Nov 28

3 Critical Tips for Buying a Home in a Short Sale

making a down paymentYou just found your perfect home, and you feel like everything is right including the price. But, what could be wrong with your ideal home? Maybe, it is being sold as a short sale, and that could present a major challenge if you want to become be the eventual homeowner.

Short sales are different from other conventional real estate transactions since the property in question is usually listed at a price that is much lower than the amount of the outstanding mortgage debt.

Unlike a regular sale, the homeowner must obtain permission from the lender before proceeding with the transaction. Whether you are a veteran property buyer or a first-time home buyer, closing a deal on a short sale can be a challenging and stressful experience. We compiled the top three tips for buying a home in a short sale.

Consult A Short Sale Expert

First, you should consider getting help from a short sale expert who will help you identify homes that are being offered as short sales, help you determine a reasonable purchase price and also advise you on what to include in your offer to make it attractive to the seller.

Before you go for a particular short sale expert, ask them how many buyers they have helped purchase homes on short sales and how long they have been in business.

Good Deals Take Patience

Secondly, remember to be patient when engaging in a short sale deal. There is a high likelihood that most buyers will get impatient after several weeks of waiting and walk away from the deal leaving you in a strong position to negotiate.

If you understand that the initial offer on any short sale can take a long time before the lender accepts or rejects it, you will be in a better position to get a good deal since there will be no stiff competition. However, you should keep in mind that the lender might reject your offer.

Get A Full Loan Approval Early

Lastly, make sure that you get approved for a loan and not just pre-approved. Go through the trouble of getting approved if you want to stand a good chance of landing your dream home through a short sale.

Keep in mind that there will be multiple bids on the property and most of the prospective buyers will be pre-approved. Since you want to get the home at the best possible price below the market prices, being fully approved will make your offer stand out with the lender since you no longer face the risk of your financing falling apart at the last minute.

Entering into a short sale transaction will require patience and diligence. Your best partners will be your trusted real estate and home loan professionals.

Nov 27

5 Real Estate Pros Who Assist You When You Buy Your First Home

final-walkthrough-checklist-real-estateSo you’re set to buy your first house. But where do you begin?

Buying a house for the first time can be nerve-racking. Most advice articles often concentrate on the steps involved in buying a house. To streamline things, let’s focus on the people who will likely be involved in your purchase transaction.

Concentrating on the finding the right professionals can help you navigate the entire buying process easier and more comfortably. Most people start with their home loan financing or locating a property with a real estate agent. Many of the other people involved in the transaction will be referred by these two important folks.

Apart from you and the seller, a number of other people will probably get involved. Some of them get involved throughout the whole process, others pop in and out, while others are optional. Below is an overview of five people involved.

Mortgage Loan Officer

First-time home buyers rarely pay all cash for their property. Most of them borrow money to purchase the property. As such, your mortgage loan officer becomes part of the process from the start to the end. From the moment you inquire if you can afford to the time of transferring ownership, your loan officer will be there.

Real Estate Agent

Most first-time buyers employ a real estate agent to assist them purchase their houses. Agents can help you find the house, draft your offer and advise you on ways to negotiate with the seller. They will likely help you circumnavigate through inspection and closing steps.

Settlement Agent

A settlement agent or a closing agent becomes involved from the moment you reach an agreement with the seller until the transfer of ownership is complete. In most cases, a settlement agent is most involved in the last days before you assume ownership.

Home Inspector

Home inspectors get involved for a short period of time. Most of them pop in, carry out an inspection, write a report and they’re gone. You may never hear from your inspector again. Your real estate agent or mortgage loan officer will most likely be able to recommend a trustworthy home inspector.

Appraiser

Mortgage lenders usually ask appraisers to estimate the market value of the house you’re purchasing. An appraiser makes sure that your lender isn’t advancing you more money than the actual market value of the house. Though the appraiser reports to your lender, you usually pay for the appraisal in your home loan closing costs.

Please keep in mind that legal requirements for transferring house ownership vary from one state to another. For instance, some states require a real estate attorney in the transfer of ownership. Check with your preferred real estate professional to get the details in your local market.

If you are in the market for a new home or interested in refinancing your current property, be sure to contact your trusted mortgage loan professional.

Nov 26

What’s Ahead For Mortgage Rates This Week – November 26th, 2018

board-of-the-federal-reserveLast week’s economic readings included readings from the National Association of Home Builders Housing Market Index, National Association of Realtors® report on sales of pre-owned homes and Commerce Department readings on housing starts and building permits issued. Weekly reports on mortgage rates and first-time jobless claims were also released.

