Category Archives: Real Estate

Is 20% Really The Average Down Payment on a Home?

couple signing house contractAsk most home buyers about what’s the average down payment on a home would be, and they’d probably answer with 20% of the house’s purchase price. Now you’re probably thinking that you couldn’t possibly afford that. While there are great reasons for putting down a 20% home deposit, some lenders might allow you to put down a down payment that’s less than 20%.

20% Down Payment

While 20% might seem like a very sizable amount, you’d actually paying less in the long term if you could make a down payment of 20% of higher on the home you’re looking to purchase. This is mainly because putting down 20% would give you a lower interest rate on a home loan and you do away with private mortgage insurance (PMI), which could tack on a couple of hundred to your monthly mortgage payments.

The reason that lenders require PMI is because of the higher risk lenders assume on home loan’s with less than 20% down payment, explains one of the top mortgage brokers from the Altius Mortgage Group in Salt Lake City. Fortunately, once you have reached 80% loan-to-value (LTV) ratio, or have paid off the equivalent of 20% of the value of your house, you could request that your lender cancel your PMI. Likewise, if you reach 78% LTV, your lender would be legally obliged to cancel your PMI.

Less Than 20% Down Payment

If you’re unable to make a down payment of 20%, you could look for lenders that would allow you to make a down payment of less than 20%. You could also look into loans, such as FHA and USDA loans that enable qualified borrowers to put down smaller down payments on certain loans. Do note though that because you’d be funding a higher amount, regardless of the terms, you would need to make higher monthly payments because of the higher interest rate.

The Bottom Line

A higher down payment equals a more affordable mortgage and the lower the down payment, the more costly the mortgage. However, it is very crucial to note that under the right circumstances, putting a lower down payment could be a viable option. For instance, it’s an excellent way to buy a house and begin building equity on it, and you just have to budget wisely due to the relatively higher monthly payments.

Likewise, you might likewise qualify for a refinance after several years. That being said, for a majority of home buyers, buying a home is likely the biggest financial decision they will make in their lives, so shop around and talk to different lenders to ensure that you secure the best home loan for your needs.

Homeowner Horror: Why Your House Isn’t Sellable

house for saleIf your house has been on the market for too long without a prospective buyer on the horizon, there may be a reason for that. GoCompare Home Insurance commissioned a research study that revealed the reasons that keep people from buying a property. These are the top four:

1. Damp Stains

According to the study, 69 percent of home buyers are turned off when they see stains or dampness. Leaky pipes and roofs likely cause molds that stain walls and ceilings. A Salt Lake City-based roof leak repair company recommends a bi-annual inspection of your roofing system as preventative maintenance to keep the longevity of your property.

2. Foul Odors

Sixty-three percent of home buyers said they get turned off by foul smells before they even see the entire property. Scents linger and make an impact on how buyers perceive a home they’re viewing. If what greets them is an unpleasant smell, they might think it’s permanent, and you end up losing a sale.

3. Poor Property Maintenance

Peeling paint and worn floors turn 59 percent of home buyers away. If your house is in bad shape, potential buyers may see the cost of repair as an added expense if they buy the house. That’s why it’s important to have a home maintenance checklist to keep your property at top value.

4. Lack of Parking Space

Since 95 percent of Americans own a car, buying a house with a garage is a must. In fact, 56 percent of home buyers will drive past your For Sale sign if they see that your property doesn’t come with a space to park their cars in.

A house is something you’ve invested in over the years, so it’s important that you profit from it whenever you plan to sell it. Just remember that keeping a property well-maintained is key to its marketability.

House Purchase: What Do Buyers Regret?

Military couples hapy with their homeWhile many swear to the happiness associated with having the keys to their new property, regrets are still common. Many homebuyers (even successful ones) have remorse in some aspects of their purchase. It is important to remember where these regrets come from, so you may avoid them by the time you search for a new home.

More Savings

It is difficult for many homebuyers to come up with a 20% down payment, which is the necessary amount to avoid paying private mortgage (PMI). You may buy a house with as little as 3% money down, but it has a long-term effect on your monthly budget and mortgage payments. This is why many wished they had more savings to avoid the extra cost of PMI.

