Thoughts By Rhonda
Motivation & Creativity to inspire you to see the positive side of life and real estate.
Sunday, February 6, 2011
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 8: Buy it because you Love it!
A home's most important role is to serve as a comfortable, safe place to live, so don't get bogged down with thinking about your home's appreciation.
It's easy to love the home when it has great curb appeal...is perfectly staged with gorgeous furnishings and smells good. Those are the obvious things. But...before we can fall in love...
Remember our first steps in our Home Buying Process¿:
1. Getting Pre-Approved - so once we see that perfect home and we love it...we can buy it!
2. Stick to that Budget - let's not look at homes we can't afford!
3. Keep your Emotions in Check - did you fall in love and forget being practical!
4. Your Lifestyle - will this home fit the way you live?
5. Physical Aspects - don't get caught up loving it that you aren't even thinking!
6. When to Buy - just because you were looking doesn't mean this is the right time for you.
7. Family & Friends - they may talk you out of it, or may even talk you into it because they love it...but remember...some advice isn't always good advice.
Thinking about how much of a home you are buying...in the neighborhood you are buying...and how much equity you will have doesn't mean a thing if you don't stay in the home long enough to recoup any of it. Don't get bogged down with all that if you don't even care about the home. Buy it because you love it!
Tip 9: Negotiation in Real Estate.
Sunday, January 16, 2011
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 7: Family & Friends Opinions
It's natural to want to get opinions from those you trust before you make your final choice, but too much¿ input will ultimately make the decision process much harder.
You may be getting down payment assistance from family. For that reason, it's good for them to know why you are choosing a particular home. It's an investment on their part as well, but remember you will be the one making monthly mortgage payments. You may be needing approval or an extra set of eyes in the beginning stages of looking at homes if you are a first time home buyer. Once you get an idea of what to be looking for, you should be ready to step out and make those decisions on your own.
If you have friends come along, their taste may be completely different from yours, and you may miss the house you like because you were only focusing on their opinion. You may end up looking at more homes than are needed because you were distracted.
Your home is yours because it fits your family, your lifestyle, your needs, and your location of choice.
Remember to focus on what your immediate wants and needs are so that YOU will be happy with the final decision.
Next...Tip 8: Buy It because You Love It!
Friday, December 31, 2010
Real Estate, Mortgages, and Finances - A Decade in Review
10 years that shook America's finances
2001: Economy endures 9/11 attacks
· A mild, eight-month recession begins. In March, a recession emerges that the National Bureau of Economic Research later declares lasted eight months. The start of the recession follows a decade of expansion.
The unemployment rate, considered a lagging indicator of the overall economy, reaches a four-year high of 4.9 percent in August.
· A major tax reform law passes. On June 7, President George W. Bush signs a $1.35 trillion tax package into law. Among the changes, the law will cut the top tax rate from 39.6 percent to 35 percent and create a new bottom tax rate of 10 percent. The law will eventually double the child tax credit from $500 to $1,000. In addition, the new rules will gradually reduce the estate tax and eliminate it in 2010.
· Terrorists attack the U.S. on Sept. 11. They hijack four commercial airliners, crashing two of them into the World Trade Center and another into the Pentagon. The fourth crashes in a field in Pennsylvania. Almost 3,000 die.
The tragic event does not cripple the U.S. economy, although the airline and the insurance industries struggle in the wake of 9/11. A year later, a report by the Congressional Research Service says, "The direct effects of the attacks were too small and too geographically concentrated to make a significant dent in the nation's economic output."
· In October, the Federal Reserve reduces its benchmark federal funds rate to 2.5 percent, bringing the overnight bank lending rate to the lowest level in 39 years. It's the ninth consecutive cut to the federal funds rate in the Fed's attempt to pump up the economy.
-- Leslie McFadden
2002: Corporate scandals spur reforms
· In January, the Federal Reserve ends its streak of cuts to the target federal funds rate, after 11 consecutive reductions in 2001. The Fed leaves the federal funds rate at 1.75 percent and the discount rate at 1.25 percent, the lowest level for the latter since 1948. The economy begins to show signs of improvement.
· In June, the U.S. Senate votes down a bill that would have made the repeal of the estate tax permanent. A massive tax cut bill passed in 2001 under President George W. Bush would gradually reduce estate taxes and repeal them in 2010. Without passage of additional legislation, a "sunset provision" would cause the estate tax and other tax cuts to expire on Dec. 31, 2010. However, an extension of the Bush-era tax cuts was approved before the deadline.
· Reacting to several corporate scandals involving Enron Corp., WorldCom Inc. and others, Congress passes into law the Sarbanes-Oxley Act in July. The law requires immediate disclosure of stock sales by company officials and sets stiff penalties for executives who commit corporate fraud. It also creates an oversight board to monitor the accounting industry.
· In October, President George W. Bush announces a federal budget deficit of $159 billion for the fiscal year 2002, the first deficit since 1997.
-- Leslie McFadden
2003: Mortgage rates fall, housing prices climb
· At the beginning of the year, the 30-year, fixed-rate mortgage falls below 6 percent for the first time in 37 years. It remains at 6 percent or below until the end of July. And in mid-June, the average rate on a 30-year, fixed-rate mortgage falls to a record low of 5.28 percent.
· Low rates provoke the biggest mortgage refinancing boom in history. Homeowners take out $2.5 trillion in refis in 2003 compared to $1.7 trillion the year before (and $234 billion in 2000). Toward the end of the year, house price appreciation accelerates.
· The Federal Reserve moves short-term interest rates just once in 2003, but it's significant. The central bank cuts the federal funds rate to 1 percent from 1.25 percent. It's the lowest federal funds rate in 45 years.
With inflationary expectations low, the Fed judged that "a slightly more expansive monetary policy would add further support for an economy, which it expects to improve over time." What follows is a housing boom, then a bust. Later, some observers partly blame the Fed for keeping the federal funds rate at 1 percent for a year.
· In October, the $20 bill gets a facelift. Andrew Jackson's portrait is enlarged and removed from an oval frame, a background image of an eagle is added to the front and the bill is given an overall cleaner look. Most noticeably, the redesigned bill is colorful, with pastel hues of peach, green and blue.
-- Holden Lewis
2004: Facebook and Google: Recognize them?
· Seeking to reduce the chance of inflation, the Fed chooses to hike the federal funds rate in June for the first time in four years from 1 percent to 1.25 percent. The move marks the beginning of a rate-hiking spree by the Fed that would last until Aug. 17, 2007.
· Facebook and Google begin to define the contemporary Internet landscape.
On Feb. 4, Mark Zuckerberg and three friends launch Facebook in a Harvard dorm room. By the end of the year, the site would have more than 1 million users, and by 2010, it will balloon to more than 400 million.
On Aug. 18, Google launches an initial public stock offering at $85 per share. The stock will eventually reach $747 in November 2007.
· Costs associated with military action in Afghanistan and Iraq and newly enacted tax cuts drive the U.S. deficit to 3.48 percent of the U.S. gross national product, the highest percentage since 1994.
· Due in part to rising demand from China and India and political instability in the Middle East, crude oil prices begin a sustained climb, breaking $40 per barrel for the first time in history during the week ending Oct. 1.
· In December, the euro reaches a high against the U.S. dollar, rising to $1.36, and provoking fears the dollar would be supplanted as the world's reserve currency.
-- Claes Bell
2005: Subprime mortgages peak
· The subprime mortgage boom peaks. Lenders hand out $625 billion in subprime loans, compared to $540 billion the year before. On top of that, lenders give $380 billion in Alt-A mortgages. Most of the Alt-A loans are low-documentation mortgages, otherwise know as "liar loans" because borrowers exaggerate their incomes with a wink and nod from their lenders.
· An adage gains currency: Mortgage lenders are willing to give a loan to anyone who can fog a mirror. Urban legends tell of gardeners buying $500,000 McMansions. More than three-quarters of the 2005 subprime and Alt-A loans are sold on the secondary market. The market would explode in 2007 and 2008, igniting the worst recession since the Great Depression.
· Congress reforms bankruptcy law to make it more difficult for consumers to file bankruptcy. The law prioritizes credit card debt higher than unpaid child support.
· The Federal Reserve raises short-term interest rates eight times. The federal funds rate begins the year at 2.25 percent and ends it at 4.25 percent.
· Nationally, home values rise more than 11 percent, according to the federal government's House Price Index. The National Association of Realtors distributes a "Housing Bubble Prospects Q&A" that assures consumers, "There is virtually no risk of a national housing price bubble based on the fundamental demand for housing and predictable economic factors."
-- Holden Lewis
2006: Growing home prices create "bubble"
· The year 2006 sees the peak of the housing bubble, with the median existing home price climbing to $221,900, more than four times the U.S. median household income at the time, according to the National Association of Realtors. The value of a typical American home climbs 50.4 percent since the beginning of the decade, with some markets such as Miami-Fort Lauderdale, Fla., Las Vegas-Paradise, Nev., and Riverside-San Bernadino, Calif., more than doubling.
· Homeowners respond to the run-up in housing prices by drawing record amounts of equity out of their homes through cash-out refinancing, home equity loans and home equity lines of credit. All in all, Americans liquidate $318.3 billion in equity through cash-out refinances in 2006, according to Freddie Mac.
· The rising federal funds rate contributes to rising yields on certificates of deposit, benefiting savers. In September, the average yield for a one-year CD hits 3.89 percent, a multiyear high that's a far cry from today's paltry average yield for one-year CDs of below 1 percent.
· Alan Greenspan, the man largely credited with engineering the housing boom, retires on Jan. 31, ending a reign of more than 18 years as chairman of the Federal Reserve. He is replaced by Ben Bernanke.
-- Claes Bell
2007: Foreclosure tsunami begins
· The stock market hits an all-time high. Usually a leading indicator of the economy's health, it proves to be anything but as the stock market peaks on Oct. 9. The Standard & Poor's 500 reaches 1,565 and the Dow Jones Industrial Average hits 14,164 just months before the start of one the worst recessions in American history.
· After years of sustained growth, the real estate bubble begins to deflate. Real estate values begin a plunge in the fourth quarter of 2007 that will last into 2010 and cost U.S. mortgage holders trillions in home equity. Baby boomers would be hit particularly hard between 2007 and 2009. Even when you factor in future Social Security earnings, households headed by individuals aged 50 or older would see their real wealth decline by 18 percent, due in part to the loss of home equity.
· The credit crunch begins in August 2007 as lenders deal with a trifecta of bad news -- declining real estate values, the spread of toxic subprime mortgages and the slowing economy. The so-called TED spread, or the spread between the three-month Treasury yield and the three-month Libor, rises from 0.39 percent to 1.81 percent between July and August 2007. When the spread increases, it's a sign that lenders believe the risk of default on interbank loans is increasing.
· The foreclosure tsunami begins. Homeowners looking for refuge from resetting variable-rate mortgages are unable to refinance because falling real estate values put them "underwater." Mortgage delinquency rates for residential real estate tracked by the Mortgage Bankers Association begin a sustained rise, starting in September 2007.
-- Claes Bell
2008: The Great Recession cripples the nation
· The greatest financial crisis since the Great Depression hits full force in 2008, spurred by the failure or emergency sale of some of the nation's biggest financial firms, starting with Bear Sterns on March 16, 2008. Wachovia, Lehman Brothers, Washington Mutual and Merrill Lynch later toppled or came to the brink of bankruptcy. The main culprit was toxic subprime mortgages.
· The Fed and Treasury take unprecedented action to prevent the wholesale collapse of the financial system. When dropping the federal funds rate from 5.25 percent to 1 percent fails to stem the crisis, Fed Chairman Bernanke and Treasury Secretary Henry Paulson turn to more radical methods.
They encourage healthier institutions to buy failing banks, making massive amounts of liquidity available through hastily created government lending programs and arranging takeovers of founding firms. For example, global insurance firm AIG is bailed out with $182 billion.
· A global panic set off by the failure of Lehman Brothers on Sept. 15 pushes an already slowing economy into the Great Recession. By the fourth quarter 2008, the U.S. economy is shrinking at an annual rate of 6.8 percent. Global gross domestic product growth falls from 3.9 percent a year in 2007 to 1.7 percent a year in 2008.
· On Dec. 11, former Nasdaq Chairman Bernard Madoff is indicted on charges his multibillion-dollar investment firm is nothing more than a giant Ponzi scheme. In the weeks following, high-profile investors and charities admit to being bilked of billions by Madoff. He is eventually sentenced to 150 years in federal prison.
· Revolving consumer credit, which includes credit cards and other forms of flexible debt, peaks at nearly $974 billion in August.
-- Claes Bell
2009: Unemployment spikes, stimulus approved
· Newly elected President Barack Obama signs the massive American Recovery and Reinvestment Act on Feb. 13. It commits $787 billion to tax cuts, infrastructure projects, job training programs and aid to families.
· On March 9, the Dow Jones Industrial Average sinks to 6,547, less than half the all-time high set in October 2007 and the lowest close since April 15, 1997. On this day, many former blue chip stocks, especially in the embattled financial sector, are trading at or near multiyear lows. Giant Citigroup hits an intraday low of 99 cents.
· In February, the Treasury Department begins a series of "stress tests" to determine which banks are healthy enough to survive further deterioration of the global economy. It finds big banks must raise an additional $74.6 billion to remain solvent should the economy slide further.
· After four straight quarters of declining GDP, the U.S. economy begins to grow again in the third quarter 2009 at an annualized rate of 1.6 percent. Later, the National Bureau of Economic Research's Business Cycle Dating Committee, the group of economists tasked with following recessions, pegs June as the official end of the recession.
· In May, the Credit Credit CARD Act passes. The measure contains consumer protections, including restrictions on interest rate hikes and double-cycle billing of credit cards. Many credit card providers respond by raising rates and fees dramatically before the law takes effect.
-- Claes Bell
2010: Reforms to financial industry approved
· Amid fierce lobbying from the financial industry and consumer advocates, the Dodd-Frank Wall Street Reform and Consumer Protection Act is signed into law by Obama on July 21. The new law creates a new Consumer Financial Protection Bureau to police mortgages and other financial products. It also forms a new office to monitor risks to the financial system and streamlines oversight of the financial industry.
· Thanks to rising corporate profits, the stock market continues a rapid recovery throughout 2010, with the Dow Jones Industrial Average hitting a 52-week high of 11,519 on Dec. 15. In just over 22 months, the Dow rises 175 percent.
· Despite government stimulus and steady if unspectacular GDP growth, high unemployment persists, hovering between 9.5 percent and 9.9 percent throughout the year. More troubling still is the length of unemployment for many Americans. As of November 2010, more than 6.3 million are out of a job for 27 weeks or more, and the average length of unemployment is 33.8 weeks.
· Three years into the housing crisis, the flood of residential foreclosures shows little sign of abating. At the end of the third quarter 2010, a survey by the Mortgage Bankers Association finds 4.39 percent of residential mortgages are in foreclosure and 9.13 percent of all home loans are in some form of delinquency.
· On Aug. 15, a new Federal Reserve rule goes into effect requiring banks to get consumers' permission before enrolling them in overdraft protection. In response, many banks begin imposing maintenance fees and balance requirements to recover lost revenue, reducing free checking options for consumers.
-- Claes Bell¿¿
Courtsey of Gina Starr, Loan Officer
Red Rock Mortgage & Lending¿
Phone: 405-210-3900
Email: gstarr@redrocklend.com
Don't worry...the next Tip will be coming soon...
HAPPY NEW YEAR 2011!
The start of a new decade!
Bankruptcy, Foreclosures, Home Values, Homes, Housing Market, Inflation, Interest Rates, Lenders, Loans, Mortgage, Real Estate, Realtor, Recession, Unemployment
Sunday, December 26, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 6: When is the Right Time to Buy...
When is the Right Time to Sell?¿
Every home buyer and seller is in a different situation, so it is important you don't compare your timeline and decisions to anyone else's.
Time to Buy?
Given all of the drops in the housing market in the last few years, many people are wondering whether now is the right time to buy a new house. Should you snatch up the good deals before prices start to rise or should you wait it out a little bit longer to see if the prices will drop even more? It can be somewhat of a gamble, so it is important to make sure that you know a few facts about the current market so that you can make the best possible decision.
One of the most important facts you should consider when determining whether now is the right time to buy a new house relates not to the market but your own situation. Consider how long you plan to live in the home. While you might not be able to look into a crystal ball and see the future, consider what you know at the moment.You also must consider how comfortable you are with taking risk as well. If you feel comfortable with a possible 10% or even more drop in a home price if you need to re-sell within the next few years then now might be a fine time to make a purchase. If you are not comfortable with risk, then it is probably better to wait and see how the market settles before you make a home purchase.
The reality of the current market is that the fluctuations have not yet stopped. During the year, prices are most likely not going to appreciate at the rate they used to. It is also important to keep in mind that you should not get swept up in the hype that is often presented in media advertisements. While there may be some truth in the media, consumers should be wary about taking this and running with it.
Lending restrictions remain tight throughout much of the country as well. Loans are available for the purchase of a home, but restrictions are much tighter than they were in the past. Make sure you know exactly what is on your credit and how much you will be able to offer for a down payment before you consider purchasing a home in the current market.
Also, if you plan to buy a new house in the current market, you should be fully aware that there is the potential for the value of your home to drop over the next few years rather than appreciate. You should not assume that your home will steadily gain value the longer that you own it. This is a gamble that you should be fully aware of before you begin shopping around with the intention of making a home purchase.
