Real Estate Information Archive

Dear: Home Buyer

 Because of the many changes in the new finance rules, there are several things that can negatively affect your ability to close your loan. Keep these in mind as we proceed. Many banks will check your credit score right before they release funds for the closing if your credit score has gone down they will not fund the loan. You could lose ALL of your deposits. They ALL check your job status a day or two before closing.

 • DO NOT get mad at your boss say something stupid and lose your job, you need your job to get the loan and to pay it after you get it.  

 • DO NOT change jobs without inquiring about the impact this change could have on the approval/ approvability of your mortgage loan. Please call your mortgage person first.

 • DO NOT open or increase any liabilities, including credit cards, signature loans, etc., during the loan process. This could have a major impact on your credit score. It would be very best not to use your credit all while we are going through this time. After you move in to your new there will be plenty of time to spent money.

 • DO NOT make major purchases during or prior to closing, no new car loans, store credit (i.e., new car, furniture, appliances, electronics) because this might impact your qualification ratios. Please call your mortgage person to calculate what your ratios would be with any additional debts.

 • DO NOT obtain and/or deposit sums of money over $500. FNMA/HUD guidelines require documentation as to the source of these funds (i.e., copy of bonus check, copy of tax refund, copy of insurance settlement, gift letter with copy of check and deposit slips, etc.) piles and piles of paper work.

 • DO NOT close/open or transfer any asset accounts without inquiring about the proper documentation required for our loan file (i.e., if you transfer all the funds in your stock account to your savings account, documentation is required).

So what should you do?

 If you get a large check from any source deposit it in ONE account DO NOT split the deposit into several accounts, DO NOT deposit half into one account and take the rest in cash. You need a paper trail.

 • DO keep originals of all pay stubs, bank statements, and other important financial documentation. We are required to update any documents that are over 30 days old prior to the closing of your mortgage loan (this is required even if your loan is approved).

 • DO provide all documentation for the sale of your current home (i.e., sales contract, closing statement, employer relocation/buyout program).

 • DO notify me and your mortgage person if you plan to receive gift funds.

 • DO notify me and your mortgage person of any employment changes (i.e., change of employer; recent raise/promotion; change of pay status, such as salary to commission, etc.).

 When closing time comes, anyone who is going to be listed on title (even if they are not on the loan) must attend the loan closing. You will be required to show identification so bring a copy of your driver’s license with you.

 Any funds required to close must be in the form of a cashier’s check made out to the Bank or title company. You should know the exact amount for the check a few days before closing.

 If there is any doubt in your mind regarding what to do, please call me or your mortgage person. Let my experience work for you. Thanks for placing your trust in me and I look forward to serving you and your friends.

 Sincerely,

Terry Twombly

Agent for Jack Conway

ttwombly@jackconway.com

www.terrytwombly.com

508-212-6511

NAR: Homeownership, stable communities linked

WASHINGTON – Aug. 13, 2010 – A new report from the National Association Of Realtors® (NAR) – Social Benefits of Homeownership and Stable Housing – explores the impact and positive social outcomes that result from homeownership.

According to NAR’s study, homeowners are more active in communities, benefit from improved education opportunities, and report higher levels of self-esteem and happiness compared to renters.

“Homeownership is in investment in your future – home is where we make memories, build our lives and feel comfortable and secure,” says NAR President Vicki Cox Golder. “Owning a home has long-standing government support in this country because homeownership benefits individuals and families, strengthens our communities and is integral to our nation’s economy.”

NAR’s study identifies research from government, industry and academia that looked at the relationship between homeownership and stable communities. Homeowners move far less frequently than renters, and therefore are embedded into the same neighborhood and community for a longer amount of time. This allows for social cohesion, ultimately resulting in social benefits and stronger communities.

“Realtors care as much about keeping families in their homes as they do about helping them find the home of their dreams,” said Golder. “Social benefits do not arise solely from ownership, but also from greater housing stability and social ties associated with less frequent moves among homeowners.”

Several research studies cited in the NAR report found that homeownership has a significant impact on educational achievement. The decision by teenage students to stay in school is higher for those raised by homeowners compared to renters. Access to economic and educational opportunities is also more prevalent in neighborhoods with high rates of homeownership. Furthermore, studies have shown that changing schools frequently due to moving negatively impacts a child’s educational outcome.

