http://www.dpol.com
negotiating those closing costs
How to negotiate your closing costsBy Holden Lewis • Bankrate.comShop around before choosing a mortgage lender, but don't stop there. When you receive your good faith estimate of closing costs, or GFE, the negotiation hasn't ended.The lender or mortgage broker is required to give you a GFE within three working days of accepting your loan application. The GFE comes in the form of an itemized list of estimated closing costs for everything from the lender's fees to the appraisal charge to the title insurance premium to a partial month's interest payment.The lender or broker charges some fees, and third parties charge others. The first step is to find out which are loan origination fees and which are third-party fees. Don't guess. Ask the lender or broker.The big money question"Say, 'Please explain to me what those fees are,'" says Jessica Cecere, director of the Consumer Credit Counseling Service in West Palm Beach, Fla.Simple advice, but a lot of loan applicants don't follow it.On the GFE, fees are categorized by numerical codes ranging from the 800s to the 1300s. Most of the negotiable lender-charged fees are in the 800s: application, origination, commitment, loan discount, broker, tax-related service and underwriting fees.Keys to lower closing costs:•Ask for a justification for each lender-charged fee.•If the lender charges an application fee, ask if it will be credited toward closing costs.•If the lender charges an underwriting fee as well as a processing fee, ask for details of those services. Maybe you'll find a fee that can be waived or reduced.•Recognize that some items are non-negotiable: taxes, city and county stamps, recording fees, prorated interest and reserves. On the GFE, these items are in the 1000s and the 1200s.Third-party feesFees charged by third parties are trickier to negotiate. A few third-party fees pop up in the 800s section of the GFE: those for the appraisal, credit report and inspection. The lender is supposed to pass along these charges without marking them up. Theoretically, they are negotiable and you can ask the lender to seek good deals on these three items and pass along the savings. In practice, you probably won't get a break on those services because the lender has contracted for them at a set price.You can realize some of your biggest savings by negotiating the items in the 1100s section of the GFE: title insurance, title search, title exam, attorney's fees and settlement fees. Most borrowers use a title company recommended by the real estate agent or lender. But you don't have to. You can shop for title insurance and settlement services, just as you shopped for the house and for the loan.Be prepared for resistance. Some lenders have business affiliations with title companies, and they'll pressure you to keep the title work in-house.Title insurance, settlement servicesWhere you shop for these title insurance and settlement services depends on where you live, because different places have different ways of closing real estate and mortgage transactions. In parts of the Northeast, closings are conducted in lawyers' offices. In some places, including Southern California, closings take place at escrow or mortgage companies. In much of the country, the closing takes place in the office of the agency that sells title insurance.Government regulation can limit your negotiating room. In Texas, the state sets one overall fee for title insurance, title search and settlement services, so title agencies compete on service and not price. Regulations aren't as restrictive in most other states and you could save hundreds of dollars in settlement services by shopping around."I think it's a matter of what the traffic will bear," says Bob Moulton, president of American Mortgage, a brokerage on Long Island, N.Y. He gives this tip: If you're refinancing your mortgage, and you've lived in the house less than 10 years, ask to get title insurance at a less-expensive "reissue rate."And don't forget to shop for hazard insurance -- item No. 903 on the GFE. Compare offers for homeowners insurance policies, either on your own or with the help of an insurance agent. Make sure the insurance company and settlement agent communicate with each other. You're not going to get that mortgage without proof that you have a homeowner's policy. That requirement is not negotiable.
Saturday, November 25, 2006
Thursday, October 12, 2006
http://www.dpol.com
Lowballing in a cool housing market
Real Estate Adviser by Steve McLinden • Bankrate.com
Dear Real Estate Adviser,
In the softening real estate market, how much wiggle room is there in negotiating for a house? -- Kathi M.
I wish to purchase a home soon. My question is what is a reasonable lowball percent to offer on a house? When I ask agents, they are very vague. Is offering 10 percent below or more way off? -- May in Mizzou
How low can I go without offending the seller? -- Anthony S.
Dear Kathi, May, Anthony and many others,
As markets that were overheated as recently as early 2005 have cooled considerably, this subject has become a hot one. With a temporary overabundance of housing on the market in many parts of the country, low bidders are truly in their element for the first time in about a decade. Offers that were laughed off just 18 months ago by confident sellers are suddenly being considered. Owners who once advised their agents to ignore offers by lowballers no longer have that luxury in most markets.
But don't expect sellers to flat-out panic. Most who bought their homes recently will not let their homes go for much less than they paid for them. On the other hand, owners who have been in their homes awhile and enjoyed a big run-up in value in recent years might be more willing to listen to lower offers because they'll still profit handily on the sale.
As always, homes most likely to sell at a big discount are those in dire need of wholesale repairs, preforeclosure homes and those owned by other highly motivated people (transferring out of town, buying another home and not able to afford two mortgages, had recent death in family, investor who bought at the wrong time, etc.). To them, offers of up to 15 percent or more under market are a little more palatable.
Knowing the seller's motives always gives you much more traction with any negotiable purchase -- especially a house.
However, stingy offers on quality properties might come off as predatory and not even elicit a counteroffer. Many sellers will dig in their heels and stay put before they'll sell at giveaway prices. With a few exceptions, the underlying fundamentals of most U.S. housing markets remain strong and are still showing annual value growth, albeit a bit slower.
On average, homes sell for a little under 5 percent of asking price, and in this generally softening market, you should set your sights below this figure. As a very loose rule of thumb, based on my research and writings of the last 20 years, closing prices in a vibrant sellers' market average about 2 percent below list and average around 8 percent or 9 percent at or around the bottom (or top, depending on your perspective) of a buyers' market. Of course, much of this depends on market, location, the local economy and a home's condition. Higher-priced homes and condos are slower to move at present, so adjust accordingly. The more you research the nuances of your market, the better you'll fare.
But you have little to lose, currently, by going low. The worse that can happen is that your offer will be flatly rejected. For that reason, your best strategy might be to pinpoint several potential homes, make your low offers and see what sticks -- or at least who is willing to negotiate. In lieu of price concessions, many homeowners are offering to throw in appliances, furnishings and even such items as high-definition TVs. If you do the math, you might come out farther ahead than if you held out for an additional 1 percent or 2 percent.
A few tips: Keep silent on what your top price is and what mortgage amount you've been prequalified for. These can be used against you in the negotiation game. The amount you can borrow needn't come out until the contract phase, after you've agreed on price. And enter negotiations armed. If you can produce "comps" of similar area homes that sold at similar discounts, you have leverage. Your buyer's agent should be able to do this as part of his or her services.
Good luck to you all.
Lowballing in a cool housing market
Real Estate Adviser by Steve McLinden • Bankrate.com
Dear Real Estate Adviser,
In the softening real estate market, how much wiggle room is there in negotiating for a house? -- Kathi M.
I wish to purchase a home soon. My question is what is a reasonable lowball percent to offer on a house? When I ask agents, they are very vague. Is offering 10 percent below or more way off? -- May in Mizzou
How low can I go without offending the seller? -- Anthony S.
Dear Kathi, May, Anthony and many others,
As markets that were overheated as recently as early 2005 have cooled considerably, this subject has become a hot one. With a temporary overabundance of housing on the market in many parts of the country, low bidders are truly in their element for the first time in about a decade. Offers that were laughed off just 18 months ago by confident sellers are suddenly being considered. Owners who once advised their agents to ignore offers by lowballers no longer have that luxury in most markets.
But don't expect sellers to flat-out panic. Most who bought their homes recently will not let their homes go for much less than they paid for them. On the other hand, owners who have been in their homes awhile and enjoyed a big run-up in value in recent years might be more willing to listen to lower offers because they'll still profit handily on the sale.
As always, homes most likely to sell at a big discount are those in dire need of wholesale repairs, preforeclosure homes and those owned by other highly motivated people (transferring out of town, buying another home and not able to afford two mortgages, had recent death in family, investor who bought at the wrong time, etc.). To them, offers of up to 15 percent or more under market are a little more palatable.
