Hello! I'm Melissa. Leader of the Holt Loans Team, a Producing Manager for our Tacoma office, mother of 2 and wife to a great husband. I live in Auburn, WA and love to camp and dance. I also run a mom's networking group, a fantasy football league and teach home buyer education courses for WA state.
My career focus has always been customer service and education. Mortgage lending is not just about financing a home for a person. It's about helping families achieve financial goals and dreams. My team and I are dedicated to providing a stellar, communicative and educational lending experience to every client. We do that by working hard, taking advantage of today's technology, working with an innovative and forward thinking company and by assessing every situation thoroughly to ensure that we are delivering a quality and consistent product every time.
From the purchase of your first house the refinance of your last, we look forward to serving all of your home financing needs!
"Whether you think you can or you think you can't, you're right."— - Henry Ford
When you apply for a mortgage, your lender will look at your entire financial picture to determine whether or not you qualify. This vetting includes a review of your credit history, employment, the funds you have available to purchase a home, and more. These factors will ultimately determine the type of loan and interest rate you qualify for. But just what does a lender look for on your credit report? Knowing that somebody is going through your records with a fine-toothed comb can be a little intimidating, but we’re here to give you a heads up on what a lender is looking for when they review your credit report.
The most important factor lenders look at when analyzing your credit report is your credit history. This shows how well you’ve paid your bills, like credit cards, student loans, and auto loans. If you take care of your financial obligations on time and don’t use all the credit available to you, lenders will look more favorably on your application as it’s a sign that you can responsibly handle your credit.
Lenders will also check to see if you have any recent significant derogatory events on your credit report. A significant derogatory event is any single event that may give the lender cause to consider you a high risk for future default. Examples of significant derogatory events include bankruptcies, foreclosures, deeds-in-lieu of foreclosure, pre-foreclosure sales, and short sales. If you have any of these events on your credit report, you’ll probably have to wait a while before you can apply for a new mortgage. These waiting periods are usually between two and seven years, depending on the circumstances.
Also found on your credit report, your debt-to-income ratio is one of the most important things that lenders pay attention to when considering you for a mortgage. Your debt-to-income ratio (DTI) tells them whether your income can cover your mortgage payments and other debts (such as credit cards, student loans, auto loans, and other obligations). Your DTI puts a quantitative value on your ability to pay back your loan. The higher your DTI, the more likely it is that you will not qualify for the mortgage amount you applied for. Think of it this way: if your total income cannot cover your monthly expenses and leave you with some spending money for things like groceries, gas, and entertainment, then it could be difficult to make your monthly mortgage payments. Lenders look at your DTI in two ways:
Housing Ratio: This is your gross monthly income divided by your proposed monthly housing expenses (your mortgage payment, including principal, interest, taxes, insurance, and homeowners association dues, if applicable). The limit for this ratio is typically around 26% to 28%.
Total Debt Ratio: Your gross monthly income divided by the sum of all your recurring debt payments (such as student loans, auto loans, credit card payments, etc.) including your proposed housing expenses. This limit is typically around 43%.
One of the most important things that lenders pay attention to when considering you for a mortgage is your debt-to-income ratio.
At the end of the day, your lender is lending you money with the intention of getting paid back. That being said, they want to see that you have a track record of not only making payments, but making them on time. A major determining factor in your credit score is payment history, which accounts for about 35% of the total score. Late or missed payments, especially on your mortgage, or a past bankruptcy are all considered red flags to lenders—because nobody wants to loan money to someone who won’t pay them back. That doesn’t mean that a few minor late payments will stop a lender from giving you a loan, but you may be either approved for a smaller loan or your interest rate may be higher than that of someone who has never missed a payment.
It’s always good to have an established credit history. However, opening a bunch of new credit card accounts in a short period of time may cause your credit score to drop and the lender to question if you are having trouble managing your finances. It may be tempting to put new appliances and furniture on new credit cards, but be patient. You’ll have plenty of time to buy things for your new house after you close.
Another important indication of your ability to repay is a record of stable employment, which can also be found on your credit report. Lenders will look at how long you have held your current job and how long you have worked in your current profession. Having a stable job lets your lender know that you have a dependable source of income to repay your mortgage. Moving jobs frequently may affect your ability to be approved for a mortgage, especially if those job changes are not consistent for your industry.
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Did you know it’s possible to save hundreds, if not thousands of dollars over the course of your home loan by practicing a little thing called early payoff? For many Americans, their mortgage is their largest form of debt. And with debt comes the pressure of wanting to pay it back as soon as possible. However, most homeowners don’t believe they could afford to pay more on their mortgage than what they’re paying right now. We want to challenge you to think outside that box and reimagine the possibilities of debt-free homeownership. If you’re a homeowner who’s still paying off your mortgage, wishing you could pay it off sooner, you’ve come to the right place. Read on to see how you may be able to get out of mortgage debt sooner.
Let’s look at a scenario from our amortization calculator: a 30-year, fixed-rate, $200,000 mortgage with a 3.25% APR. This borrower’s first month’s mortgage payment would be $870.41 which, not factoring in taxes and insurance, breaks down to $555.55 in principal and a whopping $314.86 in interest! Quite a big chunk of their mortgage payment is just interest. Because of this, over the course of their 30-year loan term, they will have paid a total of $313,348 on that $200,000 mortgage.
