As we have mentioned before and you are likely incredibly aware, houses to purchase that are not astronomically are not easy to find! In all actuality, we know that finding a home to purchase, period, is hard to find. In an effort to help, we have some ideas for you as to how you can decrease your down payment and closing costs. These ways may not work for everyone but we still want to share them with you, just in case!

A no-brainer to save money is having a no-down-payment mortgage! Both a VA loan and USDA loan offer this type of loan. You do have to qualify for them and there are quite a few hoops to jump, as you likely know, but if you qualify, it would save you from having to make a down payment!

If you do not qualify for a no-down-payment mortgage, there are some low-down-payment mortgage options available. This would mean your down payment is 3% or 3.5%, which would save you a decent amount of money. There are quite a few ways you have to qualify and while it may not be easy, it is still something we recommend you look into. This type of option is through an FHA loan.

There are some programs out there that actually help with covering your down payment. Each state has their own rules and availability but take a look to see if you meet the requirements. If you need help locating this type of program, ask a professional for help finding one. Also, some people receive gifts from loved ones that may cover both the down payment and closing costs. It is important to know that the gift must actually be a gift and not have to be paid back in any way. A formal letter must be written up that states it is a gift.

Believe it or not, some sellers or lenders will actually cover closing costs. It is likely that it will not be down-right offered to you, but if you ask and see if it is possible, it is worth a try. If the lender pays for the closing cost, it is likely that the amount will be added to your mortgage and your interest rate may be higher. But if you simply cannot afford closing costs, it is an option.

As you can see, there are many options available to get help if you need it! You may have to do some investigating, but help is available.

Did you know that purchasing a newly constructed home is a bit different than purchasing an existing home?  There are some things to think about and take into consideration when you purchase a home that has recently been or in the process of being constructed.

For the most part, the actual purchasing process is the same. But the nice part with a new construction home is that you may have some say in certain aspects of the design of the home, including what type of floor is put in, etc. We would recommend that you start the process by getting a real estate agent. The real estate agent can help you to negotiate with the builder, if need-be. And the cool thing is that the builder usually pays for the commission of the real estate agent – not you! Just like buying any other home, getting pre-approved for a loan helps the process happen a bit quicker. 

Next up is the fun stuff! You need to make sure you find the right builder for your home. Each builder has a different style and even builds in different areas. There are even some spec homes that are somewhat custom, so some decisions are left to you with what you want. Keep in mind that the type of home will affect how quickly the house is built, along with financing options.

Again, more fun instore! After you pick your builder you get to have a design consultation. This consultation will go over what you can customize, design-wise, and what you are unable to. If you want to customize everything, make sure you are on the same page with the builder and design consultant. 

After the fun is out of the way, you have to get back to serious stuff…you need to sign a contract with the builder and also finalize your mortgage. There are different loans available for new construction homes. This is where working with a professional comes to play and is very important. They can help you with all aspects of the process!

There are many people who are attracted to buying a home that needs a lot of work…a fixer-upper as they call it! Some of the reason for this, we suspect, is from all of the great do-it-yourself reality shows out there. They make it look so easy and completely do-able for people to accomplish on their own. While we do not want to discourage you from doing this if it is something you want to do, we want to give you a few things to think about before making your final decision. We understand that some of the reasons people want to do it, as well, is because the price on this kind of home is less than a home in good standing order. And in the crazy housing market of today, it is the only option for some.

If the home you are looking at has some type of structural damage, we want you to really think about the decision! If the home has structural damage, depending on how extensive it is, you may have to rebuild your entire home! This may wind up costing you a lot more money than if you were to have purchased a home without any type of damage like this. This also ties into a home that may have foundational issues. If the foundation of a home is bad, it is likely that you will have to continue to spend a great deal of money on it on a continual basis. As with the purchase of any home, we highly recommend you get an inspection and make sure it is from a reputable business! The inspection may save you from buying a money pit.

If a home has old plumbing or electrical work, we would suggest you really think about purchasing the home. If you do not get these areas fixed right away, it is possible that more serious issues can arise before you update the electrical work and plumbing. Check with a professional before deeming if the electrical work or plumbing should stop you from purchasing the home.

If a home has small issues that are easy to fix, it should not stop you from buying the home. But again, we would highly recommend that you hire a professional to deem if the issue is truly a small issue or if it is a danger to you if you move in or will prove to be a money pit.

