Taking advantage of today’s low mortgage rates is something that many home buyers are trying to do. Unfortunately, many of them get to their lender’s office only to find out that they do not qualify for a mortgage loan. There are several reasons why a potential buyer may not qualify for a home mortgage loan, but here are four of the most common reasons.

1. Credit Score – The most common reason why a potential home buyer would be denied a mortgage loan is their credit score and financial history. These days, a buyer must have a credit score of at least 600 to even be considered for a mortgage loan. Even with that, they would only qualify for a federal home loan. Private lenders won’t even look at you for a home loan unless you have a score of at least 700. Five years ago, these numbers were about 10 percent lower than what they are today. Make sure you know your credit score before you apply for a home loan to save yourself some time and embarrassment.

2. Income Scrutiny – With the recent problems in the mortgage industry, lenders are being more careful about who they give a mortgage loan to. This means you are going to face greater scrutiny in terms of your income, job security and ability to repay the mortgage loan as agreed. You may even have to prove the value of your assets in case you lose your job or become disabled.

3. Down Payments – There was a time when a small down payment was enough for a mortgage borrower to secure their loan. These days, however, lenders are requiring buyers to have a down payment of at least 20 percent before they will even consider them for a home loan. In addition to that, your debt-to-credit ratio must be no more than 35 percent.

4. Appraisals – With the large number of foreclosures and short sales, lenders are being stricter about who they offer a loan to. These foreclosures are also bringing down the value of many homes. Depending on the sale price of the home and the area’s market value, lenders may feel that a home’s price is overvalued. As a result, they may deny your application despite you being able to fulfill the other requirements to be approved for a home loan.

These are just a few of the barriers that home buyers face when they apply for a mortgage loan. If you know about the obstacles you will be facing, you can prepare yourself for them and possibly make adjustments in your credit score and other areas so you will be a better candidate for a mortgage loan.

With all of the troubled homeowners in the nation these days, it’s refreshing to see some lenders trying to do everything they can to at least alleviate some of the stress and frustration that these people are going through with their mortgages. Wells Fargo is one of the leading financial institutions in the country and the company is trying to help as many of its customers as it can. Wells Fargo has been holding seminars and workshops in various parts of the country and one of its latest is being held in southern California next week.

These free workshops are for customers of Wells Fargo Home Mortgage, Wachovia Mortgage, Wells Fargo Financial and Wells Fargo Home Equity. The workshop is going to last for two days to give thousands of invited customers a chance to improve their mortgage situation. It will take place at the Ontario Convention Center Exhibit Hall which is about 90 minutes east of Lo Angeles. It is scheduled to last from 9 a.m. to 7 p.m. on December 8 and 9.

Diana Stauffer, the senior vice president of Wells Fargo Home Mortgage, said that the bank simply wants to help people “stay in their homes.” The company has made great efforts to make this happen over the last couple years and this latest workshop is just another example to “reach out to homeowners who are facing payment challenges and provide answers on the options available for them.”

There are going to be about 200 home retention representatives at the workshop. They will work one-on-one with troubled homeowners to help them explore their options so they can make their mortgage payments easier. All together, these representatives plan to have about 2,000 appointments for the entire weekend. They will work with homeowners on loan modifications and other options. In some cases, homeowners applying for a loan modification may get an answer about qualifying while they are meeting with the Wells Fargo representative. The helpers will explore the government’s Home Affordable Modification Program (HAMP) as well as Wells Fargo’s loan modification program as well.

If you have not been invited or you still haven’t registered for the workshop, some walk-in appointments will be taken. However, Wells Fargo strongly suggests that you register first to guarantee an appointment with a representative. For more information about registering and setting up an appointment, call 1-800-405-8067.

It’s nice to see some big companies working with their clients to help them stay in their homes. Hopefully Wells Fargo will be an example that other lenders will want to follow.

One of the ways you can get back on financial track and pay your mortgage each month is to cancel your credit cards and live on cash. If you can’t afford to buy it, putting it on your credit card is only going to get you deeper in debt. And according to a recent study by TransUnion, one of the major credit reporting agencies, it looks like about 8 million consumers are taking that advice.

