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Show A-20 The Park Record Wednesday, September 1 8, 1 996 Ronald Field Credit Grading-a Grading-a new mortgage lenders' tool If you plan to buy a home or refinance your mortgage this year, you'll likely have to pass a test you probably don't even know you're taking. Over the course of 1996, the use of a secret computer-generated credit score a numerical grade, undisclosed to you, of your creditworthiness will become a standard part of the mortgage application process. Get a passing grade and your loan should sail through the system. Flunk, and you face tougher hurdles. Long relied upon by issuers of credit cards, auto loans and home-equity home-equity lines, credit scores until last year were seldom considered in connection with mortgage applications. applica-tions. Instead, lenders depended upon a loan underwriter's personal analysis of your ability to repay. Some credit scores are supplied to lenders by credit bureaus such as Equifax, Trans Union and TRW, who calculate them based upon your credit record. But many lenders prefer to calculate their own scores based on credit reports, plus additional facts such as the number of years you've worked for your present employer and how long you've lived at your current address. With the so-called Fair Isaac commonly com-monly used by credit bureaus, your score can range from 400 to 800, with the low 600's considered "passing." You don't have to be a deadbeat to fail to make the grade. Lawrence Lindsey, a member of the Federal Reserve Board, recently disclosed that he was denied a credit card last year, after being assigned a low score by a computer. The reason: credit scoring scor-ing takes into account not only the would-be borrower's debts and repayment history, but how mOch credit he has applied for lately. Because Lindsey had recently refinanced refi-nanced his mortgage, opened a home-equity line, signed up for overdraft protection on his checking check-ing account and gotten a new credit cred-it card, his credit report showed multiple inquiries from lenders. Moreover, consumers who request their credit reports from credit bureaus will not get their scores. Last September, the Federal Trade Commission ruled that though credit bureaus must make copies of credit reports avail able to consumers, they need not divulge the scores they calculate. "Consumers won't know what variables were used to determine their scores, either," says Russ Bailey, fair-lending team leader at the Office of the Comptroller of the Currency. One reason mortgage lenders are relying more heavily on credit scoring is that Freddie Mac and Fannie Mae, the two major mortgage mort-gage purchasers, have been encouraging them to do so. These two agencies control the bulk of the secondary mortgage market, so private lenders widely follow their standards. Because the precise weightings used in calculating a credit score are shrouded in secrecy, trying to improve your score is tricky. The following tips may help: - Get a copy of your credit report so that you can challenge any inaccuracies. Fixing them can take the credit bureaus as long as a month. - Since frequent loan applications applica-tions can send your score plummeting, plum-meting, seek a loan as rarely as possible, and keep only as many credit cards as you truly need. - Conversely, a history of borrowing bor-rowing little money can be a strike against you. If that's your situation, consider taking out a small loan and paying it back promptly before applying for a mortgage. - If you don't pay your bills punctually, start doing so immediately: immedi-ately: Scoring emphasizes your most recent behavior. - Pay down high credit card balances. - If you're thinking about job-hunting job-hunting soon, consider putting off doing so until after you've closed on your new mortgage loan. Job stability helps your score. - If your loan application winds up getting dinged anyway, don't give up. Most lenders have the discretion to override automatic credit scoring cutoffs and approve your loan, if you can make a compelling com-pelling case that you are a good risk. Based on the lenders surveyed this week the interest rate on 30-year 30-year mortgages decreased to 8.250 percent. The interest rate for 15-year mortgages decreased to 7.875 percent and the rate for one-year adjustable-rate mortgages mort-gages is 6.000 percent. All rates are quoted with zero points and a 1 percent origination fee. Ronald Field, Park City, is a licensed mortgage broker, investment invest-ment advisor and former columnist colum-nist for the Chicago Tribune. Readers with questions can send their letters to Ronald Field, P.O. Box 2060, Park City, UT 84060. Legislature must cope with $4.7 million surplus in revenue for state in FY96 Utah's extra in addition addi-tion to forecast $188 million revenue growth by Kimberly Murphy ASSOCIATED PRESS WRITER SALT LAKE CITY (AP) The Utah Legislature will have an extra $4.7 million in 1996 surplus revenue to spend next year, according to the state's latest budget figures. The surplus is in addition to $188 million in projected revenue growth lawmakers appropriated appropri-ated during the 1996 General Session. Even so, the amount is much smaller than in previous years. In the fiscal year that ended a year ago June 30, the state saw a whopping $60 million surplus. The governor's spokeswoman, Vicki