Thursday, July 30, 2015

Reality Of Buying A Home May Be Cheaper Than You Think

According to a Federal Reserve study done in the last thirty days, 81% of the renters indicate that they would prefer to own their home if they could do so. More than eight out of ten renters would much rather own than they would rent.

Breaking it down in the report, the non financial and the financial reasons people felt that way.

Non financial reasons... They simply prefer to own, they want to be the king of their own castle. There are fewer rules. There's no landlord telling them what they can do. And 23% say they don't like to move. When you own your home you have stability there. When you're renting, you're not sure at the end of that lease what's going to happen.

Now for the financial reasons... It allows you to build equity. Again, it's cheaper than renting and people begin to realize that more and more now. And 20% even said it provides certainty of monthly payments. They know what their expenses are going to be. And that's important, since they can budget and they can budget savings too.

In the report, it showed that the median home equity of a home in this country is $80,000. That's how much people have in their home equity. But homeowner's, in addition to that, have $7,300 in liquid cash savings. There's a continuity of what their payments are going to be. And they... Once you have a thirty year fixed rate mortgage, for the most part that payment stays the same, unlike rent that keeps on going up. When you compare that to a renter who has, in total, a median cash savings of $800, which might be one month's rent, it's really truly amazing. People understand that owning a home builds wealth. And that comes in home equity.

So most renters realize that jumping into a house is crucially important because it's a forced savings that will give them money later in their life. And money that can be tapped into later, if needed. But although renters know how important it is, 50% say that they can't buy a house because they can't afford a down payment and 41% say they'd love to own a house but they can't qualify for a mortgage. A survey of renters showed that two thirds believe that they need a very good credit score to buy a home with 45% thinking a good credit score is over 780. They also overestimate the down payment funds needed to qualify for a home loan with 36% thinking a 20% down payment is always required. If you are a renter, with this kind of thinking... continue reading for better information.

Let's take a look at the reality of the situation...

People think they need a 20% down payment. According to Realty Direct (this past quarter)... The number of loans being done with less, with only 3% or less down is increasing and is already at 30%. And when we're talking about a 3% or less down loan, 11% of all conventional loans are done with 3% down or less. And 83% of FHA loans are done with 3% or less. Cheaper than you thought?
Let's talk about FICO score...

Many home buyers think they need at least 790, 800. Well, the average FICO score on approved loans that are conventional is 757, much less than the 800 they think they need. And on FHA loans, it's 688, 100 points less than they think they need.

Fanny Mae, Freddy Mac, and the mortgage bank association projections over the next four quarters...

By averaging all four projections together, by this time next year interest rates are going to be about three quarters of a percentage point higher if these projections stay. That will affect mortgage payments.

Except for the last couple of years, there's never been a time cheaper to buy a house than now. Those bars are starting to tick up again. People that are ready, willing, and able to buy right now should know that now is the time. You can save money on a month to month basis and build equity.

Selling your home in Kokomo or Lafayette Areas? Let me help you to make you the most money possible in the shortest amount of time. I offer sellers a professional, written marketing plan, the most progressive marketing strategies in the industry, consulting, and staging.
I am a mobile agent committed to helping you around YOUR schedule. Can't drive to my office? No worries... Let me come to you. I am here to help YOU make this transition and this transaction as convenient and smooth as possible.
Gena can be reached at 765-210-5582 or you can email her at
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Monday, July 27, 2015

Why Should I Choose an FHA 203k Loan?

Lots of good reasons to choose from:

  1. your credit may not be stellar
    • Not a problem FHA has the easiest loans for a borrower to qualify
    • Even not to distant bankruptcy can be overcome
  2. your new home needs allot of work and you can't otherwise get a lender to make a loan
    • Most lenders won't make a loan on a home that has health and safety issues
  3. you would like to be sure your home gets repairs it needs as your spouse hasn't been good at fixing things as they might like to think they were as known from past experience
    • a contractor completes the work in a professional and workmanlike manner
    • the contractor has a timeline they should adhere to
    • you are the boss, the contractor works at your discretion and under YOUR supervision
  4. the home has been sitting vacant for two years or more with a known septic tank issue

What I didn't say:

  1. the loan amount doesn't go high enough...  
  2. the repairs exceed $35,000
    • Common myth based on the great marketing some lenders do that aren't qualified to do the Standard 203k and only do the "Streamlined k" 
    • the limit is based on the county limits for the county your home is located. We have several projects right now that are over $500,000 in construction cost. If you have any problem in figuring out this for your client please call us and we'll provide the answers to your delima
  3. there is foundation work or it needs a new foundation
    • some lenders have an "overlay" where they have decided they don't want to do foundation work - don't use that lender, if you need to know what lender is the best at these loans contact us, as consultants we can share our knowledge and there are some you need to stay clear of.
    • repair or replacement of foundations are commonplace
    • septic tank has been dry for over a year and needs work - not a problem for the "Standard 203k"