According to the study, millions of Americans have stopped using their general-purpose credit cards in the last year. The credit reporting agency says that one of the main reasons for this is due to consumers trying to increase their credit score so they can apply and qualify for some of today’s low mortgage rates, but other factors include charge-offs by banks for high-risk account holders and less spending overall for American consumers. The study also showed that people who had higher than average incomes were just as likely to stop using their credit cards over the past year as those with lower than average incomes.

In 2009, there were about 70 million consumers who did not have a valid general purpose credit card issued to them by a bank. In the last year, about 8 million more consumers joined that group. As a result, the group without bank-issued general purpose credit cards is one of the fastest growing groups in the consumer industry.

On the down side of this study, the balances on outstanding credit card balances continue to rise. Just because millions of consumers have stopped using their bank-issued credit cards does not mean that those balances are dropping. These consumers are not necessarily paying off their credit cards which means that interest is accruing. But consumers overall are becoming smarter with their money by paying down their balances, making payments on time and making sure they do not incur more debt by borrowing from other credit sources.

Here are some other numbers that TransUnion has reported regarding credit card debt during the first three quarters of 2010:

* Alaska had the highest average credit card debt when compared to other states. Alaska’s average credit card debt was more than $7,150. Hawaii came in second at $5,716. Iowa and North Dakota were the two states with the lowest average credit card debt at $3,807 and $4,103 respectively.

* 35 states showed an increase in average credit card debt when compared to the previous quarter. The largest increases in average credit card debt occurred in West Virginia at 2.81 percent, Wyoming at 2.2 percent and Hawaii at 2.19 percent.

When buying a home, there are many factors to consider. If you are a first-time home buyer who is taking advantage of today’s low mortgage rates, you may not even think about some of the things that are important when choosing a home. For buyers with children or for buyers who are thinking about having children, the schools in the area are going to be a major consideration when choosing a home. Here are some tips to help you research various schools so you can find a home near a school district that is ideal for your kids.

1. Research some statistics online. There are several websites that offer a number of statistics about schools in thousands of cities across the nation. GreatSchools.org and SchoolDigger.com are two of the leading websites with statistics about test scores, parent reviews and more. The schools in the area you are researching are ranked from 1 to 10 so you can quickly find the best ones in the area for you.

2. Consider the traffic. Before making your final decision on a house, consider the traffic around your home around the start of the school day and the end of the school day. If you live too close to the school, it may be difficult to get out of your driveway for a couple hours of the day. You might always have kids cutting through your yard or playing around your house if you live too close to a school.

3. Find out about future plans. Is the school district that you will be living in planning on doing any redistricting in the near future? Does the district plan on closing or opening any new schools in the immediate area? You can usually find this information on the school district’s website. When a district announces plans to open a new school in the area, home values usually increase for a short time until a couple years after the new school is built.

4. Talk to parents in the area. You will find some of the most honest information about the school district by talking to the parents who have kids in the district. They can tell you what they like about the district and particular schools as well as some of the teachers and administrators. Many times, parents will tell you more information than you need to know if you just let them talk.

These are just a few ways you can research and learn about the school districts in the area surrounding your potential new homes. Spend some time learning more about the schools so your children will get a quality education once you move to your new home.

Now that one of the big holidays is over, it’s time to get back to normal…at least for a few weeks. That means reporting the current mortgage rates and other information about the mortgage industry. Here are the current average mortgage rates for this week.

* Some lenders are offering qualified buyers rates as low as 4.00 percent for 30-year fixed rate mortgages. That’s with a 4.201 percent annual percentage rate.

* For 15-year fixed rates, some borrowers may qualify for a 3.250 mortgage rate with an annual percentage rate as low as 3.601 percent.

* FHA mortgages are also beneficial to some home buyers. Right now, the down payment requirement is only 3.5 percent. If you qualify, you can get a 30-year fixed rate FHA mortgage loan at 4.125 percent with an APR of 5.537 percent.

* Adjustable rate mortgages are seeing some of the lowest rates in the industry right now. ARMs are best for home buyers who do not plan on staying in their home for too long because the rates depend on the current market rates. That means the interest rates could go up unexpectedly over the years. Currently, 5/1 conforming adjustable rate mortgages are sitting at about 2.5 percent with a 3.022 percent annual percentage rate. For 5/1 jumbo ARMs, the current rates for qualified buyers are 3.000 percent with an APR of 3.013 percent.