Knowing the seller's motives always gives you much more traction with any negotiable purchase -- especially a house.
However, stingy offers on quality properties might come off as predatory and not even elicit a counteroffer. Many sellers will dig in their heels and stay put before they'll sell at giveaway prices. With a few exceptions, the underlying fundamentals of most U.S. housing markets remain strong and are still showing annual value growth, albeit a bit slower.
On average, homes sell for a little under 5 percent of asking price, and in this generally softening market, you should set your sights below this figure. As a very loose rule of thumb, based on my research and writings of the last 20 years, closing prices in a vibrant sellers' market average about 2 percent below list and average around 8 percent or 9 percent at or around the bottom (or top, depending on your perspective) of a buyers' market. Of course, much of this depends on market, location, the local economy and a home's condition. Higher-priced homes and condos are slower to move at present, so adjust accordingly. The more you research the nuances of your market, the better you'll fare.
But you have little to lose, currently, by going low. The worse that can happen is that your offer will be flatly rejected. For that reason, your best strategy might be to pinpoint several potential homes, make your low offers and see what sticks -- or at least who is willing to negotiate. In lieu of price concessions, many homeowners are offering to throw in appliances, furnishings and even such items as high-definition TVs. If you do the math, you might come out farther ahead than if you held out for an additional 1 percent or 2 percent.
A few tips: Keep silent on what your top price is and what mortgage amount you've been prequalified for. These can be used against you in the negotiation game. The amount you can borrow needn't come out until the contract phase, after you've agreed on price. And enter negotiations armed. If you can produce "comps" of similar area homes that sold at similar discounts, you have leverage. Your buyer's agent should be able to do this as part of his or her services.
Good luck to you all.
Thursday, September 21, 2006
http://www.dpol.com
HUD to Sell 4,000 Homes in Online Auction
From Robert Longley,Your Guide to U.S. Gov Info / Resources.FREE Newsletter. Sign Up Now!
Bidding starts Feb. 27 - View the homes now
The Department of Housing and Urban Development will sell up to 4,000 foreclosed homes via a special Internet auction on February 27-28. The unprecedented online home sale keynotes HUD's continuing commitment to increasing homeownership opportunities for American families.
The Department has used the Internet for sale of HUD homes for several years, but this auction will be different. HUD will publicize the auction in major newspapers throughout the country and use special procedures in listing the homes for sale.
Properties available through the auction will be pulled from the market for approximately three weeks prior to the auction dates. The properties can now be inspected on the HUD website. During the inspection period, prospective buyers will have an opportunity to "shop" the available listings.
zSB(3,3)
Sponsored Links
Hud Homes Sale3, 4 & 5 Bedroom Homes in Your Area for No Money Down - Search Free!www.foreclosurestore.com
List Of Hud HomesOur Lists Updated 3 Times Daily! Find Foreclosed Homes In Your Statewww.ushud.com
Free Foreclosure ListingSave 20%- 50% on your property. Buy direct from government and banks.www.realtystore.comBuyers will have time to inspect homes, look at neighborhoods and comparison shop before submitting their auction bid on February 27-28.
"HUD hopes this special effort will make more people aware of the opportunities that are available through our programs," said John C. Weicher, HUD Assistant Secretary for Housing-Federal Housing Commissioner. "This, in turn, will further our mission of increasing homeownership and expanding the supply of affordable housing."
To participate in the special auction, interested homebuyers will go to the HUD Auction Website where an announcement will lead the buyer to click on the state of interest. This will lead to complete information on properties available in that state.
The auction will begin on February 27 at 10 am (Eastern time) and will end on February 28 at 11:59 pm. Bid results will be announced on February 29, on the websites where the properties were listed.
All properties will be sold on an "as is" basis, without warrantee or guarantee. These properties were previously sold with FHA insurance and received by HUD as a result of foreclosure by a lender and payment of the related FHA insurance claim to the foreclosing lender.
HUD is the nation's housing agency committed to increasing homeownership, particularly among minorities; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development as well as enforces the nation's fair housing laws. More information about HUD and its programs is available on the Internet in both English and Spanish.
[Source: Dept. of Housing and Urban Development]
HUD to Sell 4,000 Homes in Online Auction
From Robert Longley,Your Guide to U.S. Gov Info / Resources.FREE Newsletter. Sign Up Now!
Bidding starts Feb. 27 - View the homes now
The Department of Housing and Urban Development will sell up to 4,000 foreclosed homes via a special Internet auction on February 27-28. The unprecedented online home sale keynotes HUD's continuing commitment to increasing homeownership opportunities for American families.
The Department has used the Internet for sale of HUD homes for several years, but this auction will be different. HUD will publicize the auction in major newspapers throughout the country and use special procedures in listing the homes for sale.
Properties available through the auction will be pulled from the market for approximately three weeks prior to the auction dates. The properties can now be inspected on the HUD website. During the inspection period, prospective buyers will have an opportunity to "shop" the available listings.
zSB(3,3)
Sponsored Links
Hud Homes Sale3, 4 & 5 Bedroom Homes in Your Area for No Money Down - Search Free!www.foreclosurestore.com
List Of Hud HomesOur Lists Updated 3 Times Daily! Find Foreclosed Homes In Your Statewww.ushud.com
Free Foreclosure ListingSave 20%- 50% on your property. Buy direct from government and banks.www.realtystore.comBuyers will have time to inspect homes, look at neighborhoods and comparison shop before submitting their auction bid on February 27-28.
"HUD hopes this special effort will make more people aware of the opportunities that are available through our programs," said John C. Weicher, HUD Assistant Secretary for Housing-Federal Housing Commissioner. "This, in turn, will further our mission of increasing homeownership and expanding the supply of affordable housing."
To participate in the special auction, interested homebuyers will go to the HUD Auction Website where an announcement will lead the buyer to click on the state of interest. This will lead to complete information on properties available in that state.
The auction will begin on February 27 at 10 am (Eastern time) and will end on February 28 at 11:59 pm. Bid results will be announced on February 29, on the websites where the properties were listed.
All properties will be sold on an "as is" basis, without warrantee or guarantee. These properties were previously sold with FHA insurance and received by HUD as a result of foreclosure by a lender and payment of the related FHA insurance claim to the foreclosing lender.
HUD is the nation's housing agency committed to increasing homeownership, particularly among minorities; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development as well as enforces the nation's fair housing laws. More information about HUD and its programs is available on the Internet in both English and Spanish.