Friday, July 24, 2015

The Best Way to Buy a House in a Short Sale

A short sale is a complex process, but the math is fairly easy to understand. There's a $6.00 loan on a house that is worth $4.00. The seller wants out. They sell the house to the buyer for $4.00. The purchase money goes to the bank. The bank eats the $2.00 That's a classic short sale.

It's a Bankruptcy Without The Lawyer

Short sales are just like bankruptcies. In a corporate bankruptcy, one group of people is going to get screwed. It's either the bondholders, the shareholders or the bank. Usually its the shareholders. In a short sale, the seller is likely to be the one with the disadvantage, since they will take a hit on their credit and on their taxes. As the buyer, you're the one who makes all the problems go away, but you have to start in the right place and that's with the seller.

Start With the Seller

When we buy houses, we have to make it clear to the seller our participation has a money limit and a time limit. You also want to add just a little sugar to the deal so you have something other than a signature in the game to bargain with. Offer a 2% premium and put a hard clock on the deal. If the sale does not close by X date, you're out. That will likely sweep aside any static on the seller's end.

Both Ends Against the Middle

Once you have the seller on board you come at the deal from the bank side of the table. Get the seller's terms in writing and ask the bank for a term sheet. Put a clock on it. The bank is highly motivated to get out of the house and back into a revenue stream, so they are going to be cooperative if the deal is even close to making sense. Make the same offer here: 2% premium and the mortgage if the deal closes by X date or you're out.

Also be sure the bank is offering you premium terms on the mortgage or walk away. No sense in giving your equity back to the bank in the mortgage contract. Remember you are taking the risk and bailing two parties out at once. You should get most of the reward.

You Win

Work it right and when we buy houses we get a home once appraised at $6.00 for $4.16. Even if you put $1.00 into upgrades and repairs, you've got at least $0.84 in potential equity the day the deal closes. Now it's just a matter of how fast you can pay off that mortgage.

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Tuesday, July 21, 2015

FHA 203k Renovation Loans Are Alive and Well in Dixon California

While we are always doing 203k loans all over CA sometimes it is good to remind everyone that we do them in your city too. If you need an FHA 203k renovation loan or a FannieMae HomeStyle® Renovation Mortgage we do them all over the state, and all over all other states for that matter.

Dixon is a growing community with allot of homes that are getting a bit older and perfect candidates for this loan product. Any home is a candidate for these renovation products. If need to find a 203k consultant, give us a call. We can guide to to the best lenders in your area to provide a quick close.

It doesn't matter if you are refinancing or purchasing these loans should take no more than 30-35 days to close. If they do it is likely due to the borrower not providing their financial information in a timely manner. The other issue that quite often takes time is when the borrower fails to provide guidance as to what they actually want to repair.

If you are thinking about adding a  swimming pool the HomeStyle® Renovation Mortgage would be your choice of a loan program. It has always been an issue for FHA to add a pool but come September 14th the FHA 203k will be able to make repairs on an existing swimming pool without the $1,500 cap they have had since 1961. This will allow you to resurface a pool, and make any other repairs to the equipment or pool that are needed without a limit, but you still can't build one from scratch.

Who is our recommended lender of choice in Dixon CA? Tina Norman, with First Mortgage Corporation who has been making renovation loans for many years now. She is now working out of the Benicia office of First Mortgage Corporation but has been working Davis, Vacaville, Fairfield, Vallejo, and Benicia for quite a few years now and has lots of experience with these products.

Put our 203k team to work in Dixon for your client

Wednesday, July 15, 2015

When Should You Start The Mortgage Process?

Studies have shown that over 92% of Americans surveyed have said that they at one point want to own their own home. For many, owning their own home is part of the American Dream.

Part of the process of owning your own home is the mortgage process. Yes, that perfect house that you have found will not be yours until you can make the bankers happy with your mortgage application.

Since joining the mortgage industry over 8 years ago, there is one question that I have been continually asked: "If I am thinking of purchasing a home, when should I start the mortgage process?"

The answer has always been pretty easy. Whether you are thinking of purchasing a home 2 months from now or even 2+ years from now, the time to start the mortgage process is now.