Price of the Home

Searching for the right home can be exhausting, but many who have settled on a place that they aren’t genuinely happy about often have regrets. If you, however, find the RIGHT one, don’t get too excited by paying more than the asking price to outbid others.

Migonline.com and other mortgage lenders in Cookeville suggest that it is always advisable to limit yourself, so you’ll feel comfortable about future loan payments and avoid becoming house poor.

Neighborhood

Many easily get persuaded by the appearance of the house, but fail to learn more about the neighborhood. This is why if you’re buying a home, be sure to visit the neighborhood first and walk around it. It is also a good idea to talk or meet new neighbors if you can. You may also want to check for its overall safety and nearby amenities.

Transportation Issues

A beautiful home may convince you that a longer travel is not entirely bad (which may be true or false). It is best to get a sense of the daily commute by trying to travel both ways during rush hour. You should also think about your current and future parking needs. Even if you didn’t own a car right now, consider any lifestyle changes or the issue of parking spaces when friends are invited to stay.

These are only some of the common regrets many homebuyers had. If you want to avoid having a buyer’s remorse, research more about the property and your mortgage options. It is also a good idea to find a lender that you feel working with to increase the chance of having a successful deal.

Real Property Mistakes You Should Know

Conveyancing text written on a diaryAs a would-be owner of any property, due diligence is part of your responsibility. This does not only include the task of comparing conveyancing quotes online, your obligations also involve scrutinising the authenticity of the title. You should avoid the following situations to prevent complication in your property purchase.

Hidden second charge

If the previous homeowner failed to pay mortgage or taxes, the bank or any entity that the lease is owed to would put a second charge on the property. If the second charge does not show up during inspections, it can be transferable to the new owner, which could be you. This makes it a costly mistake if you discover this after buying the property.

Secret Heir

If you think it only happens on soap operas, think again. An unknown or missing heir may show up and claim the property that is already sold to you by the estate agent. In some instances, the family of the supposed heir will step up and claim the ownership on behalf of the heir. Either way, your property rights will be jeopardised.

Unknown Easement

Other forms of encumbrances exist including easement or the right to use the property in question for a specific purpose. As long as there is a declaration, it doesn’t matter whether the other party is the owner or not. If the property is in a resource-rich area, even private companies can get a hold of the said property. There may be financial consequences along the way.

Survey Discrepancy

A boundary dispute, a mistake that can carry on for years, is also commonplace. The legal process may even take years, and you might end up losing a sizable portion of the property due to claims by neighbours.

Title mistakes occur. That’s the sad reality of conveyancing. However, any diligent would-be owner would look into these areas to avoid costly mistakes in the future.

4 Ways to Get A Mortgage Without Income Proof

An Approved Mortgage LoanAre you planning to file for a mortgage but is limited because your income proof does not post a relatively pretty picture? Here are some ways that you will be able to do to step over these hurdles for your home:

Apply for an FHA multifamily loan

The Federal Housing Administration, an office under the Department of Housing and Urban Development, has lots of programs that make obtaining loans easier. There are, for example, programs that link homeowners to FHA multifamily lenders that will be able to provide them with mortgage assistance. These types of loans are especially great because they rarely require proof of income as it is market-driven.

Get a credit card without income proof

Some lenders ask for your credit card instead for mortgage approval. But not everyone has a credit card. If you do not have one, there is still hope for you as there are credit cards that do not need income proof. Most of these types of cards have a $500 limit and are almost always sure to be approved.

Use your car as loan collateral for title loan

There are states in the United States like Missouri, South Dakota and Illinois that make it possible for loans to be approved easily. How is this done? The amount is usually based on the estimated value of the car. Just make sure that you can pay the amount and interest (which is higher than most).

Go for a no-documentation home loan

No-documentation home loans were made for people whose income is difficult to estimate or verify like those that are self-employed. Often in these cases, the lending institution only looks at the property’s value and the credit attached to it.