Now before you get too excited to pay off your mortgage early, talk to your mortgage lender and ask if they have a prepayment penalty. Some lenders do this and we wouldn’t want you to have to pay a fee for prepaying on your mortgage. That said, before you read on, we highly recommend you consult your tax, financial, and/or legal advisor too before you use any of our methods to pay off your mortgage early!
Reimagine the possibilities of debt-free homeownership.
Take baby steps. Try making one extra payment a year on your mortgage and you could greatly reduce the total amount you pay over time. How might you make this happen? Consider some luxuries you might be splurging on that you could live without. By making financial sacrifices, you could save up enough money throughout the year to make one extra payment.
If there’s no room in your budget or lifestyle for such sacrifices, you could make one extra payment a year by taking extra cash such as your tax refund or a bonus check and applying it directly to your mortgage balance. This puts more money toward your principal amount, which will reduce your interest over the life of your loan. Need help calculating? Ask your mortgage lender or try using an early payoff calculator.
Rather than paying the same amount every month for the next 30 years, increase your mortgage payment proportionately to your pay raises. Like making one extra payment a year, increasing your monthly payment when you get a raise pays down your principal amount, reducing your interest.
Some homeowners even take on a second job to bring in more income because they’re so dedicated to becoming free of mortgage debt. This option isn’t for everyone, but homeowners who work a second job could potentially put all of the money they make from that job toward the principal on their mortgage.
Another way you may be able to pay off your mortgage early is by rounding up each payment. For example, if your monthly mortgage payment is $1,105, round up and pay $1,200. The additional $95 will go toward your principal and will result in fewer payments and a reduced term. If your budget has room for it, this early payoff tip is an easy way to pay just a little extra on your mortgage every month—and it might be the method that’s easiest to integrate into your lifestyle with very little sacrifice!
Yet another way you may be able to pay off your mortgage early is by making biweekly payments. The concept is fairly simple: when you pay half of your mortgage payment every two weeks, you’re actually making 26 half-payments, which comes out to 13 full monthly payments every year. Depending on your interest rate, that extra payment could shave up to eight years off a 30-year mortgage! Just make sure you check with your loan servicer first because some don’t allow biweekly payments.
Lastly, you could check with your lender and see if you’re eligible to refinance your mortgage for a shorter term and/or lower rate. Oftentimes, a shorter term will raise your monthly payment, but depending on what you qualify for, you could reduce your mortgage term by up to 20 years!
If you refinance for a lower rate, the good news is that mortgage rates are still historically low, so you could take advantage of this time and get a lower monthly payment.
Thinking about paying off your mortgage sooner? These methods can help, but it’s important to plan carefully and seek professional tax, financial, and/or legal advice first. Ask your financial advisor about these tips before you make the decision to pay off your mortgage early.
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As “fintech” moves toward the forefront of the financial services industry, the digital mortgage has become increasingly popular amongst people looking to forego the long, drawn-out phone calls and tedious paperwork that come with securing a mortgage the old-fashioned way. Digital mortgages aren’t just providing an alternative method of processing loans, they’re turning the entire industry on its head by revolutionizing the acquisition, operation, and completion of the loan processing system for mortgage professionals and borrowers alike. But how?
Getting a loan can be a complicated process. However, digital mortgage lenders are working to make the process simpler and more efficient by making it much easier to manage the documents that come with it. Most digital lenders employ a cloud-based document manager that can take information that is shared by the applicant and move it across every phase of the loan process. Going paperless makes transferring and keeping track of the hundreds of documents that go into securing a loan much simpler.
One of the biggest benefits of a completely digital mortgage is the level of transparency that comes with it. A digital loan process allows the borrower to check on their loan application at any time from any device. Transparency and communication are key in a smooth loan process because no one wants to feel like they’re out of the loop, especially when it comes to something as important as securing a mortgage. The increased transparency and improved communication that come with a digital mortgage not only give the borrower peace of mind, but they make the lender’s job easier as well, ensuring a smooth process.
Digital mortgages aren’t just providing an alternative method of processing loans, they’re turning the entire industry on its head.
With a digital mortgage, the pre-approval process can take just a couple of hours as opposed to the several days it may take with a paper loan application. The average mortgage application consists of over 500 pages! A number that has grown in recent years and may continue its trend upward. By getting rid of the unnecessary meetings, miscommunication, slow file sharing, and paper shuffling, loan originators have more time to focus on providing top-notch customer service and overseeing more loans. Not to mention, you get to go home quicker!
The future of the digital mortgage is bright one. As the mortgage industry as a whole trends toward a digital future, large banks are lagging behind the curve. As these household names struggle to adapt to the changing times, groundbreaking digital lenders such as Cardinal Financial are poised to become leaders in the industry by leveraging speed, efficiency, and high-quality customer service into a larger market share. It’s no secret that the future is digital, and with the technological advancements that companies like Cardinal Financial are making, the sky’s the limit for the digital mortgage.
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