Summer is coming! At least here in Florida the weather is already summer-like. And no matter where you live, summer will be on its way to you shortly. With long summer days in your mind, swimming pools may be on your mind as well. The cost of in-ground swimming pools can be a minimum of $50,000 – it depends not only where you live, but what type of pool you want as well. There are a handful of options for you if you need to finance your swimming pool.

To start with, as mentioned a few posts ago, a cash-out refinance is an option. If you have a decent amount of home equity, you will be able to get cash back when you refinance your mortgage. The cash that you get back can be put toward a swimming pool. This will also add great value to your home as well. You can borrow up to 80% of your home’s equity.

You also have an option of a home equity line of credit. This type of credit is a revolving credit line that your home’s equity secures. This line of credit is very much like a credit card. As long as you are approved and you have enough credit to make the purchase, the credit can be used to finance a new swimming pool. Since the debt is secured by your home, the interest rate is typically lower than a regular credit card or even a personal loan.

You can also take out a home equity loan. It is basically a second mortgage. This type of loan gives you all of the money upfront, unlike a home equity line of credit. This type of loan does come with a closing cost and uses your home as collateral. If you stop making payments for any reason, you may lose your home.

If none of the options mentioned sound good to you, you also have the option of applying for a personal loan. Some institutions label them as a “pool loan” – as that is exactly what it is.

If your dream is to have a swimming pool in your home, just be sure you are not taking on too much of a financial burden. Make sure it makes sense for finances.

Assumable mortgages are not very common. The majority of people likely has not heard of it. It is a type of mortgage where a new borrower has the ability to take over the loan that is existing from the current borrower. To put it in simple terms, a new home buyer takes over the mortgage of the home for sale. Terms and conditions do not change for the new home buyer – all terms and conditioners are the same. This includes the mortgage rate. The remaining balance of the mortgage stays the same, along with the remaining time left on the mortgage.

Although it sounds like an assumable mortgage is fairly simple – the someone is effectively just taking over the mortgage for someone else, it is not the simple. To start with, not all loan types are assumable. For example, conventional loans cannot become an assumable loan. This may come as a surprise, but you still have to make a down payment for an assumable mortgage. The amount may be more than you expect. You also still have to apply with the mortgage lender and be sure you are qualified to do so.

Some people like to do an assumable mortgage when interest rates rise. The person who takes over the mortgage has a mortgage rate of what the original mortgage rate was on the house – not what the current going rate is. This can be a great deal of savings for someone, especially if you look at the bigger picture.

Just like any other situation that requires decision making, we want to make sure you look at all of your options and look at what all is involved in an assumable mortgage. You need to also make sure you take into consideration the circumstances of you wanting to apply for an assumable mortgage and any needs you might have with the mortgage.

Applying for a mortgage can feel very intimidating and scary. But we can assure you that it is not! Especially when we are there for you every step of the way. We want to set you up for success and take your stress away!

Before you apply for your mortgage, we recommend you check your credit. We recommend you allow enough time to be able to increase your credit score if it is too low to qualify for a mortgage. You will not know where you stand until you get your credit check. It can hurt you if you wait too close to when you apply for your mortgage.

Just like any other business relationship, it is wise to get multiple quotes instead of going with the first one you get. Mortgage rates are not completely set in stone – there is some wiggle room as far as any associated fees and the interest rate. You can also be transparent with any companies you get quotes from. By being transparent, they may be able to work some magic with a decreased interest rate or fees.

Before you decide to make an offer on a home, getting pre-approved for a mortgage can give you a competitive edge that other people may not have. You may also be surprised with the amount of money you get approved for – which may increase your options of homes to look at.

These two pieces of advice may come as no surprise, but we want to make sure you are aware of it! It is important that you are not late on any of your rent payments. Mortgage lenders always go back a minimum of one year on your rent payments to see if you were on time. Also, make sure you do not make any big purchases around the time you are applying for a mortgage.

Are there any other tips you would recommend be shared with first time home buyers? We would love to share it with them!

As you are likely aware, when you own your property, there is a title. The title is proof that you own the property. Title insurance is great protection to anyone who may try to claim ownership. There are two different types of title insurance – lender’s title insurance and owner’s title insurance. Lender’s title insurance is required – it protects your mortgage lender’s financial stake. Owner’s title insurance is optional – it protects your financial stake. Even though the owner’s title insurance is optional, it is still highly recommended. It is quite possible that having owner’s title insurance can protect you greatly.