While now could very well be an excellent time for you to buy a new home, it is important to consider your own situation as well as how comfortable you are with taking possible risks over such a large purchase in the next few years. The current market certainly is offering good deals in many markets, but before you rush out to grab one, make sure that you are fully informed.
Time to Sell?
Everything has a season – including selling your house. Listing at the right moment could mean more money in your pocket.
Traditionally, spring is the hottest season for real estate. Sales peak in April and May and stay strong in June and July. It’s a good season for families to move, between school terms and while the weather is warm. People have just received their tax refunds, which they can use to help finance a down payment. And the nice weather and beautiful flowers in spring and early summer make it a great time to show your home.
In fact, 60 percent of America's moves take place in the summer. But closing a sale can take weeks, so it’s a good idea to list your home early in the season.
August brings a lag in sales, as people go away on vacation and start to think about the new school year. Then sales surge briefly in the fall before dropping in winter as buyers and sellers focus on the holidays. But by January, buyers are out again, and sales steadily increase into spring.
If you can’t sell in the peak season, consider listing your home in the winter. It may sound counterintuitive, but you probably already have the house decorated and cleaned for holiday entertaining, so it shouldn’t be hard to get it in shape for showing. Moreover, you will have less competition and may get a better price. Another plus: buyers in winter are less likely to waste your time or draw out the closing. They may want to close before the New Year so they can claim the mortgage deduction on their tax return, which you could turn to your advantage in pressing for a quick deal.
Of course, selling in the hot season isn’t the whole story. You should pay attention to your local housing market and try to list during a seller’s market, when there will be more competition among buyers for your home – which could mean a better price, a quicker closing and fewer conditions on the offer.
Find a Realtor who you like and trust, one with the knowledge and experience in your local housing market. If you have questions or comments, please let me know...
Next...Tip 7: Family & Friends Opinions
Buyers, Buying a Home, Home Buying, Homes, Housing Market, Lenders, Listing My Home, Loans, Mortgage, Moving, Neighborhoods, Real Estate, Realtor, Sellers
Thursday, December 23, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 5: Physical Aspects of Your Home¿
Now that we've figured out what type of home fits your lifestyle, we need to think about some important issues and not get caught up in the physical aspects of the home. It's easy to walk into a home, fall in love, and completely forget that this was not an area you wanted to live in. Keeping an open mind and not being rigid is a welcome thing, but here are some things to keep in mind.
Noise Level
It could be the home sits right next to a busy interstate or main street through town. The home might be next to a train track, or even in a flight path. Maybe the neighbors have dogs that bark just because they hear the wind. Inside the home you don't hear anything, but unless you go outside to the backyard, or sit on the front porch, you never realize how loud things could be. Not paying attention to these things could end up frustrating you, and instead of loving the house, you begin to hate it.
Distance
Maybe it fits what you are looking for, but it's too far away from all the amenities ¿and activities your family enjoys. Driving to the home you really like during different times of the day or week will definitely help you see what traffic is like, how long it may take you to get to work or outside activities. Remember distance could mean less time maintaining the home you love because you spend it on the road instead. If you need the time to wind down after work, the distance may be what you need to shut your brain off so you are ready for the family that waits for you.
Neighborhoods
It may be that you see the house during the week when people are at work, kids are at school, and you don't know what goes on at different times of the day or on the weekends. It may be you don't like cars parked up and down the street, kids riding their bikes in your driveway, the loud hot rod or motorcycles engines being warmed up. Pay attention to the houses next door, what their landscaping looks like, and how the neighbors keep things. This will definitely have an impact on this home when and if you ever would decide to sell...if you ended up buying this home.
Hopefully these are things you have thought about and shared with your Realtor. As a professional, with this kind of financial investment, your Realtor has been hired to keep you on track, reminding you of what you have shared, listened to you and taken notes. You will be grateful you bought what you were looking for and not talked into making a purchase just because. Hire the Realtor that cares about you and your needs and not their paycheck.
Next...Tip 6: When is the Right Time to Buy...When is the Right Time to Sell?¿
Buyers, Home Buying, Homes, Lifestyles, Moving, Neighborhoods, Physical Aspects, Real Estate, Realtor
Saturday, December 18, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 4: Find the Home that Fits Your Lifestyle¿
You’d think the easiest thing in the world would be deciding what house to buy. After all, who knows you better than you? You know exactly what you want, right? Well...sometimes. The truth is most people only have an idea of what they want – the number of bedrooms and bathrooms, size of the kitchen and garage, and maybe the yard. Things tend to get a little murkier when you mix in neighborhoods and schools, commutes to work and distance to ball fields and retail shops.
Finding a home that fits your lifestyle can be a big challenge. There are so many options when it comes to choosing, and you probably aren't going to find a home that is 100% perfect, so the best way to narrow down your options is to take a look at your lifestyle and priorities. Chances are there is an option that will work best for you.
The Social Butterfly
A condo can be a great option for anyone who loves to socialize or wants to live right in the heart of the city, close to the action, or within walking distance to work. If you’re new in town, it can be a good way to meet new friends and neighbors. Many large complexes have community features like a pool, gym or clubroom. This will give you the opportunity to meet the people with which you share a building. Remember though, you will be sharing walls, floors and ceilings with many other people. If a little bit of noise will break the deal for you, a high-rise might not be for you.
Gated Communities
Gated communities provide a lot of benefits to the residents that live within them. The number one reason people choose to live in gated communities is likely the security element. They are private and more difficult to access than a standard community. Criminal activity is reduced in gated communities, and solicitors will have a more difficult time bothering residents.
Traffic and speeding cars are also reduced behind the gates, making it quieter and safer for children to play and ride bicycles within these neighborhoods. You likely won’t have the morning commute using your street as a shortcut either!
Another positive aspect of gated communities is a higher standard of home quality, and stricter building codes that promote uniformity in design. That means more sale comparables and better value for all the homeowners within the community. Homeowners in these neighborhoods also generally have a higher pride of ownership, and keep their homes in good condition. Along with that, gated communities create a scarcity effect, with few homes within these neighborhoods typically available for sale at the same time, adding more bite to the value.
There may also be social benefits, such as a community center, pool, park, or events that promote group activities for families to get to know each other.
Wide Open Spaces
If you value privacy and want a lot of space to call your own, buying a home on an acreage may be an option. Keep in mind that with a lot of land comes a lot of responsibility. If family time and outside activities take up a lot of your time, the maintenance of land can consume a weekend. Also remember that if you work in the city, you could be in store for a longer commute, which results in less family time as well.
Somewhere in Between
Maybe you want a place to call your own, but without all the responsibilities of a yard. A great alternative that gives you the best of both worlds is a town home. Townhouses usually consist of several single-family homes grouped together. In many cases, you can rent or own the inside of the home, while a separate organization owns and cares for the exterior of the building and the yard. This allows you the luxury of having a small yard without having to maintain it. Keep in mind that there are usually home ownership association fees that cover the land maintenance.
Buying a home is like finding the right pair of jeans. It's all about what fits. Your home should fit your lifestyle, and like fashion, that changes with time. Choose a Realtor to help you gauge your stage in life, one who knows the questions to ask you, and can pull it all together...so you can find a home that's the perfect fit!
Next...Tip¿ 5: Physical Aspects of Your Home
Buyers, Condos, Gated Communities, Homes, Lifestyles, Moving, Neighborhoods, Real Estate, Realtor, Sellers, Town homes
Tuesday, December 14, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 3: Keeping Emotions in Check
Buying a home is one of the biggest financial decisions you will make in your lifetime, and along with the finances come emotions. It is important to keep your emotions in check during the process. Being organized and in control will contribute significantly to getting the best home deal possible with the least amount of stress. ¿
Once you find a home you like, you become emotionally attached to it. Emotional attachment can cause you to make unwise decisions when making an offer, handling negotiations, and so forth. Once you’ve fallen in love with a house and visualized it being your home, you’ll start to do WHATEVER it takes to make sure it becomes your home.
This is about the worst possible way to buy a home, but this may also be the best possible home for you. You do want to fall in love with your new home, but you also want to be careful. You can literally cost yourself thousands of dollars, if not tens of thousands of dollars, by being too emotionally attached. Instead of letting emotions rule the game, try to include some common sense in the buying process. Real estate investors have a saying, “Don’t fall in love with the house, fall in love with the deal.”
Having said that, realize that you will always have some emotional attachment to your home. You need to like it. Your goal is to strike a balance between liking the house and using common sense to tell you whether you are sacrificing too much to try to get the house. If you find you have to make a lot of compromises to get a house, stop yourself and ask, “Is this really worth it?”
It's important that you choose an experienced Realtor who is willing to work through these emotions with you. Someone you know you can trust when choosing your most valuable asset. Someone you like and work well with, someone who makes the experience fun and exciting...gets excited for you! Someone you trust to know your wishes, desires, and goals...not just your list of likes and dislikes in purchasing your dream home.
So, remember to strike a balance between emotions and common sense. Find a Realtor that fits your personality, is patient and understanding of your emotions, and will work to keep you on track. You'll be grateful, and it will help you enjoy your home that much more once you actually move in!
Next...Tip 4: Find the Home that Fits Your Lifestyle¿
Saturday, December 11, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 2: Create a Budget before you Move into Your Home
There are a number of other costs you need to consider before you buy a home. It never fails...we think we have thought of everything, and lo and behold, we didn't. Hopefully you find some helpful ideas that you can use to create a budget of expenses beyond the down payment and closing costs.
Storage
You may not be a pack-rat, but every time people move (about once every 5-7 years) they notice that their moving truck gets larger and larger. We've all done it...accumulated more than we remember, not thrown things away, or even gone thru the hall storage. We've become part of the lifestyle of inflation; wanting more than we need, buying more than we have room for, and keeping it because "we may need it someday". While a storage unit may be something you need while your current home is on the market, to make the home appear larger and less crowded, is it really necessary after the move? This may be something you need to budget for unless you are willing to donate or pitch...being willing to accept this is not something you need just to pay for it and never see the items you never use anymore...because they are in Storage. A knowledgable Realtor may be able to direct you to different options, so keep that in mind.
Packing Materials
Start collecting boxes early on from stores for free. Check out Craigslist for those that have recently moved, or ask your Realtor if they have a client who may need to get rid of their used boxes. It seems as much as we plan, the need for more boxes overtakes our budget. Many of the boxes you may be able to resell after your move if they are still in good condition, which partially makes up for the costs that sneak up on you. U-Haul has colored packing tape that identifies different rooms that makes it easier when moving in. Bubble wrap and packing paper will be needed as well.
Moving Expenses
Your stuff doesn’t get to the new house on it’s own! Do you hire a moving company? Maybe you try moving yourself, but you may still need to rent a truck. Moving costs can easily cost you anywhere from a few hundred to a couple of thousand dollars depending on your situation. Certainly by now you know a Realtor or are working with a really good Realtor who has all these resources and contacts in their Rolodex. Their list of contacts should include all these tips, points, thoughts, and any answers you may ever need for your questions. A Realtor deals with people moving every day! Who better to ask!
Utilities & Transfer Fees
Most utility companies now have the option of transferring services online or over the phone without having to talk to a representative. However, overlapping service by a couple of days isn't as easy to turn service on and off, so you may end up speaking with representatives.
Cable/Telephone/Internet Services: Will these services cost more than where you previously lived? Will you need any new equipment? Will you have it in more rooms in the new home (such as more cable boxes)?
Water, trash and sewer services: These may not be an items you think of often, especially if you lived in an apartment because these were just part of your rent. In owning a home, these most likely will be included in your water bill, which is another utility most buyers don't think of when it comes expenses. Leaky faucets will now be your problem once you are a proud homeowner, which will make you keenly aware of the true costs of living in a home.
Energy Costs: Make sure you understand what the various energy costs are before you buy. Check with the local utility companies for average costs for both winter and summer.
Alarm: Will you be getting an alarm? Will it be a monthly service? Here’s another cost that could be recurring monthly.
New Locks: You may want to hire a locksmith to change all of the locks in your new home. There’s no telling how many copies of keys are out there already!
Odds are you are moving to a bigger home. Do you have the furniture you need, for example: are you moving from an eat in kitchen to a home with a formal dining room? You don’t have to buy this all at once but you may be tempted to fill in empty spaces.
Appliances: Do you have all of the appliances you need? Perhaps some need upgrading? If the ones you currently own are old, they may be using twice as much electricity as newer, energy-saving ones.
Gardening, Lawn & Landscaping
While you may be thrilled to be inheriting a lawn, have you the equipment the maintain it? How about shrubs and gardens? Can you handle the work? Will you need to buy or rent equipment, such as a mower? What does it cost to hire someone to handle the landscape? The previous owner may be able to give you an idea of the costs as well as refer you to the company they used. Find out if there are local ordinances about grass height and what you are allowed to grow as well as water usage for your lawn. What you may not anticipate is the cost difference in utilities for maintaining a lawn. Your water bill could increase substantially while trying to keep the lawn green. As a Realtor, I have a lawn service I have used for vacant property listings that I could possibly refer you to as well.
Insurance Increase
If you were a renter, you most likely carried renter's insurance. Many buildings and landlords require insurance since they aren't responsible for a tenant's personal belongings. When you call your insurance provider to discuss the purchase of a home, your agent will review your premium since now you will be a homeowner. If you have owned a home before, the premium will probably be different as well, since it is calculated on value of the home. In the process of discussing with your lender the home you have chosen, they, as well as your Realtor, should be able to direct you to insurance companies that are able to provide good rates.
Carpeting – Clean or Buy New?
Your new home may have nice wall-to-wall carpeting but when was the last time it was cleaned? Perhaps it's not quite the color you want or it's showing some wear and tear. You can go cheap with carpeting but sometimes you get what you pay for and this is your home. Always remember, buy the best pad available. Your Realtor could possibly write in the contract that the carpets be professionally cleaned. If that isn't accepted, your Realtor surely has a reputable carpet cleaner that they could refer you to. Don't hesitate to ask these questions.
Spackling and Painting
If you are fortunate, your new place will be all done up and have all the picture holes spackled and the rooms freshly painted. But many homes will still have minor dings here and there that need repair and fresh paint doesn’t mean you like the color. We all know it's easier to paint when there’s no furniture in the room. So do you repair and re-paint? Do you hire people or do it yourself? DIY will still cost you and depending on how much work needs to be done your costs can easily rise. You may shove this idea off as paint is cheap, which it is, but the supplies cost too. These are cosmetic things that need to be taken into consideration since they will be your costs. Hopefully your Realtor has names of reputable contractors that are looking for the next job.
Additional Car
Are you moving somewhere that you will need another car? Is public transportation or walking out of the question now? Think about your location and your needs when you are looking to move and figure out if you will need another car. If you do, remember you will also need additional car insurance and you will have more maintenance costs as well. This isn't one most people think about, but it is something to think about.
I don’t mean to scare you with all of these items, but they do need to be considered before you buy a new home. These may not all apply to you but you can see how quickly costs can run up! When preparing your budget for a new home make sure you take into consideration all of the other costs you may incur.
Next...Tip #3: Keeping Emotions in Check...
Sunday, December 5, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 1: 5 Steps to Mortgage Loan Approval
There will always be first time homebuyers, and while the process stays somewhat the same, so I thought I'd break it down to assist those that need the knowledge, and those that need to be refreshed in how this works.
The 5 steps to mortgage loan approval aren't complicated, but you really have to think ahead to make sure you have everything in order so you can get your loan approved without delay. Chances are good that if you have been thinking about buying a home you may have already started working on some (or all) of these five steps.
Mortgage lenders look at the same things other lenders look at when a potential borrower submits an application for credit, but home loans have additional requirements that lenders review prior to approving a mortgage loan application.
It is never too early to get started with these five steps because almost all of them will help you improve your credit overall.
One: Get Your Credit in Order
Order a copy of your credit report and review it to make sure there are no errors listed. Also, take a close look at the accounts you currently have. Are all your payments on time? Are you teetering dangerously close to meeting the maximum available credit? Mortgage lenders are usually reluctant to approve mortgage loans for applicants who are behind on their debt payments or who have maxed out their revolving account. Get any errors removed from your account and start getting your credit in order. This may take some time, but it will certainly result in a higher likelihood of getting approved for your mortgage loan and may even result in a lower interest rate for the loan you are approved for.
If your Realtor asks these questions or makes these suggestions, trust that she/he may know a little about this process and is only trying to assist and educate you. My goal is always to get to know more about you and what your ultimate goal may be, whether you've thought about it or not.
Two: Build Up a Down Payment
Different types of home loans have different down payment requirements, but no matter what type of home loan you want to obtain you will need to have some money set aside for a down payment and closing costs. Most lenders also want to see a cushion of savings that will remain after the loan is complete because it is never a good idea to buy a home and have no money in a deposit account at all. The higher your down payment, the more of an initial investment you are making when getting the mortgage. The more invested in the home you are, the more likely the lender will approve you for the loan, and oftentimes with a better loan product if available.
Also, if you have available money in a deposit account, the likelihood of needing it for moving expenses or setting up the home will not take away from making the first months house payment! Each time you move, there are unplanned for expenses, so having a cushion is always a good idea.
Three: Pay Down Debt
Mortgage lenders do not like to lend money to borrowers who are already overwhelmed with debt. Start taking steps now to pay down some of your debt obligations. Pay down your credit card balances and try to pay off any installment loans you have in place, such as personal loans or auto loans. If you plan on applying for a mortgage loan in the near future, do not close any accounts you pay off until after you close the mortgage loan. A mass closure of accounts can negatively affect your credit score in the short term, which may make you ineligible for the best mortgage interest rates.
