5 Tips To Obtaining A Mortgage

With today’s stricter lending environment, processing a mortgage application is more complex than ever.  To ensure the process goes smoother, you can take steps of your own.  By planning ahead, you’ll be in a much better position to negotiate and move forward on a purchase.

1. Evaluate Affordability – The two most important factors that lenders look at are your monthly mortgage payment and your total debt load, relative to your gross income.  But, as a home buyer, it’s also important to consider additional expenses such as property taxes, mortgage insurance, homeowners insurance, home maintenance expenses, homeowner association fees, and utilities.
2. Discuss Your Options – Decide what type of mortgage is best for your depending on your personal situation, your financial scenario, and your future plans.  Mortgage programs are always changing so check your options.
3. Interview Lenders – Rates and fees are typically very competitive between lenders, so it’s important to focus on the level of service provided, how they executed transactions with others, and what mortgage programs they do have.
4. Get Pre-approved – Applying with more than one lender will help confirm whether your intended mortgage financing plans will work out as hoped.  And, it’s an important first step that will also put you in a better negotiating position with sellers.
5. Commit to a Lender – As soon as you are under contract to purchase a home, commit to working with one lender.  You will probably be charged a fee at this point to cover processing expenses that the lender starts incurring on your behalf.  And, show your lender you are serious by submitting all the required documentation as quickly as possible.

 

If you have any questions, give me a call at 304-822-4350.

Until next time,

Sandra Hunt, Broker

ABR, ABRM, AHWD, CRS, GRI, SFR, SRES

Hunt Country Properties

TIPS TO GUIDE YOU IN YOUR HOME SEARCH

Research before you look.  Decide what features you most want to have in a home, what area you prefer, and how much you’d be willing to spend each month for housing.

Be realistic.  It’s OK to be picky, but don’t be unrealistic with your expectations.  There’s no such thing as the perfect home.  Use your list of priorities as a guide to evaluate each property.

Get your finances in order.  Review your credit report and be sure you have enough money to cover your down payment and closing costs.  Then, talk to a lender and get pre-qualified for a mortgage.  This will save you the heartache later of falling in love with a house you can’t afford.

Don’t ask too many people for opinions.  It will drive you crazy.  Select one or two people to turn to if you feel you need a second opinion, but be ready to make the final decision on your own.

Decide your moving timeline.   When is your lease up?  Are you allowed to leave before it is up without penalty?  How tight is the rental market in your area?  All of these factors will help you determine when you should move.

Think long term.  Are you looking for a starter house with plans to move up in a few years, or do you hope to stay in this home for a longer period?  This decision may dictate what type of home you’ll buy as well as the type of mortgage terms that will best suit you.

Insist on a home inspection.  A home inspector is trained to look for defects you might not see and will provide you with a lot of maintenance information.

Get help from a REALTOR.  Hire a real estate professional.  They will help you find your home of choice and assist you with the buying process from start to finish.

If you have any questions, give me a call at 304-822-4350.

Until next time,

Sandra Hunt, Broker

ABR, ABRM, AHWD, CRS, GRI, SFR, SRES

MYTHS SHARED BY FIRST-TIME HOMEBUYERS

Several of these myths have been mentioned by me previously, but in a current article written by Randy  Templeman for Today’s Buyer Rep, he outlined the 10 most common misconceptions.

Myth 1–All real estate agents are the same.  Of course not.  But many buyers think any real estate licensee can give them the same amount of service and expertise.  Look for those that have taken the time to complete advanced training and earned real estate designations.

Myth 2–The agent on the for sale sign will look out for my interests.  They can assist you, but unless an additional agreement is signed for the agent to act as a dual agent, the listing agent is under contract to watch out for the seller’s interest.

Myth 3–I can find all properties for sale on my own.  Not all properties are found advertised, on-line, or have a sign.  Agents should know their local market and be able to quickly give a list of suitable properties to a buyer.

Myth 4–If I just wait long enough, I’ll find the perfect home.  There is no such thing as a “perfect” home.  Buying a home requires compromises, a big dose of reality, and an awareness of market conditions.