Civic participation is another social benefit resulting from homeownership and stable housing. Homeowners are more politically active and more likely to vote in local elections compared to renters. In addition, homeowners have a higher membership in voluntary organizations.

“The research shows that homeowners report higher self-esteem and happiness than renters, resulting in better overall health, both physically and psychologically,” says Golder.

When it comes to property, homeowners have more invested both financially and emotionally. Property crimes affect homeowners directly, but nonviolent property crimes can impact the property values of an entire neighborhood. Therefore, homeowners are more motivated to deter crime by forming and implementing voluntary crime-prevention programs. In addition, it’s easier for homeowners to recognize perpetrators in stable neighborhoods because of extensive social ties. Unstable neighborhoods often display social disorganization, which can lead to higher levels of crime.

Along with protecting their home and neighborhood from crime, homeowners spend more time and money maintaining their home than renters. Neighbors also influence other homeowners to improve their property, resulting in a better overall quality of the community.

“Homeownership certainly contributes to positive social outcomes, but those outcomes are truly a result of stable housing communities,” says Golder. “With strong social ties and a cohesive community, homeowners can enjoy not only the long-term financial benefit of owning a home, but also a more satisfying life – which is what’s really at the heart of the American Dream.”

Should you focus more on getting a low rate or wait for a price reduction on homes?

My feelings are if you need a home, buy one now, the interest rates are at historic lows and prices are down below where they were ten years ago, the bottom must be close. Please review the example below, no one knows for sure what will happen in the future but more than likely there will be a future.  

The Fed's Mortgage Backed Securities purchase program ended. The markets have seen much more volatile price swings. For potential buyers who are waiting to see if home prices come down a little more, that means the wait could well cost you more money in the long run.

Let's look at an example to see why. Say a homebuyer wants to buy a home that costs $300,000. But the buyer wants a better deal on the home, so she delays a transaction until the home is reduced by $10,000. If, in the meantime however, rates were to rise .75% to 6.00% and the buyer financed 90% of the purchase price, the amount of total payments over a 30-year term would be over $35,000 more than paying the $300,000 purchase price and locking in the 5.25% interest rate. In other words, the buyer would save $10,000 only to end up paying $35,000 more.

Now these prices and rates are just for the sake of example. But the point is that home prices are already very affordable...and rates are still at historic lows for now. So in the end, waiting for a home price to reduce may end up costing you much more than you expect if rates rise.

For more info or to get pre-approved, please contact me. I work with several lenders that will work very hard for you and I. I have access to a loan that is insured if you lose your income for a period of time.  Right now is the right time buy now.

 Terry T

  Have you noticed an increase in the number of "for sale" signs around your neighborhood, and for good reason: Studies show that home listings increase this time of year, as homeowners want to get their families settled before the next school year begins. If you are thinking of selling your home in today's tough market, the experts recommend completing a few projects that will help your home look its best and stand out from the crowd.

 These projects don't have to cost you a lot of money or take a lot of time. "There are four easy and inexpensive projects that I recommend every homeowner complete before they stick that 'for sale' sign in their front yard."

Improve curb appeal

Curb appeal is, quite simply, what prospective buyers first see when their car pulls up to your house. According to the National Association of Realtors, half of all buying decisions are based on curb appeal. "Your mother's advice holds true here - nothing is more important than a good first impression, Strong curb appeal will help set a positive tone for the rest of the house."

Walk out to your sidewalk and take a look at the front of your house, checking for anything that needs to be cared for. A good first step is to update your exterior hardware, including house numbers, which often become dirty and dated over time. Today there are several great options on the market that incorporate some color and style, which can be customized to your home.

Another quick project is to replace your mailbox. Choose one with a more modern, sleek design such as the Postmaster Amboy Mailbox in black, which looks great on any house and is easy to install. This updated fixture, although small, can do wonders for the overall curb appeal of your home.

Create a luscious green lawn, lush lawns always receive a lot of attention. Help your lawn reach its full potential by providing it with the proper lime, fertilizer and grass seed. Make sure that your lawn receives between one and one and a half inches of water per week, including rainfall. Watering in the morning 4 to 5 o’clock is the best time to water. You want your lawn dry at night.  

Groom your garden and prune the bushes, nothing compliments a great lawn more than a well-manicured garden. After the cold winter months, gardens and flowerbeds can be left looking unruly. Prospective buyers are searching for outdoor spaces where they can enjoy spending time, so it's important that you tidy up these areas.