While we are working on getting the approval, excitement is welcome, but try not to get ahead of yourself. No major purchases like a new car, new furniture, or the like. You may very likely have the money for it, but it can definitely affect your ability to get a mortgage for a home. Once the loan is closed and you have moved into your home, what you do then is fine.
Four: Consistent Employment
Mortgage lenders generally look for two years of consistent employment before approving a loan application. Although this varies from one lender to another, demonstrating the ability to stay employed is quite important. The year that you want to apply for a mortgage loan is not the time to quit your job and open up your own business. Save this career change until after you already own your home.
Five: The Right Lender
Different mortgage lenders offer different loan products. If you know that you have less than perfect credit, do some research and find out which lenders will be willing to approve mortgage applications for people with your credit score. Research your options before you are actually ready to apply. You will save time and may be able to find a lower interest rate by investing some time into finding an appropriate lender for your credit situation.
Time is Money!
The sooner you get started with the 5 steps to mortgage loan approval, the better your chances will be of getting approved for a loan with good terms and a low interest rate.
Get started! The next tip will be coming soon! Happy Loan Approval! If you need more assistance, please don't hesitate to contact me. I have fantastic lenders who are patient and willing to discuss all these steps with you. Finding a lender and a Realtor who are knowledgeable, can walk you thru this process, keep you on track, and discuss all your options will make this fun and exciting.
Next.....Tip 2: Create a Budget before you move into your new home.
Thursday, November 25, 2010
Happy Thanksgiving
Today is a day to be thankful...positive...motivational...and encouraging. Though, I believe everyday should start with something to be thankful for, I wanted to share some short thoughts you could remember especially today.
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The smallest act of kindness is worth more than the grandest intention. (Oscar Wilde)
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No duty is more urgent than that of returning thanks.
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Every time we remember to say “thank you”, we experience nothing less than heaven on earth.
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I would thank you from the bottom of my heart, but for you my heart has no bottom.
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Silent gratitude isn’t much use to anyone. (Gladys B Stern)
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Blessed are those that can give without remembering and receive without forgetting.
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God gave you a gift of 86,400 seconds today. Have you used one to say “thank you?” (Wm A Ward
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Gratitude is the memory of the heart. (JB Massieu)
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It isn’t what you have in your pocket that makes you thankful, but what you have in your heart.
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If the only prayer you ever say in your entire life is ‘thank you’, it will be enough. (M Eckhardt)
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A thankful heart is not only the greatest virtue, but the parent of all other virtues. (Cicero)
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If you can’t be content with what you have received, be thankful for what you have escaped.
Wishing you many thankful moments making memories with those you are so thankful for...the things you treasure in this life...and the time you spend with those you love.
Saturday, November 20, 2010
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How to Assess the Real Cost of a Fixer-Upper House
When you buy a fixer-upper house, you can save a ton of money, or get yourself in a financial fix. Read
Visit houselogic.com for more articles like this.
Copyright 2010 NATIONAL ASSOCIATION OF REALTORS®
Sunday, November 14, 2010
Get sick ~ What's your attitude?
In real estate, get sick, take a vacation, or have something personal happen in your life...and you can just bet your business will get a jump start.
Last weekend I woke up with a terrible sore throat & throbbing headache. I haven't been sick in a long time & I knew what this meant...my phone was going to start ringing. Sure enough. While I'm now at the tail end of a cold, I have still been working. In the last 3 wks I've listed 2 homes, had 2 listings appts that will list in 3-4 wks, have a new buyer that also wants to sell, and have 2 listing appts Monday.
In my last post, Is the Market Really that Bad, I was talking about attitude. It can make or break you. Negativity can creep in...pay a visit...stay longer than you wanted it to...and before you know it...it has made its home. If I had let getting sick get me down, I might as well have sent out invitations to negativity, depression, sad, whoa is me, nothing good happens to me, and all the other horrible no-good things you can think of.
I'm not going to let politics get me down, does complaining about it help me? No. I'm not going to let the media convince me that real estate is down the tubes. It's not, and people will always be buying and selling real estate as long as this world is still standing. Hang around the water cooler at work and just listen to the negativity coming out of people's mouths. Read all the doom and gloom on the internet. Is this what you want to feed your mind daily? How does it set the tone for your day?
I am a work in progress, and happy to say I am content where I am today! If attitude is everything, I'm choosing to find things to smile and laugh about. I'm not going anywhere...I'll be a Realtor til my dying day. That's how passionate I am about what I do. I'd love to share my passion with you! Become one of my Fans on Facebook: http://on.fb.me/b4q9nf.
Til next time...keep smiling!
Thursday, November 4, 2010
Is the market really that bad?
My daughter asked me the other day how business was. She works as a hairstylist and another stylist next to her was cutting a lady's hair. All the lady did was complain about how bad the market is. Then she found out the lady was a local Realtor! It made me think about how many people I hear are constantly complaining.
While the market may not be what it has been in the past, it is surely not dead! You want someone who works hard, markets your home in every available avenue possible, online as well as offline, returns phone calls promptly, keeps searching for the perfect home for you as a buyer, someone who sees the glass half full. Even if things seem less than desirable, do you want people around you hearing you talk negatively about what you have chosen to do as a career? Why would they want to work with someone who has a negative attitude about what they do?
The longer I live, the more I realize the impact of attitude on life. Attitude, to me, is more important than facts. It is more important than the past, the education, the money, than circumstances, than failure, than successes, than what other people think or say or do. It is more important than appearance, giftedness or skill. It will make or break a company...a church...or a home. The remarkable think is we have a choice everyday regarding the attitude we will embrace for that day. We cannot change our past...we cannot change the fact that people will act in a certain way. We cannot change the inevitable. The only thing we can do is play on the one thing we have, and that is our attitude. I am convinced that life is 10% what happens to me and 90% of how I react to it. And so it is with you...we are in charge of our attitudes.
If you want positive words, encouragement for the day, something motivational, something that makes you think...something that makes you smile...you can count on me to deliver something regularly...whether here, on facebook, or twitter. I choose to find something everyday to make me smile...to encourage someone with...to always be thinking and speaking positively!
When you do what you love...people love what you do! I love what I do...in the feast or the famine! In a down market, buyers market, or sellers market. Full time...every time...providing service beyond your expectations!
Thursday, October 21, 2010
Color Coded
I have what some people might call perfectionist tendencies. I like order, structure, and balance. If it can't be done right, why bother...but once you get in the habit, it becomes so much easier and you don't even think twice about always doing it.
If you don't know already by reading my posts, I am a Realtor...and I absolutely LOVE it! I can't think of anything else I'd rather be doing than meeting people that want my assistance in buying or selling homes! Which brings me to my thoughts today...
I am in a lot of homes...see a lot of decorating styles...see a lot of different things. While showing homes a number of years ago, I noticed how organized and big a closet was. Much to my amazement, it wasn't that big, it just looked big because of the color coding! It's really quite simple. Start with your white clothes. Tank tops, sleeveless shirts, t-shirts, short sleeve w/ collars, long sleeve t-shirts, long sleeve w/ collars...you get the idea. Do each color. Mostly white shirts but with prints, put them in where they belong and so on.
I have kept my own closet this way since. Each time I put clothes away they just slide in where they belong and I always know whether or not something is clean and it is SO much easier in the morning getting ready!
It's like staging your closet to sell as well. Use like colored plastic hangers to keep the neat & tidy look. If you haven't gotten to the closets yet, put it on your list of items to do before you decide to sell your home. It makes my job so much easier and I'll know where you got the idea from!
Monday, October 18, 2010
Moving...again...
My parents are moving again which reminded me of when they moved 5 years ago after being in my childhood home for more than 30 years. Thus, the question: How do you go thru all the stuff you have accumulated for 20-30 years and not get overwhelmed?
At that time, they lived in a ranch style home with a basement. We knew it would take time to go thru everything, so since they thought it would be a year before they moved, I suggested we divide the house into 12 rooms, that way they had a month on each room and only that room would be in an upheaval. They needed a system, so it was "Keep", "Donate", "Pitch", or see if the kids want it.
The goal was set: move in a year. The plan was made: work only one room at a time so as to not get overwhelmed. The system was in place: keep it, donate it, or pitch it.
Little did I know, how I helped my parents, who are now in their 70's, would be the exact "idea" I would assist my clients with who are either downsizing, moving into an Assisted Living Center, or nursing care.
It can apply to anyone moving though. You don't have to wait to get so-called "Old" to do this. People move all the time, never going thru the boxes of old tax returns, credit reports, or even old magazines...just moving it with them.
In all reality, we keep more than we ever need, buy more than we really need, and stash more than we'll ever see again! So before you dismiss the idea...the holidays are quickly approaching and you will be getting your decorations down from the attic. What are you bringing down, thinking you will put it up, but you don't. Get rid of it!
Happy Keeping! Happy Donating! Happy Pitching!
Sunday, January 16, 2011
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 7: Family & Friends Opinions
It's natural to want to get opinions from those you trust before you make your final choice, but too much¿ input will ultimately make the decision process much harder.
You may be getting down payment assistance from family. For that reason, it's good for them to know why you are choosing a particular home. It's an investment on their part as well, but remember you will be the one making monthly mortgage payments. You may be needing approval or an extra set of eyes in the beginning stages of looking at homes if you are a first time home buyer. Once you get an idea of what to be looking for, you should be ready to step out and make those decisions on your own.
If you have friends come along, their taste may be completely different from yours, and you may miss the house you like because you were only focusing on their opinion. You may end up looking at more homes than are needed because you were distracted.
Your home is yours because it fits your family, your lifestyle, your needs, and your location of choice.
Remember to focus on what your immediate wants and needs are so that YOU will be happy with the final decision.
Next...Tip 8: Buy It because You Love It!
Friday, December 31, 2010
Real Estate, Mortgages, and Finances - A Decade in Review
10 years that shook America's finances
2001: Economy endures 9/11 attacks
· A mild, eight-month recession begins. In March, a recession emerges that the National Bureau of Economic Research later declares lasted eight months. The start of the recession follows a decade of expansion.
The unemployment rate, considered a lagging indicator of the overall economy, reaches a four-year high of 4.9 percent in August.
· A major tax reform law passes. On June 7, President George W. Bush signs a $1.35 trillion tax package into law. Among the changes, the law will cut the top tax rate from 39.6 percent to 35 percent and create a new bottom tax rate of 10 percent. The law will eventually double the child tax credit from $500 to $1,000. In addition, the new rules will gradually reduce the estate tax and eliminate it in 2010.
· Terrorists attack the U.S. on Sept. 11. They hijack four commercial airliners, crashing two of them into the World Trade Center and another into the Pentagon. The fourth crashes in a field in Pennsylvania. Almost 3,000 die.
The tragic event does not cripple the U.S. economy, although the airline and the insurance industries struggle in the wake of 9/11. A year later, a report by the Congressional Research Service says, "The direct effects of the attacks were too small and too geographically concentrated to make a significant dent in the nation's economic output."
· In October, the Federal Reserve reduces its benchmark federal funds rate to 2.5 percent, bringing the overnight bank lending rate to the lowest level in 39 years. It's the ninth consecutive cut to the federal funds rate in the Fed's attempt to pump up the economy.
-- Leslie McFadden
2002: Corporate scandals spur reforms
· In January, the Federal Reserve ends its streak of cuts to the target federal funds rate, after 11 consecutive reductions in 2001. The Fed leaves the federal funds rate at 1.75 percent and the discount rate at 1.25 percent, the lowest level for the latter since 1948. The economy begins to show signs of improvement.
· In June, the U.S. Senate votes down a bill that would have made the repeal of the estate tax permanent. A massive tax cut bill passed in 2001 under President George W. Bush would gradually reduce estate taxes and repeal them in 2010. Without passage of additional legislation, a "sunset provision" would cause the estate tax and other tax cuts to expire on Dec. 31, 2010. However, an extension of the Bush-era tax cuts was approved before the deadline.
· Reacting to several corporate scandals involving Enron Corp., WorldCom Inc. and others, Congress passes into law the Sarbanes-Oxley Act in July. The law requires immediate disclosure of stock sales by company officials and sets stiff penalties for executives who commit corporate fraud. It also creates an oversight board to monitor the accounting industry.
· In October, President George W. Bush announces a federal budget deficit of $159 billion for the fiscal year 2002, the first deficit since 1997.
-- Leslie McFadden
2003: Mortgage rates fall, housing prices climb
· At the beginning of the year, the 30-year, fixed-rate mortgage falls below 6 percent for the first time in 37 years. It remains at 6 percent or below until the end of July. And in mid-June, the average rate on a 30-year, fixed-rate mortgage falls to a record low of 5.28 percent.
· Low rates provoke the biggest mortgage refinancing boom in history. Homeowners take out $2.5 trillion in refis in 2003 compared to $1.7 trillion the year before (and $234 billion in 2000). Toward the end of the year, house price appreciation accelerates.
· The Federal Reserve moves short-term interest rates just once in 2003, but it's significant. The central bank cuts the federal funds rate to 1 percent from 1.25 percent. It's the lowest federal funds rate in 45 years.
With inflationary expectations low, the Fed judged that "a slightly more expansive monetary policy would add further support for an economy, which it expects to improve over time." What follows is a housing boom, then a bust. Later, some observers partly blame the Fed for keeping the federal funds rate at 1 percent for a year.
· In October, the $20 bill gets a facelift. Andrew Jackson's portrait is enlarged and removed from an oval frame, a background image of an eagle is added to the front and the bill is given an overall cleaner look. Most noticeably, the redesigned bill is colorful, with pastel hues of peach, green and blue.
-- Holden Lewis
2004: Facebook and Google: Recognize them?
· Seeking to reduce the chance of inflation, the Fed chooses to hike the federal funds rate in June for the first time in four years from 1 percent to 1.25 percent. The move marks the beginning of a rate-hiking spree by the Fed that would last until Aug. 17, 2007.
· Facebook and Google begin to define the contemporary Internet landscape.
On Feb. 4, Mark Zuckerberg and three friends launch Facebook in a Harvard dorm room. By the end of the year, the site would have more than 1 million users, and by 2010, it will balloon to more than 400 million.
On Aug. 18, Google launches an initial public stock offering at $85 per share. The stock will eventually reach $747 in November 2007.
· Costs associated with military action in Afghanistan and Iraq and newly enacted tax cuts drive the U.S. deficit to 3.48 percent of the U.S. gross national product, the highest percentage since 1994.
· Due in part to rising demand from China and India and political instability in the Middle East, crude oil prices begin a sustained climb, breaking $40 per barrel for the first time in history during the week ending Oct. 1.
· In December, the euro reaches a high against the U.S. dollar, rising to $1.36, and provoking fears the dollar would be supplanted as the world's reserve currency.
-- Claes Bell
2005: Subprime mortgages peak
· The subprime mortgage boom peaks. Lenders hand out $625 billion in subprime loans, compared to $540 billion the year before. On top of that, lenders give $380 billion in Alt-A mortgages. Most of the Alt-A loans are low-documentation mortgages, otherwise know as "liar loans" because borrowers exaggerate their incomes with a wink and nod from their lenders.
· An adage gains currency: Mortgage lenders are willing to give a loan to anyone who can fog a mirror. Urban legends tell of gardeners buying $500,000 McMansions. More than three-quarters of the 2005 subprime and Alt-A loans are sold on the secondary market. The market would explode in 2007 and 2008, igniting the worst recession since the Great Depression.
· Congress reforms bankruptcy law to make it more difficult for consumers to file bankruptcy. The law prioritizes credit card debt higher than unpaid child support.
· The Federal Reserve raises short-term interest rates eight times. The federal funds rate begins the year at 2.25 percent and ends it at 4.25 percent.
· Nationally, home values rise more than 11 percent, according to the federal government's House Price Index. The National Association of Realtors distributes a "Housing Bubble Prospects Q&A" that assures consumers, "There is virtually no risk of a national housing price bubble based on the fundamental demand for housing and predictable economic factors."
-- Holden Lewis
2006: Growing home prices create "bubble"
· The year 2006 sees the peak of the housing bubble, with the median existing home price climbing to $221,900, more than four times the U.S. median household income at the time, according to the National Association of Realtors. The value of a typical American home climbs 50.4 percent since the beginning of the decade, with some markets such as Miami-Fort Lauderdale, Fla., Las Vegas-Paradise, Nev., and Riverside-San Bernadino, Calif., more than doubling.
· Homeowners respond to the run-up in housing prices by drawing record amounts of equity out of their homes through cash-out refinancing, home equity loans and home equity lines of credit. All in all, Americans liquidate $318.3 billion in equity through cash-out refinances in 2006, according to Freddie Mac.
· The rising federal funds rate contributes to rising yields on certificates of deposit, benefiting savers. In September, the average yield for a one-year CD hits 3.89 percent, a multiyear high that's a far cry from today's paltry average yield for one-year CDs of below 1 percent.
· Alan Greenspan, the man largely credited with engineering the housing boom, retires on Jan. 31, ending a reign of more than 18 years as chairman of the Federal Reserve. He is replaced by Ben Bernanke.
-- Claes Bell
2007: Foreclosure tsunami begins
· The stock market hits an all-time high. Usually a leading indicator of the economy's health, it proves to be anything but as the stock market peaks on Oct. 9. The Standard & Poor's 500 reaches 1,565 and the Dow Jones Industrial Average hits 14,164 just months before the start of one the worst recessions in American history.