Housing Market Challenges Catch Up to Builder Sentiment

According to the National Association of Home Builders, overall builder sentiment fell six points to November’s reading of 60. This was the largest decline in builder sentiment since 2016. Ongoing concerns over lot and labor shortages and rising costs of building materials were cited along with recently rising mortgage rates.

Demand for homes eased as potential buyers were sidelined by rising rates, shortages of homes for sale and approaching winter weather and holidays. Any Housing Market Index reading over 50 is considered positive, but steep drops in builder sentiment is considered a predictor of stabilizing market conditions.

National Association of Realtors®: Sales of Pre-Owned Home Sales Rise in October

Sales of previously-owned homes rose in October to a seasonally-adjusted annual rate of 5.22 million sales as compared to September’s reading of 5.15 million sales. Analysts estimated a reading of 5.18 million sales. While this reading suggests that buyers are active, an increase in home sales signals easing demand as compared to recent months when many buyers were sidelined due to extreme buyer competition for short inventories of homes for sale.

Mortgage Rates First-Time Jobless Claims Fall as New Jobless Claims Rise

Freddie Mac reported lower mortgage rates last week; rates for 30-year fixed rate mortgages averaged 4.81 percent, which was 13 basis points lower than the previous week. Rates for 15-year fixed rate mortgages averaged 4.24 percent and were 12 basis points lower.

Rates for 5/1 adjustable rate mortgages averaged 4.09 percent and were five basis points lower. Discount points averaged 0.40 percent for 30-year fixed rate mortgages, 0.50 percent for 15-year fixed rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.

First-time jobless claims rose last week to 224,000 new claims filed as compared to expectations of 215,000 claims. The prior week’s reading was 221,000 new claims filed.

What‘s Ahead

Economic readings set for release this week include Case-Shiller home price indices, new home sales and pending home sales. Weekly readings on mortgage rates and new jobless claims will also be released.

Nov 23

5 Home-Buying Pitfalls To Avoid

buying-a-new-home-checklistBuying your home can be nerve-racking, especially if it’s the first time. The buying process is exciting and often complex. The chances of making a mistake are relatively high.

In today’s real estate market where demand surpasses supply, you can’t afford to make mistakes. And this is just the tip of the iceberg. If you are in the market to buy a house, here are five pitfalls avoid.

Not Doing Your Homework Well

Fortune favors the prepared in real estate. And preparedness begins with understanding your finances. A wise buyer examines assets, analyzes debts and gets finances pre-approved before jumping into the house hunt.

Know the neighborhood well, since you’re also buying a location. It’s paramount to research about the quality of schools, upcoming zoning issues and crime level. Not all suburb spots are ideal to live in.

Picking The Wrong Mortgage

Getting your loan preapproved puts you in a better position to negotiate. Find out how much property you can afford. Don’t rely on your bank’s internet site only. Instead, use calculators and consult with your trusted mortgage professional to find out how much you can borrow.

It’s worth noting that what banks show they can lend can differ with what they will lend. As such, it’s imperative to choose your mortgage carefully. Compare offers from various banks or consult an independent finance broker.

Going With The Market Flow

Resist the temptation to flow with the market rather than your needs. The real estate market goes in cycles. There are times suitable for buyers, and times suitable for sellers.

However, don’t gamble with your future by sitting and waiting for the right time. Once you know your budget, get your finances organized, think about your needs now and in future. Then use short term market conditions to make long-term lifestyle choices.

Exceeding Your Budget

Most homebuyers fall for the trap of picking more appealing properties that cost more than their budgets. Falling into this pitfall can derail your future finances.

Although it’s human nature to yearn for more than we can afford, resist the desire. Surpassing your budget exposes you to potential financial shocks with bigger payments, property taxes and more.

Falling In Love

If you find the perfect house, keep it to yourself. Don’t let the sellers read your emotions. If they do, they may use them against you while negotiating.

Wise buyers know there are several homes out there, and there is one that’s right for them. And if you can’t afford one or your offer isn’t accepted, keep looking and move on.

Buying a home is rejuvenating. However, if you’re not careful, you can make mistakes you may regret later. Consult with your trusted real estate expert and trusted mortgage professional to get the best advice for your situation.

Nov 21

3 Things You Should Know About Land Surveys

fotolia 3663046 XSOne thing to think about when purchasing a home or parcel of land is to have an updated land survey conducted. While property deeds generally include detailed information, many are outdated for a variety of reasons that include nature, weather conditions, and adjustments in floodplain maps among others.