[Source: Dept. of Housing and Urban Development]
Remodeling: A dozen ideas to enhance the value of your home
http://www.dpol.com
Remodeling: A Dozen Ideas to Enhance the Value of Your Home
Unless you’re a stock market genius, your home is probably your biggest asset. Real estate has become a rockier road than it was a year ago, but that doesn’t mean you should stop thinking about those home improvement projects. Remodeling can be both exciting and profitable if you know which remodels add the most value to your house. Take a look at the following twelve projects which can change the feel of your home while also adding real value:
1. Minor kitchen remodel - Both men and women seem to find a bright and shiny kitchen the most appealing part of the house. The surprising news is that a minor kitchen re-do is a better deal than a complete kitchen make-over. So, if you’re feeling up to it, go ahead and get that new fridge, paint the kitchen walls and change the drawer pulls – you’re going to get the most bang for your buck by updating your kitchen first.2. Bathroom addition - Having an extra bathroom makes a house extremely attractive to larger families. Just imagine - no more fighting over bathroom time on weekday mornings.3. Major kitchen remodel - Now we’re talking about the expensive projects that probably require a professional such as updating cabinets, re-tiling and adding a granite countertop. You might also consider getting new appliances.4. Family room addition - The beauty of adding a family room is the flexibility of eventually using it for whatever best fits your needs: an extra bedroom, an office, a home theater or even a game room. Potential buyers are attracted to concepts that allow them to adjust to their families’ needs.5. Second-story addition - This remodel shares many benefits with a family room addition and even adds the same equity to your home. But, it has one special advantage: it can serve as a mother-in-law suite or a room for a teenager who suddenly needs her own space.6. Attic bedroom - Close in value to the family room and second-story additions, this project is designed exclusively as an extra bedroom but should be less expensive than building a new level or extension to the house. Since the attic already exits, this project becomes more of a redecorating proposition with maybe some attention to heating / cooling needs.7. Master suite - The complete bedroom suite for both married couples and singles is a hallmark of luxury for most Americans. Couples with children particularly love the privacy that comes with having bedroom, bath, walk-in closet and dressing area all connected and separate from the rest of the house.8. Bathroom remodel - An upgraded bathroom with new tile, tub, vanity, toilet and lighting is an extremely attractive item to potential buyers. Who doesn’t love an updated, clean bathroom?9. Siding replacement - While your family might not notice this upgrade on a daily basis, this remodel option is of huge importance when you’re ready to put your house on the market. Buyers usually won't get to the good stuff inside if your “curb appeal” doesn’t grab them.10. Deck addition - A well designed deck not only adds to the beauty of a home, but when properly displayed, also makes your home seem much larger and roomier. With the increasing popularity of outdoor living spaces, this would make a great selling point.11. Window replacement - Few things detract from the appearance of a house more than old, shabby windows. Not only do new windows add beauty, they also provide improved insulation and energy savings – an item high on most homeowner and potential buyer lists these days.12. Home office - With many people working from home these days, a home office is a great addition to a home. It’s space that you can use for professional or personal use that is separate from the rest of the house and can be a kids-free zone. It might be an upgrade that requires the least work and expense and also likely recaptures what now might be wasted space.
Are you considering a home remodel project? Keep in mind that any upgrades to your home might change the scope of your homeowners policy. Let NetQuote help you instantly connect with quality, local agents in your area who can help you make sure your policy reflects your current home – and, help save you money!
Remodeling: A Dozen Ideas to Enhance the Value of Your Home
Unless you’re a stock market genius, your home is probably your biggest asset. Real estate has become a rockier road than it was a year ago, but that doesn’t mean you should stop thinking about those home improvement projects. Remodeling can be both exciting and profitable if you know which remodels add the most value to your house. Take a look at the following twelve projects which can change the feel of your home while also adding real value:
1. Minor kitchen remodel - Both men and women seem to find a bright and shiny kitchen the most appealing part of the house. The surprising news is that a minor kitchen re-do is a better deal than a complete kitchen make-over. So, if you’re feeling up to it, go ahead and get that new fridge, paint the kitchen walls and change the drawer pulls – you’re going to get the most bang for your buck by updating your kitchen first.2. Bathroom addition - Having an extra bathroom makes a house extremely attractive to larger families. Just imagine - no more fighting over bathroom time on weekday mornings.3. Major kitchen remodel - Now we’re talking about the expensive projects that probably require a professional such as updating cabinets, re-tiling and adding a granite countertop. You might also consider getting new appliances.4. Family room addition - The beauty of adding a family room is the flexibility of eventually using it for whatever best fits your needs: an extra bedroom, an office, a home theater or even a game room. Potential buyers are attracted to concepts that allow them to adjust to their families’ needs.5. Second-story addition - This remodel shares many benefits with a family room addition and even adds the same equity to your home. But, it has one special advantage: it can serve as a mother-in-law suite or a room for a teenager who suddenly needs her own space.6. Attic bedroom - Close in value to the family room and second-story additions, this project is designed exclusively as an extra bedroom but should be less expensive than building a new level or extension to the house. Since the attic already exits, this project becomes more of a redecorating proposition with maybe some attention to heating / cooling needs.7. Master suite - The complete bedroom suite for both married couples and singles is a hallmark of luxury for most Americans. Couples with children particularly love the privacy that comes with having bedroom, bath, walk-in closet and dressing area all connected and separate from the rest of the house.8. Bathroom remodel - An upgraded bathroom with new tile, tub, vanity, toilet and lighting is an extremely attractive item to potential buyers. Who doesn’t love an updated, clean bathroom?9. Siding replacement - While your family might not notice this upgrade on a daily basis, this remodel option is of huge importance when you’re ready to put your house on the market. Buyers usually won't get to the good stuff inside if your “curb appeal” doesn’t grab them.10. Deck addition - A well designed deck not only adds to the beauty of a home, but when properly displayed, also makes your home seem much larger and roomier. With the increasing popularity of outdoor living spaces, this would make a great selling point.11. Window replacement - Few things detract from the appearance of a house more than old, shabby windows. Not only do new windows add beauty, they also provide improved insulation and energy savings – an item high on most homeowner and potential buyer lists these days.12. Home office - With many people working from home these days, a home office is a great addition to a home. It’s space that you can use for professional or personal use that is separate from the rest of the house and can be a kids-free zone. It might be an upgrade that requires the least work and expense and also likely recaptures what now might be wasted space.
Are you considering a home remodel project? Keep in mind that any upgrades to your home might change the scope of your homeowners policy. Let NetQuote help you instantly connect with quality, local agents in your area who can help you make sure your policy reflects your current home – and, help save you money!
Thursday, August 24, 2006
Exterior Remodeling tips for boosting home values
http://www.dpol.com
Exterior Remoldeling Tips for Boosting Home Values
As the record-setting heat wave that swept much of the country subsides, Americans are venturing back outdoors to resume end-of-summer remodeling. When you make your to-do list, consider that the best improvements are the ones that add value to your home. The following are a few fix-ups that don’t require an advanced degree in carpentry, but can greatly increase the value of your home:
Look from a different angle - Snap a picture of your house. Use a digital or Polaroid camera to take several different photos of your home from various angles and exposures. It’s always enlightening to examine static images. They allow you look at details that you normally would miss, and should highlight targets for your home improvement planning.
Consider repainting - Nothing enhances the “curb appeal” of a house more than a fresh coat of paint. This project requires more patience than professional skill, so don’t be intimidated. Color selection is the part of home exterior painting that is most critical, so take the time to review the wide array of color samples provided by paint manufacturers. After all, with just the color white there are hundreds of shades. Try not to pick unusual colors for the majority of the house. Instead, look at more neutral, earthy tones such as light grays, browns or greens for most of the walls, and use brighter shades for the trim and accent touches. Warning: colors that look perfect on a sample card may need to be toned down for painting larger areas of your home. Be sure to check on a small area of the house first.
Do a little landscaping - A little landscaping goes a long way in improving your home’s curb appeal. Second to repainting, adding and maintaining new trees and shrubs is the most effective way to improve the beauty of your home. Trees are both attractive and functional providing privacy, shade and a screen to block unwanted views - creating more privacy in your home’s backyard. If you have distracting objects in your yard, such as utility boxes, shield them from sight with planter boxes or bushes.
Restore aging driveways and walkways - Pavers are the most fashionable and attractive of the possible solutions to a home’s worn, cracked or stained pathway, but they are expensive and require more skill than most homeowners possess. The alternative is to clean, repaint, or repave them. Money saving tip for cleaning your home’s driveway stain: stubborn oil or grease stains can be removed with a solution of baking soda and water. Make an absorptive paste, apply it and cover with plastic for 24 hours. Bye-bye stain.
Spruce up doors – Your home’s doors can be beautified, not replaced. Your front and back doors make a lasting impression for visitors, setting the tone for how your home’s interior is judged. Doors can be refinished and accent lighting and planter boxes will do wonderful things for drab home entranceways. If you are considering redoing your household doors, stripping and staining aren’t advisable. Instead, paint the door a traditional color, or coat the existing finish with an opaque stain. Finally, add a brass kick plate or a new, fashionable handle and lock for an extra bit of home elegance.
