The Early Bird’s Guide to Buying a Home

Planning to buy a home this spring? Then rightnow–yes, during these last days of winter–is the time to get rolling.

“Spring is peak home-buying season, which means you’re going to have a ton of competition from other buyers,” says Peggy Yee, supervising broker at Frankly Realtors in Vienna, VA. Hence, winter is theideal time to get ahead of the curve, but how?Follow these steps and you’ll be way ahead of the pack once the spring home-buying season heats up.

Step No. 1: Find abuyer’s agent

Teaming up with a buyer’s agent during the winter offers several advantages. For starters, becausebusiness is slow, anagent can take the time to help you identify what type of home you wantand educate you on the local market so that you’ll have realistic expectations of what you’ll be able to find in a few months.

Should Millenials Put Off Buying a Home?

Land Ownership has always been part of the fabric of our nation. The founding fathers considered it so important that Thomas Jefferson was the champion of making land ownership a prerequisite for voting because he believed that only landowners had a stake in the future of the country. Of course Alexander Hamilton and the federalists won that debate but property rights and ownership remain the foundation of the American Dream. George Morris, CEO CENTURY 21 Everest Realty Group and Sales Agent amp; Team Leader: Jona Gamboato joined GTU to talk about the importance of home ownership today.

They say that the share of 18-34 year olds buying homes is at a 30-year low. National studies say that 93% of Millenials say they are likely to buy a home “someday, George says it’s important to start young and get in the game now.

Many people do not understand that they can buy a home. We encourage your viewers to reach out to us and we can connect them with a good team of loan officers. There are many programs for first time homebuyers, veterans and low-income families. Once we know the price range, we can help them find the home that they are looking for, Jona explained.

Benefits of Home Ownership:

  • Tax benefits
  • Rental payments build a future for the Landlord, not the tenant.
  • Year-over -year the asset will increase an average of 3% in addition to the equity you pay down. A home is the most important savings account for most people. It’s about planning for your future!

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Taking the stress out of buying a home – WSIL-TV 3 Southern Illinois

CARBONDALE — Buying a home may not be as difficult as it sounds.

Local realtors and lenders explained it all at the Carbondale Public Library Saturday.

Justin Zurlinden, a realtor with Remax said his first tip of advice is to get a buying agent.

The signs you see in front of the houses have the listing agent and that person is representing that property and that seller so you can have a buyers agent who represents you. Who takes you to all of the listings that you want to go into and helps negotiate on your behalf, he said.

And he said getting a loan pre-qualification might save you in the long run.

“It’s a very,very important negotiating tool. So if you come in and make an offer on a house and you have a letter from your bank saying yeah, you know with these conditions we would loan you the money, a seller is a lot more likely to take you seriously,” Zurlinden said.

He said the local housing market is considered a buyers market.

Theres a lot more property available than buyers available and so buyers have a lot of options in terms of which houses they would like, he said.

What You Need to Know Before Buying a Home “As-Is”

In the housing market, if someone sells you a lemon, squeezing out some lemonade could mean wringing out your wallet as well. Purchasing a house in “as-is” condition means that there are no guarantees from the seller on the home’s physical condition; you’re accepting any faults that might exist.

However, “not all as-is properties are distressed,” says real estate agent Katie Messenger of Bello Dimora Real Estate Network. Financial concerns are a common reason that sellers choose to list a home as-is, removing them from the responsibility of repairs and the sometimes costly fixes from home inspections. Or sometimes, the seller lives elsewhere and doesn’t want to deal with managing the repairs before selling.

“Other times the house is in good condition, and it’s an estate, so the executor may just want to sell the home and move on with as little hassle as possible,” Messenger says.

When buying a house as-is, how can you be sure you’re getting a deal and not a dud? In-House Realty broker Rosanna Rivera shares what you need to know before buying a home as-is.

Insist on a Home Inspection

“Every single home buyer in America should obtain a home inspection before buying a home,” says Rivera. “Not only is a home inspection a crucial element, but as any real estate agent will tell you, it offers disclosures that an agent can’t provide.”

Even with a home inspection, the responsibility to disclose any known issues still remains with the seller. Obvious defects should be apparent in the home inspection; however, sellers must acknowledge any known hidden defects in the property disclosure form. If an expensive repair need is revealed in the home inspection that’s much pricier than what the seller originally disclosed, then the buyer has the option to walk away.

An HGTV star who’s invested in over 100 properties reveals the most important money move to make before buying a …

One of the biggest
challenges is that once somebody realizes that theyre ready to
buy a home, then they realize that they havent prepared
properly, says HGTVs Scott McGillivray.
Malcolm Taylor/Getty

Youve cut back your spending, researched your favorite
neighborhoods, and have started saving upfor your dream home.

But no matter how much cash you have, before you begin the
homebuying process its important to get your finances in order,
says Scott McGillivray, the
host of HGTVs Income Property and a real estate expert
whos invested in over 100 properties.

One of the biggest challenges is that once somebody realizes
that theyre ready to buy a home, then they realize that they
havent prepared properly, and it takes a while, McGillivray
told Business Insider.

Outside of saving up enough cold hard cash to afford a down
payment — ideally, 20% of the sale price of the home — that means
also understanding where your credit score is and how to improve
it (or maintain it), getting pre-approved for financing, and
talking to an adviser or broker to determine if youve set a
reasonable budget, McGillivray says.

It doesnt sound appealing, but theres definitely some
sacrifices that need to be made, he continues. You cant
just be frivolous and then expect to be able
afford to buy a home.

