21 Jun 2018
By Kevin Gahagan

3 Programs That Allow You To Buy A Home With No Money Down In 2018

Home Mortgage

3 Programs That Allow You To Buy A Home With No Money Down In 2018Home buyers are typically advised to put at least 20% down for a mortgage. Coming up with that amount can seem almost impossible if you have little to no money left over after paying bills each month.

Fortunately, if you want to buy a house but are worried about coming up with the 20 percent down needed for a downpayment, you still have plenty of options. There are still plenty of programs that allow you to buy a home with a low down payment or even no money down in 2018. 

Here are some of the best programs that designed for homebuyers who don’t have a massive chunk of cash to put down at closing. Maybe one of these options will be the perfect solution to make your dreams come true. 

#1 VA Home Loans 

If you are a veteran, in the National Guard and Reserves or an active-duty service member, then you may qualify for a VA home loan. The VA offers 100 percent financing. So, you don’t need any money down. The VA does not require mortgage insurance. There is a funding fee, which must be paid by the borrower. However, the lender can roll the fee into the loan amount. The funding fee is typically 2.15 percent of the loan amount. 

#2 USDA Loans

The U.S.Department of Agriculture (USDA) offers a zero-down mortgage for low to moderate-income families. This program was created to help rural development. The loans are only available in towns that have populations of 10,000 or less. However, this is quite a large area. In fact, the USDA program covers more than 97 percent of the United States. Many eligible smaller towns are located right outside major cities.

The USDA program was designed for first-time home buyers although there are some exceptions to this rule. USDA loans do not require mortgage insurance. There is an upfront guarantee fee of one percent. The lender can roll this fee into the loan amount. 

#3 FHA Home Loans

The Federal Housing Administration (FHA) provides one of the most popular low down payment mortgage options in the country.  Normally this loan product requires a minimum 3.5% down payment.  However, 100 percent of the down payment money can be a financial gift from a relative or a non-profit organization.  This allows a borrower to get into their home with no money down.

Contact your trusted mortgage professional to find out about these programs or others that might be right for you.

20 Jun 2018
By Kevin Gahagan

House Hunting When You Are In A Time Crunch

Real Estate

House Hunting When You Are In A Time CrunchIn an ideal world, you’d have plenty of time to find the perfect home. However, that does not always happen. Maybe you are relocating because of a job transfer. Fortunately, it doesn’t have to take months to find the perfect home. You can speed up the process of buying a home utilizing some tried and true tips. 

Here are some of the best ways to speed up the house buying process. 

Find An Experienced Real Estate Agent 

An experienced agent likely has an extensive network and many connections. They might know what properties are coming on the market before anyone else does. They can also help you assemble a great team of real estate professionals such as a mortgage banker and real estate attorney. 

Get A Mortgage Pre-Approval 

Obtaining a home loan is a long process that requires a lot of paperwork. You can speed up the process by getting pre-approved before looking for homes. You’ll need to gather some paperwork for pre-approval including bank statements, tax returns and information about your debt. Have all of these things ready when you talk with the mortgage loan officer.

Having a pre-approval letter also demonstrates to sellers that you are serious about buying. They might be more likely to respond quickly to your offer if they feel that the deal will go through. 

Make A List Of Things That You Must Have 

If you are in a hurry to buy a home, you don’t want to waste time looking at houses that won’t meet your needs. So, before doing any online research, make a list of things of your must-have amenities. Zeroing on the things that you must have will help keep you focused on properties that are right for you. 

Search Areas That Have A lot of Inventory 

Don’t waste time looking at communities that don’t have much inventory. The real estate market will be a lot more competitive. Instead, try choosing areas that meet your needs as far as easy access to your work, quality of the school and so forth. Make sure that they have plenty of inventory available. You might have to hunt in surrounding neighborhoods to find something quickly. 

Be Available to Act Quickly 

If you want to close quickly, you must be available to act as soon as an offer is accepted. It is essential to be available anytime to get in touch with your agent, respond to counter-offers and answer questions. Provide your agent with multiple ways to reach you — by phone, email or text. 

Contact your trusted mortgage professional today to help you with a pre-approval for your new home purchase. This is one of the most important and timely steps you can take to ensure a smooth transaction when you are ready to put in an offer on your new home.