* Jumbo mortgages are also seeing some low mortgage rates these days. A jumbo mortgage is required when the amount of the loan is higher than the confirming limit of Freddie Mac and Fannie Mae. Depending on the area in which you live, this amount could range anywhere from $417,000 to $729,750. Qualified buyers may be able to get jumbo mortgages at rates as low as 4.875 percent for a 30-year fixed mortgage and as low as 3.500 percent for a 15-year fixed rate loan.

As always, these mortgage rates are subject to change based on the borrower’s credit and qualifications. The rates are also an average so some lenders may be charging higher or lower rates than the ones listed here. The best thing you can do is to do some research and shop around for the best mortgage rates you can find.

At a time when mortgage rates are still low and there has been a drop in demand for loan applications, the number of homeowners who have delinquent mortgages is dropping. According to TransUnion, one of the three major credit reporting agencies, the delinquency rate for mortgage payments has dropped to only 6.44 percent during the third quarter of this year. That number represents the biggest drop in mortgage delinquencies since the end of 2006.

The rate of delinquencies is measured by counting the ratio of borrowers who are at least 60 days past due on their mortgage payments. Many analysts are looking at these numbers as a sign of an improving real estate and mortgage market. One reason for the turnaround is the fact that home prices have stabilized during the earlier part of the year. But the historically low mortgage rates are also being credited with the dropping delinquency rate. Here are some other numbers reported by TransUnion concerning the mortgage delinquency rate:

* Nevada had the highest number of delinquency rates in the country during the third quarter of this year at 15.12 percent. Florida was next highest at 14.63 percent.

* The lowest mortgage delinquency rates in the country were in North Dakota at 1.52 percent followed by South Dakota at 2.24 percent and Nebraska at 2.61 percent.

* More than half (58 percent) of the metropolitan areas in the nation reported a decrease in mortgage delinquencies that were 60 or more days late since last quarter.

* Compared to last year, new mortgages across the country have dropped 23 percent. All 50 states showed a decline in new mortgage loans when compared to last year’s numbers.

* During the third quarter of this year, the District of Columbia had the highest amount of mortgage debt on average at about $368,255. California had the second highest average at $342,695. awHHawaii had the third highest amount of mortgage debt on average with $309,536. West Virginia had the lowest average at just about $100,000.

Hopefully this trend of declining mortgage delinquencies will continue for this quarter and future quarters. Before long, the mortgage industry may get back on track or, at the very least, begin to improve in the foreseeable future.

With the next Congress taking over in a matter of weeks, there are many questions brewing as to some of the changes that they will be making. Many of those changes are going to directly affect you – the average American citizen – but one decision may affect you more than the others.

The Republican leaders that are set to take over Congress plan to put an end to the bailouts and monies given to Freddie Mac and Fannie Mae. According to Tom Price, a representative from Georgia and the chairman of the Republican Study Committee, the Democrats and the Obama administration has used these two giant mortgage institutions to “manipulate the housing market,” which helped contribute to the debacle that has all but brought the market and parts of the economy to its knees.

Another representative – Republican Spencer Bachus from Alabama – said that his first priority as the potential incoming chairman is to end the federal assistance that the government has been giving to Freddie Mac and Fannie Mae. Since these two major companies either own or guarantee about half of the mortgages in the United States, refusing to give them any more federal financial help would have a major impact on them as well as the mortgage borrowers who have their mortgages through them.

However, Bachus said that the change won’t take place in a matter of days. According to him, subsidizing the mortgage market with money from the taxpayers is an “addiction” and addictions cannot be cured overnight. He said that the transition will take place over several years in order to minimize any problems that will occur as a result of the change.

Democrats have also accused Republicans of doing nothing to help the mortgage institutions in the past. The Republicans had control of the House of Representatives from 1995 to 2007.

In addition to stopping the federal funding to Freddie Mac and Fannie Mae, the Republicans want to have the government oversee the two institutions more closely. This includes the two institutions being more transparent with their accounting practices as well as creating a position for an independent inspector general.

What do you think this will do to the mortgage rates if these two mortgage giants lose their federal funding? Will it make the rates spike or will it help them go down even further? Let us know your thoughts below.