· After years of sustained growth, the real estate bubble begins to deflate. Real estate values begin a plunge in the fourth quarter of 2007 that will last into 2010 and cost U.S. mortgage holders trillions in home equity. Baby boomers would be hit particularly hard between 2007 and 2009. Even when you factor in future Social Security earnings, households headed by individuals aged 50 or older would see their real wealth decline by 18 percent, due in part to the loss of home equity.
· The credit crunch begins in August 2007 as lenders deal with a trifecta of bad news -- declining real estate values, the spread of toxic subprime mortgages and the slowing economy. The so-called TED spread, or the spread between the three-month Treasury yield and the three-month Libor, rises from 0.39 percent to 1.81 percent between July and August 2007. When the spread increases, it's a sign that lenders believe the risk of default on interbank loans is increasing.
· The foreclosure tsunami begins. Homeowners looking for refuge from resetting variable-rate mortgages are unable to refinance because falling real estate values put them "underwater." Mortgage delinquency rates for residential real estate tracked by the Mortgage Bankers Association begin a sustained rise, starting in September 2007.
-- Claes Bell
2008: The Great Recession cripples the nation
· The greatest financial crisis since the Great Depression hits full force in 2008, spurred by the failure or emergency sale of some of the nation's biggest financial firms, starting with Bear Sterns on March 16, 2008. Wachovia, Lehman Brothers, Washington Mutual and Merrill Lynch later toppled or came to the brink of bankruptcy. The main culprit was toxic subprime mortgages.
· The Fed and Treasury take unprecedented action to prevent the wholesale collapse of the financial system. When dropping the federal funds rate from 5.25 percent to 1 percent fails to stem the crisis, Fed Chairman Bernanke and Treasury Secretary Henry Paulson turn to more radical methods.
They encourage healthier institutions to buy failing banks, making massive amounts of liquidity available through hastily created government lending programs and arranging takeovers of founding firms. For example, global insurance firm AIG is bailed out with $182 billion.
· A global panic set off by the failure of Lehman Brothers on Sept. 15 pushes an already slowing economy into the Great Recession. By the fourth quarter 2008, the U.S. economy is shrinking at an annual rate of 6.8 percent. Global gross domestic product growth falls from 3.9 percent a year in 2007 to 1.7 percent a year in 2008.
· On Dec. 11, former Nasdaq Chairman Bernard Madoff is indicted on charges his multibillion-dollar investment firm is nothing more than a giant Ponzi scheme. In the weeks following, high-profile investors and charities admit to being bilked of billions by Madoff. He is eventually sentenced to 150 years in federal prison.
· Revolving consumer credit, which includes credit cards and other forms of flexible debt, peaks at nearly $974 billion in August.
-- Claes Bell
2009: Unemployment spikes, stimulus approved
· Newly elected President Barack Obama signs the massive American Recovery and Reinvestment Act on Feb. 13. It commits $787 billion to tax cuts, infrastructure projects, job training programs and aid to families.
· On March 9, the Dow Jones Industrial Average sinks to 6,547, less than half the all-time high set in October 2007 and the lowest close since April 15, 1997. On this day, many former blue chip stocks, especially in the embattled financial sector, are trading at or near multiyear lows. Giant Citigroup hits an intraday low of 99 cents.
· In February, the Treasury Department begins a series of "stress tests" to determine which banks are healthy enough to survive further deterioration of the global economy. It finds big banks must raise an additional $74.6 billion to remain solvent should the economy slide further.
· After four straight quarters of declining GDP, the U.S. economy begins to grow again in the third quarter 2009 at an annualized rate of 1.6 percent. Later, the National Bureau of Economic Research's Business Cycle Dating Committee, the group of economists tasked with following recessions, pegs June as the official end of the recession.
· In May, the Credit Credit CARD Act passes. The measure contains consumer protections, including restrictions on interest rate hikes and double-cycle billing of credit cards. Many credit card providers respond by raising rates and fees dramatically before the law takes effect.
-- Claes Bell
2010: Reforms to financial industry approved
· Amid fierce lobbying from the financial industry and consumer advocates, the Dodd-Frank Wall Street Reform and Consumer Protection Act is signed into law by Obama on July 21. The new law creates a new Consumer Financial Protection Bureau to police mortgages and other financial products. It also forms a new office to monitor risks to the financial system and streamlines oversight of the financial industry.
· Thanks to rising corporate profits, the stock market continues a rapid recovery throughout 2010, with the Dow Jones Industrial Average hitting a 52-week high of 11,519 on Dec. 15. In just over 22 months, the Dow rises 175 percent.
· Despite government stimulus and steady if unspectacular GDP growth, high unemployment persists, hovering between 9.5 percent and 9.9 percent throughout the year. More troubling still is the length of unemployment for many Americans. As of November 2010, more than 6.3 million are out of a job for 27 weeks or more, and the average length of unemployment is 33.8 weeks.
· Three years into the housing crisis, the flood of residential foreclosures shows little sign of abating. At the end of the third quarter 2010, a survey by the Mortgage Bankers Association finds 4.39 percent of residential mortgages are in foreclosure and 9.13 percent of all home loans are in some form of delinquency.
· On Aug. 15, a new Federal Reserve rule goes into effect requiring banks to get consumers' permission before enrolling them in overdraft protection. In response, many banks begin imposing maintenance fees and balance requirements to recover lost revenue, reducing free checking options for consumers.
-- Claes Bell¿¿
Courtsey of Gina Starr, Loan Officer
Red Rock Mortgage & Lending¿
Phone: 405-210-3900
Email: gstarr@redrocklend.com
Don't worry...the next Tip will be coming soon...
HAPPY NEW YEAR 2011!
The start of a new decade!
Bankruptcy, Foreclosures, Home Values, Homes, Housing Market, Inflation, Interest Rates, Lenders, Loans, Mortgage, Real Estate, Realtor, Recession, Unemployment
Sunday, December 26, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 6: When is the Right Time to Buy...
When is the Right Time to Sell?¿
Every home buyer and seller is in a different situation, so it is important you don't compare your timeline and decisions to anyone else's.
Time to Buy?
Given all of the drops in the housing market in the last few years, many people are wondering whether now is the right time to buy a new house. Should you snatch up the good deals before prices start to rise or should you wait it out a little bit longer to see if the prices will drop even more? It can be somewhat of a gamble, so it is important to make sure that you know a few facts about the current market so that you can make the best possible decision.
One of the most important facts you should consider when determining whether now is the right time to buy a new house relates not to the market but your own situation. Consider how long you plan to live in the home. While you might not be able to look into a crystal ball and see the future, consider what you know at the moment.You also must consider how comfortable you are with taking risk as well. If you feel comfortable with a possible 10% or even more drop in a home price if you need to re-sell within the next few years then now might be a fine time to make a purchase. If you are not comfortable with risk, then it is probably better to wait and see how the market settles before you make a home purchase.
The reality of the current market is that the fluctuations have not yet stopped. During the year, prices are most likely not going to appreciate at the rate they used to. It is also important to keep in mind that you should not get swept up in the hype that is often presented in media advertisements. While there may be some truth in the media, consumers should be wary about taking this and running with it.
Lending restrictions remain tight throughout much of the country as well. Loans are available for the purchase of a home, but restrictions are much tighter than they were in the past. Make sure you know exactly what is on your credit and how much you will be able to offer for a down payment before you consider purchasing a home in the current market.
Also, if you plan to buy a new house in the current market, you should be fully aware that there is the potential for the value of your home to drop over the next few years rather than appreciate. You should not assume that your home will steadily gain value the longer that you own it. This is a gamble that you should be fully aware of before you begin shopping around with the intention of making a home purchase.
While now could very well be an excellent time for you to buy a new home, it is important to consider your own situation as well as how comfortable you are with taking possible risks over such a large purchase in the next few years. The current market certainly is offering good deals in many markets, but before you rush out to grab one, make sure that you are fully informed.
Time to Sell?
Everything has a season – including selling your house. Listing at the right moment could mean more money in your pocket.
Traditionally, spring is the hottest season for real estate. Sales peak in April and May and stay strong in June and July. It’s a good season for families to move, between school terms and while the weather is warm. People have just received their tax refunds, which they can use to help finance a down payment. And the nice weather and beautiful flowers in spring and early summer make it a great time to show your home.
In fact, 60 percent of America's moves take place in the summer. But closing a sale can take weeks, so it’s a good idea to list your home early in the season.
August brings a lag in sales, as people go away on vacation and start to think about the new school year. Then sales surge briefly in the fall before dropping in winter as buyers and sellers focus on the holidays. But by January, buyers are out again, and sales steadily increase into spring.
If you can’t sell in the peak season, consider listing your home in the winter. It may sound counterintuitive, but you probably already have the house decorated and cleaned for holiday entertaining, so it shouldn’t be hard to get it in shape for showing. Moreover, you will have less competition and may get a better price. Another plus: buyers in winter are less likely to waste your time or draw out the closing. They may want to close before the New Year so they can claim the mortgage deduction on their tax return, which you could turn to your advantage in pressing for a quick deal.
Of course, selling in the hot season isn’t the whole story. You should pay attention to your local housing market and try to list during a seller’s market, when there will be more competition among buyers for your home – which could mean a better price, a quicker closing and fewer conditions on the offer.
Find a Realtor who you like and trust, one with the knowledge and experience in your local housing market. If you have questions or comments, please let me know...
Next...Tip 7: Family & Friends Opinions
Buyers, Buying a Home, Home Buying, Homes, Housing Market, Lenders, Listing My Home, Loans, Mortgage, Moving, Neighborhoods, Real Estate, Realtor, Sellers
Thursday, December 23, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 5: Physical Aspects of Your Home¿
Now that we've figured out what type of home fits your lifestyle, we need to think about some important issues and not get caught up in the physical aspects of the home. It's easy to walk into a home, fall in love, and completely forget that this was not an area you wanted to live in. Keeping an open mind and not being rigid is a welcome thing, but here are some things to keep in mind.
Noise Level
It could be the home sits right next to a busy interstate or main street through town. The home might be next to a train track, or even in a flight path. Maybe the neighbors have dogs that bark just because they hear the wind. Inside the home you don't hear anything, but unless you go outside to the backyard, or sit on the front porch, you never realize how loud things could be. Not paying attention to these things could end up frustrating you, and instead of loving the house, you begin to hate it.
Distance
Maybe it fits what you are looking for, but it's too far away from all the amenities ¿and activities your family enjoys. Driving to the home you really like during different times of the day or week will definitely help you see what traffic is like, how long it may take you to get to work or outside activities. Remember distance could mean less time maintaining the home you love because you spend it on the road instead. If you need the time to wind down after work, the distance may be what you need to shut your brain off so you are ready for the family that waits for you.
Neighborhoods
It may be that you see the house during the week when people are at work, kids are at school, and you don't know what goes on at different times of the day or on the weekends. It may be you don't like cars parked up and down the street, kids riding their bikes in your driveway, the loud hot rod or motorcycles engines being warmed up. Pay attention to the houses next door, what their landscaping looks like, and how the neighbors keep things. This will definitely have an impact on this home when and if you ever would decide to sell...if you ended up buying this home.
Hopefully these are things you have thought about and shared with your Realtor. As a professional, with this kind of financial investment, your Realtor has been hired to keep you on track, reminding you of what you have shared, listened to you and taken notes. You will be grateful you bought what you were looking for and not talked into making a purchase just because. Hire the Realtor that cares about you and your needs and not their paycheck.
Next...Tip 6: When is the Right Time to Buy...When is the Right Time to Sell?¿
Buyers, Home Buying, Homes, Lifestyles, Moving, Neighborhoods, Physical Aspects, Real Estate, Realtor
Saturday, December 18, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 4: Find the Home that Fits Your Lifestyle¿
You’d think the easiest thing in the world would be deciding what house to buy. After all, who knows you better than you? You know exactly what you want, right? Well...sometimes. The truth is most people only have an idea of what they want – the number of bedrooms and bathrooms, size of the kitchen and garage, and maybe the yard. Things tend to get a little murkier when you mix in neighborhoods and schools, commutes to work and distance to ball fields and retail shops.
Finding a home that fits your lifestyle can be a big challenge. There are so many options when it comes to choosing, and you probably aren't going to find a home that is 100% perfect, so the best way to narrow down your options is to take a look at your lifestyle and priorities. Chances are there is an option that will work best for you.
The Social Butterfly
A condo can be a great option for anyone who loves to socialize or wants to live right in the heart of the city, close to the action, or within walking distance to work. If you’re new in town, it can be a good way to meet new friends and neighbors. Many large complexes have community features like a pool, gym or clubroom. This will give you the opportunity to meet the people with which you share a building. Remember though, you will be sharing walls, floors and ceilings with many other people. If a little bit of noise will break the deal for you, a high-rise might not be for you.
Gated Communities
Gated communities provide a lot of benefits to the residents that live within them. The number one reason people choose to live in gated communities is likely the security element. They are private and more difficult to access than a standard community. Criminal activity is reduced in gated communities, and solicitors will have a more difficult time bothering residents.
Traffic and speeding cars are also reduced behind the gates, making it quieter and safer for children to play and ride bicycles within these neighborhoods. You likely won’t have the morning commute using your street as a shortcut either!
Another positive aspect of gated communities is a higher standard of home quality, and stricter building codes that promote uniformity in design. That means more sale comparables and better value for all the homeowners within the community. Homeowners in these neighborhoods also generally have a higher pride of ownership, and keep their homes in good condition. Along with that, gated communities create a scarcity effect, with few homes within these neighborhoods typically available for sale at the same time, adding more bite to the value.
There may also be social benefits, such as a community center, pool, park, or events that promote group activities for families to get to know each other.
Wide Open Spaces
If you value privacy and want a lot of space to call your own, buying a home on an acreage may be an option. Keep in mind that with a lot of land comes a lot of responsibility. If family time and outside activities take up a lot of your time, the maintenance of land can consume a weekend. Also remember that if you work in the city, you could be in store for a longer commute, which results in less family time as well.
Somewhere in Between
Maybe you want a place to call your own, but without all the responsibilities of a yard. A great alternative that gives you the best of both worlds is a town home. Townhouses usually consist of several single-family homes grouped together. In many cases, you can rent or own the inside of the home, while a separate organization owns and cares for the exterior of the building and the yard. This allows you the luxury of having a small yard without having to maintain it. Keep in mind that there are usually home ownership association fees that cover the land maintenance.
Buying a home is like finding the right pair of jeans. It's all about what fits. Your home should fit your lifestyle, and like fashion, that changes with time. Choose a Realtor to help you gauge your stage in life, one who knows the questions to ask you, and can pull it all together...so you can find a home that's the perfect fit!
Next...Tip¿ 5: Physical Aspects of Your Home
Buyers, Condos, Gated Communities, Homes, Lifestyles, Moving, Neighborhoods, Real Estate, Realtor, Sellers, Town homes
Tuesday, December 14, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 3: Keeping Emotions in Check
Buying a home is one of the biggest financial decisions you will make in your lifetime, and along with the finances come emotions. It is important to keep your emotions in check during the process. Being organized and in control will contribute significantly to getting the best home deal possible with the least amount of stress. ¿
Once you find a home you like, you become emotionally attached to it. Emotional attachment can cause you to make unwise decisions when making an offer, handling negotiations, and so forth. Once you’ve fallen in love with a house and visualized it being your home, you’ll start to do WHATEVER it takes to make sure it becomes your home.
This is about the worst possible way to buy a home, but this may also be the best possible home for you. You do want to fall in love with your new home, but you also want to be careful. You can literally cost yourself thousands of dollars, if not tens of thousands of dollars, by being too emotionally attached. Instead of letting emotions rule the game, try to include some common sense in the buying process. Real estate investors have a saying, “Don’t fall in love with the house, fall in love with the deal.”
Having said that, realize that you will always have some emotional attachment to your home. You need to like it. Your goal is to strike a balance between liking the house and using common sense to tell you whether you are sacrificing too much to try to get the house. If you find you have to make a lot of compromises to get a house, stop yourself and ask, “Is this really worth it?”
It's important that you choose an experienced Realtor who is willing to work through these emotions with you. Someone you know you can trust when choosing your most valuable asset. Someone you like and work well with, someone who makes the experience fun and exciting...gets excited for you! Someone you trust to know your wishes, desires, and goals...not just your list of likes and dislikes in purchasing your dream home.
So, remember to strike a balance between emotions and common sense. Find a Realtor that fits your personality, is patient and understanding of your emotions, and will work to keep you on track. You'll be grateful, and it will help you enjoy your home that much more once you actually move in!
Next...Tip 4: Find the Home that Fits Your Lifestyle¿
Saturday, December 11, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 2: Create a Budget before you Move into Your Home
There are a number of other costs you need to consider before you buy a home. It never fails...we think we have thought of everything, and lo and behold, we didn't. Hopefully you find some helpful ideas that you can use to create a budget of expenses beyond the down payment and closing costs.
Storage
You may not be a pack-rat, but every time people move (about once every 5-7 years) they notice that their moving truck gets larger and larger. We've all done it...accumulated more than we remember, not thrown things away, or even gone thru the hall storage. We've become part of the lifestyle of inflation; wanting more than we need, buying more than we have room for, and keeping it because "we may need it someday". While a storage unit may be something you need while your current home is on the market, to make the home appear larger and less crowded, is it really necessary after the move? This may be something you need to budget for unless you are willing to donate or pitch...being willing to accept this is not something you need just to pay for it and never see the items you never use anymore...because they are in Storage. A knowledgable Realtor may be able to direct you to different options, so keep that in mind.
