.  Some brokerage firms ask for a “broker’s fee” which is typically between $250 up to $500 per transaction which covers the cost of doing business.  Again, this fee is also paid at settlement.  It doesnot matter if you want to see 100 houses and decide you will move out of state, you will NOT PAY ANYTHING UNTIL THE DATE OF SETTLEMENT!

You might ask yourself that if you can see houses for sale in the newspaper or in the Internet, why do you still need the assistance of a REALTOR?  Did you know the average contract is about 30 pages long?  Did you know that you may not be able to do a home inspection if you forgot to tell the seller you wanted to do one?  If you are buying a home, did you know you can ask the seller for closing cost help?  If you are either selling or buying a home do you believe your house is priced correctly?  Are you paying too much for a house?  Could you get a little bit more money if you sell your home now?

All these questions and more are answered by a licensed REALTOR.  We have access to accurate available listings in the state of Maryland.  The REALTOR we will write an offer for the house you want, as well guide you in explaining the contract.  We will make sure we protect you in making sure you have the right to inspections and inform you of any defects inside your future home.  Coordinate the home inspections as well as negotiate any repairs.  We will also assist you to get the house for the best pricing as dictated by the market.

Think about it this way, you own a pizza shop and a friend calls you and asks you to use your oven to cook their frozen pizza.  You are capable to buy or sell your home on your own but wouldn’t you rather hire an expert?

Nathalia N. Cruz-Edmonds is a REALTOR with Berkshire Hathaway HomeServices PenFed Realty.  To schedule a meeting call direct (410) 350-5848, at her office (410) 464-5500 or via email at nathaliaedmonds@gmail.com.  She is also the owner of Clearview Real Estate Management LLC a third party real estate management company in Maryland.

Beautiful buildings in Baltimore City

 

I love walking around Baltimore and learn about the history of the buildings.   This one caught my eye.  Baltimore City Fire Company Engine No. 16.  It was built on 1910.  It is currently owned by Dominion Properties and it has been leased and it is schedule to re-open as a restaurant and micro-brewery this late Spring.  About the building's history, click here.

 

 

I look forward to show you more historic real estate soon!

 

-Nathalia

 

 

Getting ready to buy

Getting Ready to Buy

By:  Nathalia N. Cruz-Edmonds

With Daylight Savings starting on March 8 and the first day of Spring being on March 20th, thoughts of a new beginning start to really take shape.  Thoughts of moving is probably the first one specially because it is easier to move in warm weather than cold and it is easier to change school districts once the school year is over.  But, are you financially ready to complete this desire?

In the United States, having large amounts of cash stacked under the mattress only works in the movies like Scarface.  The reality is that cash needs to be in the bank not only because it is secured from being stolen(*) but because the Government demands it for tax purposes.  If your income is predominantly cash, you must start by opening a checking account and a savings account.  If you have an ITIN number, you are still able to open a bank account.  Usually to open a checking account, you need a government issued ID, and proof of residency whether is a copy of your lease agreement or a bill for cable, phone or utility.  Call your bank for more details.

Another big obstacle that you might be facing is lack of credit.  By definition credit is an arrangement for deferred payment of a loan or purchase.  This loan needs to be paid back, usually in monthly installments, until the balance is paid in full and sometimes you need to pay interest.  In the United States, credit is the second most important item in your financial health.  The easiest way to get credit is with a Secured Credit Card.  This credit card borrows money from an initial deposit you make when opening the account.  You can open this particular credit card with just $300.00, all banks have individual restrictions, therefore, you must call them directly to learn more about their product.  The purpose of this card is for you to use it no more than 15% of your available balance every month.  Meaning, if your available balance is $300.00 you cannot exceed $45.00 in purchases every month and then paid this used balance in full on the day your payment is due.  After a year the bank will return your initial deposit and the secure credit will convert into a regular credit.  The bank will be able to increase your credit and it will be easier to access more credit such as a mortgage!

Other ways of obtaining credit is by buying furniture, opening a credit card a major store like BestBuy, WalMart, Target, Macy’s or buy a car.  Please, do not go crazy.  Too much open credit will lower your credit score and if you do not pay your debts on time as agreed in the contract it will harm your financial credibility for SEVEN YEARS!  This means that once you start making late payments, have too many credits cards with high balances you will not be able to buy a home for SEVEN YEARS even if you paid your until your balances in full.

Finally, the first most important item of your financial health is a savings account!  You will need up to two months rent in order to move to a new place or minimum of $5,000.00 deposit if you are buying a home.  These amounts do not include the cost of moving from one home to the other.  When opening an checking account, make sure you are able to open a savings account.  Every time you get paid you should apply the 80/20 rule.  Ten (10) percent to save, Ten (10) percent to give to charity and Eighty (80) percent to pay your expenses  Having savings will also help you in a time of need such as losing a job due to weather, your car breaking down, or God forbid, paying a medical bill for yourself or a loved one.

Financial freedom is the ultimate goal which can be achieved by buying your home but in order to buy your home you must must have good financial health by having savings and good credit.  There is no better time than now to start!

Coming Soon!  PS International Team of Berkshire Hathaway Homesale Service will be representing the owners of newly remodelled houses in Essex (11 Helena Ave, Essex MD 21221) and in Dundalk.  Information will be soon available on www.pitinastucky.com.  If this is your first time buying a home, you must register to attend the First Time Homeowner Seminar at Southeast CDC on Eastern Avenue.  Visit http://goo.gl/28veRx to learn the next available date and register to attend the seminar.

Nathalia Cruz-Edmonds is a REALTOR with PS International Team of Berkshire Hathaway Homesale Realty and she is also the owner of Clearview Real Estate Management LLC.  To speak to her you can email her at nathaliaedmonds@gmail.com or call her directly at (410) 350-5848 or the office (410) 583-0400.  Visit her website at www.clearviewrem.com.

(*)To learn more about how banks in United States guarantee to secure your money please visit https://www.fdic.gov/deposit/deposits/