Myth 5–I’ll improve the odds of finding the house I want if I work with more than one agent.   Find a knowledgeable agent that you are comfortable with and enter into a buyer-representation agreement with them.  Your interests will then be that agent’s priority.

Myth 6–Buying a house is as simple as agreeing on a price and signing a few papers.  If only it were that simple.  What happens to negotiations beyond the price and what about loan approvals, appraisal, title search, home inspection, etc.  Moving the transaction successfully from contract to closing takes a lot of effort.

Myth 7–Foreclosures offer the best deal.  That may be the general assumption, but some are over-priced and a lot of them have undesirable conditions attached to them.  When it comes to foreclosures, what you see is what you get and what you don’t see is also what you get.

Myth 8–Getting a mortgage should be quick and easy.  Many first time buyers are offended by the whole lending process and don’t understand that lenders need to take important precautions before extending credit and that means asking a lot of personal/financial questions.

Myth 9–All mortgages are essentially the same.  There are many different types of mortgages:  Fixed rate – 15 year, 30 year, etc.; adjustable rate – 1 year, 3 year, 5 year, etc.; balloon payments; assisted mortgages; conventional, FHA, VA, and on and on.

Myth 10–If something appears on the inspection report, the seller has to fix it.  This is false.  Generally, the buyer can ask for “some” repairs and the seller can say yes, no, or negotiate.  Likewise, the buyer can negotiate over the repairs.  But the bottom line is the seller does not have to fix it.  However, the buyer could null and void the contract based on the results of the inspection.

Should you have any questions, feel free to call me at 304-822-4350. 

Until Next Time

Sandra Hunt, Broker

ABR, ABRM, AHWD, CRS, GRI, SFR, SRES

WHEN DOES IT MAKE SENCE TO REFINANCE?

There are certain instances where it would be an advantage for you to refinance your home.  Your primary consideration in refinancing your home should be to save money.

Several ways for savings might be to lower your interest rate, lower your monthly payment, shorten the term of your loan, incorporate balances on high-interest unsecured debt, reduce debt-to-income ratio, eliminate your private mortgage insurance (PMI), obtain financing for repairs that would significantly improve the value of your home, or for college or medical expenses. 

If you find that you will save money on a refinance for your home loan, then you should consider your options.   Keep in mind that your first and foremost goal will be to find a lower interest rate.

Once you have decided what type of loan you will want–a conventional or government-backed  loan–a traditional or adjustable rate mortgage, you should first contact your current lender and see what kind of interest rate they can offer you.  Make sure you ask for all fees and charges.  Then check to see what other lenders are offering, but be careful, make sure the lender is reputable.

Put all this information on a spread sheet so you can compare the benefits of each.  Note your savings of each in a final column.  This will help you make your decision.

Now you’ve done all your research and you’re confident you will receive the desired outcome (to save money), sign on the dotted line.

For further information, please contact me at 304-822-4350.

Until next time,

Sandra Hunt, Broker

ABR, ABRM, AHWD, CRS, GRI, SFR, SRES

WRITING AN OFFER

Once you find the home you want to buy, the next step is to write an offer–which is not as easy as it sounds.

Your offer is the first step toward negotiating a sales contract with the seller.  Since this is generally just the beginning of negotiations, you should put yourself in the seller’s shoes and imagine his or her reaction to everything you include in the offer.  Your goal is to get what you want, and imagining the seller’s reactions will help you attain that goal.

The offer is much more complicated than simply coming up with a price and saying, “This is what I’ll pay.”

In an offer to purchase real estate, you include not only the price you are willing to pay, but other details of the purchase as well.  These include how you intend to finance the home, your down payment, who pays what closing costs, what inspections are performed, timetables, whether personal property is included in the purchase, terms of cancellation, repairs you want performed, which professional services will be used, when you get physical possession of the property, and how to settle disputes should they occur.

Buying a home is a major event for both the buyer and the seller.  The seller makes plans based on your offer.  In the time it takes to write an offer, you are making decisions that affect how you live for the next several years, if not the rest of your life.  The seller is going to review your offer carefully, because it also affects how he or she lives the rest of their life.

