Valuing a Property as a First Time Homebuyer

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First time homebuyers can make the task of finding the right home for sale a lot less complicated by having an awareness of the steps in the home buying process. Once you get to know these easy steps, you will be able to make the best new home purchase to suit your needs and budget. Valuation of the home or determining what the home is worth from your perspective is one of the most important steps in the home buying process.

The true value of the home does not only consist of the price. Since value depends on the individual, identifying the elements that you would want to have in your new home can make the search among the many homes for sale a lot easier. The true value of the home is based on what it is worth to you and the benefits that you will get from investing in that piece of real estate property.

When you begin the valuation process of any of the homes for sale, the first step that you can take is to review its actual dollar cost and compare it to the other homes for sale in the same neighborhood. This can be done by studying the MLS listings of the area and discovering how much the seller had paid for the home, if possible. Finding out how much was paid will give you a baseline amount to use in your assessment, whether or not it is lower or higher than the seller’s current asking price. Other factors that you have to take into consideration is when the seller had bought the home because if more than 3 years has elapsed, an estimate based on the purchase price will no longer be accurate.

The second step that a home buyer can take is to figure out how much repair work is needed and what the cost will be. Ask yourself a few questions like “If I move in next week, what has to be done to make it livable and lovable?” or “What needs to be fixed and how much will it cost?” Sometimes, the cost of repairs is factored into the asking price but if it is not, it is to your advantage to know what the add-on expenses you may be facing in the near future.

The third step in determining the value of the home is to project what it may be worth in three years, ten years or twenty years. Is the home located in a brand new subdivision or an historic part of town? What is the average appreciation value of the home year to year in that particular neighborhood? The appreciation value may be a powerful ‘pull factor’ for a particular property, especially if you are a first time homebuyer in a buyer’s market.

When deciding which among the many homes for sale to purchase, try to look at the different properties available in the various neighborhoods to see what best suits your needs and your budget. Finding out what the true value of the home that you are interested in goes far beyond the price of purchase. There is more to a buying a new home that just what simply meets the eye. Find out more about the current homes for sale in the different neighborhoods and what benefits you can get as a first time home buyer.

Points, Interest Rates, And How You Can Cut Down On Mortgage Payments

Points, Interest Rates, And How You Can Cut Down On Mortgage Payments
Points, Interest Rates, And How You Can Cut Down On Mortgage Payments
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Points would be the common term for an upfront cost paid to a lender in exchange for the loan itself. The higher your credit score and annual wages, the fewer points you have to pay to get your loan. Despite this, having more points can be better and something you can request for.

The correlation of points and interest is a fascinating thing to consider in a mortgage. A low-interest rate usually goes with a high amount of points to be paid. Only in case you have a bad credit rating, the above rule would not always apply. You can play around with this relationship to your benefit.

It doesn’t matter whether you pay a lot of points on a loan – the cost will not even come close to the amount of interest paid over the loan’s entire lifespan. If you love your new home and want to stay there for a good number of years, you will need to find a way to cut down your interest rate big-time. This is an excellent way to save cash. And you can do so by actually using your points.

It is possible to buy down your interest rate through points – pay a greater amount of points to the lender so that you can enjoy lower rates. Try to balance the effect on your interest rate with some points you need. The math can be complicated, so have the documents from your lender in writing and use a mortgage calculator to do the math. It would also be nice to reduce your monthly payments. After figuring out the numbers, compare them to the number of points needed before making your final choice.

The concept of points can be simple if mastered, and doesn’t need to be considered the wrong side of the mortgage business. You could potentially save thousands, or even hundred thousand, over the lifespan of your loan.

Interest-only mortgage rates allow you greater purchasing power. Because interest-only mortgage rates have lower costs compared to fixed rates or other types of loans, you are afforded extra money which would have been spent on high monthly payments. Interest-only mortgage rates give you the chance to qualify for other loans, thus enabling you to buy more home or real estate properties.

7 Commonly Forgotten Home Maintenance Tasks

7 Commonly Forgotten Home Maintenance Tasks
7 Commonly Forgotten Home Maintenance Tasks
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Some often forgotten home maintenance tasks become memorable when they cause a big repair bill. We have identified 7 commonly forgotten home maintenance tasks which can be costly when they are overlooked.

Clean Out The Gutters

Gutters can accumulate leaves, bird nests and other debris which will weigh enough to pull the gutters away from their mounting. This condition will cause water to run down the side of the home and into the foundation. These gutters will not drain properly causing the water to flow over the side and onto the landscaping.

Hire A Professional To Inspect The Roof

The roof should be inspected once a year to find the problems that can cause water to leak into the home. Caulking, sealant and flashing should be inspected because these materials can also allow water to leak into the home when they are defective. The roof decking should be examined to determine whether it is rotting. Curled shingles and shingles out of place need to be replaced or nailed down securely. One other important part of the roof is the drip edge since this is what channels the water into the gutters.