An easy way to do this is by spreading new mulch. Also trim and prune the shrubs and trees to create a refined look, A 'jungle theme' makes the home look unkempt.
Finally, give your garden a pop of color by planting inexpensive annuals, such as marigolds and snapdragons.

Now on to the interior spruce up with paint and remove the old carpet, If you know that you have wood under the old carpet, I feel it is much better to remove the old carpet and either leave the wood to be re-finished or have it redone if it needs it.

 Then spend some time on the interior painting, painting is one of the most inexpensive and simple projects that homeowners can do, and, it makes a huge difference!" Choosing neutral paint colors over bold ones won't distract prospective buyers and will help them visualize making the space their own.  

Just some ideas, to sell fastest, when the home goes on the market it wants to be the best home, in the price range that it is in, looks matter.

For Your Clients: 12 Tips to Make Your Move Simple and Stress-Free

By Gregory Karp

RISMEDIA, July 13, 2010—(MCT)—Packing your belongings and moving is often fraught with high emotions and involves a to-do list a mile long. So, it’s tempting to give only passing attention to hiring a mover and the related incidental costs. That could be a mistake—for your wallet and your peace of mind. Moving can be quite expensive. A typical full-service interstate move costs about $4,300, while the same in-state move might cost about $2,500, according to the American Moving & Storage Association. And while the moving industry has many fine companies, it is notorious for fraud and dirty tactics by so-called rogue movers.

Here are 12 tips to make your move simple and avoid the hassle.

Choose a type of move: You have three basic choices: do-it-yourself, full service and a relatively new hybrid of the two. Going it alone is the cheapest alternative, costing the rental price of a truck, gasoline, packing materials and, perhaps, pizza and beer for friends you rope into helping. With full-service moves, moving within a state is charged by the hour, while moving across state lines is charged by weight and mileage.

With a hybrid move, a mover will drop off a large container at your home for you to pack. The mover will then load the container onto a truck, drive the belongings to your new location and drop off the container for you to unload. Because you’re doing the manual labor of packing and unpacking, it’s far less costly than a full-service move.

Hire a quality mover: If you hire help, get at least three price quotes and do your homework before selecting a mover. Seek recommendations by talking with family and friends, even your Facebook circle. Investigate a company’s reputation with the Better Business Bureau (bbb.org), Yelp.com and possibly the paid-membership site Angie’s List (angieslist.com). Check a company’s complaint history at the federal government site, ProtectYourMove.gov.

“People think a good reputation equals expensive, but that’s not true,” said Laura McHolm, co-founder of NorthStar Moving in Los Angeles. “You don’t get a good reputation by overcharging people.”

Look for two things when hiring a moving company: A full-service mover should visit your home in person, not give a quote over the phone or online, and should provide a written estimate, experts say.

Declutter: No matter what type of move you’re making, taking less stuff is cheaper and less hassle. Set up a staging area, perhaps in a garage, with various piles, such as throw out, recycle, donate and sell.

For many items, use the rule of thumb, ‘If you haven’t used it in a year, you probably don’t need it.’

Be flexible: Like airline fares, moving rates depend on when you book. The busiest time for movers, and thus the most expensive time for consumers, is summer weekends near the 15th and 30th of the month.

If you have time flexibility, ask what rates would be for different days or seasons. If you have extreme flexibility, ask about moving standby: waiting until the mover has extra space and needs to fill a truck.

Save on boxes: Buying new boxes from a moving company is the most expensive choice. To save some money on packing materials, ask if you can buy used boxes from your moving company.

Cheaper yet is finding free boxes, ideally from somebody who just moved. Ask your real estate agent to connect you with other clients who recently moved or look on Craigslist.org. Specialty boxes, such as wardrobe boxes, might be cheaper to purchase at a do-it-yourself moving store, such as U-Haul, than from your mover.

Save on packing materials: If you’re packing your belongings yourself, fill suitcases, laundry baskets and plastic containers with unbreakable items. Use pillows, scarves and towels to wrap fragile belongings.

Mail books: If you have a large collection of books, pack them yourself and ship them at the postal media mail rate as it might be cheaper than paying a mover—a 70-pound box would cost less than $30.

Consider consolidation: For long-distance moves, ask about consolidating your stuff on a truck with other people’s as most homeowners can’t fill a full-size moving van. You might have to be flexible on delivery dates and times, but consolidation can be cheaper.