There has been a great deal of chatter about if the value of homes is going to plummet. For a significant amount of time now, the value of homes have been significantly higher than other years. It has also been difficult for people to even find a home to purchase since the market is so hot right now. With that being said, all good things must come to an end at some point. (And that is if you see it as “good” – if you are a buyer, you may not see this as being something that is good!)

In the beginning of 2020, the price of a house rose 41%. That continued to the beginning of this year. That increase is something else! Along with that increase, the interest rate decreased greatly as well. This created some great scenarios for some people. It has been this way for two and a half years – which is a decent amount of time. The majority of people do not see the housing market stopping.

Two and a half years of people buying homes as much as they can since the interest rate decreased caused supply and demand to play a big role in the housing market as well. Since the amount of houses available to purchase has been low, the prices of the homes have stayed high. We are not at a point where the interest rate is not as low as it was, which may cause the demand for homes to decrease.

With this being said, it is likely that the housing market will decrease. However, that does not mean there will be a significant housing market crash like we experienced in 2008. As of right now, this appears to be the general consensus for most professionals who are knowledgeable enough to make an educated guess in this situation. 

We are not done with the refinance talk yet! As more people are trying to make the right decision for themselves and their family as far as if they should refinance or not, we are happy to help answer any questions people may have. Some of you have asked us if you should refinance or if you should pay a bit extra toward your mortgage. For most people, it makes the most sense to refinance since their interest rate will be significantly lower. (If it is not, there is no reason to refinance.) But for some people, it saves more money in the long run by just paying extra toward your mortgage monthly. Your current loan and interest rate play a large part of making the right decision. Your family’s needs also play a role in the decisions as well, along with any financial goals you may have.

If you can lower both your interest rate and your monthly payment, it would be beneficial for you to refinance. When you refinance, do not forget that you still have to pay closing costs and other fees. Do not forget to factor this amount of money into the decision. If you are wanting to use some of your home equity, a cash-out refinance is a great option for you. The money you take out can be used for a variety of things – renovating your home, paying off credit card bills, etc. If you think you are going to stay in your home for a significant amount of time, it would be beneficial to refinance as you will truly be able to reap the rewards of saving money.

Now when looking into making extra payments instead, there are a few things to keep in mind. To start off, by paying extra, you will be lowering your loan and paying off your loan faster. This is a good idea if the potential savings of refinancing is not enough for you to benefit from refinancing. If you think you may sell your home in the near distant future, making extra payments on your mortgage is the way to go. You will likely save money from not having to pay a closing cost and other fees if you were to refinance – and then you turn around shortly after and sell your home.

We would recommend you really figure out your goals with your house for the foreseeable future, along with planning out how much money you would potentially save. This will help you to figure out which decision is best.

We know that there has been a lot of talk lately about refinancing! That is because a lot of you are refinancing or asking questions about refinancing. The housing market is a hot topic right now, as you know – and that includes refinancing! Believe it or not, it is possible to have a no-cost refinance. While this may be a little deceiving, it does not mean you will not have any fees. But it does mean you will not have to pay for the fees up front at the start of the process, but rather, include it into the balance of the loan. There are some lenders who will cover these types of fees but the interest rate may be higher. So in the end, you are still paying these fees.

If you choose to add your closing costs and other costs into your loan, keep in mind that your monthly payments will likely be more. You will also be paying more in interest over time as well. If this is something you are comfortable with and feel okay with doing, it is a great way to not have to pay all of these costs upfront. This option is not for everyone.

Another option is something called lender credit. This means that your lender will pay your closing costs and other fees, however your mortgage rate will be higher. This will obviously cause you to pay more money overall in the long run with a higher rate. However, if you do not plan to have the mortgage long and the home is not your “forever home” this may be a good option for you.

Going with a no-cost refinance depends on the homeowners financial situation and what is best for them in both the short term and long term. We would recommend you take a look at the finances as a whole and how much more money you will have to spend overall.

Most people have not heard of refinancing with an appraisal being done. To be honest, I did not know this was an option until recently! It saves both time and money if you are able to refinance without an appraisal. Keep in mind that not all lenders have this as an option.

Appraisers do play an important role when it comes to purchasing a home. The appraisal is what tells the lender how much the home is valued at so they know if they are making a wise investment or not.

There are a handful of ways you may be able to skip the appraisal from being done. There are a few lenders, like Fannie Mae and Freddie Mac, that have waivers available. These waivers are usually only for applicants that are considered to be a strong applicant. These waivers are pretty uncommon but they do exist. The borrower must have at least 20% equity and the home not valued more than one million. The higher the credit score and amount of income will help an applicant as well.