Packing Materials
Start collecting boxes early on from stores for free. Check out Craigslist for those that have recently moved, or ask your Realtor if they have a client who may need to get rid of their used boxes. It seems as much as we plan, the need for more boxes overtakes our budget. Many of the boxes you may be able to resell after your move if they are still in good condition, which partially makes up for the costs that sneak up on you. U-Haul has colored packing tape that identifies different rooms that makes it easier when moving in. Bubble wrap and packing paper will be needed as well.
Moving Expenses
Your stuff doesn’t get to the new house on it’s own! Do you hire a moving company? Maybe you try moving yourself, but you may still need to rent a truck. Moving costs can easily cost you anywhere from a few hundred to a couple of thousand dollars depending on your situation. Certainly by now you know a Realtor or are working with a really good Realtor who has all these resources and contacts in their Rolodex. Their list of contacts should include all these tips, points, thoughts, and any answers you may ever need for your questions. A Realtor deals with people moving every day! Who better to ask!
Utilities & Transfer Fees
Most utility companies now have the option of transferring services online or over the phone without having to talk to a representative. However, overlapping service by a couple of days isn't as easy to turn service on and off, so you may end up speaking with representatives.
Cable/Telephone/Internet Services: Will these services cost more than where you previously lived? Will you need any new equipment? Will you have it in more rooms in the new home (such as more cable boxes)?
Water, trash and sewer services: These may not be an items you think of often, especially if you lived in an apartment because these were just part of your rent. In owning a home, these most likely will be included in your water bill, which is another utility most buyers don't think of when it comes expenses. Leaky faucets will now be your problem once you are a proud homeowner, which will make you keenly aware of the true costs of living in a home.
Energy Costs: Make sure you understand what the various energy costs are before you buy. Check with the local utility companies for average costs for both winter and summer.
Alarm: Will you be getting an alarm? Will it be a monthly service? Here’s another cost that could be recurring monthly.
New Locks: You may want to hire a locksmith to change all of the locks in your new home. There’s no telling how many copies of keys are out there already!
Odds are you are moving to a bigger home. Do you have the furniture you need, for example: are you moving from an eat in kitchen to a home with a formal dining room? You don’t have to buy this all at once but you may be tempted to fill in empty spaces.
Appliances: Do you have all of the appliances you need? Perhaps some need upgrading? If the ones you currently own are old, they may be using twice as much electricity as newer, energy-saving ones.
Gardening, Lawn & Landscaping
While you may be thrilled to be inheriting a lawn, have you the equipment the maintain it? How about shrubs and gardens? Can you handle the work? Will you need to buy or rent equipment, such as a mower? What does it cost to hire someone to handle the landscape? The previous owner may be able to give you an idea of the costs as well as refer you to the company they used. Find out if there are local ordinances about grass height and what you are allowed to grow as well as water usage for your lawn. What you may not anticipate is the cost difference in utilities for maintaining a lawn. Your water bill could increase substantially while trying to keep the lawn green. As a Realtor, I have a lawn service I have used for vacant property listings that I could possibly refer you to as well.
Insurance Increase
If you were a renter, you most likely carried renter's insurance. Many buildings and landlords require insurance since they aren't responsible for a tenant's personal belongings. When you call your insurance provider to discuss the purchase of a home, your agent will review your premium since now you will be a homeowner. If you have owned a home before, the premium will probably be different as well, since it is calculated on value of the home. In the process of discussing with your lender the home you have chosen, they, as well as your Realtor, should be able to direct you to insurance companies that are able to provide good rates.
Carpeting – Clean or Buy New?
Your new home may have nice wall-to-wall carpeting but when was the last time it was cleaned? Perhaps it's not quite the color you want or it's showing some wear and tear. You can go cheap with carpeting but sometimes you get what you pay for and this is your home. Always remember, buy the best pad available. Your Realtor could possibly write in the contract that the carpets be professionally cleaned. If that isn't accepted, your Realtor surely has a reputable carpet cleaner that they could refer you to. Don't hesitate to ask these questions.
Spackling and Painting
If you are fortunate, your new place will be all done up and have all the picture holes spackled and the rooms freshly painted. But many homes will still have minor dings here and there that need repair and fresh paint doesn’t mean you like the color. We all know it's easier to paint when there’s no furniture in the room. So do you repair and re-paint? Do you hire people or do it yourself? DIY will still cost you and depending on how much work needs to be done your costs can easily rise. You may shove this idea off as paint is cheap, which it is, but the supplies cost too. These are cosmetic things that need to be taken into consideration since they will be your costs. Hopefully your Realtor has names of reputable contractors that are looking for the next job.
Additional Car
Are you moving somewhere that you will need another car? Is public transportation or walking out of the question now? Think about your location and your needs when you are looking to move and figure out if you will need another car. If you do, remember you will also need additional car insurance and you will have more maintenance costs as well. This isn't one most people think about, but it is something to think about.
I don’t mean to scare you with all of these items, but they do need to be considered before you buy a new home. These may not all apply to you but you can see how quickly costs can run up! When preparing your budget for a new home make sure you take into consideration all of the other costs you may incur.
Next...Tip #3: Keeping Emotions in Check...
Sunday, December 5, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 1: 5 Steps to Mortgage Loan Approval
There will always be first time homebuyers, and while the process stays somewhat the same, so I thought I'd break it down to assist those that need the knowledge, and those that need to be refreshed in how this works.
The 5 steps to mortgage loan approval aren't complicated, but you really have to think ahead to make sure you have everything in order so you can get your loan approved without delay. Chances are good that if you have been thinking about buying a home you may have already started working on some (or all) of these five steps.
Mortgage lenders look at the same things other lenders look at when a potential borrower submits an application for credit, but home loans have additional requirements that lenders review prior to approving a mortgage loan application.
It is never too early to get started with these five steps because almost all of them will help you improve your credit overall.
One: Get Your Credit in Order
Order a copy of your credit report and review it to make sure there are no errors listed. Also, take a close look at the accounts you currently have. Are all your payments on time? Are you teetering dangerously close to meeting the maximum available credit? Mortgage lenders are usually reluctant to approve mortgage loans for applicants who are behind on their debt payments or who have maxed out their revolving account. Get any errors removed from your account and start getting your credit in order. This may take some time, but it will certainly result in a higher likelihood of getting approved for your mortgage loan and may even result in a lower interest rate for the loan you are approved for.
If your Realtor asks these questions or makes these suggestions, trust that she/he may know a little about this process and is only trying to assist and educate you. My goal is always to get to know more about you and what your ultimate goal may be, whether you've thought about it or not.
Two: Build Up a Down Payment
Different types of home loans have different down payment requirements, but no matter what type of home loan you want to obtain you will need to have some money set aside for a down payment and closing costs. Most lenders also want to see a cushion of savings that will remain after the loan is complete because it is never a good idea to buy a home and have no money in a deposit account at all. The higher your down payment, the more of an initial investment you are making when getting the mortgage. The more invested in the home you are, the more likely the lender will approve you for the loan, and oftentimes with a better loan product if available.
Also, if you have available money in a deposit account, the likelihood of needing it for moving expenses or setting up the home will not take away from making the first months house payment! Each time you move, there are unplanned for expenses, so having a cushion is always a good idea.
Three: Pay Down Debt
Mortgage lenders do not like to lend money to borrowers who are already overwhelmed with debt. Start taking steps now to pay down some of your debt obligations. Pay down your credit card balances and try to pay off any installment loans you have in place, such as personal loans or auto loans. If you plan on applying for a mortgage loan in the near future, do not close any accounts you pay off until after you close the mortgage loan. A mass closure of accounts can negatively affect your credit score in the short term, which may make you ineligible for the best mortgage interest rates.
While we are working on getting the approval, excitement is welcome, but try not to get ahead of yourself. No major purchases like a new car, new furniture, or the like. You may very likely have the money for it, but it can definitely affect your ability to get a mortgage for a home. Once the loan is closed and you have moved into your home, what you do then is fine.
Four: Consistent Employment
Mortgage lenders generally look for two years of consistent employment before approving a loan application. Although this varies from one lender to another, demonstrating the ability to stay employed is quite important. The year that you want to apply for a mortgage loan is not the time to quit your job and open up your own business. Save this career change until after you already own your home.
Five: The Right Lender
Different mortgage lenders offer different loan products. If you know that you have less than perfect credit, do some research and find out which lenders will be willing to approve mortgage applications for people with your credit score. Research your options before you are actually ready to apply. You will save time and may be able to find a lower interest rate by investing some time into finding an appropriate lender for your credit situation.
Time is Money!
The sooner you get started with the 5 steps to mortgage loan approval, the better your chances will be of getting approved for a loan with good terms and a low interest rate.
Get started! The next tip will be coming soon! Happy Loan Approval! If you need more assistance, please don't hesitate to contact me. I have fantastic lenders who are patient and willing to discuss all these steps with you. Finding a lender and a Realtor who are knowledgeable, can walk you thru this process, keep you on track, and discuss all your options will make this fun and exciting.
Next.....Tip 2: Create a Budget before you move into your new home.
Thursday, November 25, 2010
Happy Thanksgiving
Today is a day to be thankful...positive...motivational...and encouraging. Though, I believe everyday should start with something to be thankful for, I wanted to share some short thoughts you could remember especially today.
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The smallest act of kindness is worth more than the grandest intention. (Oscar Wilde)
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No duty is more urgent than that of returning thanks.
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Every time we remember to say “thank you”, we experience nothing less than heaven on earth.
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I would thank you from the bottom of my heart, but for you my heart has no bottom.
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Silent gratitude isn’t much use to anyone. (Gladys B Stern)
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Blessed are those that can give without remembering and receive without forgetting.
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God gave you a gift of 86,400 seconds today. Have you used one to say “thank you?” (Wm A Ward
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Gratitude is the memory of the heart. (JB Massieu)
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It isn’t what you have in your pocket that makes you thankful, but what you have in your heart.
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If the only prayer you ever say in your entire life is ‘thank you’, it will be enough. (M Eckhardt)
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A thankful heart is not only the greatest virtue, but the parent of all other virtues. (Cicero)
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If you can’t be content with what you have received, be thankful for what you have escaped.
Wishing you many thankful moments making memories with those you are so thankful for...the things you treasure in this life...and the time you spend with those you love.
Saturday, November 20, 2010
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How to Assess the Real Cost of a Fixer-Upper House
When you buy a fixer-upper house, you can save a ton of money, or get yourself in a financial fix. Read
Visit houselogic.com for more articles like this.
Copyright 2010 NATIONAL ASSOCIATION OF REALTORS®
Sunday, November 14, 2010
Get sick ~ What's your attitude?
In real estate, get sick, take a vacation, or have something personal happen in your life...and you can just bet your business will get a jump start.
Last weekend I woke up with a terrible sore throat & throbbing headache. I haven't been sick in a long time & I knew what this meant...my phone was going to start ringing. Sure enough. While I'm now at the tail end of a cold, I have still been working. In the last 3 wks I've listed 2 homes, had 2 listings appts that will list in 3-4 wks, have a new buyer that also wants to sell, and have 2 listing appts Monday.
In my last post, Is the Market Really that Bad, I was talking about attitude. It can make or break you. Negativity can creep in...pay a visit...stay longer than you wanted it to...and before you know it...it has made its home. If I had let getting sick get me down, I might as well have sent out invitations to negativity, depression, sad, whoa is me, nothing good happens to me, and all the other horrible no-good things you can think of.
I'm not going to let politics get me down, does complaining about it help me? No. I'm not going to let the media convince me that real estate is down the tubes. It's not, and people will always be buying and selling real estate as long as this world is still standing. Hang around the water cooler at work and just listen to the negativity coming out of people's mouths. Read all the doom and gloom on the internet. Is this what you want to feed your mind daily? How does it set the tone for your day?
I am a work in progress, and happy to say I am content where I am today! If attitude is everything, I'm choosing to find things to smile and laugh about. I'm not going anywhere...I'll be a Realtor til my dying day. That's how passionate I am about what I do. I'd love to share my passion with you! Become one of my Fans on Facebook: http://on.fb.me/b4q9nf.
Til next time...keep smiling!
Thursday, November 4, 2010
Is the market really that bad?
My daughter asked me the other day how business was. She works as a hairstylist and another stylist next to her was cutting a lady's hair. All the lady did was complain about how bad the market is. Then she found out the lady was a local Realtor! It made me think about how many people I hear are constantly complaining.
While the market may not be what it has been in the past, it is surely not dead! You want someone who works hard, markets your home in every available avenue possible, online as well as offline, returns phone calls promptly, keeps searching for the perfect home for you as a buyer, someone who sees the glass half full. Even if things seem less than desirable, do you want people around you hearing you talk negatively about what you have chosen to do as a career? Why would they want to work with someone who has a negative attitude about what they do?
The longer I live, the more I realize the impact of attitude on life. Attitude, to me, is more important than facts. It is more important than the past, the education, the money, than circumstances, than failure, than successes, than what other people think or say or do. It is more important than appearance, giftedness or skill. It will make or break a company...a church...or a home. The remarkable think is we have a choice everyday regarding the attitude we will embrace for that day. We cannot change our past...we cannot change the fact that people will act in a certain way. We cannot change the inevitable. The only thing we can do is play on the one thing we have, and that is our attitude. I am convinced that life is 10% what happens to me and 90% of how I react to it. And so it is with you...we are in charge of our attitudes.
If you want positive words, encouragement for the day, something motivational, something that makes you think...something that makes you smile...you can count on me to deliver something regularly...whether here, on facebook, or twitter. I choose to find something everyday to make me smile...to encourage someone with...to always be thinking and speaking positively!
When you do what you love...people love what you do! I love what I do...in the feast or the famine! In a down market, buyers market, or sellers market. Full time...every time...providing service beyond your expectations!
Thursday, October 21, 2010
Color Coded
I have what some people might call perfectionist tendencies. I like order, structure, and balance. If it can't be done right, why bother...but once you get in the habit, it becomes so much easier and you don't even think twice about always doing it.
If you don't know already by reading my posts, I am a Realtor...and I absolutely LOVE it! I can't think of anything else I'd rather be doing than meeting people that want my assistance in buying or selling homes! Which brings me to my thoughts today...
I am in a lot of homes...see a lot of decorating styles...see a lot of different things. While showing homes a number of years ago, I noticed how organized and big a closet was. Much to my amazement, it wasn't that big, it just looked big because of the color coding! It's really quite simple. Start with your white clothes. Tank tops, sleeveless shirts, t-shirts, short sleeve w/ collars, long sleeve t-shirts, long sleeve w/ collars...you get the idea. Do each color. Mostly white shirts but with prints, put them in where they belong and so on.
I have kept my own closet this way since. Each time I put clothes away they just slide in where they belong and I always know whether or not something is clean and it is SO much easier in the morning getting ready!
It's like staging your closet to sell as well. Use like colored plastic hangers to keep the neat & tidy look. If you haven't gotten to the closets yet, put it on your list of items to do before you decide to sell your home. It makes my job so much easier and I'll know where you got the idea from!
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 7: Family & Friends Opinions
It's natural to want to get opinions from those you trust before you make your final choice, but too much¿ input will ultimately make the decision process much harder.
You may be getting down payment assistance from family. For that reason, it's good for them to know why you are choosing a particular home. It's an investment on their part as well, but remember you will be the one making monthly mortgage payments. You may be needing approval or an extra set of eyes in the beginning stages of looking at homes if you are a first time home buyer. Once you get an idea of what to be looking for, you should be ready to step out and make those decisions on your own.
If you have friends come along, their taste may be completely different from yours, and you may miss the house you like because you were only focusing on their opinion. You may end up looking at more homes than are needed because you were distracted.
Your home is yours because it fits your family, your lifestyle, your needs, and your location of choice.
Remember to focus on what your immediate wants and needs are so that YOU will be happy with the final decision.
Next...Tip 8: Buy It because You Love It!
Friday, December 31, 2010
Real Estate, Mortgages, and Finances - A Decade in Review
10 years that shook America's finances
2001: Economy endures 9/11 attacks
· A mild, eight-month recession begins. In March, a recession emerges that the National Bureau of Economic Research later declares lasted eight months. The start of the recession follows a decade of expansion.
The unemployment rate, considered a lagging indicator of the overall economy, reaches a four-year high of 4.9 percent in August.
The unemployment rate, considered a lagging indicator of the overall economy, reaches a four-year high of 4.9 percent in August.
· A major tax reform law passes. On June 7, President George W. Bush signs a $1.35 trillion tax package into law. Among the changes, the law will cut the top tax rate from 39.6 percent to 35 percent and create a new bottom tax rate of 10 percent. The law will eventually double the child tax credit from $500 to $1,000. In addition, the new rules will gradually reduce the estate tax and eliminate it in 2010.
· Terrorists attack the U.S. on Sept. 11. They hijack four commercial airliners, crashing two of them into the World Trade Center and another into the Pentagon. The fourth crashes in a field in Pennsylvania. Almost 3,000 die.
The tragic event does not cripple the U.S. economy, although the airline and the insurance industries struggle in the wake of 9/11. A year later, a report by the Congressional Research Service says, "The direct effects of the attacks were too small and too geographically concentrated to make a significant dent in the nation's economic output."
The tragic event does not cripple the U.S. economy, although the airline and the insurance industries struggle in the wake of 9/11. A year later, a report by the Congressional Research Service says, "The direct effects of the attacks were too small and too geographically concentrated to make a significant dent in the nation's economic output."