Insure it: Check your homeowner’s or renter’s insurance policy to determine whether it provides coverage for your belongings while in transit. If not, you’ll probably want more than the basic free valuation coverage a full-service mover provides. The standard valuation is 60 cents per pound per item. That means breaking a 10-pound, $1,000 stereo system would net you $6. You’ll want full replacement-value insurance, which reimburses you what it will cost to replace broken items. But don’t necessarily buy that insurance from the moving company. Moving insurance is likely cheaper from a third party, but be aware that you probably cannot get insurance on boxes you packed yourself.

Be prepared: Plot out where furniture and boxes will go before moving day arrives. The less time movers spend rearranging, the less expensive it will be.

In urban areas, reserve a space or two in front of your new home for the moving truck by parking your own vehicle there ahead of time. If the movers have to park too far away to unload, you could incur a ‘long carry’ surcharge.

Stake your claim: If you’re moving for a job, negotiate the best relocation package you can. Un-reimbursed expenses might be tax-deductible. For details, see Publication 521 Moving Expenses at IRS.gov.

Tip: Tipping each mover $3-$5 per hour is customary, said Stephen Coady, marketing manager for Gentle Giant Moving Co. in Somerville, Mass.

 7 Things All Borrowers Should Know About FHA Loans

A national FHA condo approval service, has developed a list of facts speaking to the top misconceptions associated with FHA loans in order to help home buyers better navigate an already confusing market. FHA loans are mortgages issued by qualified lenders and insured by the Federal Housing Administration (FHA).


1. FHA Loans Are Not Only For Lower-Income Borrowers. FHA loans are available to everyone. In fact, even Bill Gates can get one. There is no maximum income restriction associated with FHA loans. Borrowers do need to substantiate income and assets by submitting proper documentation. This requirement ensures that borrowers are well-vetted and truly able to afford their future homes.

2. FHA Loans Are Not Only For First-Time Buyers. Many people believe FHA loans are available only to first-time homebuyers. This is not the case. Whether borrowers are making their first home purchase or their fifth, they can look to FHA loans as a home financing option.

3. FHA Loans Are Not Just Small Loans; In Fact, Loan Amounts Can Be As High As Almost $800,000. The government recently raised the maximum loan amount from its original cap of $362,790 to $793,750 as a way to help stabilize the housing market. The amount a buyer can borrow varies from county to county. Later this summer, condo buyers interested in FHA loans can visit www.checkfhaapproval.com to instantly identify FHA-approved condo associations and review maximum loan amounts for a given location.

4. FHA Loans Are Not Affiliated With The Section 8 Housing Program. While both programs are administered by the U.S. Department of Housing and Urban Development (HUD), FHA loans have nothing to do with low-income subsidized housing. FHA loans are simply mortgages insured by FHA. This insurance provided by the federal government allows lenders to lend more freely by assuring them that they will be repaid in the event of default. Most traditional lenders, including Wells Fargo & Co., JP Morgan Chase and Citigroup are able to provide FHA loans to their customers.

5. FHA Loans Are Often More Affordable Than Conventional Loans. While FHA loans typically offer the same interest rates as other loans, borrowers benefit from a much lower down payment of as low as 3.5 percent.

6. FHA-Approved Condo Developments Are More Desirable To Buyers. With 87 percent of home buyers indicating that they plan to use FHA loans, condo associations that are not FHA approved are missing out on a significant pool of prospective buyers. Under rules in place since February 2010, an entire condominium development must now apply to HUD and be granted FHA approval before a buyer can purchase a unit in an association with an FHA loan or before an existing unit owner can refinance into an FHA loan.

Due to the general unwillingness of today’s lenders to extend credit with respect to conventional loans, many borrowers find that FHA is their best bet. Lenders don’t mind lending when the federal government (FHA) assures them of repayment.

Homeowners associations (HOAs) should note that although FHA-insured mortgages might be easier to obtain, they are not “risky” loans, due in large part to the strict “full documentation” requirements placed on borrowers.

Individual buyers or sellers can initiate the approval process or current owners can encourage their HOA to apply. More information about the FHA- approval process is available at www.getfhaapproval.com.

7. FHA Loans Are Assumable. In addition to lower down-payment and credit-qualifying requirements as compared to conventional loans, FHA loans are assumable. This means that when a seller with an FHA loan sells his or her property, the loan and its financing terms (interest rate) can be transferred to the new buyer. This unique feature will certainly make a property more valuable in times of rising interest rates.