Title insurance protects both homeowners and mortgage lenders from any potential financial losses that may come up. Title insurance can covering unknown liens, omitted heirs, mistakes in the public record, or even fraud

The cost for title insurance varies. – it can be from $300 up to more than $2,000 The price will fluctuate based on the value of the property and where the home is located. On a positive note, title insurance is not a recurring payment but a one-time payment that is made at the closing.

The chance of you actually needing to use the title insurance is slim – but it could definitely happen. At the event you do need to use it, it would save you quite a lot of money – legal fees included.

Most people do not realize it, but if you decide to refinance your home, you will need to purchase a new lender’s title insurance policy. This even holds true if you decide to use the same lender. Also, title insurance does not transfer to a new homeowner.

Another positive about the process Is that you have complete control over who you decide to use as the title insurance company.

There are many programs available for those who have a disability. There are some people who think that it is not possible – but that is ja common misconception. It is also easier than traditional home loans. Some of them also have lower interest rates as well. Even if you were turned down in the past, we suggest you still apply.

If your main income source is from: long-term disability income from an employer or insurer, supplement security income, or social security disability income, you may qualify. All major home loan programs accept these types of incomes. If you get denied due to your disability income on your home loan application, try applying with a different lender. Someone else may accept you.

Just like any other income source, you will need to document it properly for a mortgage lender. The requirements will differ depending on who is applying for the loan and the mortgage lender requirements. (A parent is able to buy a home for their disabled child – they just need to present certain documentations. There are actually special programs available for these types of situations.)

As with any mortgage loan, there are different requirements that exist. If you are interested in specifics, we would be happy to work with you and discuss your options. There are even options for disabled people who may have a low credit score.

Many grants also exist to help disabled home buyers. These grants may be a down payment grant or a down payment loan. Depending what state you are in, it is their housing finance agency that typically offer these types of programs. Sometimes local non-profits will offer it as well. Habitat for Humanity is a very well-known program that offers help.

As with any situation you are in, we always recommend you explore all of your home buying options. There may be more options available than you realize!

If you are a first time home buyer and just beginning your research on mortgages, you may not be familiar with what escrow is. Although, let’s be real, you may have a mortgage now and not completely understand what escrow is. Am I right?

Going the definition route, escrow is when you put something of value in the care of a third party who is neutral. The valued item is there until certain conditions are met. In regards to real estate and mortgages, it makes transactions safe for all parties involved. An escrow company holds on to all funds involved until the final transaction comes to be. This process makes the real estate transaction safe for all parties involved.

Another escrow account that comes to be is ongoing escrow. The company you hold your mortgage with is who manages this escrow. This escrow helps with property tax and insurance bills that come up. The escrow company distributes funds as needed to the appropriate parties – like your local tax authority or homeowners insurance premiums. The funds that go into this account may also be called “impounds.” Keep in mind that this will increase your closing costs since the escrow company will make sure the first six months are taken care of.

Escrow companies can also order home inspections, surveys, title searches, etc. As you can see, they deal with more than just money. They certainly wear many hats! The costs of their services can vary. They tend to vary depending what states you are in. Ultimately, they are an important part of homeownership.

You are probably aware that your debt-to-income ratio is very important in order to qualify for a mortgage. It also play a part into finding out how much of a loan you can afford. There are many available mortgage programs out there, with many of them being flexible, so you will likely not have trouble finding one that you qualify for. Keep in mind that your debts must not be ridiculous.

It is hard to say what a good debt-to-income ratio is, as different programs have different requirements. Roughly speaking, we would say that between 36% and 43% debt-to-income ratio is what you want to aim for. This is not a hard number or set in stone as there other factors that play apart as well. Also, some programs will accept you if your debt-to-income ratio is higher than 43% if you meet other requirements of the program. For instance, if you have a high credit score or a significantly large down payment, you may be more likely to qualify if your debt-to-income ratio is more than 43%. Other factors would include having a significant amount of money in your savings account or being able to prove you have made loan payments back on time.