Maintain, maintain, maintain - Homeowners get excited over new projects and ideas but the general upkeep of a home isn’t fun and often gets neglected. When a house looks dirty, a lawn is overgrown or gutters are left hanging, a once-beautiful home takes on a tarnished appearance. This results in the de-valuing of a home that is likely worth much more. It’s easier to maintain a house on a regular basis than to take on the huge project of doing it all at once.
Exterior Remoldeling Tips for Boosting Home Values
As the record-setting heat wave that swept much of the country subsides, Americans are venturing back outdoors to resume end-of-summer remodeling. When you make your to-do list, consider that the best improvements are the ones that add value to your home. The following are a few fix-ups that don’t require an advanced degree in carpentry, but can greatly increase the value of your home:
Look from a different angle - Snap a picture of your house. Use a digital or Polaroid camera to take several different photos of your home from various angles and exposures. It’s always enlightening to examine static images. They allow you look at details that you normally would miss, and should highlight targets for your home improvement planning.
Consider repainting - Nothing enhances the “curb appeal” of a house more than a fresh coat of paint. This project requires more patience than professional skill, so don’t be intimidated. Color selection is the part of home exterior painting that is most critical, so take the time to review the wide array of color samples provided by paint manufacturers. After all, with just the color white there are hundreds of shades. Try not to pick unusual colors for the majority of the house. Instead, look at more neutral, earthy tones such as light grays, browns or greens for most of the walls, and use brighter shades for the trim and accent touches. Warning: colors that look perfect on a sample card may need to be toned down for painting larger areas of your home. Be sure to check on a small area of the house first.
Do a little landscaping - A little landscaping goes a long way in improving your home’s curb appeal. Second to repainting, adding and maintaining new trees and shrubs is the most effective way to improve the beauty of your home. Trees are both attractive and functional providing privacy, shade and a screen to block unwanted views - creating more privacy in your home’s backyard. If you have distracting objects in your yard, such as utility boxes, shield them from sight with planter boxes or bushes.
Restore aging driveways and walkways - Pavers are the most fashionable and attractive of the possible solutions to a home’s worn, cracked or stained pathway, but they are expensive and require more skill than most homeowners possess. The alternative is to clean, repaint, or repave them. Money saving tip for cleaning your home’s driveway stain: stubborn oil or grease stains can be removed with a solution of baking soda and water. Make an absorptive paste, apply it and cover with plastic for 24 hours. Bye-bye stain.
Spruce up doors – Your home’s doors can be beautified, not replaced. Your front and back doors make a lasting impression for visitors, setting the tone for how your home’s interior is judged. Doors can be refinished and accent lighting and planter boxes will do wonderful things for drab home entranceways. If you are considering redoing your household doors, stripping and staining aren’t advisable. Instead, paint the door a traditional color, or coat the existing finish with an opaque stain. Finally, add a brass kick plate or a new, fashionable handle and lock for an extra bit of home elegance.
Maintain, maintain, maintain - Homeowners get excited over new projects and ideas but the general upkeep of a home isn’t fun and often gets neglected. When a house looks dirty, a lawn is overgrown or gutters are left hanging, a once-beautiful home takes on a tarnished appearance. This results in the de-valuing of a home that is likely worth much more. It’s easier to maintain a house on a regular basis than to take on the huge project of doing it all at once.
This was the fourth week that rates have dropped
http://www.dpol.com
Most interest rates were down again during the week ended August 17 and 18, but the changes were not nearly as aggressive as immediately after the Federal Reserve Board's decision to pause in its long term pattern of quarter-point rate increases.
This was the fourth week in a row that rates have dropped and the long term fixed rate products are down at least 20 basis points over that period. Frank Nothaft, Freddie Mac vice president and chief economist commented "This week's news that July housing starts fell 2.5 percent added conviction to Fed Fund futures traders who are currently pricing contracts to suggest the chances of another rate increase from the central bank this year are about fifty-fifty. As a result, 30-year fixed-rate mortgages are down for the fourth straight week and are the lowest they've been since mid-April. Meanwhile, ARM rates have gone down less. All of which could help persuade homeowners with ARMs on the verge of resetting to make the decision to lock into a fixed-rate mortgage now rather than take a chance of a higher rate on the adjustment date."
This was the fourth week in a row that rates have dropped and the long term fixed rate products are down at least 20 basis points over that period.
Frank Nothaft, Freddie Mac vice president and chief economist commented "This week's news that July housing starts fell 2.5 percent added conviction to Fed Fund futures traders who are currently pricing contracts to suggest the chances of another rate increase from the central bank this year are about fifty-fifty."
"As a result, 30-year fixed-rate mortgages are down for the fourth straight week and are the lowest they've been since mid-April. Meanwhile, ARM rates have gone down less. All of which could help persuade homeowners with ARMs on the verge of resetting to make the decision to lock into a fixed- rate mortgage now rather than take a chance of a higher rate on the adjustment date."
Most interest rates were down again during the week ended August 17 and 18, but the changes were not nearly as aggressive as immediately after the Federal Reserve Board's decision to pause in its long term pattern of quarter-point rate increases.
This was the fourth week in a row that rates have dropped and the long term fixed rate products are down at least 20 basis points over that period. Frank Nothaft, Freddie Mac vice president and chief economist commented "This week's news that July housing starts fell 2.5 percent added conviction to Fed Fund futures traders who are currently pricing contracts to suggest the chances of another rate increase from the central bank this year are about fifty-fifty. As a result, 30-year fixed-rate mortgages are down for the fourth straight week and are the lowest they've been since mid-April. Meanwhile, ARM rates have gone down less. All of which could help persuade homeowners with ARMs on the verge of resetting to make the decision to lock into a fixed-rate mortgage now rather than take a chance of a higher rate on the adjustment date."
This was the fourth week in a row that rates have dropped and the long term fixed rate products are down at least 20 basis points over that period.
Frank Nothaft, Freddie Mac vice president and chief economist commented "This week's news that July housing starts fell 2.5 percent added conviction to Fed Fund futures traders who are currently pricing contracts to suggest the chances of another rate increase from the central bank this year are about fifty-fifty."
"As a result, 30-year fixed-rate mortgages are down for the fourth straight week and are the lowest they've been since mid-April. Meanwhile, ARM rates have gone down less. All of which could help persuade homeowners with ARMs on the verge of resetting to make the decision to lock into a fixed- rate mortgage now rather than take a chance of a higher rate on the adjustment date."
Wednesday, August 09, 2006
First-Time Homebuyers guide to taxes
http://www.dpol.com
First-time home buyers' guide to taxes
By Kay Bell • Bankrate.com
There's nothing quite like purchasing your first home. You're on your own. You have a substantial financial investment.
And you now have some different tax considerations.
You're probably well-aware that homeownership affords you several new ways to save on the annual Internal Revenue Service bill.
"Homeownership is one of the best tax benefits that the federal government gives out," says attorney Robin Gronsky, principal of Gronsky Law Offices in Ridgewood, N.J. "People count on it. It's how they calculate their out-of-pocket costs in owning versus renting."
What you're probably less sure of is exactly how to go about taking advantage of all your new house-related tax breaks.
Many first-time homeowners will definitely enter new tax-filing territory with the very first return they file after moving into their new abode. For other new owners, the filing changes might take a little longer to show up.
But all will need to know some basic tax rules that could make their homes a great tax -- as well as an actual -- shelter.
Guide to first-home taxes
You survived the house search and the bidding process. Getting the mortgage on your new home was a piece of cake. But now you've got to file your tax return for the first time since you moved into your first home. Relax. You'll probably find that as a new homeowner, you'll save on your taxes. But there are some specific things you need to pay attention to so that you get every available tax break.
10 tax tips for home buyers
1.
Welcome to Schedule A
2.
Making the most of mortgage interest
3.
Hang onto your HUD-1
4.
Points pay off at tax time
5.
