Blog — First Rate Financial Group

04

Nov

Home Buyer Tips

Steps to Take Now to Build Your Credit for a Home Purchase Next Year

Buying a home is one of the most exciting goals you can set, but your credit score plays a major role in how easy or challenging the process will be. The good news is that with time and planning, you can strengthen your credit and set yourself up for a smoother approval when you are ready to buy next year.

Review Your Credit Report
Start by pulling your credit report from all three major credit bureaus. Review each report carefully to make sure that your personal information and account details are accurate. Dispute any errors right away, since mistakes can bring down your score unnecessarily. This first step gives you a clear picture of where you stand and what needs attention.

Pay Down Existing Balances
One of the fastest ways to improve your credit score is to reduce your credit card balances. High credit utilization, which means using too much of your available credit, can make lenders view you as a higher risk.

Aim to keep your balances below thirty percent of your credit limit, and if possible, pay them off completely each month. Consistent progress here can have a significant positive impact.

Make All Payments on Time
Your payment history is the single biggest factor in your credit score. Set up reminders or automatic payments to ensure every bill is paid on time. Even one late payment can hurt your score. If you have any past-due accounts, bring them current as soon as possible. A record of consistent, on-time payments builds trust with future lenders.

Avoid Taking on New Debt
While it might be tempting to open a new credit card or finance a large purchase, adding new debt right before applying for a mortgage can lower your score. Each new inquiry slightly impacts your credit, and a higher balance increases your debt-to-income ratio. Focus on maintaining stability and demonstrating that you can manage your existing accounts responsibly.

Keep Older Accounts Open
The length of your credit history also matters. If you have older accounts in good standing, keep them open. Closing old accounts shortens your credit history and can reduce your available credit limit, which may cause your score to drop. Instead, use those accounts occasionally and pay them off to keep them active and positive.

Building good credit takes time, consistency, and awareness, but starting now can make a huge difference when you are ready to purchase a home next year. By following these steps, you will be in a stronger financial position and feel confident when it is time to meet with a lender.

03

Nov

By First Rate Financial Group

Financial Reports

What’s Ahead For Mortgage Rates This Week – November 3rd, 2025

With the ongoing government shutdown, other major releases have hit a snag, as there is still very limited information for when the shutdown may end. The largest and most impactful releases continuing to move forward are those from third-party sources still publishing data — such as the Consumer Sentiment reports — which show that consumers remain concerned about inflation but have recently grown more optimistic about the labor market.

As expected, the Federal Reserve cut rates again by another 25 basis points. However, Chairman Jerome Powell remains skeptical that another rate cut will occur anytime soon.

Consumer Sentiment
Consumers were more optimistic about the labor market outlook in October, according to a new survey from the Conference Board released Tuesday. The survey’s so-called labor-market differential — which measures the gap between the percentage of consumers who say jobs are “plentiful” and those who say jobs are “hard to get” — rose to 9.4 in October from 8.7 in the prior month.

Primary Mortgage Market Survey Index
• 15-Yr FRM rates saw a decrease of -0.03% for this week, with the current rate at 5.41%
• 30-Yr FRM rates saw a decrease of -0.02% for this week, with the current rate at 6.17%

MND Rate Index
• 30-Yr FHA rates saw an increase of 0.06% for this week. Current rates at 6.01%
• 30-Yr VA rates saw an increase of 0.06% for this week. Current rates at 6.03%

Jobless Claims
Initial Claims were reported to be delayed until further notice.

What’s Ahead
U.S. employment data, if released next week, are likely to be the most significant reports to watch.

31

Oct

By First Rate Financial Group

Mortgage Tips

Comparing Biweekly Payments and Lump Sum Payments to See Which Saves More

Homeowners looking to save on interest or shorten their loan term often explore two popular strategies: biweekly payments and lump sum payments. Both can reduce the total interest paid and help you build equity faster, but they work in different ways. Understanding how each method functions can help you decide which fits your financial goals and lifestyle best.

How Biweekly Payments Work
With a biweekly payment plan, you make half of your monthly mortgage payment every two weeks instead of one full payment each month. Since there are 52 weeks in a year, you end up making 26 half-payments, which equals 13 full payments annually instead of 12. That one extra payment each year directly reduces your principal balance.

Over time, this extra payment can save thousands of dollars in interest and help you pay off your mortgage several years early. The best part is that the change feels manageable, since you are simply splitting your payments into smaller amounts rather than paying a large lump sum all at once.

How Lump Sum Payments Work
A lump sum payment involves making an additional one-time payment toward your principal, usually once a year or whenever you receive extra income. This could come from a tax refund, bonus, or inheritance. The lump sum goes directly toward reducing your loan balance, which lowers the amount of interest you pay over time.

Even small lump sum payments can have a big impact if made early in your loan term. The sooner you reduce your principal, the less interest accrues, accelerating your path to becoming debt-free.

Pros and Cons of Each Strategy
Both methods help you save on interest and shorten your loan term, but they differ in flexibility and commitment.

Biweekly payments create a steady habit and gradually reduce your balance. However, not all lenders offer official biweekly plans, so you may need to set it up manually.
Lump sum payments give you flexibility. You can contribute whenever you have extra funds, but it requires discipline to set aside money and remember to apply it toward your mortgage.

The right choice depends on your financial situation. If consistent budgeting works best for you, biweekly payments might be ideal. If your income fluctuates or you prefer flexibility, lump sums may be a better fit.

Both biweekly and lump sum payment strategies can save you money and help you pay off your home faster. Whether you choose regular smaller payments or occasional larger ones, the goal is to reduce your principal sooner and cut down on interest. Give us a call to discuss which option works best for your loan type and financial goals.