Don’t Neglect Your Credit Score
Don’t Acquire More Credit During Your Refinance:
Don’t Ignore Your Savings Account:
Don’t Constantly Refinance:
A home in good condition:
This is listed first for good reason. Buyers don’t want any unknown expenses to creep up on them or hang over their head in the buying process, especially when there are an abundance of other homes out there with less trouble. Simply stated, a well maintained home is the most important piece to the puzzle. Sure, there are people willing to put their money in a “fixer-upper” but with the economic hardships that many people are facing, some may simply not have the extra money to invest in vast improvements after they buy a home. Sellers should repair, update, clean and stage their home before the put it up for sale, in order to remove anything a person may see as an obstacle when buying that home.
Bargains and Incentives:
With the current market the way it is, more and more buyers are negotiating and focusing on getting the biggest bang for their buck. They won’t be settling on a home because they know right now they don’t have to. Many sellers are offering incentives in order to pique interest. From new paint or window treatments, the inclusion of a new flat screen television, or even offering gift cards to certain hardware stores, sellers realize that not only do buyers want low prices, they want something extra. Contributions to the down payment or covering closing costs could especially be of help to a first-time home buyer and it’s something that some sellers have considered in order to get their house sold.
Unique Features:
Many people are looking for outdoor living areas, whether that’s a screened in porch, a two-way fireplace or even a just larger patio perfect for outside entertaining. One of these features can be a huge selling point and will make a home more competitive on the market. Other features include more open space, such as the elimination of the wall between the kitchen and family room. Others are looking for a little bit of luxury to the home; granite countertops, stainless steel appliances or marble tile are a must for many people looking to find their next home.
The location and quality of the home are probably going to be the most important thing to someone buying a new house, but there are other selling points out there, and sellers are willingly to do their part in order to stand out from the rest of the pack. There are many homeowners out there who are very anxious to sell their house, especially as they continue to find themselves in a volatile market. The supply is higher than the demand, so a seller really has to get their home in the best-selling conditions in order to make sure their place isn’t on the market for longer than they can afford.
However this year, for the third time in seven years, your federal income taxes will not be due April 15. Instead, because of a combination of the calendar, a holiday, and tax law, Tax Day 2012 is delayed until Tuesday, April 17.
So the procrastinators out there will have two extra days to prepare and file their federal income taxes this year.
First, April 15 is a Sunday and all federal offices are closed on Sundays. This means that taxes can’t be filed on April 15, as regularly scheduled. Rather, the tax due date should roll over to the first available business day — Monday.
However, Monday, April 16 is Emancipation Day, a holiday in the District of Columbia since 2005. Emanciption Day honors President Abraham Lincoln’s April 16, 1862 signing of the Compensation Emancipation Act, the freeing of slaves in the district. All of Washington, D.C. is closed for the local holiday — including the offices of the IRS. Taxes can’t be due on this date because no one will be working at the Internal Revenue Service to receive them.
Therefore, Tax Day rolls over to the next available business day, and that’s Tuesday, April 17. Despite the 2-day change, as a reminder, the deadline to file a federal tax return with extension has not changed. People who need an extension can submit Form 4868 for a six month extension; that filing date remains October 15, 2012.
The IRS says it is expecting more than 144 million individual tax returns to be filed this year, with most filing by the April 17 deadline.
When filing, homeowners shouldn’t forget the tax deductions for their home, including property and real estate taxes, the mortgage interest on your primary residence, the interest on a HELOC, the premium you paid for private mortgage insurance (only if the policy was issued after 2006), or even any home improvements that were made for medical care.
Most states have chosen to mirror the IRS’ tax deadlines this year even though Emancipation Day is a Washington, D.C-specific holiday. Just to be on the safe side, be sure to check with your accountant to confirm your local filing deadline.
Cut costs on your mortgage
The continued rate dip has opened up a refinancing window that is pretty hard to pass up. Many borrowers are refinancing to lower rates and even refinancing to shorter term loans in order to pay off their mortgage quicker. Now is as great a time as ever to make sure you have the best rate and mortgage and are in the best financial situation available. Please feel free to call or email and I can help make sure you are best positioned on your mortgage.