The tax-deduction value of property taxes
6.
Timing is everything
7.
Other deductions, thanks to your home
8.
What's not deductible
9.
Not federal, but tax-related
10.
Planning ahead
Welcome to Schedule AAs a homeowner, regardless of whether you're a first-timer or have owned many residences, you probably immediately think "deductions" when it comes to tax time. That's because you now have the chance to claim several expenses you didn't face as a renter.
The big-three home-related deductions are mortgage interest, any points connected with the loan and property taxes. To claim these, you'll have to itemize.
This deduction method, which requires filing the long Form 1040 and detailing your various deductible expenses on Schedule A, is often a new experience for first-time homeowners.
However, before you rush off to download this new tax paperwork, take a few minutes to evaluate your overall filing circumstances. While many homeowners do benefit by itemizing, that's not the case in every situation.
You want to make sure that the deduction method you choose is the one that gives you the larger deduction amount. If you find that the standard deduction, which on 2005 taxes is $5,000 for single taxpayers and $10,000 for married couples filing a joint return, is greater than the total of your itemized expenses, then by all means take the standard deduction.
Don't worry, you're not stuck using that method forever. You can alternate between the two deduction options every year or you can itemize for several years, claim the standard amount for a few more and then return to itemizing.
The key is to always pick the deduction method that will give you the most tax savings for each filing year.
First-time home buyers' guide to taxes
By Kay Bell • Bankrate.com
There's nothing quite like purchasing your first home. You're on your own. You have a substantial financial investment.
And you now have some different tax considerations.
You're probably well-aware that homeownership affords you several new ways to save on the annual Internal Revenue Service bill.
"Homeownership is one of the best tax benefits that the federal government gives out," says attorney Robin Gronsky, principal of Gronsky Law Offices in Ridgewood, N.J. "People count on it. It's how they calculate their out-of-pocket costs in owning versus renting."
What you're probably less sure of is exactly how to go about taking advantage of all your new house-related tax breaks.
Many first-time homeowners will definitely enter new tax-filing territory with the very first return they file after moving into their new abode. For other new owners, the filing changes might take a little longer to show up.
But all will need to know some basic tax rules that could make their homes a great tax -- as well as an actual -- shelter.
Guide to first-home taxes
You survived the house search and the bidding process. Getting the mortgage on your new home was a piece of cake. But now you've got to file your tax return for the first time since you moved into your first home. Relax. You'll probably find that as a new homeowner, you'll save on your taxes. But there are some specific things you need to pay attention to so that you get every available tax break.
10 tax tips for home buyers
1.
Welcome to Schedule A
2.
Making the most of mortgage interest
3.
Hang onto your HUD-1
4.
Points pay off at tax time
5.
The tax-deduction value of property taxes
6.
Timing is everything
7.
Other deductions, thanks to your home
8.
What's not deductible
9.
Not federal, but tax-related
10.
Planning ahead
Welcome to Schedule AAs a homeowner, regardless of whether you're a first-timer or have owned many residences, you probably immediately think "deductions" when it comes to tax time. That's because you now have the chance to claim several expenses you didn't face as a renter.
The big-three home-related deductions are mortgage interest, any points connected with the loan and property taxes. To claim these, you'll have to itemize.
This deduction method, which requires filing the long Form 1040 and detailing your various deductible expenses on Schedule A, is often a new experience for first-time homeowners.
However, before you rush off to download this new tax paperwork, take a few minutes to evaluate your overall filing circumstances. While many homeowners do benefit by itemizing, that's not the case in every situation.
You want to make sure that the deduction method you choose is the one that gives you the larger deduction amount. If you find that the standard deduction, which on 2005 taxes is $5,000 for single taxpayers and $10,000 for married couples filing a joint return, is greater than the total of your itemized expenses, then by all means take the standard deduction.
Don't worry, you're not stuck using that method forever. You can alternate between the two deduction options every year or you can itemize for several years, claim the standard amount for a few more and then return to itemizing.
The key is to always pick the deduction method that will give you the most tax savings for each filing year.
5 homeownership tax myths
http://www.dpol.com
5 homeownership tax myths
By Kay Bell • Bankrate.com
Owning a home tops the dream list for most Americans, and for plenty of good reasons. It's a shelter for your family, a gathering place for your friends and a good long-term investment.
Tax breaks are also frequently cited as motivation for moving from renting to owning, and there are many ways a home can cut your tax bill.
But, as is often the case with the U.S. tax code, homeownership tax benefits are not always clear-cut. That frequently leads to some bad information floating around.
While myths, half-truths and misconceptions may abound, we've narrowed it down to five that, if you buy into them, could cost you.
Half-truths, misconceptions and just plain hogwash
1.Mortgage interest will reduce my tax bill.
2.All costs related to my home are deductible.
3.I must use home profits to buy a new home.
4.Putting my children on the deed is tax-smart.
5.If I take a loss on a sale, I can write it off.
1. My mortgage interest will reduce my tax bill. This is true for the majority of homeowners, but not for all. And this tax break won't work forever.
To take tax advantage of your home loan's interest, you must itemize and come up with a total that exceeds your standard amount. On 2006 tax returns, the standard deductions will be $5,150 for single taxpayers, $7,550 for head of household filers and $10,300 for married couples who file jointly. These amounts increase a bit each year to account for inflation.
"Given home prices these days, most owners are itemizing," says Mark Luscombe, principal tax analyst with CCH Inc. of Riverwoods, Ill. By the time they count mortgage interest, property taxes and other nonhome deductions, such as state taxes and charitable gifts, their itemized totals easily surpass their allowable standard deductions.
But most is not all.
Taxpayers who buy a home late in the year, for instance, might find the standard deduction is more beneficial, at least initially, says Kathy Tollaksen, a CPA at Sikich LLP in Aurora, Ill. In these cases, where you make only a few payments in a tax year, depending on your loan you might not pay much interest, at least not enough to exceed standard amounts.
Timing also could reduce or eliminate other home-related tax breaks.
"Quite a few states have real estate taxes that are calculated in arrears. That is, they have already been paid or mostly paid (by the seller) by the time you buy," says Tollaksen. "In the first year, you're seeing taxes that are someone else's responsibility so you're not getting the full tax value of your real estate taxes."
The benefit of mortgage interest also could be a myth if you've lived in your home for a long time. In this case, you likely are paying more toward your loan's principal instead of interest. So homeowners at the end of a loan term don't get much, if any, from this tax break.
5 homeownership tax myths
By Kay Bell • Bankrate.com
Owning a home tops the dream list for most Americans, and for plenty of good reasons. It's a shelter for your family, a gathering place for your friends and a good long-term investment.
Tax breaks are also frequently cited as motivation for moving from renting to owning, and there are many ways a home can cut your tax bill.
But, as is often the case with the U.S. tax code, homeownership tax benefits are not always clear-cut. That frequently leads to some bad information floating around.
While myths, half-truths and misconceptions may abound, we've narrowed it down to five that, if you buy into them, could cost you.
Half-truths, misconceptions and just plain hogwash
1.Mortgage interest will reduce my tax bill.
2.All costs related to my home are deductible.
3.I must use home profits to buy a new home.
4.Putting my children on the deed is tax-smart.
5.If I take a loss on a sale, I can write it off.
1. My mortgage interest will reduce my tax bill. This is true for the majority of homeowners, but not for all. And this tax break won't work forever.
To take tax advantage of your home loan's interest, you must itemize and come up with a total that exceeds your standard amount. On 2006 tax returns, the standard deductions will be $5,150 for single taxpayers, $7,550 for head of household filers and $10,300 for married couples who file jointly. These amounts increase a bit each year to account for inflation.
"Given home prices these days, most owners are itemizing," says Mark Luscombe, principal tax analyst with CCH Inc. of Riverwoods, Ill. By the time they count mortgage interest, property taxes and other nonhome deductions, such as state taxes and charitable gifts, their itemized totals easily surpass their allowable standard deductions.