Varela, said the surplus is an indicator the state's economic eco-nomic growth has slowed slightly. But more importantly, she said, the figure shows revenue projections hit the mark. "Things are evening out a little bit, and partly part-ly because of that we had more accurate calculations," calcu-lations," Varela said Tuesday. The $4.7 million includes a $1.1 million surplus in the state's General Fund and $3.6 million surplus in the state's Uniform School Fund for the fiscal year that ended June 30. The Legislature will decide next session whether to spend that surplus in the current fiscal year, or carry it over to FY98. Varela said the governor has no plans for the surplus since it represents a relatively small amount of money compared to $5 billion FY96 budget. bud-get. "It's basically a balanced checkbook," Varela said. Lynn Koga, director of the Governor's Office of Planning and Budget, said the small surplus reflects good budgeting. "It's just a matter of budgeting and how close you can get," Koga said. "This is pretty darn close." By comparison, the surplus for FY94 was about half as much as 1995 at $37 million. In FY93, it was $1.7 million, and $4.8 million in 1992. The $5 billion budget for FY96 included a $140 million tax cut, $465 million for transportation trans-portation and $1.7 billion in funding for public pub-lic education including $4 million directed at highly impacted schools and $24 million for class size reduction. "We are embarking on an unprecedented transportation project, improving our schools, giving money back to taxpayers and still ending the year with a modest surplus," said Gov. Mike Leavitt. "Everything is on target tar-get in our economy." Koga said final figures for FY96 will be available in December. Program Rate Bank of Utah 30 yr Fix 8.375 30 yr FHAVA 8.500 15yrFlx 7.875 Points Commonwealth United Mortgage 30 yr Jumbo 8.750 0 15yrFlx 8.125 0 31 yr ARM 7.825 0 First Union Home Equity Corp. Second Mortgages Line of Credit Prime 1 0 15yrFlx 10.750 0 Great Western Thrift Conforming Loans 30 yr Fix 8.250 0 15yrFlx 7.875 0 1 mo ARM 3.950 0 Intermountain Mortgage 30 yr Fix 8.125 0 15yrFix 7.625 0 1 yr ARM 5.875 0 Mountain Express Mortgage 30 yr Fix 8.000 0 31 ARM 6.750 0 1 yr ARM 5.875 0 United Savings Bank 30 yr Fix 8.250 0 15yrFlx 7.875 0 1 yr ARM 6.375 0 Utah Housing Finance Agency 30 yr FHAVA 7.070 2 30 yr FHAVA 7.370 0 Washington Federal Savings 30 yr Fix 8.250 0 30 yr Jumbo 8.500 0 15yrFlx 8.000 0 U.S. Bank of Utah 30 yr Fix 8.375 0 15yrFix 8.000 0 1 yr ARM 6.875 0 Down Caps Index 5 5 5 5 5 5 26 T-Bill NA NA 10 10 10 5 5 5 5 5 5 5 5 10 3-5 3-5 5 5 10 5 5 10 11.95 11th D 26 26 26 T-Bill T-Bill T-Bill 16 26 T-Bill T-Bill The Utah Mortage Pulse includes up-to-date information on home loan rates charged by Salt Lake City area lenders. The information was accurate on Monday, September 16, but is subject to change without notice. Closing points: One point equals 1 percent of the loan amount. Most lenders also require private pri-vate mortgage insurance with down payments of less than 20 percent. Also, most lenders charge loan processing fees up to $300, credit and appraisal fees up to $400, origination fees of 1 along with other closing costs. Index: T-Bill Yield on 1 yr T-Bill, COFI Cost of Funds Index, 11th D 11th District Cost of Funds, LIBOR London InterBank Offered Rate. Source: Mountain Express Mortgage (801 ) 647-3700 V I VI W TT ''.If' ' " OI1L Located across from the Heber Creeper Depot J' Full Color Press " T & mm jz- K ,3" ". Large Sheetfed Press Up to 17x25 size Full Color. . . Brochures Rack Cards Menus Flyers Booklets ! Now Available. . . Quality Film and Four Color Separations! Daily Pick-up & Delivery in Park City 675 West 100 South P.O. Bex 118 (801) 6541471 Fox: (801) 654-5085 Park City's Finest Homes fsiSli iM RON WILSTEIN SILLING PARK CITY'S HNKST PROPERTIES 4 BEDROOM CUSTOM LOG HOME This spacious home has a large kitchen, huge family room and luxury master suite. The home is secluded on 1 .4 acres, complete with 2 stone fireplaces, a large family room, hand-peeled logs, streams and mountain views, plus a separate barn with apartment & storage shed. Available for $739,000 PARK MEADOWS GOLF COURSE HOME This single-level 4 bedroom home is located on the 16th fairway of the Jack Nicklaus-designed golf course. It's open floor plan includes 10' ceilings, ceil-ings, granite counter-tops, built-in Jenn-Aire BBQ, surround sound, decks for entertaining and a 3 car garage. VRM Listing - Seller will entertain enter-tain offers between $590,000-$720,000 a j I t -,r t f BRAND NEW 5 BEDROOM LOG HOME This spacious log home has been crafted with hand peeled logs - the workmanship is unbelievable! unbeliev-able! Located in Silver Creek, it offers panoramic views that go on forever. Two rock fireplaces, a great room by the kitchen, located on approx 2.5 acres of horse property. Available for $389,000 STARTER HOME IN PROSPECTOR This 4 bedroom home is located in an excellent family neighborhood in Prospector Park, near the Park City schools and the bus route. It has a great room with a fireplace, formal dining room and a large backyard with a deck for entertaining. enter-taining. VRM Listing- Seller will entertain offers between $210,000-$250,000 Call Ron Wilstein for more information 801-647-8010 or 800-553-4666, ext. 8010 ThePrudential Coleman Real Estate Ron Wilstein i |