If you’re in need of repairs, now is the time to negotiate
Though it may be on the way up, contractors are still facing a slumping market and will probably be willing to strike a deal to get your business, especially during these cold winter months. A recent survey on a consumer review website stated that 81% of contractors say they’d negotiate labor costs; more than 25% said they’d drop prices by more than 10%. Also, service providers like house cleaners and landscapers are cutting rates, too. Remember to get multiple price quotes. You’ll have the most bargaining power if you can be flexible about the timing of your project.
Look for Deals
When sales slow down after the holiday season and end-of-the-year sales, many furniture shops will make deals to move their inventory, so check up on local deals around your neighborhood. At times gently used floor models can go for 25% off. And remember another easy way to save money –sign up for e-mails from furniture shopping sites and other stores who offer coupons on their websites or via e-mail. Also, if you’re in need of a new television or other appliance, now is the best time to buy, as new models are coming out in the spring and sales on current stock offer great deals right now. Also, if you have credit card with that store, ask about 0% financing, as most of them offer it on an 18-36 month basis for their customers.
Some other cost cutting ideas:
Try to set thermostats no higher than 68 degrees in winter. Turn your heat down even further at night or when you’re not home (unless you have a heat pump, which operates more efficiently at one consistent setting). Each extra degree in winter can increase heating costs by 3%. During the summer, each degree can raise cooling costs by 6%. This can be a real cost saver, potentially saving you up to $325 to $500 annually.
Cut back on the use of your dryer. Not only is it a big energy drain, it can also suck heated air out of your house very quickly in winter. Instead, hang clothes on a clothing rack to dry and just use the dryer for towels and other heavy items and this can save about $25-$50 per year.
Install the new type of fluorescent bulbs in lights you leave on for long periods. They provide four times as much light and last ten times longer than incandescent bulbs. It can save you up about $10-$50 a year.
There are some things you can do on your end to avoid low appraisals. First and foremost, make sure your house is in great shape before the appraisal. Treating an appraisal like an open house is not a bad idea, as “curb appeal” can make a good impression when the appraiser visits. It may not be much, but every little bit helps, and you want your home to look the best it can be when it’s getting appraised for its value. Highlighting any recent renovations or upgrades you have done to your home—even putting your “before photos” out on the counter, or providing the appraiser with a list of upgrades you’ve done can’t hurt.
Getting rid of the clutter definitely wouldn’t hurt either. Most appraisals require a photo of each room, so a well-kept property can help. The best thing that you can do to get ready is to make sure that the appraiser has easy access to the entire property, inside and out. Pay careful attention to areas that you may not frequently access, like tool sheds, attics and basements.
Also, dig up some comps yourself with the help of your real estate agent. Real estate sales are a matter of public record, so feel free to spend the time to find houses like yours in your neighborhood. And if need be, do some research to identify any extenuating circumstances that produced lower prices that some comparable homes sold for. Instances like a death or divorce in the family can lead to a seller taking a lower offer than they would in a normal circumstance; also, poor conditioning of the home or a foreclosure will definitely affect a home’s value. Do the research and make this information available to the appraiser, as these efforts can only help your cause.
Once the appraisal is finished, double check the final report submitted. It’s not a problem to request to see what the appraiser turned in. You want to check for factual mistakes—wrong lot size, wrong square footage, or an incorrect number of bathrooms are just some of the errors that will affect the value of your home if this information is not reported and evaluated correctly. You won’t insult the appraiser by checking on your report, as appraisers understand how important this will be to the sale or refinancing of your home.
Buying a home that has been foreclosed upon can provide large profits for potential buyers and investors. During stressful economic times, many great homes go into foreclosure due to job loss or other personal and financial hardships, and it can be advantageous to take a look at these properties as they become available. Finding a foreclosure for a great price, coupled with current all-time low mortgage rates could mean now is as good a time as ever to start your search.
Finding a foreclosure isn’t always easy – you have to make sure and do your homework, researching whether or not this purchase is worth the time, effort and money that goes into the process. The safest deal is with a bank-owned property, that way there are fewer risks, no taxes and liens and no tenants that need to be evicted. Typically you’ll find that the property doesn’t sell at as big a discount as at an auction, but there is much less risk, as you can obtain financing through 1st Advantage Mortgage and can have the property inspected. This is very similar to buying a property from another owner, but instead it is owned by a bank.