There is also a program called the Streamline Refinance program. This is a program that is offered by government-backed loans. These types of loans are specifically available to help a homeowner save money by lowering your mortgage rate. While the government may not require an appraisal for these types of loans, it is possible that your lender may still require it.

There are some lenders that offer specific loans that give you the opportunity to obtain an appraisal waiver. While appraisal waivers are not common, there are some situations where it is possible. There are a lot of things you have to do in order to qualify, but if you are able to go through all of the red tape and meet all requirements, it will get you out of having to have an appraisal!

As you can see, although it is not common, it is something that may be possible. Not having to have an appraisal will save time, money, and cause less stress!

Due to the continuing increasing cost of homes this year, some people are reflecting on whether or not it is a wise decision to purchase a home this year. Even though the cost of a home is greatly increased when compared to other years, if you have the financial means to do so, it may be a wise choice especially when you compare it to the cost of renting a home.

If you purchase a home now, you will earn home equity which can benefit you in the future by adding to your net worth. This is one of the advantages of purchasing a home now, especially when compared to renting a home. Another perk of purchasing a home now is that your housing cost will stay the same (for the most part) but if you compare it to renting a home, you do not know how much your rent will increase a year from now. All over the board, rents are increasing significantly. Purchasing a home also gives you some opportunities that renting does not. For example, since you own the home, you can decide how you would like to decorate it and what you would like to do with it. You even have the opportunity to get a roommate if you choose to. This would help offset any costs you acquire along the way.

If you are struggling to see what the right decision is for your family, we would be happy to help you. If you get in touch with us, we can go over your available budget and see what would make the most financial sense for you and your family. Be sure you let us know what your financial goals are as well so we can accurately assess your situation and what the future may look like for you.

We have heard from some of you recently that home inspections are quite intimidating to you. They do not need to be intimidated. If you know what the inspector is looking for, you will likely be a bit more laid back and be more confident about the inspection. The inspection is for the best interest of the buyer of the home. And really, as the seller, you should, in good conscience, want to be sure the house you are selling has no outstanding issues that a new homeowner would have to worry about.

Before the house is sold, the home inspection results may result in a re-negotiation of price or some type of work needing to be done in order for the sale of the home to go through. As the seller, knowing what the inspector is going to look for will put your mind at ease a bit so you know what to expect.

To start with, expect that the inspection should take anywhere from two to four hours. It depends on the size of the home, how many issues come up, etc. You will not get the written report right away – whether something is wrong with it or not. It will take a minimum of a couple of days to get the written report. That does depend on how fast the inspector works.

If you are the buyer, you can actually be there at the time of the inspection. If you have any questions, you can ask the inspector while you’re there.

If you are unsure as to what the inspector will be looking at – they are looking at everything and anything! To name a few, they will be inspecting the heating and cooling system, plumbing, electrical work, the roof, windows, doors, the attic, foundation, structural components, etc. The inspector will not make a mess but they will be very thorough in the process.

When finding the best inspector, we would recommend word of mouth from other people who have used them. If you need any local leads, let us know!

Refinancing has been all the talk again with refinancing rates being less than some homeowners financed rates. However, there are some reasons that refinancing is not a good idea for people. Remember, to each their own and make sure you make the right informed decision for you and your family.

If you have had your current mortgage for a long period of time, you may not benefit from refinancing. This especially holds true if you have had your current mortgage for at least ten years. When you refinance, the payoff period increases (it starts over again) unless you refinance into a shorter loan. For the most part, lower rates are associated with a shorter loan length. So if you choose to decrease the length of your loan, you may wind up saving money. Keep in mind that this would mean your monthly payment would likely be more expensive, so this option may not be one that you can afford.

Another aspect to look at is that when you refinance, your total interest cost may increase. We would recommend you do a cost analysis between what your current mortgage is with your current interest rate and compare it to what your refinanced mortgage may look like. Be sure you look at both your monthly savings and your total, long-term savings. Doing this side by side cost analysis will give you the big picture to show you if it is a financially good idea for you.

What is your credit score like? If your credit score is not sufficient enough for you to qualify for a competitive interest rate, you may not benefit from refinancing at all. If your credit score yields you a good refinance rate, then that is a different story. It would not hurt to at least look into it!

Although this may be common sense, we have to reiterate the fact that it is only a good time to refinance if your savings are more than your cost! Be sure to do your homework and look into everything thoroughly.