I have heard people say before "we are going to start the mortgage process in a year or two. We need to work on a few things first to get ready." That statement is great and the forethought of preparing for homeownership is a fantastic idea. Here is the problem: Imagine if for 2 years you were "working on a few things" but they were the wrong things? Imagine if for 2+ years you were working on things and thought you were ready, only to find out that during that time you were working on the wrong things and in fact were another 1 or 2 away because of it?

The time to contact a mortgage lender is now, even if you aren't ready or looking to purchase a home for awhile. Your loan officer can pull your credit as well as check your income, assets, etc. If there are things you need to work on (paying off collections, saving for a down-payment, increasing your credit score, etc) they can help you put that plan in place and help you along the way. This will make sure that when you are ready to purchase, that you actually are ready.

Choosing a mortgage lender can be a bit intimidating. There are options such as your local bank, national banks, mortgage lenders, mortgage brokers and more. Rates and fees are important of course- but qualification requirements can vary drastically between all of those choices. If you have challenging credit or income situations, your lender of choice could make the difference between approval and decline. Make sure that you understand what each lender's guidelines entail.

I do hope that this article has helped you to realize that starting to plan for your mortgage financing early is a good idea and finding a great loan officer is key to your mortgage financing success.

Matthew (Matt) Krimm is a Regional Manager with Hancock Mortgage Partners. To talk to a licensed loan officer about your mortgage goals or to answer any questions you have about what programs might be available for you, call 800.535.8417 or apply online @ To contact him directly, call 443.219.2775 or visit his website
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Sunday, July 12, 2015

Using FHA 203K Loan to Purchase a Fixer-Upper

Across there are a large number of short sale homes available to buyers. A short sale is a home being sold for an amount less than the existing mortgage balance. These homes often have a few cosmetic repairs that need to be made in order to make the home more presentable, if not safe. For years the issue of repairing a home prior to purchase was a catch 22. The bank or seller was not willing to spend extra money on a home that they are selling. The buyer could not make the repairs because they did not legally own the home. The FHA 203k loan solves that problem with ease.

Two Kinds of Loans

The Federal Housing Authority (FHA) offers a loan called the 203k mortgage, named after the code section where the loan is found in the FHA guidelines. This loan is offered as a Streamline version and the regular version. The streamline was designed to offer lower amounts designated for repairs and slightly less paperwork. Both loans are ideal for homebuyers who wish to purchase a home in need of some repairs.

How the Loan Works

The loan program allows buyers to purchase a home based on the sales price. In addition, the buyers can borrow extra money to make the necessary repairs. Once the loan is approved and closed, the extra money is placed in an escrow account. The contractor that is doing the work will receive payment once the work is completed. This protects the borrower and the lender against problems with the repair process.

The amount needed for repairs is added to the loan for the purchase and the homebuyer makes one payment, at one interest rate, on the entire loan. Since mortgage rates are so cheap right now it is a wonderful way to buy a home that may be priced below market value due to some simple fix-ups.

Loan Amounts

The Streamline 203k loan will allow homebuyers to borrow a minimum of $5,000 and a maximum of $35,000 to be used towards the repairs. The regular 203k loan allows much more as a percentage of the sales price and the estimated appraised value after the proposed repairs have been made. The regular 203k loan will need the involvement of an appraiser, home contractor and loan officer from the very beginning to make sure the loan and repairs meet the guidelines of the program

What Can be Done with 203k?

Homebuyers often ask about the types of repairs that can be done with the Streamline 203k program. The following list shows some of the more popular tasks accomplished using this type of loan
  • New gutters and a new roof
  • New Heating and air conditioning system or repairs to the existing system
  • Plumbing updates and repairs
  • Electrical updates and repairs
  • Bath and kitchen remodels, to a lesser extent
  • New flooring of any type; wood, carpet, tile
  • Painting for both exterior and the interior
  • New windows and doors
  • Energy efficient appliances
The 203K loan allows many types of repairs and improvements that can greatly enhance the value of a home and give buyers a chance to purchase a place at a savings. This loan is ideal for short sales or foreclosures.

This communication is provided to you for informational purposes only and should not be relied upon by you. Rock Realty is not a mortgage lender and so you should contact a FHA lender directly to learn more about its mortgage products and your eligibility for such products.
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Thursday, July 9, 2015

FHA 203K Mortgage - The FHA Home Loan Program For Fixer-Upper Homes!

In latest reports, home ownership rates have raised continuously due to the implementation of the FHA Home Loan Program. Acquiring homes continues to be made a lot easier mainly because of this particular advantage. But if you want to buy a home that needs repairs the best way to finance it is a FHA 203K Mortgage.