Clean The Chimney

Creosote can build up in the chimney. This is a very flammable substance, and it can cause a fire. Critters can build nests in the chimney, and they will cause a problem when the fireplace is used.

Service The Heating And Cooling System

These systems should be inspected and serviced before each season begins. Routine maintenance will prolong the life of the equipment and help prevent emergency repairs. Well-maintained systems will be energy-efficient. Checking the thermostat is also essential.

Flush Out The Water Heater

Mineral deposits will build up over time on the bottom of the tank. The result is corrosion which causes the tank to leak. These deposits also make it more difficult to heat the water. The result is an unnecessary use of energy.

Clean The Refrigerator Coils

Dirt, dust and pet hair will clog the coils to the point where they can no longer release heat removed from the refrigerator. This condition makes the motor work harder to release heat through dirty coils.

Check The Slope Of The Soil Around The Foundation

The soil around the foundation should slope away from the foundation to prevent water from becoming a problem. Water that builds up can result in hydrostatic pressure which can cause water to push through the foundation into the basement. Hydrostatic pressure is the main cause of basement leaks.

 

 

7 Reasons Why You Need a Real Estate Broker

7 Reasons Why You Need a Real Estate Broker
7 Reasons Why You Need a Real Estate Broker
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Buying real estate in Fullerton is one of the best investment decisions that a person can make. For most people, real estate transactions are among the most expensive that they can make in their entire life, so there is no room for mistakes. Residents in Fullerton and adjacent areas seek the assistance from a broker when handling real estate matters, and here’s a few reasons why:

  1. Know the Structures of Leasing or Purchasing

Real estate brokers are experts in handling all aspects of real estate matters and issues. They deal with current market transactions on a daily basis and understand the brokerage vocabulary and routine. A broker will help each client understand every step of the process and advise them on the proper moves to make.

  1. Access to Unlimited Listings

Each person is limited to a certain amount of listings that are made available to the public. However, a broker has access to multiple real estate databases allowing him or her to maximize your search and uncover all of the available properties. Not only do real estate professionals have the ability to access various real estate databases, but their relationship with the industry has provided them with “market knowledge,” allowing them to utilize all opportunities, even ones that are considered “off the market”.

  1. Save Time

Time is valuable. Avoid the hassle and confusion of handling real estate transactions alone. Clients should be spending their time adhering to their daily tasks, while a broker assists them in the real estate process. A broker will monitor and negotiate transactions, exceeding customer satisfaction and relieving them from the frustrations of handling it alone.

  1. Minimize Risk

Working with a broker helps each client minimize their risks by developing a better understanding of the real estate process and being advised as to which steps to take. Brokers hold a fiduciary responsibility to each client. This means that your realtor takes after your financial interests and does everything in their power to exceed customer satisfaction and protect your interests while completing a real estate transaction.

  1. Experience to Offer

Real estate brokers have extensive knowledge and experience handling real estate matters. Brokers help tenants and buyers throughout all aspects of each real estate transaction. From trusted general contractors and architects, to knowledgeable attorneys and bankers, brokers have gained relationships with professionals from various backgrounds to pass onto clients.

  1. Save Money

Abatement, moving allowance, and tenant improvement dollars are just a few ways brokers help save clients’ money. Allowing a broker to help in the real estate process means benefitting from their market knowledge. Since brokers are working in the industry on a daily basis, they know what the current market trends are and what landlords will give tenants to make a transaction more successful.

  1. Build a Lasting Relationship

A broker will assist each client in finding a home that suits his or her needs perfectly. Looking for a home is just more than looking at baths and square footage. Professional brokers go beyond the superficial looks of a property because they have the technical knowledge about what they need to look out for in a prospective property. Building a relationship with a real estate broker is very beneficial. Their extensive knowledge, experience and connections will help each client successfully reach their goal without any frustrations or major complications.

A Smart and Easy Way to Pay off Your Mortgage

A Smart and Easy Way to Pay off Your Mortgage
A Smart and Easy Way to Pay off Your Mortgage
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Are you struggling to pay off your mortgage? Have you ever heard of a government program called the Home Affordable Refinance Plan (HARP program)? Well, if your answer to the first question was yes, then the HARP program is here to rescue you! This program can greatly benefit millions of Americans by decreasing their monthly payments by as much as $4,264 each year.

Unfortunately, this program will most likely expire by the end of this year, so it is imperative that you take advantage of it while you can. The good news is, once you are in the program, you are in the program forever. So if you are looking to lower your payments, pay off your mortgage faster, and possibly take out some cash with your accrued equity, it is necessary that you act now.

The HARP program one hundred percent free to see if you qualify. Do not be fooled into believing that this program is too good to be true! It is a no-cost government program that was created to be very easy to sign up for.

The HARP program was created by the government beginning in 2008 to make it easier for middle class homeowners to make it through the recession by providing the opportunity to reduce their mortgage payments.