· In October, the Federal Reserve reduces its benchmark federal funds rate to 2.5 percent, bringing the overnight bank lending rate to the lowest level in 39 years. It's the ninth consecutive cut to the federal funds rate in the Fed's attempt to pump up the economy.
-- Leslie McFadden
2002: Corporate scandals spur reforms
· In January, the Federal Reserve ends its streak of cuts to the target federal funds rate, after 11 consecutive reductions in 2001. The Fed leaves the federal funds rate at 1.75 percent and the discount rate at 1.25 percent, the lowest level for the latter since 1948. The economy begins to show signs of improvement.
· In June, the U.S. Senate votes down a bill that would have made the repeal of the estate tax permanent. A massive tax cut bill passed in 2001 under President George W. Bush would gradually reduce estate taxes and repeal them in 2010. Without passage of additional legislation, a "sunset provision" would cause the estate tax and other tax cuts to expire on Dec. 31, 2010. However, an extension of the Bush-era tax cuts was approved before the deadline.
· Reacting to several corporate scandals involving Enron Corp., WorldCom Inc. and others, Congress passes into law the Sarbanes-Oxley Act in July. The law requires immediate disclosure of stock sales by company officials and sets stiff penalties for executives who commit corporate fraud. It also creates an oversight board to monitor the accounting industry.
· In October, President George W. Bush announces a federal budget deficit of $159 billion for the fiscal year 2002, the first deficit since 1997.
-- Leslie McFadden
2003: Mortgage rates fall, housing prices climb
· At the beginning of the year, the 30-year, fixed-rate mortgage falls below 6 percent for the first time in 37 years. It remains at 6 percent or below until the end of July. And in mid-June, the average rate on a 30-year, fixed-rate mortgage falls to a record low of 5.28 percent.
· Low rates provoke the biggest mortgage refinancing boom in history. Homeowners take out $2.5 trillion in refis in 2003 compared to $1.7 trillion the year before (and $234 billion in 2000). Toward the end of the year, house price appreciation accelerates.
· The Federal Reserve moves short-term interest rates just once in 2003, but it's significant. The central bank cuts the federal funds rate to 1 percent from 1.25 percent. It's the lowest federal funds rate in 45 years.
With inflationary expectations low, the Fed judged that "a slightly more expansive monetary policy would add further support for an economy, which it expects to improve over time." What follows is a housing boom, then a bust. Later, some observers partly blame the Fed for keeping the federal funds rate at 1 percent for a year.
With inflationary expectations low, the Fed judged that "a slightly more expansive monetary policy would add further support for an economy, which it expects to improve over time." What follows is a housing boom, then a bust. Later, some observers partly blame the Fed for keeping the federal funds rate at 1 percent for a year.
· In October, the $20 bill gets a facelift. Andrew Jackson's portrait is enlarged and removed from an oval frame, a background image of an eagle is added to the front and the bill is given an overall cleaner look. Most noticeably, the redesigned bill is colorful, with pastel hues of peach, green and blue.
-- Holden Lewis
2004: Facebook and Google: Recognize them?
· Seeking to reduce the chance of inflation, the Fed chooses to hike the federal funds rate in June for the first time in four years from 1 percent to 1.25 percent. The move marks the beginning of a rate-hiking spree by the Fed that would last until Aug. 17, 2007.
· Facebook and Google begin to define the contemporary Internet landscape.
On Feb. 4, Mark Zuckerberg and three friends launch Facebook in a Harvard dorm room. By the end of the year, the site would have more than 1 million users, and by 2010, it will balloon to more than 400 million.
On Aug. 18, Google launches an initial public stock offering at $85 per share. The stock will eventually reach $747 in November 2007.
On Feb. 4, Mark Zuckerberg and three friends launch Facebook in a Harvard dorm room. By the end of the year, the site would have more than 1 million users, and by 2010, it will balloon to more than 400 million.
On Aug. 18, Google launches an initial public stock offering at $85 per share. The stock will eventually reach $747 in November 2007.
· Costs associated with military action in Afghanistan and Iraq and newly enacted tax cuts drive the U.S. deficit to 3.48 percent of the U.S. gross national product, the highest percentage since 1994.
· Due in part to rising demand from China and India and political instability in the Middle East, crude oil prices begin a sustained climb, breaking $40 per barrel for the first time in history during the week ending Oct. 1.
· In December, the euro reaches a high against the U.S. dollar, rising to $1.36, and provoking fears the dollar would be supplanted as the world's reserve currency.
-- Claes Bell
2005: Subprime mortgages peak
· The subprime mortgage boom peaks. Lenders hand out $625 billion in subprime loans, compared to $540 billion the year before. On top of that, lenders give $380 billion in Alt-A mortgages. Most of the Alt-A loans are low-documentation mortgages, otherwise know as "liar loans" because borrowers exaggerate their incomes with a wink and nod from their lenders.
· An adage gains currency: Mortgage lenders are willing to give a loan to anyone who can fog a mirror. Urban legends tell of gardeners buying $500,000 McMansions. More than three-quarters of the 2005 subprime and Alt-A loans are sold on the secondary market. The market would explode in 2007 and 2008, igniting the worst recession since the Great Depression.
· Congress reforms bankruptcy law to make it more difficult for consumers to file bankruptcy. The law prioritizes credit card debt higher than unpaid child support.
· The Federal Reserve raises short-term interest rates eight times. The federal funds rate begins the year at 2.25 percent and ends it at 4.25 percent.
· Nationally, home values rise more than 11 percent, according to the federal government's House Price Index. The National Association of Realtors distributes a "Housing Bubble Prospects Q&A" that assures consumers, "There is virtually no risk of a national housing price bubble based on the fundamental demand for housing and predictable economic factors."
-- Holden Lewis
2006: Growing home prices create "bubble"
· The year 2006 sees the peak of the housing bubble, with the median existing home price climbing to $221,900, more than four times the U.S. median household income at the time, according to the National Association of Realtors. The value of a typical American home climbs 50.4 percent since the beginning of the decade, with some markets such as Miami-Fort Lauderdale, Fla., Las Vegas-Paradise, Nev., and Riverside-San Bernadino, Calif., more than doubling.
· Homeowners respond to the run-up in housing prices by drawing record amounts of equity out of their homes through cash-out refinancing, home equity loans and home equity lines of credit. All in all, Americans liquidate $318.3 billion in equity through cash-out refinances in 2006, according to Freddie Mac.
· The rising federal funds rate contributes to rising yields on certificates of deposit, benefiting savers. In September, the average yield for a one-year CD hits 3.89 percent, a multiyear high that's a far cry from today's paltry average yield for one-year CDs of below 1 percent.
· Alan Greenspan, the man largely credited with engineering the housing boom, retires on Jan. 31, ending a reign of more than 18 years as chairman of the Federal Reserve. He is replaced by Ben Bernanke.
-- Claes Bell
2007: Foreclosure tsunami begins
· The stock market hits an all-time high. Usually a leading indicator of the economy's health, it proves to be anything but as the stock market peaks on Oct. 9. The Standard & Poor's 500 reaches 1,565 and the Dow Jones Industrial Average hits 14,164 just months before the start of one the worst recessions in American history.
· After years of sustained growth, the real estate bubble begins to deflate. Real estate values begin a plunge in the fourth quarter of 2007 that will last into 2010 and cost U.S. mortgage holders trillions in home equity. Baby boomers would be hit particularly hard between 2007 and 2009. Even when you factor in future Social Security earnings, households headed by individuals aged 50 or older would see their real wealth decline by 18 percent, due in part to the loss of home equity.
· The credit crunch begins in August 2007 as lenders deal with a trifecta of bad news -- declining real estate values, the spread of toxic subprime mortgages and the slowing economy. The so-called TED spread, or the spread between the three-month Treasury yield and the three-month Libor, rises from 0.39 percent to 1.81 percent between July and August 2007. When the spread increases, it's a sign that lenders believe the risk of default on interbank loans is increasing.
· The foreclosure tsunami begins. Homeowners looking for refuge from resetting variable-rate mortgages are unable to refinance because falling real estate values put them "underwater." Mortgage delinquency rates for residential real estate tracked by the Mortgage Bankers Association begin a sustained rise, starting in September 2007.
-- Claes Bell
2008: The Great Recession cripples the nation
· The greatest financial crisis since the Great Depression hits full force in 2008, spurred by the failure or emergency sale of some of the nation's biggest financial firms, starting with Bear Sterns on March 16, 2008. Wachovia, Lehman Brothers, Washington Mutual and Merrill Lynch later toppled or came to the brink of bankruptcy. The main culprit was toxic subprime mortgages.
· The Fed and Treasury take unprecedented action to prevent the wholesale collapse of the financial system. When dropping the federal funds rate from 5.25 percent to 1 percent fails to stem the crisis, Fed Chairman Bernanke and Treasury Secretary Henry Paulson turn to more radical methods.
They encourage healthier institutions to buy failing banks, making massive amounts of liquidity available through hastily created government lending programs and arranging takeovers of founding firms. For example, global insurance firm AIG is bailed out with $182 billion.
They encourage healthier institutions to buy failing banks, making massive amounts of liquidity available through hastily created government lending programs and arranging takeovers of founding firms. For example, global insurance firm AIG is bailed out with $182 billion.
· A global panic set off by the failure of Lehman Brothers on Sept. 15 pushes an already slowing economy into the Great Recession. By the fourth quarter 2008, the U.S. economy is shrinking at an annual rate of 6.8 percent. Global gross domestic product growth falls from 3.9 percent a year in 2007 to 1.7 percent a year in 2008.
· On Dec. 11, former Nasdaq Chairman Bernard Madoff is indicted on charges his multibillion-dollar investment firm is nothing more than a giant Ponzi scheme. In the weeks following, high-profile investors and charities admit to being bilked of billions by Madoff. He is eventually sentenced to 150 years in federal prison.
· Revolving consumer credit, which includes credit cards and other forms of flexible debt, peaks at nearly $974 billion in August.
-- Claes Bell
2009: Unemployment spikes, stimulus approved
· Newly elected President Barack Obama signs the massive American Recovery and Reinvestment Act on Feb. 13. It commits $787 billion to tax cuts, infrastructure projects, job training programs and aid to families.
· On March 9, the Dow Jones Industrial Average sinks to 6,547, less than half the all-time high set in October 2007 and the lowest close since April 15, 1997. On this day, many former blue chip stocks, especially in the embattled financial sector, are trading at or near multiyear lows. Giant Citigroup hits an intraday low of 99 cents.
· In February, the Treasury Department begins a series of "stress tests" to determine which banks are healthy enough to survive further deterioration of the global economy. It finds big banks must raise an additional $74.6 billion to remain solvent should the economy slide further.
· After four straight quarters of declining GDP, the U.S. economy begins to grow again in the third quarter 2009 at an annualized rate of 1.6 percent. Later, the National Bureau of Economic Research's Business Cycle Dating Committee, the group of economists tasked with following recessions, pegs June as the official end of the recession.
· In May, the Credit Credit CARD Act passes. The measure contains consumer protections, including restrictions on interest rate hikes and double-cycle billing of credit cards. Many credit card providers respond by raising rates and fees dramatically before the law takes effect.
-- Claes Bell
2010: Reforms to financial industry approved
· Amid fierce lobbying from the financial industry and consumer advocates, the Dodd-Frank Wall Street Reform and Consumer Protection Act is signed into law by Obama on July 21. The new law creates a new Consumer Financial Protection Bureau to police mortgages and other financial products. It also forms a new office to monitor risks to the financial system and streamlines oversight of the financial industry.
· Thanks to rising corporate profits, the stock market continues a rapid recovery throughout 2010, with the Dow Jones Industrial Average hitting a 52-week high of 11,519 on Dec. 15. In just over 22 months, the Dow rises 175 percent.
· Despite government stimulus and steady if unspectacular GDP growth, high unemployment persists, hovering between 9.5 percent and 9.9 percent throughout the year. More troubling still is the length of unemployment for many Americans. As of November 2010, more than 6.3 million are out of a job for 27 weeks or more, and the average length of unemployment is 33.8 weeks.
· Three years into the housing crisis, the flood of residential foreclosures shows little sign of abating. At the end of the third quarter 2010, a survey by the Mortgage Bankers Association finds 4.39 percent of residential mortgages are in foreclosure and 9.13 percent of all home loans are in some form of delinquency.
· On Aug. 15, a new Federal Reserve rule goes into effect requiring banks to get consumers' permission before enrolling them in overdraft protection. In response, many banks begin imposing maintenance fees and balance requirements to recover lost revenue, reducing free checking options for consumers.
-- Claes Bell¿¿
Courtsey of Gina Starr, Loan Officer
Red Rock Mortgage & Lending¿
Phone: 405-210-3900
Email: gstarr@redrocklend.com
Don't worry...the next Tip will be coming soon...
HAPPY NEW YEAR 2011!
The start of a new decade!
Bankruptcy, Foreclosures, Home Values, Homes, Housing Market, Inflation, Interest Rates, Lenders, Loans, Mortgage, Real Estate, Realtor, Recession, Unemployment
Sunday, December 26, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 6: When is the Right Time to Buy...
When is the Right Time to Sell?¿
Every home buyer and seller is in a different situation, so it is important you don't compare your timeline and decisions to anyone else's.
Time to Buy?
Given all of the drops in the housing market in the last few years, many people are wondering whether now is the right time to buy a new house. Should you snatch up the good deals before prices start to rise or should you wait it out a little bit longer to see if the prices will drop even more? It can be somewhat of a gamble, so it is important to make sure that you know a few facts about the current market so that you can make the best possible decision.
One of the most important facts you should consider when determining whether now is the right time to buy a new house relates not to the market but your own situation. Consider how long you plan to live in the home. While you might not be able to look into a crystal ball and see the future, consider what you know at the moment.You also must consider how comfortable you are with taking risk as well. If you feel comfortable with a possible 10% or even more drop in a home price if you need to re-sell within the next few years then now might be a fine time to make a purchase. If you are not comfortable with risk, then it is probably better to wait and see how the market settles before you make a home purchase.
The reality of the current market is that the fluctuations have not yet stopped. During the year, prices are most likely not going to appreciate at the rate they used to. It is also important to keep in mind that you should not get swept up in the hype that is often presented in media advertisements. While there may be some truth in the media, consumers should be wary about taking this and running with it.
Lending restrictions remain tight throughout much of the country as well. Loans are available for the purchase of a home, but restrictions are much tighter than they were in the past. Make sure you know exactly what is on your credit and how much you will be able to offer for a down payment before you consider purchasing a home in the current market.
One of the most important facts you should consider when determining whether now is the right time to buy a new house relates not to the market but your own situation. Consider how long you plan to live in the home. While you might not be able to look into a crystal ball and see the future, consider what you know at the moment.You also must consider how comfortable you are with taking risk as well. If you feel comfortable with a possible 10% or even more drop in a home price if you need to re-sell within the next few years then now might be a fine time to make a purchase. If you are not comfortable with risk, then it is probably better to wait and see how the market settles before you make a home purchase.
The reality of the current market is that the fluctuations have not yet stopped. During the year, prices are most likely not going to appreciate at the rate they used to. It is also important to keep in mind that you should not get swept up in the hype that is often presented in media advertisements. While there may be some truth in the media, consumers should be wary about taking this and running with it.
Lending restrictions remain tight throughout much of the country as well. Loans are available for the purchase of a home, but restrictions are much tighter than they were in the past. Make sure you know exactly what is on your credit and how much you will be able to offer for a down payment before you consider purchasing a home in the current market.
Also, if you plan to buy a new house in the current market, you should be fully aware that there is the potential for the value of your home to drop over the next few years rather than appreciate. You should not assume that your home will steadily gain value the longer that you own it. This is a gamble that you should be fully aware of before you begin shopping around with the intention of making a home purchase.
While now could very well be an excellent time for you to buy a new home, it is important to consider your own situation as well as how comfortable you are with taking possible risks over such a large purchase in the next few years. The current market certainly is offering good deals in many markets, but before you rush out to grab one, make sure that you are fully informed.
While now could very well be an excellent time for you to buy a new home, it is important to consider your own situation as well as how comfortable you are with taking possible risks over such a large purchase in the next few years. The current market certainly is offering good deals in many markets, but before you rush out to grab one, make sure that you are fully informed.
Time to Sell?
Everything has a season – including selling your house. Listing at the right moment could mean more money in your pocket.
Traditionally, spring is the hottest season for real estate. Sales peak in April and May and stay strong in June and July. It’s a good season for families to move, between school terms and while the weather is warm. People have just received their tax refunds, which they can use to help finance a down payment. And the nice weather and beautiful flowers in spring and early summer make it a great time to show your home.
In fact, 60 percent of America's moves take place in the summer. But closing a sale can take weeks, so it’s a good idea to list your home early in the season.
August brings a lag in sales, as people go away on vacation and start to think about the new school year. Then sales surge briefly in the fall before dropping in winter as buyers and sellers focus on the holidays. But by January, buyers are out again, and sales steadily increase into spring.
If you can’t sell in the peak season, consider listing your home in the winter. It may sound counterintuitive, but you probably already have the house decorated and cleaned for holiday entertaining, so it shouldn’t be hard to get it in shape for showing. Moreover, you will have less competition and may get a better price. Another plus: buyers in winter are less likely to waste your time or draw out the closing. They may want to close before the New Year so they can claim the mortgage deduction on their tax return, which you could turn to your advantage in pressing for a quick deal.