All of this sounds dramatic.  But, every real estate book or article you read says the same thing.  They all say it because it is true.

For more information, please call me at 304-822-4350.

Until next time,

Sandra Hunt, Broker

ABR, ABRM, AHWD, CRS, GRI, SFR, SRES

Hunt Country Properties

CONDITION OF THE PROPERTY

You have looked at the property, looked at the walls and ceiling, turned on the faucets, and played with the light switches, but you have not lived in it.  And the last thing you want when you assume possession of your new home is to find out you have a lot of problems that you didn’t expect.

In West Virginia, the seller is not required to provide a property disclosure.  So what do you do?

You should also ask a few simple questions of the seller.  For example, does the roof leak, do the appliances work, does the plumbing leak, are there broken or cracked windows, has the lawn been kept up and is there any debris?

In addition, an appraisal and inspections should be considered–termite, well, septic, and home inspection.

One of the best solutions is to have a home inspection professional answer a lot of the questions for you.  You have toured the home, but you are not used to looking at some things that a professional will find.  Even if things are found that you do not expect the seller to repair, at least you will have foreknowledge of any potential problems.

And finally, you should revisit the property before closing to ensure it is in the same condition as stipulated in your offer, and to see that any required repairs have been done.  Make sure this right to a final walk-through inspection is included in your offer to purchase a home.

Should you have any questions, please call me at 304-822-4350.

Until next time,

Sandra Hunt, Broker

ABR, ABRM, AHWD, CRS, GRI, SFR, SRES

Hunt Country Properties

BALANCING ACT

A house can be a place to eat, sleep, park your car, and put all your “stuff”.  It is a material possession and an investment.  A home is where you feel comfortable, warm, safe, and protected.  A home is where you live.

A house you buy logically.  A home is an emotional purchase.  When buying real estate you have to balance your emotional wants and your logical needs because there will almost certainly be a time when the two conflict.

When viewing a house, most people look at it emotionally and envision it as a safe, happy, comfortable home.  later, when making the offer or filling out the mortgage application, your logic may begin to kick in, instead.

The trick in buying real estate is to view all decisions with both a logical perspective and an emotional perspective  If a situation presents itself that requires a trade-off, decide on whether there is a huge conflict or a small one  Logic should win the big conflicts, but emotion should always be a factor, even in winning the small ones.

If you have questions, please feel free to call me at 304-822-4350.

Until next time,

Sandra Hunt, Broker

ABR, ABRM, AHWD, CRS, GRI, SFR, SRES

Hunt Country Properties

THINGS NOT TO DO BEFORE PURCHASING A HOME

The #1 thing not to do–do not make any major purchases of any kind.  Do not buy furniture, appliances, electronic equipment, jewelry, cars, expensive weddings or vacations, etc.  You do not want to create debt of any kind.

Don’t move your money around.  You will need to verify funds and the mortgage underwriter will probably require a complete paper trail of all your withdrawals and deposits.  Moving your money could make it more difficult for your lender to properly document.

Changing jobs usually doesn’t affect your ability to qualify for a mortgage loan.  However, there are situations that can be disastrous to your loan application.

     If you are a salaried employee, switching employers should not create a problem.  Just make sure you remain in the same line of work.

     If your income is based on hourly wages and you work a straight forty hours a week, changing jobs should not create any problems.

     If a substantial portion of your income is derived from commissions, you should not change jobs before buying a home.

     If a substantial portion of your income on the new job will come from bonuses, you may want to consider delaying an employment change.  You need to have a two-year track record necessary to count bonuses as income.

     If you earn an hourly income but rarely work forty hours a week, you should not change jobs.  There is no way to accurately calculate the hours you would work on the new job, therefore, no way to calculate your income.

     Overtime income cannot be determined if you change jobs.  You can receive credit for overtime only if you have been at the same job for at least two years.

     If you are self-employed, do not consider a change.  Lenders need to see a two-yer track record of self-employment income.