There are foreclosures that are riskier than others, particularly if you’re going to buy a foreclosure at an auction. Buying from an auction means you can’t go in and inspect the property, and you also may find other liens against the home. Generally homes that sell at auctions will provide you with the lowest purchase costs, but be prepared to pay cash, as you won’t be able to take out a mortgage for this type of home. In providing mortgage financing, it is essential for us to inspect the property and have an appraisal done in order to protect our clients from making a purchase that is not worth their time or money.
Keep in mind that people who lost their home in foreclosure very likely couldn’t afford to maintain their property. Be prepared to pay for any problems such as plumbing or electrical repairs, leaky roofs, or even a poorly kept interior or exterior that will need the care that the previous homeowner didn’t or couldn’t provide.
Though there are some risks and probably some added costs to purchasing a foreclosed property, there are many homes out there that are in great shape and have just become the product of economic hardship among their previous owner. If you find a home that is worth the effort, take advantage of a golden opportunity.
With Valentine’s Day quickly approaching, many couples may be planning to make reservations to a fancy restaurant, placing an order of flowers for their loved ones or just getting ready to share a special evening with their significant other. If you’re in a relationship that you think is heading down the path of a house, a marriage and a family, one important thing that couples should also be sharing is their credit score and credit reports. It may not sound as romantic, but it is just as important to your relationship and your future. Once the time is right in a relationship, it’s important to discuss any past credit or financial issues that would impact your ability to buy a home together.
Put Everything on the Table: Make a list of your current debt, including student loans, car payments, credit card debts. Be transparent about debt and finances.
Check Your Individual Credit Reports—and Share Them: These reports provide detailed information about what is currently owed, what has been owed to other lenders and details of any missed or late payments. Everyone is entitled to a free credit report from each of the three credit bureaus per year. Visit www.annualcreditreport.com, the official site of the three credit reporting agencies in the country.
Adhere to Credit Boundaries –Before making any purchases on your credit cards, talk about how this will impact your plan and your future. Talk about how you’ll pay off future bills, that way there won’t be any surprises down the line.
Plan to Reduce Debt Together: Discuss and implement a plan that will correct any past irresponsible behavior on either of your parts. Don’t dwell on it now, but instead, take the necessary steps to fix it. Debt doesn’t have to be a deal breaker if you face the challenge head on.
With home prices as low as they are today and down payment assistance programs hard to come by at times, a little-know HUD program allows for soon-to-be married couples to gather monetary gifts from friends and family and place them into a down payment program for an FHA mortgage.
The program, called The FHA Bridal Registry, works like a traditional registry but is even more flexible. The bride and groom can speak to me as their mortgage lender and we can set up what is essentially a custodial savings account for the dedicated purpose of funding their down payment. Then the couple can simply provide the details to friends and family. In turn, the couple’s guests can deposit funds directly into the account, or they can just hand cash or checks to the couple for deposit into the account.
These arrangements offer additional flexibility beyond the traditional down payment gift rules applicable to FHA loans, which require that gift funds (versus money the couple would have saved up from their own income) be “sourced,” meaning borrowers must document their family relationship between themselves, show where the giver got the funds from and produce a letter from the giver stating that the funds are a gift and not a loan.
A few other things:
- The entire amount of gift funds can go towards the FHA required 3.5% down payment.
- Anyone with an interest in the purchase of the home cannot be party to the gift funds.
- Maintain a journal listing the dollar amount, name of the donor(s), and date for each monetary gift given to the bridal registry.
- The bride and groom must supply copies of the bridal registry bank statements to me, verifying the deposits showing in their Bridal Registry journal.
- Bridal couples or individuals are not obligated to use the money in the Bridal Registry Account for a down payment on a home. The couples or individuals control how the funds will be used, and if plans change, the money can simply be withdrawn and used for something else.
- There is no requirement that the couple needs to be married prior to closing on their new home.
So, if you are currently planning for a wedding and a home purchase, why not skip on asking for that expensive vase or another blender and put money toward the purchase of your new home? Contact me for more details.
Rates are very attractive right now and have hit new record low’s. Now is a great time to see if you can improve on your current mortgage with a refinance. Borrowers who apply for a mortgage and close with me can mention this Facebook post and receive a $500 closing cost credit. Contact me for more details.