Even when the information about the property is spot-on at the closing, human perception of where your property begins and ends can lead to some unenviable outcomes. Given that buying real estate ranks among the largest personal investments for most people, these are three things you may want consider about land surveys.

Good Fences Make Good Neighbors

The old Robert Frost poem “Mending Wall” ponders the reasons that people erect property line fences and why they fix them each spring. The reason is a simple one, setting boundaries avoids unnecessary disagreements and allows people to get along.

Land disputes can turn otherwise friendly neighbors into hostile abutters because there is a pervasive sense that someone is stealing from you. Good fences are the product of clearly identified boundary markers and professional surveyors are the people who measure and certify them. If you plan on buying or recently purchased a parcel of land, updating the land survey may be in you and your neighbor’s best interest.

Squatters Can Take Your Land Through Adverse Possession

Many states continue to allow the practice of adverse possession. In some places, it’s known as “squatters rights.” If someone who does not rightfully own a piece of land can maintain or utilize it for a period of time, they may be able to put in a claim.

Although many people consider this an outdated and unfair practice, it remains too common in rural and suburban areas. Misplaced fences are often the basis of such claims. When abutters work your land or use it to access their own, that can be the basis of a claim to get a permanent easement or take it from you.

Land Surveys Can Be Used For Insurance Purposes

The severe weather storms that struck communities across the country have prompted organizations to update their floodplain maps. Property owners who were not previously required to purchase flood insurance may now find themselves considered “at risk.”

But that designation can be considerably more complex than just owning a home or residential property inside the flood zone. These updated maps do not necessarily consider the elevation of each and every property. In order to be properly listed, you may need to have an elevation certificate to petition FEMA and others that your property is not at risk. That means having a professional land survey conducted.

There are numerous reasons why current land surveys can prove valuable to real estate buyers and sellers. Without one, you are operating without critical information about a significant investment. Your trusted home mortgage professional can refer you to appraisers and land surveyors in your area. Be sure to rely on this valuable resource during your new home purchase.

Nov 19

What’s Ahead For Mortgage Rates This Week – November 19th, 2018

board-of-the-federal-reserveLast week’s economic news included readings on inflation, core inflation and retail sales. Weekly readings on mortgage rates and first-time jobless claims were also released.

Inflation, Retail Sales Rise in October

Commerce Department readings for October showed higher inflation and retail sales. Consumer Price Index rose by 0.30 percent and met expectations. September’s CPI reading was 0.10 percent. Core CPI, which excludes volatile food and energy sectors, also met expectations with a reading of 0.20 percent growth. September’s reading was 0.10 percent. Analysts attributed the highest reading in nine months to higher costs of fuel, rent and used cars.

Retail sales recovered from September’s negative reading of -0.10 percent and surpassed expectations of 0.60 percent growth with October’s reading of 0.80 percent. Higher fuel prices prompted the jump in retail sales after August and September readings were revised to negative readings. Recent declines in oil prices were expected to stabilize gas prices for consumers.

The reading for retail sales excluding autos also exceeded expectations with a reading of 0.70 percent. Analysts expected growth of 0.50 percent based September’s revised reading of -0.10 percent. Looking forward to the holiday shopping season, analysts expected robust readings for retail sales. Increased wages and a strong labor market were expected to help consumers during the holiday shopping season.

Mortgage Rates Stabilize

Mortgage rates were mostly unchanged last week, which provided a reprieve for home buyers. Freddie Mac reported that rates for 30-year fixed rate mortgages averaged 4.33 percent and was unchanged from the prior week. Mortgage rates for 15-year fixed rate mortgages rose three basis points and averaged 4.36 percent.

Rates for a 5/1 adjustable rate mortgage averaged 4.14 percent and were unchanged from the prior week. Discount points averaged 0.50 percent for 30-year mortgages and 0.40 percent for 15-year fixed rate mortgages. Discount points for 5/1 adjustable rate mortgages were 0.30 percent on average.

First-time jobless claims were higher last week with a reading of 216,000 new claims filed as compared to expectations of 210,000 new claims filed and the prior week’s reading of 214,000 new claims filed New jobless claims remained near historic lows despite last week’s increase in claims.

What’s Ahead

This week’s scheduled economic releases include readings from the National Association of Home Builders Housing Market Index and Commerce Department readings on housing starts and building permits issued. The National Association of Realtors® will release its report on sales of pre-owned homes. Weekly readings on mortgage rates and new jobless claims will also be released.

Nov 19

5 Creative Ways To Buy A Foreclosure

buying real estateBuying a foreclosed home is easy, right? After all, they sell for pennies on the dollar, right? Well, that could be a false assumption. Buying a foreclosed property appears easy on TV, but in reality, it can be overwhelming.