But most is not all.
Taxpayers who buy a home late in the year, for instance, might find the standard deduction is more beneficial, at least initially, says Kathy Tollaksen, a CPA at Sikich LLP in Aurora, Ill. In these cases, where you make only a few payments in a tax year, depending on your loan you might not pay much interest, at least not enough to exceed standard amounts.
Timing also could reduce or eliminate other home-related tax breaks.
"Quite a few states have real estate taxes that are calculated in arrears. That is, they have already been paid or mostly paid (by the seller) by the time you buy," says Tollaksen. "In the first year, you're seeing taxes that are someone else's responsibility so you're not getting the full tax value of your real estate taxes."
The benefit of mortgage interest also could be a myth if you've lived in your home for a long time. In this case, you likely are paying more toward your loan's principal instead of interest. So homeowners at the end of a loan term don't get much, if any, from this tax break.
17 ways to save on energy
17 ways to save on energy
By Bankrate.com
Get a home energy audit every couple of years with your power company to find ways to cut costs.
Check with your utility company for rebates whenever you install energy-saving equipment.
Add more energy-efficient insulation to your attic, with the appropriate R-value, or resistance to heat flow, for your climate and the type of heating in your house..
Turn down your home thermostat two degrees and save 24 kilowatt hours a month. It might not sound like much, but it adds up.
Buy a programmable thermostat, especially if your home is vacant most of the day. Set it to turn on a half hour before anyone arrives home.
Adjust your thermostat to a comfortable temperature and wait. Turning your thermostat up or down dramatically wastes energy and increases your heating costs.
Lower your hot water thermostat 10 degrees, but no lower than 120 degrees. You'll still get all the hot water you need and save 25 kilowatt hours a month.
Fix leaky faucets -- one drip a second is 20 kilowatts a month.
Invest in weather-stripping kits if you've got drafty doors.
Trade your standard candescent bulbs for compact fluorescent bulbs. They are more energy-efficient, last for years instead of months, consume little power and generate little heat.
Turn off your computer when not in use, or use the energy-saving "sleep" mode.
Seal energy leaks. Caulk over cracks and small holes around windows and exterior walls. Look carefully around plumbing pipes, telephone wires, dryer vents, sink and bathtub drains and under countertops.
Participate in your power company's special energy-saving program. Some programs shut down electric appliances for short bursts of time during peak hours. You hardly notice the difference -- except in your bill.
Buy major appliances that sport the "Energy Star" sticker. That shows the appliance meets or exceeds standards set by the U.S. Department of Energy and the Environmental Protection Agency.
Consider a front-loading washing machine. They use 50 percent less energy and one-third less water. Plus, they remove far more water in the rinse cycle, and that translates into big savings in dryer time.
When building a home or replacing a roof, select a roof based more on energy efficiency than on how it looks. Light-colored roofs, such as white, galvanized metal or cement tile, do the best job of reflecting the sun, and cool quickly at night.
Landscaping with the right mix of trees and shrubs can lower your energy bills by blocking winter winds or the summer sun.
By Bankrate.com
Get a home energy audit every couple of years with your power company to find ways to cut costs.
Check with your utility company for rebates whenever you install energy-saving equipment.
Add more energy-efficient insulation to your attic, with the appropriate R-value, or resistance to heat flow, for your climate and the type of heating in your house..
Turn down your home thermostat two degrees and save 24 kilowatt hours a month. It might not sound like much, but it adds up.
Buy a programmable thermostat, especially if your home is vacant most of the day. Set it to turn on a half hour before anyone arrives home.
Adjust your thermostat to a comfortable temperature and wait. Turning your thermostat up or down dramatically wastes energy and increases your heating costs.
Lower your hot water thermostat 10 degrees, but no lower than 120 degrees. You'll still get all the hot water you need and save 25 kilowatt hours a month.
Fix leaky faucets -- one drip a second is 20 kilowatts a month.
Invest in weather-stripping kits if you've got drafty doors.
Trade your standard candescent bulbs for compact fluorescent bulbs. They are more energy-efficient, last for years instead of months, consume little power and generate little heat.
Turn off your computer when not in use, or use the energy-saving "sleep" mode.
Seal energy leaks. Caulk over cracks and small holes around windows and exterior walls. Look carefully around plumbing pipes, telephone wires, dryer vents, sink and bathtub drains and under countertops.
Participate in your power company's special energy-saving program. Some programs shut down electric appliances for short bursts of time during peak hours. You hardly notice the difference -- except in your bill.
Buy major appliances that sport the "Energy Star" sticker. That shows the appliance meets or exceeds standards set by the U.S. Department of Energy and the Environmental Protection Agency.
Consider a front-loading washing machine. They use 50 percent less energy and one-third less water. Plus, they remove far more water in the rinse cycle, and that translates into big savings in dryer time.
When building a home or replacing a roof, select a roof based more on energy efficiency than on how it looks. Light-colored roofs, such as white, galvanized metal or cement tile, do the best job of reflecting the sun, and cool quickly at night.
Landscaping with the right mix of trees and shrubs can lower your energy bills by blocking winter winds or the summer sun.
Questions about Homeowners policy
1. Can I drop my homeowners policy? If you have a mortgage, the answer is probably "no." Because you have a lien on the property, most home loans require you to have coverage that the lender finds suitable. If the policy lapses, you can be in mortgage default. If you are having trouble finding an insurer or paying the premiums, call your lender to see if it can offer suggestions and/or work with you to solve the problem.
2. Can I afford to regularly put money into an account to cover any storm damages? This is a necessity if you're going to drop your insurance coverage. Without the emergency self-insurance account, you'll either be stuck not making repairs, borrowing money to make them or putting them on credit cards, which could create additional problems.
3. How large should my self-insurance account be? Sit down and do a worst-case scenario in the event of a natural disaster. Consider what it will cost to repair or replace your home or major parts of it, such as your roof or walls that are more exposed to potential damage.
Then there are your belongings: furniture, clothing, food, exterior buildings, landscaping, and potential costs of debris removal or demolishing partially standing structures that need to come down for safety reasons.
2. Can I afford to regularly put money into an account to cover any storm damages? This is a necessity if you're going to drop your insurance coverage. Without the emergency self-insurance account, you'll either be stuck not making repairs, borrowing money to make them or putting them on credit cards, which could create additional problems.
3. How large should my self-insurance account be? Sit down and do a worst-case scenario in the event of a natural disaster. Consider what it will cost to repair or replace your home or major parts of it, such as your roof or walls that are more exposed to potential damage.
Then there are your belongings: furniture, clothing, food, exterior buildings, landscaping, and potential costs of debris removal or demolishing partially standing structures that need to come down for safety reasons.
Homeowner's Insurance Don't go bare
Homeowners insurance: Don't go bare
By Kay Bell • Bankrate.com
Homeowners all across the United States are doing double takes as they look at their annual insurance policy renewal statements.
A spate of natural disasters, accompanying insurance claims and subsequent premium increases has pushed some homeowners to the breaking point. Out of both personal and financial frustration, some are considering dropping their coverage.
In the insurance industry, it's known as "going bare." And while it might be tempting if you're looking at a policy price that's tripled or quadrupled in the last year, it's not a decision to be made rashly.
"Two types of people might qualify to go without coverage," says George Yates of Dayton Ritz & Osborne, an insurance agency based in East Hampton, N.Y. "The independently wealthy, with an asset so small to them that it wouldn't matter if they lost it, or someone who just can't afford insurance.
"In either case, it's not particularly good risk management."
But sometimes, a homeowner's day-to-day financial management issues are more pressing.
In Florida, for example, homeowners are finding their premiums have skyrocketed. Add to that deductibles that look like they won't be met unless the structure is destroyed. Plus, many insurers have either gone out of business or decided to stop writing policies, limiting customers' comparison-shopping options.