Traditionally, spring is the hottest season for real estate. Sales peak in April and May and stay strong in June and July. It’s a good season for families to move, between school terms and while the weather is warm. People have just received their tax refunds, which they can use to help finance a down payment. And the nice weather and beautiful flowers in spring and early summer make it a great time to show your home.
In fact, 60 percent of America's moves take place in the summer. But closing a sale can take weeks, so it’s a good idea to list your home early in the season.
August brings a lag in sales, as people go away on vacation and start to think about the new school year. Then sales surge briefly in the fall before dropping in winter as buyers and sellers focus on the holidays. But by January, buyers are out again, and sales steadily increase into spring.
If you can’t sell in the peak season, consider listing your home in the winter. It may sound counterintuitive, but you probably already have the house decorated and cleaned for holiday entertaining, so it shouldn’t be hard to get it in shape for showing. Moreover, you will have less competition and may get a better price. Another plus: buyers in winter are less likely to waste your time or draw out the closing. They may want to close before the New Year so they can claim the mortgage deduction on their tax return, which you could turn to your advantage in pressing for a quick deal.
Of course, selling in the hot season isn’t the whole story. You should pay attention to your local housing market and try to list during a seller’s market, when there will be more competition among buyers for your home – which could mean a better price, a quicker closing and fewer conditions on the offer.
Find a Realtor who you like and trust, one with the knowledge and experience in your local housing market. If you have questions or comments, please let me know...
Next...Tip 7: Family & Friends Opinions
Buyers, Buying a Home, Home Buying, Homes, Housing Market, Lenders, Listing My Home, Loans, Mortgage, Moving, Neighborhoods, Real Estate, Realtor, Sellers
Thursday, December 23, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 5: Physical Aspects of Your Home¿
Now that we've figured out what type of home fits your lifestyle, we need to think about some important issues and not get caught up in the physical aspects of the home. It's easy to walk into a home, fall in love, and completely forget that this was not an area you wanted to live in. Keeping an open mind and not being rigid is a welcome thing, but here are some things to keep in mind.
Noise Level
It could be the home sits right next to a busy interstate or main street through town. The home might be next to a train track, or even in a flight path. Maybe the neighbors have dogs that bark just because they hear the wind. Inside the home you don't hear anything, but unless you go outside to the backyard, or sit on the front porch, you never realize how loud things could be. Not paying attention to these things could end up frustrating you, and instead of loving the house, you begin to hate it.
Distance
Maybe it fits what you are looking for, but it's too far away from all the amenities ¿and activities your family enjoys. Driving to the home you really like during different times of the day or week will definitely help you see what traffic is like, how long it may take you to get to work or outside activities. Remember distance could mean less time maintaining the home you love because you spend it on the road instead. If you need the time to wind down after work, the distance may be what you need to shut your brain off so you are ready for the family that waits for you.
Neighborhoods
It may be that you see the house during the week when people are at work, kids are at school, and you don't know what goes on at different times of the day or on the weekends. It may be you don't like cars parked up and down the street, kids riding their bikes in your driveway, the loud hot rod or motorcycles engines being warmed up. Pay attention to the houses next door, what their landscaping looks like, and how the neighbors keep things. This will definitely have an impact on this home when and if you ever would decide to sell...if you ended up buying this home.
Hopefully these are things you have thought about and shared with your Realtor. As a professional, with this kind of financial investment, your Realtor has been hired to keep you on track, reminding you of what you have shared, listened to you and taken notes. You will be grateful you bought what you were looking for and not talked into making a purchase just because. Hire the Realtor that cares about you and your needs and not their paycheck.
Next...Tip 6: When is the Right Time to Buy...When is the Right Time to Sell?¿
Buyers, Home Buying, Homes, Lifestyles, Moving, Neighborhoods, Physical Aspects, Real Estate, Realtor
Saturday, December 18, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 4: Find the Home that Fits Your Lifestyle¿
You’d think the easiest thing in the world would be deciding what house to buy. After all, who knows you better than you? You know exactly what you want, right? Well...sometimes. The truth is most people only have an idea of what they want – the number of bedrooms and bathrooms, size of the kitchen and garage, and maybe the yard. Things tend to get a little murkier when you mix in neighborhoods and schools, commutes to work and distance to ball fields and retail shops.
Finding a home that fits your lifestyle can be a big challenge. There are so many options when it comes to choosing, and you probably aren't going to find a home that is 100% perfect, so the best way to narrow down your options is to take a look at your lifestyle and priorities. Chances are there is an option that will work best for you.
The Social Butterfly
A condo can be a great option for anyone who loves to socialize or wants to live right in the heart of the city, close to the action, or within walking distance to work. If you’re new in town, it can be a good way to meet new friends and neighbors. Many large complexes have community features like a pool, gym or clubroom. This will give you the opportunity to meet the people with which you share a building. Remember though, you will be sharing walls, floors and ceilings with many other people. If a little bit of noise will break the deal for you, a high-rise might not be for you.
Gated Communities
Gated communities provide a lot of benefits to the residents that live within them. The number one reason people choose to live in gated communities is likely the security element. They are private and more difficult to access than a standard community. Criminal activity is reduced in gated communities, and solicitors will have a more difficult time bothering residents.
Traffic and speeding cars are also reduced behind the gates, making it quieter and safer for children to play and ride bicycles within these neighborhoods. You likely won’t have the morning commute using your street as a shortcut either!
Another positive aspect of gated communities is a higher standard of home quality, and stricter building codes that promote uniformity in design. That means more sale comparables and better value for all the homeowners within the community. Homeowners in these neighborhoods also generally have a higher pride of ownership, and keep their homes in good condition. Along with that, gated communities create a scarcity effect, with few homes within these neighborhoods typically available for sale at the same time, adding more bite to the value.
There may also be social benefits, such as a community center, pool, park, or events that promote group activities for families to get to know each other.
Wide Open Spaces
If you value privacy and want a lot of space to call your own, buying a home on an acreage may be an option. Keep in mind that with a lot of land comes a lot of responsibility. If family time and outside activities take up a lot of your time, the maintenance of land can consume a weekend. Also remember that if you work in the city, you could be in store for a longer commute, which results in less family time as well.
Somewhere in Between
Maybe you want a place to call your own, but without all the responsibilities of a yard. A great alternative that gives you the best of both worlds is a town home. Townhouses usually consist of several single-family homes grouped together. In many cases, you can rent or own the inside of the home, while a separate organization owns and cares for the exterior of the building and the yard. This allows you the luxury of having a small yard without having to maintain it. Keep in mind that there are usually home ownership association fees that cover the land maintenance.
Buying a home is like finding the right pair of jeans. It's all about what fits. Your home should fit your lifestyle, and like fashion, that changes with time. Choose a Realtor to help you gauge your stage in life, one who knows the questions to ask you, and can pull it all together...so you can find a home that's the perfect fit!
Finding a home that fits your lifestyle can be a big challenge. There are so many options when it comes to choosing, and you probably aren't going to find a home that is 100% perfect, so the best way to narrow down your options is to take a look at your lifestyle and priorities. Chances are there is an option that will work best for you.
The Social Butterfly
A condo can be a great option for anyone who loves to socialize or wants to live right in the heart of the city, close to the action, or within walking distance to work. If you’re new in town, it can be a good way to meet new friends and neighbors. Many large complexes have community features like a pool, gym or clubroom. This will give you the opportunity to meet the people with which you share a building. Remember though, you will be sharing walls, floors and ceilings with many other people. If a little bit of noise will break the deal for you, a high-rise might not be for you.
Gated Communities
Gated communities provide a lot of benefits to the residents that live within them. The number one reason people choose to live in gated communities is likely the security element. They are private and more difficult to access than a standard community. Criminal activity is reduced in gated communities, and solicitors will have a more difficult time bothering residents.
Traffic and speeding cars are also reduced behind the gates, making it quieter and safer for children to play and ride bicycles within these neighborhoods. You likely won’t have the morning commute using your street as a shortcut either!
Another positive aspect of gated communities is a higher standard of home quality, and stricter building codes that promote uniformity in design. That means more sale comparables and better value for all the homeowners within the community. Homeowners in these neighborhoods also generally have a higher pride of ownership, and keep their homes in good condition. Along with that, gated communities create a scarcity effect, with few homes within these neighborhoods typically available for sale at the same time, adding more bite to the value.
There may also be social benefits, such as a community center, pool, park, or events that promote group activities for families to get to know each other.
Wide Open Spaces
If you value privacy and want a lot of space to call your own, buying a home on an acreage may be an option. Keep in mind that with a lot of land comes a lot of responsibility. If family time and outside activities take up a lot of your time, the maintenance of land can consume a weekend. Also remember that if you work in the city, you could be in store for a longer commute, which results in less family time as well.
Somewhere in Between
Maybe you want a place to call your own, but without all the responsibilities of a yard. A great alternative that gives you the best of both worlds is a town home. Townhouses usually consist of several single-family homes grouped together. In many cases, you can rent or own the inside of the home, while a separate organization owns and cares for the exterior of the building and the yard. This allows you the luxury of having a small yard without having to maintain it. Keep in mind that there are usually home ownership association fees that cover the land maintenance.
Buying a home is like finding the right pair of jeans. It's all about what fits. Your home should fit your lifestyle, and like fashion, that changes with time. Choose a Realtor to help you gauge your stage in life, one who knows the questions to ask you, and can pull it all together...so you can find a home that's the perfect fit!
Next...Tip¿ 5: Physical Aspects of Your Home
Buyers, Condos, Gated Communities, Homes, Lifestyles, Moving, Neighborhoods, Real Estate, Realtor, Sellers, Town homes
Tuesday, December 14, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 3: Keeping Emotions in Check
Buying a home is one of the biggest financial decisions you will make in your lifetime, and along with the finances come emotions. It is important to keep your emotions in check during the process. Being organized and in control will contribute significantly to getting the best home deal possible with the least amount of stress. ¿
Once you find a home you like, you become emotionally attached to it. Emotional attachment can cause you to make unwise decisions when making an offer, handling negotiations, and so forth. Once you’ve fallen in love with a house and visualized it being your home, you’ll start to do WHATEVER it takes to make sure it becomes your home.
This is about the worst possible way to buy a home, but this may also be the best possible home for you. You do want to fall in love with your new home, but you also want to be careful. You can literally cost yourself thousands of dollars, if not tens of thousands of dollars, by being too emotionally attached. Instead of letting emotions rule the game, try to include some common sense in the buying process. Real estate investors have a saying, “Don’t fall in love with the house, fall in love with the deal.”
Having said that, realize that you will always have some emotional attachment to your home. You need to like it. Your goal is to strike a balance between liking the house and using common sense to tell you whether you are sacrificing too much to try to get the house. If you find you have to make a lot of compromises to get a house, stop yourself and ask, “Is this really worth it?”
It's important that you choose an experienced Realtor who is willing to work through these emotions with you. Someone you know you can trust when choosing your most valuable asset. Someone you like and work well with, someone who makes the experience fun and exciting...gets excited for you! Someone you trust to know your wishes, desires, and goals...not just your list of likes and dislikes in purchasing your dream home.
So, remember to strike a balance between emotions and common sense. Find a Realtor that fits your personality, is patient and understanding of your emotions, and will work to keep you on track. You'll be grateful, and it will help you enjoy your home that much more once you actually move in!
Once you find a home you like, you become emotionally attached to it. Emotional attachment can cause you to make unwise decisions when making an offer, handling negotiations, and so forth. Once you’ve fallen in love with a house and visualized it being your home, you’ll start to do WHATEVER it takes to make sure it becomes your home.
This is about the worst possible way to buy a home, but this may also be the best possible home for you. You do want to fall in love with your new home, but you also want to be careful. You can literally cost yourself thousands of dollars, if not tens of thousands of dollars, by being too emotionally attached. Instead of letting emotions rule the game, try to include some common sense in the buying process. Real estate investors have a saying, “Don’t fall in love with the house, fall in love with the deal.”
Having said that, realize that you will always have some emotional attachment to your home. You need to like it. Your goal is to strike a balance between liking the house and using common sense to tell you whether you are sacrificing too much to try to get the house. If you find you have to make a lot of compromises to get a house, stop yourself and ask, “Is this really worth it?”
It's important that you choose an experienced Realtor who is willing to work through these emotions with you. Someone you know you can trust when choosing your most valuable asset. Someone you like and work well with, someone who makes the experience fun and exciting...gets excited for you! Someone you trust to know your wishes, desires, and goals...not just your list of likes and dislikes in purchasing your dream home.
So, remember to strike a balance between emotions and common sense. Find a Realtor that fits your personality, is patient and understanding of your emotions, and will work to keep you on track. You'll be grateful, and it will help you enjoy your home that much more once you actually move in!
Next...Tip 4: Find the Home that Fits Your Lifestyle¿
Saturday, December 11, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 2: Create a Budget before you Move into Your Home
There are a number of other costs you need to consider before you buy a home. It never fails...we think we have thought of everything, and lo and behold, we didn't. Hopefully you find some helpful ideas that you can use to create a budget of expenses beyond the down payment and closing costs.
Storage
Packing Materials
Start collecting boxes early on from stores for free. Check out Craigslist for those that have recently moved, or ask your Realtor if they have a client who may need to get rid of their used boxes. It seems as much as we plan, the need for more boxes overtakes our budget. Many of the boxes you may be able to resell after your move if they are still in good condition, which partially makes up for the costs that sneak up on you. U-Haul has colored packing tape that identifies different rooms that makes it easier when moving in. Bubble wrap and packing paper will be needed as well.
Moving Expenses
Your stuff doesn’t get to the new house on it’s own! Do you hire a moving company? Maybe you try moving yourself, but you may still need to rent a truck. Moving costs can easily cost you anywhere from a few hundred to a couple of thousand dollars depending on your situation. Certainly by now you know a Realtor or are working with a really good Realtor who has all these resources and contacts in their Rolodex. Their list of contacts should include all these tips, points, thoughts, and any answers you may ever need for your questions. A Realtor deals with people moving every day! Who better to ask!
Most utility companies now have the option of transferring services online or over the phone without having to talk to a representative. However, overlapping service by a couple of days isn't as easy to turn service on and off, so you may end up speaking with representatives.
Cable/Telephone/Internet Services: Will these services cost more than where you previously lived? Will you need any new equipment? Will you have it in more rooms in the new home (such as more cable boxes)?
Water, trash and sewer services: These may not be an items you think of often, especially if you lived in an apartment because these were just part of your rent. In owning a home, these most likely will be included in your water bill, which is another utility most buyers don't think of when it comes expenses. Leaky faucets will now be your problem once you are a proud homeowner, which will make you keenly aware of the true costs of living in a home.
Energy Costs: Make sure you understand what the various energy costs are before you buy. Check with the local utility companies for average costs for both winter and summer.
Alarm: Will you be getting an alarm? Will it be a monthly service? Here’s another cost that could be recurring monthly.
New Locks: You may want to hire a locksmith to change all of the locks in your new home. There’s no telling how many copies of keys are out there already!
Odds are you are moving to a bigger home. Do you have the furniture you need, for example: are you moving from an eat in kitchen to a home with a formal dining room? You don’t have to buy this all at once but you may be tempted to fill in empty spaces.
Appliances: Do you have all of the appliances you need? Perhaps some need upgrading? If the ones you currently own are old, they may be using twice as much electricity as newer, energy-saving ones.
Gardening, Lawn & Landscaping
While you may be thrilled to be inheriting a lawn, have you the equipment the maintain it? How about shrubs and gardens? Can you handle the work? Will you need to buy or rent equipment, such as a mower? What does it cost to hire someone to handle the landscape? The previous owner may be able to give you an idea of the costs as well as refer you to the company they used. Find out if there are local ordinances about grass height and what you are allowed to grow as well as water usage for your lawn. What you may not anticipate is the cost difference in utilities for maintaining a lawn. Your water bill could increase substantially while trying to keep the lawn green. As a Realtor, I have a lawn service I have used for vacant property listings that I could possibly refer you to as well.
Insurance Increase
If you were a renter, you most likely carried renter's insurance. Many buildings and landlords require insurance since they aren't responsible for a tenant's personal belongings. When you call your insurance provider to discuss the purchase of a home, your agent will review your premium since now you will be a homeowner. If you have owned a home before, the premium will probably be different as well, since it is calculated on value of the home. In the process of discussing with your lender the home you have chosen, they, as well as your Realtor, should be able to direct you to insurance companies that are able to provide good rates.
Carpeting – Clean or Buy New?
Your new home may have nice wall-to-wall carpeting but when was the last time it was cleaned? Perhaps it's not quite the color you want or it's showing some wear and tear. You can go cheap with carpeting but sometimes you get what you pay for and this is your home. Always remember, buy the best pad available. Your Realtor could possibly write in the contract that the carpets be professionally cleaned. If that isn't accepted, your Realtor surely has a reputable carpet cleaner that they could refer you to. Don't hesitate to ask these questions.
Spackling and Painting
If you are fortunate, your new place will be all done up and have all the picture holes spackled and the rooms freshly painted. But many homes will still have minor dings here and there that need repair and fresh paint doesn’t mean you like the color. We all know it's easier to paint when there’s no furniture in the room. So do you repair and re-paint? Do you hire people or do it yourself? DIY will still cost you and depending on how much work needs to be done your costs can easily rise. You may shove this idea off as paint is cheap, which it is, but the supplies cost too. These are cosmetic things that need to be taken into consideration since they will be your costs. Hopefully your Realtor has names of reputable contractors that are looking for the next job.