Through the years, FHA has aided Americans to realize their rights in buying the houses which they desire. Sensible home loan rates for middle class, creating property for the seniors and people with lower earnings, and funding military housing are only some samples of what the FHA has been doing on their behalf. But one of the best ways to finance or refinance a home that needs a lot of repairs is a FHA 203K Mortgage.

The full course of action starts with the loan companies advancing the mortgages to those whom commonly could not purchase a home devoid of their support. However, these individuals have got to satisfy the FHA specifications just before they can be provided with the mortgages which they may be trying to get. One qualification they have to satisfy is that they ought to possess a good credit score ranking.

When they have a poor credit history, they may have difficulty having their application accepted. Whenever they do have it accepted, it may mean that they will have to pay out an increased rate of interest when compared with anyone who has favorable credit history. FHA does have more lenient credit requirements than conventional loans.

Furthermore, FHA loans provide advantages to the people who desire to get houses but can't make down payments simply because they may be fresh college graduates, newlyweds, or individuals who will be still attempting to finish their schooling. The down payment for FHA Home Loan Program is only 3.5%. Additionally, there are several loan companies whom make it possible for folks having bad credit score to be eligible nevertheless. They are aware that these individuals are marred by foreclosure or bankruptcy nevertheless they are going to provide them with an additional opportunity.

The FHA 203K Mortgage is one among the most favorite FHA home loan. There is a fixed interest rate and this is the most perfect for first time home buyers. It enables the people pay up to 96.5 percent of their entire mortgage loan. What this means is the down payments are managed on a controllable level and also the settlement costs will also be at a minimum.

The FHA 203K Mortgage is the only mortgage loan where the sum of the settlement costs might be provided as gift from family, employer, or non-profit or governmental agency.

Nonetheless, the guidelines to consider in this entire transaction whenever working with the FHA 203K Mortgage is that there exists a minimum income requirement. The person should be eligible for this prior to be given an FHA 203k loan.

Your debt ratios can also be specific, based upon on the state he could be residing in. The FHA 203K Mortgage is a good investment decision since one can possibly obtain the house he's been seeking and have the repairs rolled into their mortgage.

The best place to do more research on the FHA 203K Mortgage and other FHA Home Loan Program loans is the Internet. You will be able to find websites with additional information that will help you buy your dream home even though it does need repairs!

You can get start your search by clicking FHA Home Loan Program [] where you get much more information on FHA loans. Learn more about the FHA 203K Mortgage by clicking Streamlined FHA 203K Loan [].
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Monday, July 6, 2015

Easy FHA Loan Qualifications With No Credit Or Bad Credit

If you fall into one of these categories you should definitely consider an FHA loan.

- Considering a home purchase with less than perfect credit

- Considering a home refinance with less than perfect credit

- Considering buying a home but have not established traditional credit.

- Currently in an ARM loan that is due to reset - and have less than perfect credit

If you have less than perfect credit or no traditional credit you may be in luck due to easy FHA loan qualifications.


FHA loan qualification guidelines are perhaps the most lenient in the mortgage world because they do not use FICO scores exclusively to assess your risk as a borrower.

Many With Low FICO Scores Qualify for FHA Loans

FHA makes it's decision on whether or not to grant you a loan based on your total credit profile. For example, your credit score may have taken a dip because of some isolated events in the past, job lay-off, illness, divorce etc...Fortunately FHA lenders look at your bill paying history over the last 2 years to determine if you qualify or not, your low FICO score will not disqualify you from receiving an FHA loan.

FHA Looks at Overall Credit Profile

FHA's philosophy is that the majority of borrowers overcome these financial setbacks. You are truly NOT the high risk your FICO score indicates; even though your credit score may indicate sub-prime status.

FHA will assess your income, recent payback status with current lenders as well your current debt-to-income ratio giving borrowers a chance to purchase or refinance a home.

Non Traditional Credit Qualifies

What if you have no established credit? You may have never used credit cards, had a car loan, student loan, or mortgage. These are considered traditional means of credit which are recorded with the 3 major credit bureaus.

FHA qualifications consider non traditional credit references as proof of responsible money management. Payments like rent, utility bills, cell phone, personal loans, and even regular deposits into a savings account as proof of "credit worthiness"

So if you thought that your bad credit or non credit disqualified you from purchasing a home - think again - an FHA loan may be the answer.

Hard working families that may have damaged credit and very little down payment can still experience the joy of home ownership with an FHA loan. Qualifying is much easier than you may think - visit: FHA Loan qualification
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Friday, July 3, 2015