In the end, many homeowners find themselves in the unhappy position of choosing between high premiums or exorbitant premiums. Or no premiums.
By Kay Bell • Bankrate.com
Homeowners all across the United States are doing double takes as they look at their annual insurance policy renewal statements.
A spate of natural disasters, accompanying insurance claims and subsequent premium increases has pushed some homeowners to the breaking point. Out of both personal and financial frustration, some are considering dropping their coverage.
In the insurance industry, it's known as "going bare." And while it might be tempting if you're looking at a policy price that's tripled or quadrupled in the last year, it's not a decision to be made rashly.
"Two types of people might qualify to go without coverage," says George Yates of Dayton Ritz & Osborne, an insurance agency based in East Hampton, N.Y. "The independently wealthy, with an asset so small to them that it wouldn't matter if they lost it, or someone who just can't afford insurance.
"In either case, it's not particularly good risk management."
But sometimes, a homeowner's day-to-day financial management issues are more pressing.
In Florida, for example, homeowners are finding their premiums have skyrocketed. Add to that deductibles that look like they won't be met unless the structure is destroyed. Plus, many insurers have either gone out of business or decided to stop writing policies, limiting customers' comparison-shopping options.
In the end, many homeowners find themselves in the unhappy position of choosing between high premiums or exorbitant premiums. Or no premiums.
Tuesday, August 08, 2006
Annual Percentage Rate
The cost of credit on yearly basis, expressed as a percentage. Required to be disclosed by the lender under the federal Truth in Lending Act, Regulation Z. Includes up front costs paid to obtain the loan, and is therefor, usually a higher amount then the interest rate stipulated in the mortgage note. Does not include title insurance, appraisal, and credit report.
Amortization
Amortization is payment of debt in regular, periodic payments of principal and interest.
Aggregate Adjustment
The adjustment made as a credit to the borrower at closing to avoid an overage in the borrower's escrow account.
Adjustment Interval
For an adjustable rate mortgage, the time between changes in the interest rate charged. The most common adjustment intervals are one, three, or five years.
Adjustable Rate Mortgage (ARM)
A mortgage in which the interest rate is adjusted periodically based on an index. Also called a variable rate mortgage.
Acknowledgement
An acknowledgement is a formal declaration before a public official (typically a Notary Public) certifying that one has signed a document. Required before recording real estate legal documents, such as deeds of trust.
Abstract of Title
An abstract of Titleis a historical summary of all the recorded transactions that affect the title to the property. An attorney or a title company will review an abstract of title to determine if there are any problems affecting the property. All problems must be cleared before the buyer can be issued a clear and insurable title.
Saturday, August 05, 2006
DPOL.com
dpol.com is where you can view current property listings for sale in the Delmarva area. Check it out, you can put in price desired, bedrooms wanted, and so on and it will show you everything available that fits into your criteria.
Low-Rate Mortgage & Home Equity Loans
Choosing the right lender is crucial. They will be with you for the life of your loan, 30-40 years. With E-loan you can apply over the internet and track your progress.
Choosing the right lender is crucial. They will be with you for the life of your loan, 30-40 years. With E-loan you can apply over the internet and track your progress.
Monday, July 24, 2006
Bank Accounts
It is important to maintain a bank account in good standing. Keeping your account with a positive balance is a good way to build your credit standing.
If you do not have a bank account you should definately obtain one. Look for one that gives you a good percentage rate so that the money you are saving can grow more rapidly. Anything that can help your money grow is a good thing.
One thing mortgage lenders like to see is that you have been able to have saved some money. Try making some amount of deposit monthly to grow your balance.
Money is not always needed for a down payment, but there are almost always closing costs, unless the seller has agreed to pay them.
Friday, July 21, 2006
There are Programs for the Credit challenged
Compare what different lenders have to offer. There are many different loan programs out there. Almost one for every individual. Even people with less than perfect credit scores can obtain a mortgage loan. Your loan will be based on your credit score.
For the people with less than perfect credit, lenders like to see that you have been paying your bills on time for at least the last six months. They also would like to see close to three lines of open credit, such as credit cards and major department store cards. One other thing to keep in mind is that now is not the time to make any large purchases, like a vehicle. This would create a new loan on your credit with no payment history. If you have recently purchased a vehicle, you will want to ake timely payments for the next six months to help your credit score.
Wednesday, July 19, 2006
Getting More Interested Buyers
Sometimes a yard can make all the difference. It's hard to say how many more homes buyers would have an interest in seeing if the yard was more appeallng. Usually, if a buyer hasn't spotted your home from riding around, they have found it on the internet. Sites like dpol.com are a common site people view properties for sale. "A picture says a thousand words" visitors of this site can view properties for sale by simply logging on and starting a search. If your home isn't appealling from the outside, it's unlikely buyers will wish to visit your property. If noone visits, noone buys.
Try some simple landscaping to the yard. Plant shubbery and flowers. Brighten your yard and brighten your opportunity of a sale.
A skilled Mortgage Lender can help
A Skilled Mortgage Lender Can Help
It’s a very simple equation. The higher your credit score, the better interest rate you will receive as a borrower. The reasoning behind the equation is equally simple –your interest rate not only reflects current market conditions but also your estimated ability to pay back the loan. To a lender, the latter is worth its weight in gold.
Components of a Credit Score Generally speaking, your credit score is based upon the following criteria in order of importance:
Payment history (this is where delinquencies will hurt you).
Responsibility regarding credit usage (how maxed out are your accounts).
Credit age (how long have you had your credit accounts).
Number of credit inquiry requests.
Credit diversity.
These quantifiable aspects, once accumulated, typically result in a number between 450 and 850. The bottom line is the higher number, the more likely you are to pay back the loan. A Closer Look at the Players Involved. There are three separate credit bureaus that keep track of your score, Experian, Trans Union and Equifax. If you’ve heard your score referred to as a “FICO” score it’s because all three bureaus use software developed by Fair Isaac Corporation. FICO is an acronym taken from that name. It’s important to know most lenders look at all three scores when making a decision on your loan, since scores can and often do vary. While FICO is the industry standard, the three major credit bureaus recently released their own scoring model called Vantage Score. The new system is actively being marketed to lenders, and the bureaus claim that it will produce more uniform results. In addition, the scoring system is arranged similarly to the grades given out in school, making it easier for everyone to understand. Time will tell whether this system will impact the use of the FICO system. What a Credit Score Means... A borrower with an outstanding credit score will get what is called an A-paper loan. This borrower is rewarded with a lower interest rate because of their proven track record. Consumers with less-than-perfect credit receive loans labeled A-minus, B-paper, C-paper or D-paper. These loans are known as “sub-prime” and come with a higher interest rate. On a monthly basis, this translates into more money out of the borrower’s pocket."
Improving Your Score
Now that we’ve explored the nuts and bolts of credit scoring, let’s examine how you can improve your score. For starters, it’s a good idea to consult with a qualified mortgage professional that can provide examples of reasonable credit usage, discuss options for paying off existing debt and advise you regarding whether limiting or expanding your credit is most beneficial. A mortgage consultant can also assist you with identifying negative items or potential errors on your credit report. It’s important to deal with such issues as soon as possible. In addition, if you need credit counseling, a mortgage professional can help you obtain it. Here are some additional tips to keep in mind:
1)Pay your bills in a timely manner – Paying bills on time for one month can raise your credit score as much as 20 points.
2)Control the balances on your credit cards. Maxing out credit cards can lower your score as much as 70 points.
3)Don’t open new lines of credit you don’t need. New accounts lower your average account age which, in turn, may lower your score as much as 10 points.
4)Increasing high credit limit on current accounts – Often you can increase your line of credit to the point where you balance is less than 50%, this generally has a positive impact on your scores as the credit bureau’s systems pick this ratio up as a conservative use of spending.