There are some simple ways to decrease your debt-to-income ratio. For starters, do not overuse your credit card! This may seem like common sense, but for some people, they seem to have forgotten about this simple rule. Live within your means. If you are unable to pay a credit card back by the end of the month and you are spending money unnecessarily, take a step back and think about if you really need to be spending that money. In past posts, we have recommended you to not take out any new loans before deciding to purchase a home. We want to remind you of this again! Avoiding any new monthly payments before qualifying for a mortgage is a good idea.

There is a number of people who would be more comfortable and happier with living in a condo. Depending where you live, a condo may be easier to get to stores and your place of employment – this holds true if you live in a city. Living in a condo is also a lot less maintenance and upkeep when it comes to lawn care, outside maintenance, etc. If you decide that living in a condo instead of a regular house is the right decision for you, you then need to make a decision if you should rent or buy the condo.

A lot of these reasons will hold true with buying VS renting, period. For example, if you have a stable job and income, buying is a good idea. If you are able to afford the down payment, closing cost, and mortgage payment, owning a home is a good investment. If you know you want to stay in the same place for a minimum for the next three years, put another check mark down for buying a condo! If your current life situation will stay the same (for example, you will not need to downsize or upsize due to a change of family structure) living in the same condo will be a good idea. In the long run, deciding to purchase a condo may save you some money in the long run and all be less stressful! You can do what you want with the property.

If you decide to purchase the condo, make sure you can afford any HOA fees you may be responsible for. If you are renting, you will likely not be responsible for those fees and the owner will be. Make sure you are aware of any of the HOA rules as well – some tend to be strict!

We would recommend when you are finalizing your decision to find out how much money you would spend in the next three years whether you purchase or rent the condo in the long run. Also look into all of the ins and outs of living there for an extended period of time VS just a year lease.

Unfortunately, we have some bad news for those of you who may have been looking into getting an investment property or a vacation/second home. This holds true for Fannie Mae. It is likely that Freddie Mac will become more difficult as well. (Thankfully this will not affect any customers who already have an agreement set in stone…this will start on April 1.)

The Federal Housing Finance Agency (FHFA) is who set this new rule into place. They are decreasing the amount of Fannie Mae and Freddie Mac investment or second home loans in half. Once Fannie Mae and Freddie Mac have 7% of their loans being second homes, they will not be able to purchase any loans from anyone after closing.

For those borrowing money, this means that the loan cost will be increased. This is because lender will be more at risk. Penny Mac is a company that holds many second home loans currently. They have already added a 2.25% fee onto their loan amount for second home loans. This even holds true for those who have made a 25% (or more) down payment! If someone put down less than 25%, they have an additional 5% fee that will be added to their loan.

At this moment, we are unaware of the rules to qualify for an investment property mortgage will change, but we have a feeling that it will. Since lenders will not be able to have as many of these loans as they once had, the requirements will likely be more strict since the lender will have to be more selective.

Keep in mind this will not hold true for all options available out there. But for the main ones where Freddie Mac and Fannie Mae are involved, we can guarantee that those will be affected. It is possible that there may be some new programs available to complete. (This is completely conjecture!)

There are quite a few available options out there to purchase a home in the least expensive way. Isn’t that what we all want, anyway? As you likely already know, the housing market is on fire right now! With that being said, it is unfortunate that cheap houses are not readily available like they once were. In order to embrace this changing time, we have some ideas to share with you as to how you can find cash for a down payment and closing cost if you do not have enough saved up. There are even some ways you can finagle to have very little out of pocket expense.

If you are eligible for a VA loan or USDA loan, there will be no down payment required. The requirements for both of these loans are very specific so before you get your hopes up, we recommend you find out if you qualify and what is entailed with them.

If you do not qualify for these loans, there are other loans out there that have a low down-payment mortgage. These down payments can be as low as 3% or 3.5% of the purchase price of the home. If your credit score is not substantial, do not be discouraged as you may still qualify! There are programs available where you can qualify for a grant or loan to pay for your upfront costs. Also, if you are gifted money toward a down payment from a family member, you will save a lot of money as well. (It must indeed be a gift, though…no hidden agenda of it actually be a loan as the giver must write a letter saying it is indeed a gift with no strings attached.)

Some people also get the seller or even the lender to pay for any closing costs. You really have to know what you are doing to make this happen. We would be happy to help if this is an area you might wish to pursue.

No matter which option you choose, if you do not have funds for a down payment or closing cost, do not worry…there are possibilities out there. You may just have to get a little creative!