Avoid These 6 Mistakes When Buying a Home in a Seller’s Market

Thenational inventory of homes for sale has been stuck at low levels for months. In January, for instance, inventory was down 7.1% year over year. That means that a buyer’s choices are somewhat limited and the price a buyer will pay is going to be higher. A classic seller’s market.

While there are a number of reasons for low home inventories, two stand out: more homes and condos were converted to rental units following the housing crisis, and older homeowners are not selling their homes, preferring instead to “age in place.”

Buying vs Renting a Home: What the Math Says

A simple way to understand that huge difference is to think of buying a home as a forced savings plan. Buying a home with a 30-year fixed-rate mortgage means that every month you are adding some portion of the mortgage payment to a savings account (your house) that is growing at least at the rate of inflation and usually even more than that.

A 2013 report from the Harvard Joint Center on Housing Studies makes the point:

While studies simulating the financial returns to owning and renting find that renting is often more likely to be beneficial, in practice renters rarely accumulate any wealth. In no small part this seems traceable to the difficulties households face in trying to save absent either a clear goal or an automatic savings mechanism.

What are the downsides to homeownership? Well, as we learned during the recent meltdown in the housing market, what goes up can very well come down, and with very bad effects. The housing crisis, however, was the worst economic event since the Great Depression of the 1930s, so we can take some comfort from that.

Buying a house also limits a person’s or family’s mobility. As homeownership rises, unemployment rates tend to begin moving higher within five years, at least partly due to homeowners who are unwilling to sell up and move.

Then there are the other costs of homeownership: property taxes, homeowners insurance and maintenance, to name the most obvious. A renter does not have to pay for a new roof or a new furnace while a homeowner does. And these things aren’t cheap.

The rent versus buy decision depends mostly on personal goals. As a creator of wealth, homeownership ranks at the top for most Americans. By the time we reach 65 years of age, about 80% of us will own a home, compared with less than 40% of Americans under the age of 35. That’s how needs and priorities change.

VA Home Loan: Buying A House With A Non-Veteran

VA Home Loan: Buying A House With A Non-Veteran
Joint VA Home Loan:Non-Eligible Co-Borrowers

Special rules apply when co-borrowers who are not married take out a VA home loan.

All co-borrowers dontneed to be VA-eligible. However, only theeligible borrowers portion of the loan gets a VA guaranty. Entitlements are pro-rated when joint borrowers include:

  • the veteran and one or more nonveterans (not spouse)
  • the veteran and one or more veterans (not spouse) who will not be using VA entitlement

When you buya home with a non-veteran spouse, that is not considered a joint loan, and your entitlement is not curtailed.

Click to see todays rates (Mar 2nd, 2017)
How Are The Guaranty And Down PaymentDetermined?

When there are VA-eligible and non-VA-eligible borrowers, the lender must pro-rate the amount of the guaranty. For example:

  • Two borrowers
  • Only one using VA entitlement
  • Purchase price: $400,000
  • Vet’s portion: $200,000
  • Maximum guaranty = 25 percent of $200,000

The lender can choose to accept what amounts to a 12.5 percent guaranty ($50,000 of $400,000). This is unlikely, however — in most cases, the VA lender would require a down payment.

For mostVA home loan borrowers, the 25 percent guaranty limits the lenders exposure to 75 percent of the property value. So foreclosure losses up to 25 percent are covered by the VA.

Lenders funding joint VA mortgages generally want the same protection, so theyll usually require a down payment tomake up any pro-rationof the guaranty.

In this case, the required down payment would probably be 12.5 percent, or $50,000 to give the lender its 25 percent cushion.

Qualifying For The VA-Eligible Buyer

To use your VA entitlement, you must certify that you intend to make the house your primary residence- you can’t just use your entitlement to help a friendbuy a house that you won’t be living in.

You need to meet standard VA underwriting guidelines, which are fairly liberal.The VA states, Veteran’s credit must be satisfactory and veteran’sincome must be sufficient to repay that portion of theloan allocable to the veteran’s interest in the property.

The VA has not established a minimum credit score, although many VA lenders have — often between 620 and 640. The average FICO for approved VA home loans, according to Ellie Mae, is 707.

The non-VA borrower’s income cannot be used to compensate for inadequate income on your part.

Your income should be sufficient to cover your portion of the monthly mortgage payment, property taxes and insurance, plus monthly payments on your accounts like auto loans and credit cards.

Lenders determine this either by applying a maximum debt-to-income (DTI) ratio of 41 percent, or using a residual income formula for your household size and location.

Click to see todays rates (Mar 2nd, 2017)
Qualifying For The Non-Eligible Buyer

Non-eligible co-borrowers do not have to certify that they will reside in the home.

For them, underwriting is slightly different. The non-eligible borrowers credit must also be satisfactory. However, thecombined income of both borrowers can beconsidered in evaluating his or her repayment ability.

In other words:

  • Income strength of the eligible borrowercan offsetincome weakness of the non-eligible borrower.
  • Income strength of the non-eligible buyercannotoffset income weakness of the veteran.

Your lender has to submit your applicationfor prior approval to the VA. Expect your full loan approval to take a little longer because of this, and build that into any offer you make.

What Are Todays VA Mortgage Rates?

Current mortgage rates depend on the type of VA home loan you choose, your strength as a borrower, and how aggressively you shop for your VA mortgage.

Click to see todays rates (Mar 2nd, 2017)