It’s a very simple equation. The higher your credit score, the better interest rate you will receive as a borrower. The reasoning behind the equation is equally simple –your interest rate not only reflects current market conditions but also your estimated ability to pay back the loan. To a lender, the latter is worth its weight in gold.
Components of a Credit Score Generally speaking, your credit score is based upon the following criteria in order of importance:
Payment history (this is where delinquencies will hurt you).
Responsibility regarding credit usage (how maxed out are your accounts).
Credit age (how long have you had your credit accounts).
Number of credit inquiry requests.
Credit diversity.
These quantifiable aspects, once accumulated, typically result in a number between 450 and 850. The bottom line is the higher number, the more likely you are to pay back the loan. A Closer Look at the Players Involved. There are three separate credit bureaus that keep track of your score, Experian, Trans Union and Equifax. If you’ve heard your score referred to as a “FICO” score it’s because all three bureaus use software developed by Fair Isaac Corporation. FICO is an acronym taken from that name. It’s important to know most lenders look at all three scores when making a decision on your loan, since scores can and often do vary. While FICO is the industry standard, the three major credit bureaus recently released their own scoring model called Vantage Score. The new system is actively being marketed to lenders, and the bureaus claim that it will produce more uniform results. In addition, the scoring system is arranged similarly to the grades given out in school, making it easier for everyone to understand. Time will tell whether this system will impact the use of the FICO system. What a Credit Score Means... A borrower with an outstanding credit score will get what is called an A-paper loan. This borrower is rewarded with a lower interest rate because of their proven track record. Consumers with less-than-perfect credit receive loans labeled A-minus, B-paper, C-paper or D-paper. These loans are known as “sub-prime” and come with a higher interest rate. On a monthly basis, this translates into more money out of the borrower’s pocket."
Improving Your Score
Now that we’ve explored the nuts and bolts of credit scoring, let’s examine how you can improve your score. For starters, it’s a good idea to consult with a qualified mortgage professional that can provide examples of reasonable credit usage, discuss options for paying off existing debt and advise you regarding whether limiting or expanding your credit is most beneficial. A mortgage consultant can also assist you with identifying negative items or potential errors on your credit report. It’s important to deal with such issues as soon as possible. In addition, if you need credit counseling, a mortgage professional can help you obtain it. Here are some additional tips to keep in mind:
1)Pay your bills in a timely manner – Paying bills on time for one month can raise your credit score as much as 20 points.
2)Control the balances on your credit cards. Maxing out credit cards can lower your score as much as 70 points.
3)Don’t open new lines of credit you don’t need. New accounts lower your average account age which, in turn, may lower your score as much as 10 points.
4)Increasing high credit limit on current accounts – Often you can increase your line of credit to the point where you balance is less than 50%, this generally has a positive impact on your scores as the credit bureau’s systems pick this ratio up as a conservative use of spending.
Thursday, July 13, 2006
Pre-qualification
"Pre-qualification" occurs before the loan process actually begins, and is usually the first step after initial contact is made. In a pre-qualification, the lender gathers information about the income and debts of the borrower and makes a financial determination about how much house the borrower may be able to afford. Different loan programs may lead to different values, depending on whether you are qualified for them, so be sure to get a pre-qualification for each type of program you are suited for.
Application
The "application" is actually the beginning of the loan process and usually occurs between days one and five of the loan. The buyer, now referred to as a "borrower", completes a mortgage application with the loan officer and supplies all of the required documentation for processing. Various fees and down payments are discussed at this time and the borrower will receive a Good Faith Estimate (GFE) and a Truth-in-Lending statement(TIL) within three days which itemizes the rates and associated costs for obtaining the loan.
Opening the File
This occurs between day three and ten. At this time the lender orders a property appraisal, property survey and credit reports, mail out requests for verification, if neccessary, for employment (VOE) and bank deposits (VOD) and any other documents needed for processing of the loan. All information supplied by the buyer is reviewed at this time and a list of items not yet received is compiled.
Processing
Processing occurs between days five and twenty-five of the loan. The "processor" reviews the credit reports and verifies the borrower's debts and payment histories as the VODs and VOEs are returned. If there are unacceptable late payments, collections for judgements, etc., a written explanation is required from the borrower. The processor also reviews the appraisal and survey and checks property issues that may require further discernment. The processors job is to put together an entire package that may be underwrited by the lender.
Underwriting
"Lender Underwriting" occurs between days fifteen and twenty-five. The underwriter is responsible for determining whether the combined package passed over by the processor is deemed as an acceptable loan. If more information is needed, the loan is put into "suspense" and the borrower is contacted to supply more documentation.
"Mortgage insurance Underwriting" occurs when the borrower has less than 20% to put towards a down payment. At this time, the loan is submitted to a private mortgage guaranty insurer, who provides extra insurance to the lender in case of default. As above, if more information is needed the loan goes into suspense. Otherwise it is usually returned back to the mortgage company within 48 hours.
Pre-closing
"Pre-closing" occurs between days twenty and thirty. During this time the title insurance is ordered, all approval contingencies, if any, are met, and a closing time is scheduled for the loan.
Closing
Closing usually occurs between days thirty and forty-five of the loan. At the closing, the lender "funds" the loan with a cashier's check, draft or wire to the selling party in exchange for the title to the property. This is the point at which the borrower finishes the loan process and actually buys the house.
Closings occur at different places in different states. For instance, some states require that the closing take place at a closing attorney's office while others use a title or escrow company.
"Pre-qualification" occurs before the loan process actually begins, and is usually the first step after initial contact is made. In a pre-qualification, the lender gathers information about the income and debts of the borrower and makes a financial determination about how much house the borrower may be able to afford. Different loan programs may lead to different values, depending on whether you are qualified for them, so be sure to get a pre-qualification for each type of program you are suited for.
Application
The "application" is actually the beginning of the loan process and usually occurs between days one and five of the loan. The buyer, now referred to as a "borrower", completes a mortgage application with the loan officer and supplies all of the required documentation for processing. Various fees and down payments are discussed at this time and the borrower will receive a Good Faith Estimate (GFE) and a Truth-in-Lending statement(TIL) within three days which itemizes the rates and associated costs for obtaining the loan.
Opening the File
This occurs between day three and ten. At this time the lender orders a property appraisal, property survey and credit reports, mail out requests for verification, if neccessary, for employment (VOE) and bank deposits (VOD) and any other documents needed for processing of the loan. All information supplied by the buyer is reviewed at this time and a list of items not yet received is compiled.
Processing
Processing occurs between days five and twenty-five of the loan. The "processor" reviews the credit reports and verifies the borrower's debts and payment histories as the VODs and VOEs are returned. If there are unacceptable late payments, collections for judgements, etc., a written explanation is required from the borrower. The processor also reviews the appraisal and survey and checks property issues that may require further discernment. The processors job is to put together an entire package that may be underwrited by the lender.
Underwriting
"Lender Underwriting" occurs between days fifteen and twenty-five. The underwriter is responsible for determining whether the combined package passed over by the processor is deemed as an acceptable loan. If more information is needed, the loan is put into "suspense" and the borrower is contacted to supply more documentation.
"Mortgage insurance Underwriting" occurs when the borrower has less than 20% to put towards a down payment. At this time, the loan is submitted to a private mortgage guaranty insurer, who provides extra insurance to the lender in case of default. As above, if more information is needed the loan goes into suspense. Otherwise it is usually returned back to the mortgage company within 48 hours.
Pre-closing
"Pre-closing" occurs between days twenty and thirty. During this time the title insurance is ordered, all approval contingencies, if any, are met, and a closing time is scheduled for the loan.
Closing
Closing usually occurs between days thirty and forty-five of the loan. At the closing, the lender "funds" the loan with a cashier's check, draft or wire to the selling party in exchange for the title to the property. This is the point at which the borrower finishes the loan process and actually buys the house.
Closings occur at different places in different states. For instance, some states require that the closing take place at a closing attorney's office while others use a title or escrow company.
Tuesday, July 11, 2006
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