Archive for July, 2006
5 Useful Tips in Buying a House
Buying a house is a very serious matter that comes in to people’s lives. It is very risky to invest your money in buying just any house you find. You must have some guidelines that can help you decide which house is the best for you. Here are some:
1. Determine your rights
When you are ready to buy your own house, be sure you understand your rights as a homebuyer. Knowing the process of buying a house prevents you from getting scammed. You can personally do your home work or seek for a knowledgeable person like a real estate agent or a broker. Make sure that the agent you hire is licensed and have a wide knowledge regarding the area.
2. Make sure you can afford it
Your budget is really a big deal in buying your own house. What you want is different from what you need, so be practical. You don’t really need a big house if you’re just one person that travels everyday, right? Make sure that you make the best for your money. Seek help or ask for suggestions especially for those who have knowledge in real estate prices. If you can’t stay for at least a year, buying a house is inappropriate for you. You may save a whole lot more of money if you sell it urgently.
3. Make sure it fits your lifestyle
Make your house a home. Be sure it really fits your way of life and you are comfortable with it. A good example of this is if you’re working in an office, a good place to find is near or in the vicinity of your office. If you love nature, a good place to find is outside the city with clean air, near parks, has a mountain view or near at the beach. Your personality really matters in finding a good house. Make sure to look at its suburbs first and try to gather some information about the area and its surroundings. Try also to consider the kind of neighbors you will have.
4. Consider your future plan
If you’re newly married, you might to consider how many kids you want to have. You can assume the number of rooms or the home space you need. If you can afford a house that is near to a good school, it is better. School districts are more important to home buyers, therefore, it will increase your property values.
5. Be organized
It is very important to make your document files organized and safe. Because it will prove that you own the house. It will help you a lot especially when it comes in paying your house payments (taxes and amortization).
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Ester is one of the SEOs of http://www.ozfreeonline.com and takes care of the Ozfree Online Real Estate Page where in it offers a comprehensive list of office & commercial real estates, homes for rent or sell and an apartment finder to thousands of properties in Australia. For more information, visit http://realestate.ozfreeonline.com.
“Behind the scenes” look at your mortgage being processed:
Today, I wanted to give you a bit of a “behind the scenes” look at how your mortgage is processed. A lot of American consumers seem to be unaware of the amount of overhead and problems involved for lenders when trying to close a mortgage.
I do not intend for this piece to be a sob story to get you to feel sorry for me or other loan officers. However, I think if all the parties involved with a real estate transaction are made aware of how complex the process is to obtain financing, they tend to be a little less “pushy” in trying to get transactions completed in unrealistic amounts of time.
Below are the steps for completing a standard 30-year fixed-rate mortgage. These steps vary by loan program, but we will stick to the basics, for now:
1) Complete mortgage application with your loan officer
2) Your loan officer obtains automated approval for your mortgage via a computerized approval system
3) Income verification (usually, paystubs, W-2 for the last two years, and/or tax returns)
4) Asset verification (usually, bank statements for all accounts listed on the application, and statements for all retirement or stock accounts listed on the application)
5) Employment verification (your employer is either faxed a form they must complete to verify your employment and income at your current job, or they are contacted by telephone and asked to verbally verify your employment)
6) Appraisal (to verify the property is worth as much as you have agreed to pay)
7) Title examination for the property (basically, an examination of public records to verify that all taxes and loans against the property are paid satisfactory)
Only seven steps. Sounds easy, right? Think again. The potential for problems when completing these steps is fairly extensive. I will elaborate on those in my next article. Without going in to too much detail here, it is safe to say that good credit scores, good income, and lots of money in savings do not guarantee that your transaction will be “easy” to complete…
Do ARMs make housing more affordable
Re-visiting the theme of the ARM, many are still deluding themselves that using these products makes housing ‘affordable’.
Exotic, but dangerous
Nontraditional mortgages may be the only way some people can afford a home. But the buyers should beware.
Rising home prices have caused people to look at exotic mortgages as a way to get into a house with small down payments and little monthly notes. These mortgages are a break from the traditional 30-year, fixed-rate loans. In some varieties, the borrowers only pay the interest on the note; in others, the interest rates adjust with the market.
Part of the demand for these mortgage programs is the steady rise in home prices, which have gone up an average of 33% across the U.S. since 2002. For many middle class families in hot housing markets, such as southern California, Atlanta or Las Vegas, taking out a loan and spending the first 10 years paying only the interest on it, or getting a 40-year mortgage is the only way to afford a home.
Carby says the new mortgages have been developed to manipulate monthly payments to a level the borrower can afford.
“There are people wanting to buy property at any cost, in any situation,” Carby says. “It’s all about making a unique fit to go with a person’s income.”
But now, Fishbein says there are $1.5 trillion in adjustable rate mortgages set to reset in the next few years. In the past year, interest on an adjustable rate mortgage (ARM) has jumped from 5.1% to 6.3%. That means homeowners will face a huge upswing in their monthly mortgage notes. The swing is so significant, that Wall Street analysts estimate one out of eight people could end up defaulting on their mortgage.