Foreclosure sales continue to decline in the market from 38.6 percent in 2011 to 14 percent in 2017 but ticking up a bit in 2018 according to Attom Data Solutions, a national property data company. As foreclosure sales drop, competition for these properties become stiffer and more complex. And as home prices increase in most cities, buyers often turn to foreclosures as affordable alternatives for landing their dream home

Foreclosures usually occur when homeowners can no longer pay their mortgages and the mortgagees seize the properties. Once former owners vacate the properties, lenders typically put it on sale at discounted price or auction to the highest bidder.

Foreclosures give homebuyers the opportunity to get great deals. While foreclosures can save you thousands of dollars, it may come with risks. Having a stomach of steel can help when pursuing a foreclosure.

5 Creative Ways To Buy A ForeclosureTo mitigate the risks involved, keep the following hacks and tricks in mind.

Budget Carefully

Don’t allow a small price tag to entice you into a quick deal. Ask yourself the following:

Do you have sufficient dollars for extensive repairs?
Do you have a team ready for any required repairs or are you handy at doing them yourself?
Can you find a tenant if you intend to rent?
If you conduct thorough research, you’ll minimize the risks.

Get A Home Inspection

Though foreclosures are usually sold “as is”, you need to know the property deficiencies. The home seller can allow you to bring in a competent home inspector. Your inspector will give you a list of what the property lacks and the cost estimates needed to complete the renovations. You may even want to hire a home inspector after purchasing a foreclosure just to get a thorough review of the property.

Ask For Vacancy Duration

Ask how long the house remained vacant. In most cases, long vacancy means more damages. For example, plumbing seals may dry out, bugs get into the house and sewer gases back up.

Don’t Ignore The Landscaping

Neglected landscaping contribute to house deterioration. Tree seedlings grow roots into the foundation and vines crawl into the windows. Small trees can also mess up pavers, and dead branches can break and crash into the house.

Be Cautious With Auctions

Although auctions are common with foreclosures, it’s best to avoid them. And if you can’t, be vigilant when bidding. Competitive bidding can raise the value so high that you end up losing money after the cost of repairs.

It’s always best to work with your trusted local real estate professional to find foreclosure properties. They are experienced in determining the quality of the properties and can help you through the tenuous foreclosure purchase process.

Another key partner is your trusted mortgage professional. If your good credit and pre-approval are in place, you will be on your way to making an offer as soon as the right property comes along.

Nov 15

5 Trends Shaping Green Homes

Depositphotos 5892794 MThink green home design is a fad? Well, think again. Sustainable home designs are gaining popularity at a breakneck speed. In 2017, green homes accounted for more than 60 percent of family home builder’s portfolios, according to a survey conducted by the National Association of Home Builders.

But what is really driving green home designs? In this post, we explore five trends shaping sustainable homes.

1. Energy Efficiency

Home designs that cater to consumers’ need to reduce utility bills continue taking center stage. From net-zero energy homes to energy conserving products, home buyers want to save money. Moving forward, industry experts predict that ultra-efficient building designs like net-zero-energy or passive home designs will continue dominating the industry.

2. Health

Most home buyers are more aware of the dangers of chemicals than before. As such, most of them are seeking non-toxic interior products. The manufacturing industry trend is leaning towards healthier materials. As the demand rises and prices stabilize, these products are more likely to be game changers. Most home designs will probably focus on eliminating troublesome chemicals such as VOC paints and phthalate free flooring.

3. Home Performance And Monitoring

Home energy audits are major factors considered by consumers, and home performance is key. Some cities like Austin expect new homes to undergo performance tests before recommendation for resale.

Energy software programs allow home builders and remodelers to monitor how slight changes in home designs can save thousands of dollars in utility bills. Homeowners are also benefiting from energy monitoring devices to track their household energy consumption.

4. Water Efficiency

80 percent of American states anticipate water shortages in a few years, says a Government Accountability Office survey. Therefore, wise water usage is becoming crucial as consumers demand for water efficient homes. Most builders are already getting their homes HERS Rated as consumers look for ways to save dollars from rising water prices.

5. Biophilic Home Designs

Nature is beneficial to us biologically, physically and psychologically. However, in the last century, home designs separated us from nature. Today, biophilic designs (connected to nature) strive to reverse that by integrating nature into homes. Modern building can capture the sun’s movement using windows, architectural details and patterns, connecting us to the season, time of day and our inner biorhythms.

If you are in the market for a green home, be sure to contact your trusted mortgage professional for a financing pre-approval!