Here are several other good reasons to delay a purchase:

     If you will have to sell in a short amount of time, you may end up having to come up with cash out-of-pocket to sell your home.  Time is needed for a property to appreciate enough to cover the cost of buying and selling a home.

     You may want to delay buying a  home if you have just moved into an area you are unfamiliar with.  Generally a better decision can be made if you wait awhile.

     If you job future is uncertain, it might be best to wait to buy a home until you have a clearer view of your future for the next few years.

     If you are having marital problems, a new house may not resolve your problems but could add to the financial burden in n already difficult situation.

If you have any questions, please call 304-822-4350.

Until next time,

Sandra Hunt, Broker

ABR, ABRM, AHWD, CRS, GRI, SFR, SRES

Hunt Country Properties

WHY YOU SHOULD NOT BUY A CAR

If you have had thoughts of buying a home, or a move-up home, don’t buy a car.  It’s an innate instinct of modern civilized men and women to spend money when they get a raise or accumulate some savings.  It starts with going out to restaurants, then accelerates to purchasing clothing and electronic gadgets, and then to that “brand new car”.

Reality sets in when you contact a loan officer to get pre-qualified for a mortgage loan.  After stating your desired price, how much you can put down, how much you make, and your debts, the loan officer crunches the numbers, and then states “if only you didn’t have that car payment”.

You see, when determining your ability to qualify for a mortgage, a lender looks at what is called your “debt-to-income” rate.  That is the percentage of your gross monthly income before taxes that you spend on debt.  This will include your monthly housing costs, credit cards, installment debt, and ……….car payments.

Often times because of the large monthly payments involved with buying a car, your debt-to-income ratio will be too high to qualify for a mortgage, or at least too high to qualify to buy the home you want.

Even if you feel you can afford the car payment, mortgage companies approve your mortgage based on their guidelines, not yours.  So, if you are thinking about buying a car, do not buy the car, buy the house first.

Should you have any questions, please call me at 304-822-4350.

Until next time,

Sandra D. Hunt, Broker

ABR, ABRM, AHWD, CRS, GRI, SFR, SRES

Hunt Country Properties

DETAILS NEEDED IN A LISTING CONTRACT

Obviously the name of the seller, the property address, the legal description, and the effective period (of time) need to be included in the listing contract.

When setting the terms of the sale, the main thing you, as the seller, are concerned with is the price.  Exercise great care in determining your asking price by checking out other sales in the area.  You will also want to disclose any real property items that do not convey with the home.  For example, a chandelier.

The commission is generally indicated as a percentage of the gross sale price and is agreed upon at the signing of the listing.  This percentage varies from company to company and depends upon the type of property being listed.  Please note that the listing should also specify when the commission is earned.  If a ready, willing and able buyer presents an offer that meets your listing price and terms, the agent has effectively earned the commission at that time.  The agent has also earned the commission if a buyer presents an offer and you reach an agreement on price and terms.

Your contract should specify whether or not the house will be listed with the local multiple listing system and whether or not the commission can be shared with another agency.  The MLS is a huge network and practically every local agent is a member -  and those agents have clients looking to buy a home.

Whether a “for sale sign” can be place on the property should be clearly indicated.  A sign is another method of exposing the property to prospective purchasers.

Clarify the use of a lockbox, or not.  Without a lockbox, it will be inconvenient for agents to show your property, and some may simply not show it.  You could miss out on lots of potential buyers without having a lockbox available.

An earnest deposit is usually part of a sales contract offer.  Therefore, it should be indicated in the listing agreement how the deposit is handled and what happens to the deposit in the case of a default on the part of the purchaser.

Other requirements needed in the listing agreement package would depend upon the type of property and federal, state, and local law.  Some of these would include a notice of agency disclosure, lead base paint disclosure, property disclosure, health department permits or approvals, and more.

Your listing agent should provide you with appropriate documents required in your area.

Should you have any questions, please call me at 304-822-4350.

Until next time,

Sandra Hunt, Broker

ABR, ABRM, AHWD, CRS, GRI, SFR, SRES

Hunt Country Properties