Additional Car
Are you moving somewhere that you will need another car? Is public transportation or walking out of the question now? Think about your location and your needs when you are looking to move and figure out if you will need another car. If you do, remember you will also need additional car insurance and you will have more maintenance costs as well. This isn't one most people think about, but it is something to think about.
I don’t mean to scare you with all of these items, but they do need to be considered before you buy a new home. These may not all apply to you but you can see how quickly costs can run up! When preparing your budget for a new home make sure you take into consideration all of the other costs you may incur.
Next...Tip #3: Keeping Emotions in Check...
Sunday, December 5, 2010
10 Simple Tips to Take the Stress Out of Home Buying Process - Focus on the Positives!
Tip 1: 5 Steps to Mortgage Loan Approval
There will always be first time homebuyers, and while the process stays somewhat the same, so I thought I'd break it down to assist those that need the knowledge, and those that need to be refreshed in how this works.
The 5 steps to mortgage loan approval aren't complicated, but you really have to think ahead to make sure you have everything in order so you can get your loan approved without delay. Chances are good that if you have been thinking about buying a home you may have already started working on some (or all) of these five steps.
Mortgage lenders look at the same things other lenders look at when a potential borrower submits an application for credit, but home loans have additional requirements that lenders review prior to approving a mortgage loan application.
It is never too early to get started with these five steps because almost all of them will help you improve your credit overall.
One: Get Your Credit in Order
Order a copy of your credit report and review it to make sure there are no errors listed. Also, take a close look at the accounts you currently have. Are all your payments on time? Are you teetering dangerously close to meeting the maximum available credit? Mortgage lenders are usually reluctant to approve mortgage loans for applicants who are behind on their debt payments or who have maxed out their revolving account. Get any errors removed from your account and start getting your credit in order. This may take some time, but it will certainly result in a higher likelihood of getting approved for your mortgage loan and may even result in a lower interest rate for the loan you are approved for.
If your Realtor asks these questions or makes these suggestions, trust that she/he may know a little about this process and is only trying to assist and educate you. My goal is always to get to know more about you and what your ultimate goal may be, whether you've thought about it or not.
Two: Build Up a Down Payment
Different types of home loans have different down payment requirements, but no matter what type of home loan you want to obtain you will need to have some money set aside for a down payment and closing costs. Most lenders also want to see a cushion of savings that will remain after the loan is complete because it is never a good idea to buy a home and have no money in a deposit account at all. The higher your down payment, the more of an initial investment you are making when getting the mortgage. The more invested in the home you are, the more likely the lender will approve you for the loan, and oftentimes with a better loan product if available.
Also, if you have available money in a deposit account, the likelihood of needing it for moving expenses or setting up the home will not take away from making the first months house payment! Each time you move, there are unplanned for expenses, so having a cushion is always a good idea.
Three: Pay Down Debt
While we are working on getting the approval, excitement is welcome, but try not to get ahead of yourself. No major purchases like a new car, new furniture, or the like. You may very likely have the money for it, but it can definitely affect your ability to get a mortgage for a home. Once the loan is closed and you have moved into your home, what you do then is fine.
Four: Consistent Employment
Mortgage lenders generally look for two years of consistent employment before approving a loan application. Although this varies from one lender to another, demonstrating the ability to stay employed is quite important. The year that you want to apply for a mortgage loan is not the time to quit your job and open up your own business. Save this career change until after you already own your home.
Five: The Right Lender
Different mortgage lenders offer different loan products. If you know that you have less than perfect credit, do some research and find out which lenders will be willing to approve mortgage applications for people with your credit score. Research your options before you are actually ready to apply. You will save time and may be able to find a lower interest rate by investing some time into finding an appropriate lender for your credit situation.
Time is Money!
Get started! The next tip will be coming soon! Happy Loan Approval! If you need more assistance, please don't hesitate to contact me. I have fantastic lenders who are patient and willing to discuss all these steps with you. Finding a lender and a Realtor who are knowledgeable, can walk you thru this process, keep you on track, and discuss all your options will make this fun and exciting.
Next.....Tip 2: Create a Budget before you move into your new home.
Thursday, November 25, 2010
Happy Thanksgiving
Today is a day to be thankful...positive...motivational...and encouraging. Though, I believe everyday should start with something to be thankful for, I wanted to share some short thoughts you could remember especially today.
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The smallest act of kindness is worth more than the grandest intention. (Oscar Wilde)
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No duty is more urgent than that of returning thanks.
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Every time we remember to say “thank you”, we experience nothing less than heaven on earth.
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I would thank you from the bottom of my heart, but for you my heart has no bottom.
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Silent gratitude isn’t much use to anyone. (Gladys B Stern)
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Blessed are those that can give without remembering and receive without forgetting.
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God gave you a gift of 86,400 seconds today. Have you used one to say “thank you?” (Wm A Ward
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Gratitude is the memory of the heart. (JB Massieu)
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It isn’t what you have in your pocket that makes you thankful, but what you have in your heart.
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If the only prayer you ever say in your entire life is ‘thank you’, it will be enough. (M Eckhardt)
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A thankful heart is not only the greatest virtue, but the parent of all other virtues. (Cicero)
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If you can’t be content with what you have received, be thankful for what you have escaped.
Wishing you many thankful moments making memories with those you are so thankful for...the things you treasure in this life...and the time you spend with those you love.
Saturday, November 20, 2010
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How to Assess the Real Cost of a Fixer-Upper House
When you buy a fixer-upper house, you can save a ton of money, or get yourself in a financial fix. Read
Visit houselogic.com for more articles like this.
Copyright 2010 NATIONAL ASSOCIATION OF REALTORS®
Sunday, November 14, 2010
Get sick ~ What's your attitude?
In real estate, get sick, take a vacation, or have something personal happen in your life...and you can just bet your business will get a jump start.
Last weekend I woke up with a terrible sore throat & throbbing headache. I haven't been sick in a long time & I knew what this meant...my phone was going to start ringing. Sure enough. While I'm now at the tail end of a cold, I have still been working. In the last 3 wks I've listed 2 homes, had 2 listings appts that will list in 3-4 wks, have a new buyer that also wants to sell, and have 2 listing appts Monday.
In my last post, Is the Market Really that Bad, I was talking about attitude. It can make or break you. Negativity can creep in...pay a visit...stay longer than you wanted it to...and before you know it...it has made its home. If I had let getting sick get me down, I might as well have sent out invitations to negativity, depression, sad, whoa is me, nothing good happens to me, and all the other horrible no-good things you can think of.
I'm not going to let politics get me down, does complaining about it help me? No. I'm not going to let the media convince me that real estate is down the tubes. It's not, and people will always be buying and selling real estate as long as this world is still standing. Hang around the water cooler at work and just listen to the negativity coming out of people's mouths. Read all the doom and gloom on the internet. Is this what you want to feed your mind daily? How does it set the tone for your day?
I am a work in progress, and happy to say I am content where I am today! If attitude is everything, I'm choosing to find things to smile and laugh about. I'm not going anywhere...I'll be a Realtor til my dying day. That's how passionate I am about what I do. I'd love to share my passion with you! Become one of my Fans on Facebook: http://on.fb.me/b4q9nf.
Til next time...keep smiling!
Last weekend I woke up with a terrible sore throat & throbbing headache. I haven't been sick in a long time & I knew what this meant...my phone was going to start ringing. Sure enough. While I'm now at the tail end of a cold, I have still been working. In the last 3 wks I've listed 2 homes, had 2 listings appts that will list in 3-4 wks, have a new buyer that also wants to sell, and have 2 listing appts Monday.
In my last post, Is the Market Really that Bad, I was talking about attitude. It can make or break you. Negativity can creep in...pay a visit...stay longer than you wanted it to...and before you know it...it has made its home. If I had let getting sick get me down, I might as well have sent out invitations to negativity, depression, sad, whoa is me, nothing good happens to me, and all the other horrible no-good things you can think of.
I'm not going to let politics get me down, does complaining about it help me? No. I'm not going to let the media convince me that real estate is down the tubes. It's not, and people will always be buying and selling real estate as long as this world is still standing. Hang around the water cooler at work and just listen to the negativity coming out of people's mouths. Read all the doom and gloom on the internet. Is this what you want to feed your mind daily? How does it set the tone for your day?
I am a work in progress, and happy to say I am content where I am today! If attitude is everything, I'm choosing to find things to smile and laugh about. I'm not going anywhere...I'll be a Realtor til my dying day. That's how passionate I am about what I do. I'd love to share my passion with you! Become one of my Fans on Facebook: http://on.fb.me/b4q9nf.
Til next time...keep smiling!
Thursday, November 4, 2010
Is the market really that bad?
My daughter asked me the other day how business was. She works as a hairstylist and another stylist next to her was cutting a lady's hair. All the lady did was complain about how bad the market is. Then she found out the lady was a local Realtor! It made me think about how many people I hear are constantly complaining.
While the market may not be what it has been in the past, it is surely not dead! You want someone who works hard, markets your home in every available avenue possible, online as well as offline, returns phone calls promptly, keeps searching for the perfect home for you as a buyer, someone who sees the glass half full. Even if things seem less than desirable, do you want people around you hearing you talk negatively about what you have chosen to do as a career? Why would they want to work with someone who has a negative attitude about what they do?
The longer I live, the more I realize the impact of attitude on life. Attitude, to me, is more important than facts. It is more important than the past, the education, the money, than circumstances, than failure, than successes, than what other people think or say or do. It is more important than appearance, giftedness or skill. It will make or break a company...a church...or a home. The remarkable think is we have a choice everyday regarding the attitude we will embrace for that day. We cannot change our past...we cannot change the fact that people will act in a certain way. We cannot change the inevitable. The only thing we can do is play on the one thing we have, and that is our attitude. I am convinced that life is 10% what happens to me and 90% of how I react to it. And so it is with you...we are in charge of our attitudes.
If you want positive words, encouragement for the day, something motivational, something that makes you think...something that makes you smile...you can count on me to deliver something regularly...whether here, on facebook, or twitter. I choose to find something everyday to make me smile...to encourage someone with...to always be thinking and speaking positively!
When you do what you love...people love what you do! I love what I do...in the feast or the famine! In a down market, buyers market, or sellers market. Full time...every time...providing service beyond your expectations!
While the market may not be what it has been in the past, it is surely not dead! You want someone who works hard, markets your home in every available avenue possible, online as well as offline, returns phone calls promptly, keeps searching for the perfect home for you as a buyer, someone who sees the glass half full. Even if things seem less than desirable, do you want people around you hearing you talk negatively about what you have chosen to do as a career? Why would they want to work with someone who has a negative attitude about what they do?
The longer I live, the more I realize the impact of attitude on life. Attitude, to me, is more important than facts. It is more important than the past, the education, the money, than circumstances, than failure, than successes, than what other people think or say or do. It is more important than appearance, giftedness or skill. It will make or break a company...a church...or a home. The remarkable think is we have a choice everyday regarding the attitude we will embrace for that day. We cannot change our past...we cannot change the fact that people will act in a certain way. We cannot change the inevitable. The only thing we can do is play on the one thing we have, and that is our attitude. I am convinced that life is 10% what happens to me and 90% of how I react to it. And so it is with you...we are in charge of our attitudes.
If you want positive words, encouragement for the day, something motivational, something that makes you think...something that makes you smile...you can count on me to deliver something regularly...whether here, on facebook, or twitter. I choose to find something everyday to make me smile...to encourage someone with...to always be thinking and speaking positively!
When you do what you love...people love what you do! I love what I do...in the feast or the famine! In a down market, buyers market, or sellers market. Full time...every time...providing service beyond your expectations!
Thursday, October 21, 2010
Color Coded
I have what some people might call perfectionist tendencies. I like order, structure, and balance. If it can't be done right, why bother...but once you get in the habit, it becomes so much easier and you don't even think twice about always doing it.
If you don't know already by reading my posts, I am a Realtor...and I absolutely LOVE it! I can't think of anything else I'd rather be doing than meeting people that want my assistance in buying or selling homes! Which brings me to my thoughts today...
I am in a lot of homes...see a lot of decorating styles...see a lot of different things. While showing homes a number of years ago, I noticed how organized and big a closet was. Much to my amazement, it wasn't that big, it just looked big because of the color coding! It's really quite simple. Start with your white clothes. Tank tops, sleeveless shirts, t-shirts, short sleeve w/ collars, long sleeve t-shirts, long sleeve w/ collars...you get the idea. Do each color. Mostly white shirts but with prints, put them in where they belong and so on.
I have kept my own closet this way since. Each time I put clothes away they just slide in where they belong and I always know whether or not something is clean and it is SO much easier in the morning getting ready!
It's like staging your closet to sell as well. Use like colored plastic hangers to keep the neat & tidy look. If you haven't gotten to the closets yet, put it on your list of items to do before you decide to sell your home. It makes my job so much easier and I'll know where you got the idea from!
If you don't know already by reading my posts, I am a Realtor...and I absolutely LOVE it! I can't think of anything else I'd rather be doing than meeting people that want my assistance in buying or selling homes! Which brings me to my thoughts today...
I am in a lot of homes...see a lot of decorating styles...see a lot of different things. While showing homes a number of years ago, I noticed how organized and big a closet was. Much to my amazement, it wasn't that big, it just looked big because of the color coding! It's really quite simple. Start with your white clothes. Tank tops, sleeveless shirts, t-shirts, short sleeve w/ collars, long sleeve t-shirts, long sleeve w/ collars...you get the idea. Do each color. Mostly white shirts but with prints, put them in where they belong and so on.
I have kept my own closet this way since. Each time I put clothes away they just slide in where they belong and I always know whether or not something is clean and it is SO much easier in the morning getting ready!
It's like staging your closet to sell as well. Use like colored plastic hangers to keep the neat & tidy look. If you haven't gotten to the closets yet, put it on your list of items to do before you decide to sell your home. It makes my job so much easier and I'll know where you got the idea from!
Monday, October 18, 2010
Moving...again...
My parents are moving again which reminded me of when they moved 5 years ago after being in my childhood home for more than 30 years. Thus, the question: How do you go thru all the stuff you have accumulated for 20-30 years and not get overwhelmed?
At that time, they lived in a ranch style home with a basement. We knew it would take time to go thru everything, so since they thought it would be a year before they moved, I suggested we divide the house into 12 rooms, that way they had a month on each room and only that room would be in an upheaval. They needed a system, so it was "Keep", "Donate", "Pitch", or see if the kids want it.
The goal was set: move in a year. The plan was made: work only one room at a time so as to not get overwhelmed. The system was in place: keep it, donate it, or pitch it.
Little did I know, how I helped my parents, who are now in their 70's, would be the exact "idea" I would assist my clients with who are either downsizing, moving into an Assisted Living Center, or nursing care.
It can apply to anyone moving though. You don't have to wait to get so-called "Old" to do this. People move all the time, never going thru the boxes of old tax returns, credit reports, or even old magazines...just moving it with them.
In all reality, we keep more than we ever need, buy more than we really need, and stash more than we'll ever see again! So before you dismiss the idea...the holidays are quickly approaching and you will be getting your decorations down from the attic. What are you bringing down, thinking you will put it up, but you don't. Get rid of it!
Happy Keeping! Happy Donating! Happy Pitching!
At that time, they lived in a ranch style home with a basement. We knew it would take time to go thru everything, so since they thought it would be a year before they moved, I suggested we divide the house into 12 rooms, that way they had a month on each room and only that room would be in an upheaval. They needed a system, so it was "Keep", "Donate", "Pitch", or see if the kids want it.
The goal was set: move in a year. The plan was made: work only one room at a time so as to not get overwhelmed. The system was in place: keep it, donate it, or pitch it.
Little did I know, how I helped my parents, who are now in their 70's, would be the exact "idea" I would assist my clients with who are either downsizing, moving into an Assisted Living Center, or nursing care.
It can apply to anyone moving though. You don't have to wait to get so-called "Old" to do this. People move all the time, never going thru the boxes of old tax returns, credit reports, or even old magazines...just moving it with them.
In all reality, we keep more than we ever need, buy more than we really need, and stash more than we'll ever see again! So before you dismiss the idea...the holidays are quickly approaching and you will be getting your decorations down from the attic. What are you bringing down, thinking you will put it up, but you don't. Get rid of it!
Happy Keeping! Happy Donating! Happy Pitching!
Saturday, October 16, 2010
A Realtor's Home
Have you ever wondered what a Realtor's home would look like? Inside or outside? Do they keep it in "show" condition? Does the outside demonstrate the curb appeal that attracts buyers? While recently watering my flowers, I turned to look at my home...garage door open, and I just smiled. As a Realtor, I believe our homes, whether seen by our clients or not, are a reflection of ourselves. If your neighbors know you are a Realtor, or don't but just happen to see the signs in the garage, the mere fact that you care about your home might mean that you might care about them and what you do for a living.
The fact that we advertise with such enthusiasm the homes that we list, we market ourselves with great pride, and dress the part of the successful professional...should not our private lives also be a reflection of the career that we have chosen?
I believe we should always be thinking about what the public is seeing. The garage door that is rotten particle board on a Realtor's personal home, but also happens to be the Real Estate office? The unkept yard full of weeds that needs not only mowing, but a whole lot more. The front door that looks like only a dog lives there because of the paw prints and slobber? If the only people that come into our homes are family and friends, we should care even more!
When a Realtor's personal home is placed on the market, it should be a reflection of the passion in which they do the job, not just the fact that they can list their own home.
I want to be living proof of the passion I have for what I love to do! It's not just a job to me, it's a lifestyle! It's a choice to have my home, as well as my life, reflect the passion in which I live my life.