Nov 14

3 Millennial Home-Buying Trends Sellers Should Know

consumer1After five consecutive years of Millennials outpacing all other home-buying demographics, sellers would be wise to wrap their thinking around what makes this generation tick.

According to a 2018 Home Buyer and Seller Generational Trends research study, Millennials purchased more than one-third of all homes in 2017. With home purchases totaling approximately 36 percent of the market in 2018, this class of buyer has increased its market share from 34 percent in 2017.

Taken as a whole, the previously formidable Baby Boomers ranging from 52-70 years old enjoyed only a 32-percent market share. GenXers declined from 28 percent in 2017 to 26 percent in 2018.

With the relatively young Millennials still not fully engaged in the real estate market, expectations are that this group could set the tone for decades.

Millennials Have Improved Buying Power

If you accept the Pew Research Centre definition of Millennials, then they were born between 1981 and 1996. That means the entire population is currently at or past the age of college graduation.

Other research indicates that they enjoy an average annual income that has trended up from $82,000 in 2017 to $88,000 in 2018. That means their overall income outran the estimated inflation rate of about 2.1 percent. Not every group can boast that claim.

With the older end of the group now over 30 years old and the younger swath advancing into careers, sellers may want to plan for spare-no-expense Millennial buyers. The average home they purchased in 2017 was $205,000. In 2018, the average rose to $220,000. They apparently are not shy about spending more on a house they like.

Single Millennial Women Are Buying More Homes

Young single females are making a run at home-buying supremacy. According to recent data, single women purchased approximately 18 percent of all homes in 2017. The figure is more than double that of single males, although married couples remain in the top spot.

The average age of single female buyers stands at 28 years old, and their home loans exceeded $175,000. Appraised values reportedly topped $210,000. Sellers may want to consider a more single female-oriented aesthetic moving forward.

Millennials Willing To Pay For More Space

There are two telling reasons why many Millennials are inclined to bypass traditional starter homes and pay for larger ones.

The first reason goes to the age of the older Millennials. At about 36 years old, they entered into adulthood during a painful economic period. High unemployment and a sluggish economy persuaded older Millennials to either wait or hunker down in a small starter home. That group now has equity in the property or money in the bank. With a hot economy and rising wages, larger homes make affordable sense.

Younger Millennials, by contrast, are entering the workforce during a full-blown economic revival. Jobs are plentiful, and employers are competing with wages to secure workers. The robust economic landscape allows many young professionals to afford larger homes. With that in mind, sellers may want to upgrade outdoor patios and consider taking down a wall or two to create an open floor plan.

If you are a homeowner interested in listing a property, speak with a real estate professional about what Millennials in your area want in a home. Millennial home buyers are changing the industry. If you are a Millennial in the market for a property, be sure to contact your trusted mortgage professional for a pre-approval!

Nov 13

What’s Ahead For Mortgage Rates This Week – November 13th, 2018

board-of-the-federal-reserveLast week’s scheduled economic news was slim last week. The Federal Open Market Committee of the Federal Reserve issued its post-meeting statement, weekly readings on average mortgage rates and first-time jobless claims were also issued.

FOMC: Fed Target Rate Unchanged, but Expected to Rise in December

The Federal Open Market Committee of the Federal Reserve announced that it did not raise the target federal funds rate but set the stage for raising the benchmark rate n coming months. The current range for the Fed rate us 2.00 percent to 2.00 to 2.25 percent. The Fed expects to increase rates three times in 2019 provided that strong economic conditions prevail.

FOMC members watch inflation, financial markets and domestic and global news to determine how or if to adjust the Federal Reserve’s target interest rates range.

Although FOMC releases projections based on current events and financial developments, changes to financial markets or global events could cause the Fed to hold off on raising interest rates.

Mortgage Rates, Hit Seven-Year High, New Jobless Claims Fall

Freddie Mac reported higher average mortgage rates that pushed current mortgage rates to their highest levels in seven years. Rates for a 30-year fixed rate mortgages rose 11 basis points to an average of 4.94 percent; 15-year fixed rate mortgage rates averaged 4.33 percent, which was ten basis points higher than the prior week.

Rates for a 5/1 adjustable rate rose by 10 basis points to an average of 4.14 percent. Discount points averaged 0.50 percent for fixed rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.

First-time jobless claims fell by 1000 new claims to 214,000 new claims filed. Analysts expected 210,000 new claims filed based on the prior week’s reading of 215,000 first-time jobless claims filed.

What‘s Ahead

Next week’s economic reports include readings on inflation, retail sales and weekly reports on mortgage rates and mortgage rates.

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