In order to make it even easier for homeowner to qualify, some specific requirements for the program such as minimum credit scores and equity requirements have been relaxed. The HARP program is one of the most effective opportunities for homeowners to lower monthly mortgage payments. As a middleclass homeowner, it would be extremely smart of you to apply to refinance under the HARP program, even if you have previously applied under a different program and been turned down. Check today to see if you qualify for the HARP program by visiting the HARP Eligibility Website.

5 Tips To Manage Your Mortgage

5 Tips To Manage Your Mortgage
5 Tips To Manage Your Mortgage
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A home mortgage is not something you acquire and then forget about it, except for making payments. There are, however, ways that every homeowner can manage their mortgage for better short-term and long-term results. We have put together 5 tips to manage your mortgage. These are tips that have been proven to be important for every homeowner with a mortgage.

1. Pay The Payment On Time

Take every precaution to ensure that you make every mortgage payment on time. People can forget to make a payment when they are caught up in the challenges of everyday living, but forgetting a payment can ruin your credit for seven years. A late payment might result in accrued interest and penalties. You can avoid this by having the payment automatically deducted from your checking or savings account.

2. Consider Other Expenses You Will Have To Make When You Buy A Home

Buyers often have to scrape up every dollar they can find just to make the down payment and pay for the closing costs. Often, buyers will then go into debt to buy items for their new home. Buyers may also take out a personal loan to make these purchases. Problems arise when the interest accumulates and the payments are more than can be paid on time. A condition like this can interfere with making mortgage payments on time. Living on the edge is dangerous for managing a mortgage.

3. Create A Rainy Day Fund

Homeowners need a rainy day fund to cover unexpected expenses such as a leaking roof, a burst water heater, or leaking water pipes. Doing so will keep your mortgage payment funds untouched.

4. Keep A Watchful Eye On Your Property Taxes An Home Insurance

These are two automatic inclusions in your mortgage payment, and these can go up which means that your mortgage payment will go up by a corresponding amount. Many taxing authorities and insurance companies do not tell you when their rate are increasing. For some homeowners, this can be a significant problem. Property insurance premiums have been increasing by 10 to 20 percent annually. Call your insurance company before the renewal date and ask if your policy premium will increase. If it will, then look for another insurance company. If your property taxes are scheduled to increase, then you might want to appeal the increase. Check the tax rates for the property around you to see if rates are increasing for those owners. If they are not, then you have a right to challenge your increase. Keep in mind that many municipalities increase property taxes every year.

5. Try To pay Down Your Mortgage Quickly

One easy way to accomplish this is to pay your mortgage payment by paying one-half every two weeks. This will result in making one extra payment every year, and the savings in the long-run will be significant. Or, pay a monthly amount that is equivalent to what your principle and interest payment would be for a 15-year mortgage.

What Is A Jumbo Loan?

What Is A Jumbo Loan?
What Is A Jumbo Loan?
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Jumbo loans are mortgages that exceed $417,000 which is the traditional mortgage limit, also known as the conforming loan, for single-family mortgages. The conforming loan limit is the maximum amount that will be backed by Fannie Mae or Freddie Mac. However, the real estate market is not the same in every city, so in some places the jumbo loan threshold is higher. For example, in Alaska and Hawaii the conforming loan maximum is $625,000, so jumbo loans would be made for a larger amount. Jumbo loans are used to purchase higher priced homes.

Qualifying For a Jumbo Loan

It is not easy to qualify for a jumbo loan even if you have $1 million in liquid assets. Qualifying for a traditional mortgage loan means jumping through several hoops, and there may be more hoops to jump through for a jumbo loan. You will need to have all of the documents that will support your income from all sources. Tax returns and bank statements will also be required. It is nearly mandatory that you have at least six months of cash that could be used to make the payments on the jumbo loan. This requirement could be stricter if you work for yourself.

Your debt-to-income ratio must be below 36% if you are applying for a traditional mortgage loan. This ratio is calculated by dividing the total monthly debt payments by your monthly income. Jumbo loan applicants will need a significantly lower debt-to-income ratio. The ratio requirement may vary between jumbo loan lenders. However, it will not be as high as 36%.

An excellent credit score is essential when applying for a jumbo loan. Most jumbo loan lenders look for a credit score of at least 700. Keep in mind that credit scores are created by a variety of credit bureaus and by the independent FAIR ISSAC score organization.

Favorable Interest Rates are Available For Jumbo Loans

As recently as 2008, jumbo loans were not available, and if they were, the interest was higher than for traditional mortgage loans. However, borrowers looking for jumbo loans today will find that interest rates are slightly lower. The reason is people who apply for jumbo loans are viewed as less likely to default on the mortgage or fail to make payments on time. Many applicants are high-income earners with substantial assets. They are also considered to be financially stable through any economic downturn.

As with any mortgage, it pays to shop for the best jumbo loan deal. Jumbo loans come in a variety of adjustable and fixed interest rates. You might find investors among the secondary mortgage market.

Look at your finances carefully. Find the best jumbo lender for your needs. Be sure that you can make the long-term commitment to making the mortgage payment along with the high taxes and property insurance.