Hopefully, these tips will be able to help you in getting a mortgage for your home. Not only are they proven, more and more people are also doing them.

3 Questions to Ask When Choosing a Mortgage Company

A man showing the contract for mortgagePerhaps the most difficult choice to make right after deciding to take on a mortgage for your home is to choose the best mortgage company. This can be a complicated process, which can take weeks or even months. After all, you don’t want to barter your entire home with some shady and unscrupulous company and end up losing everything in the process.

The sheer number of lenders in Salt Lake City makes it even harder to decide. Because this is an important matter, you need to make sure you choose the best mortgage company.

So how do you start? Here are a few things to look for when shopping around for a mortgage company.

License

Real estate finance can be a tangled web if you don’t know your way around. This is why many people have undergone training and gotten licensed to handle these matters. Now, if you’re going to take on a mortgage, would you trust someone who doesn’t have these qualifications? It never hurts to check for certification.

Years in the Business

Do you know the average age of most mortgage lending companies? Just a little below 4 years. You’ll probably be handling this mortgage far longer than these companies have been in business. Would you trust a startup company to handle your finances? Well, the Better Business Bureau carries a very detailed record of companies’ reviews and histories and this can give you an idea of how experienced and/or reliable your choice of company is. A little research goes a long way, especially for mortgages.

Offerings

Much like in fashion, there is no one-size-fits-all in mortgage company offerings. Most of these businesses have a “menu” that their customers can choose from, and the truth is, you either fall in the specific categories of their menu or you simply don’t. Do you think your situation is unique or is it like the rest of the cases they hear every day? You decide.

These are just a few pointers to help you get started. Taking out a mortgage for your home is an important but difficult process. Don’t forget to do your research and work with the right lender.

Why You Need a Realtor to Help You Sell Your Home

House Being soldSome homeowners who would like to sell their property decide to do it entirely on their own. While this is legal and totally doable, you should consider if this is indeed the course of action you want to take. Here are some of the reasons you should get help from your realtor in selling your house.

Your realtor has the experience

Not only is your real estate agent more experienced, but they also have the education for the job. Your realtor can take the load off your shoulders, and you can rest easy knowing someone with more experience and knowledge in these matters is doing the work.

They have the network

Your realtor probably already has a network of other professionals that you may need for your sale. For example, they can call a professional they trust to apply any repairs or improvements that can increase the value of the property. They also know whether you can recoup the cost of the improvement. Many realtors also have many contacts among those who are looking for a house for living or as an investment. So if you want to sell a house fast in St. Louis or elsewhere, call a well-connected realtor.

They can handle the paperwork

It’s their job, so they can handle the paperwork faster, as they don’t have to ask around about the next step. If you do this yourself, you might be overwhelmed by all the paperwork. And if you make any mistakes, you might be legally liable for it and cost you a lot of money to correct it.

They can protect you

When you try selling a house on your own, you might be subjected to phone calls that lead nowhere, even visits from people who have no real intention of buying. Your agent knows how to handle such things and can protect you from them, so you are not bothered.

The job of a real estate agent is not one for the untrained and uninitiated. Find a trustworthy real estate agent and let them do their job for you.

3 Secrets to Keeping the Total Cost of Your Home Loan Affordable

Affordable Home LoanWhen applying for a home loan, you need one that is affordable and easy to pay. Unfortunately, this type of loan is not easy to find. In fact, many people have to deal with high-interest rates. But with the right considerations, you can keep your loan’s interest rate low.

Improve Your Creditworthiness

Lenders look at your credit ratings before deciding whether to approve your loan or application or not. You finances form the basis to determine how much money you can borrow and the applicable interest rate. It is also a deciding factor on your eligibility. You can increase your chances of qualifying by eliminating most, if not all, of the red flags that a lender is likely to encounter.

Cleaning up your financial history is a slow and lengthy process that takes a considerable amount of effort. As such, you should give it a sufficient grace period. Don’t fall for the numerous fraudulent activities on the Internet that promise overnight results.

Reduce Your Loan Principal with Extra Payment

Paying off your home loan quickly offers many advantages, including savings on the interest. Check with your lender before embarking on such a plan. While some lenders might frown on such a practice, they are fine with an extra payment every year. Start by dividing your monthly payment into two equal parts. Since there are 52 weeks in the year, you will make 13 repayments instead of the regular 12. The extra month goes towards lowering your principal.

Choose a Reputable Lender

Before acquiring a loan, check the reputation of the lending company. Work with a company with a long history of quality and honest service. Read online reviews of several companies before making a commitment. Avoid signing with companies with dubious reputation as it could ruin your finances.

With the proper application, loans are quite helpful when you are short on cash. But you need to approach the process with utmost caution to ensure you get the best terms and the lowest interest rate.

Applying for a Mortgage

Applying for a Mortgage? Improve Your Credit Score First

Applying for a MortgageA good credit score is one important requirement in a home loan application. This is especially true if you want to qualify for a low mortgage rate and save more money over the life of the loan. The best way to do is to pay your bills on time, but be sure not to miss other strategies or moves that can hurt or improve affect your score.

Don’t Apply for New Cards

Six months before your loan application, avoid opening or applying for new credit cards. Note that for lenders, a new card means taking on a new debt, which will make it harder for you to pay other bills on time. If other lenders have asked for your credit report within the past few months, your mortgage lender would think that you’ve taken a new debt that hasn’t been recorded yet.

Check Your Credit Report

Mortgage companies in Utah suggest ordering your credit report from major credit bureaus (Experian, Equifax, and TransUnion) and checking it for errors. Even if reports from other bureaus are accurate, errors on one report can affect the interest rate you would qualify for. You can resolve errors within 30 to 60 days, but it is best to have enough time before applying for a loan.

Don’t Close Cards

If you keep the balance same on other cards, but close one with a high credit limit, it would seem like you’re maxing out your available credit. This can negatively affect your score. If you want to close the cards that you’re not using or to avoid an annual fee, it is best to do it more than six months before applying for a mortgage.

Apart from these three suggestions, don’t forget to pay your balances two months before you apply. This is because low balances don’t often reflect in the report immediately. It can take about two months before your credit report can update the account and show a new or a zero-dollar balance.

Hardwood Floor Refinishing: Costs and Considerations

Hardwood Floors Hardwood floors are beautiful and durable, but they can still lose their shine over the years that your family has been using it. Once you have a floor that looks bleached or dead, industry experts at Sunshine Hardwood Flooring note that it’s time that you consider a comprehensive hardwood floor refinishing service that can make your floor shine — as if it was newly installed.

Refinishing Costs on Average

According to data from a home improvement website, floor refinishing jobs usually cost around $970 to $1,250 for each 300 square feet of floor. Of course, costs can rise depending on wood type, floor condition, and chosen enhancements. It is up to you to decide how large or small your budget will be. People have spent $600 at the lowest and $3,450 at the highest for such jobs.

DIY Risks

Most homeowners spend between $1,001 to $2,156 for refinishing jobs. Now, you may be tempted to do the refinishing on your own. Although you can do that, DIY refinishing has risks and hidden costs. You may pay for more than what you expected. You may also damage your floors if refinished incorrectly.

Professionals on the Job

You can choose to let flooring professionals do the work for you as it is the best option. You can pick your contractor carefully, however, as inexperienced professionals can do as much damage as you doing a DIY refinish. You can select a contractor based in Boise that has plenty of experience to handle your hardwood floor.

Details that Increase or Decrease Costs

Consulting your flooring professional, you can check if you need a full refinish or only a maintenance coat. A maintenance coat can save you almost half of the cost of a full refinish. Alternately, a full refinish may remove the color of your hardwood floor. You can have the refinished floor stained for a cost increase of 50%.

Lastly, you can move out of the room being refinished for a few days. A full refinishing takes a while to settle. You can also repaint the baseboard as stains and polyurethane may be on it.

Do you think it is time to refinish your hardwood floor?