19 Jun 2018
By Kevin Gahagan

How To Manage Investment Property While Working Full-Time

Real Estate

How To Manage Investment Property While Working Full-TimeIn 2017, upwards of 75 percent of independent rental property owners in the U.S. reportedly worked another job on top of being a landlord. That means the overwhelming majority of landlords are attempting to juggle more than they can handle at times.

There are organizational and strategic concepts that can maximize efficiency and profitability.

Consider the following tips that bring property management tasks under three basic headings: organization, automation and outsourcing.  

Organization Matters

One of the things that tends to overwhelm landlords is thinking about the rental properties as an extension of home ownership. The rental seems like it involves many of the same tasks such as maintenance and repair.

By rethinking rentals in terms of a small business, the way these and other tasks are approached can become radically different. If this were a Mom and Pop store or a corporation, the necessary resources would be brought in to handle niche labor. Organize all of the tasks that the rental unit(s) require under categories that may include the following.

  • Rental Advertising
  • Applicant Interviews
  • Background Checks
  • Legal Documents (leases)
  • Maintenance and Repairs
  • Rent Collection and Bill Paying

Accounting

With a defined set of tasks organized under specific headings, it becomes much easier to visualize the breadth of work involved and what supporting resources would be needed.

Automation Matters

Industries across the globe are moving to automation as a way to increase productivity and lower costs. There’s no reason landlords working other jobs cannot do the same.

While fixing a burst pipe may not be a good candidate for automation, there are numerous tasks property owners undertake that no longer require valuable time.

  • Advertising: Consider a process where an online advertisement is pre-written and posted when a lease expires.
  • Rental Payments: Consider automatic withdrawal from tenant accounts or having them direct deposit.
  • Bill Payment: Consider auto pay for every possible facet of the property, including utilities, taxes, insurance, mortgage and others.
  • Maintenance and Repair: Consider an online form for tenants to fill out that provides real-time notification.

These and other tools can streamline the amount of time required to manage a rental property without incurring significant expense.

Outsourcing Matters

People who work regular jobs and also manage rental properties are entrepreneurs by nature. That go-getter personality leads many to take on more tasks than there is time in the day. That’s why outsourcing is so important.

Outsourcing things like accounting or legal services are no-brainers because they require specialized knowledge. But other tasks such as applications, background checks and maintenance may be good things to put on someone else’s plate as well.

As noted in the beginning of this article, if a small business mindset were applied, many of these tasks would be assigned to a designated resource. Consider operating rental units in this fashion by running a cost analysis and outsourcing. Roll in the labor costs that make sense and take some time to binge watch a Netflix series while your investment turns a profit.

Contact your trusted mortgage professional to make sure that you have the most competitive financing on your investment property or to get pre-qualified if you’re ready to get started on this new real estate venture!

18 Jun 2018
By Kevin Gahagan

What’s Ahead For Mortgage Rates This Week – June 18th, 2018

Financial Reports

What’s Ahead For Mortgage Rates This Week – June 18th, 2018Last week’s economic reports included the post-meeting statement by the Fed’s Federal Open Market Committee along with readings on retail sales and inflation. Weekly reports on mortgage rates and new jobless claims were also released.

Fed Raises Key Interest Rate on Strong Economic Indicators

The post-meeting announcement by the Federal Open Market Committee of the Federal Reserve indicated that committee members voted to raise the target federal funds rate to 0.175 to 2.00 percent from the prior rate of 1.50 to 1.75 percent.

The post-meeting announcement cited strong economic conditions and stated that FOMC had altered their outlook from three rate increases in 2018 to four increases. This news is significant to consumers as banks and credit card companies typically raise lending rates in response to Federal Reserve actions.

Committee members were closely divided on interest rate forecasts for 2018. Eight members said that the Fed rate would likely increase four times in 2018 while seven members said three rate increases would be appropriate. The post-meeting statement also cited concerns over inflation and Fed Chair Jerome Powell said that raising interest rates too fast could increase the risk of recession.

Consumer Price Index, Retail Sales Rise in May

The Consumer Price Index rose from 0.10 percent in April to 0.20 percent in May according to the Commerce Department. The Core CPI, which excludes volatile food and fuel sectors, was unchanged at 0.20 percent against expectations of 0.20 percent growth and 0.20 percent in April.

Retail sales rose 0.80 percent in May as compared to expectations of 0.40 percent growth and April’s growth rate of 0.40 percent. Retail sales excluding the automotive sector rose 0.90 percent in May; analysts expected a reading of 0.50 percent based on April’s reading of 0.40 percent growth.

Mortgage Rates Rise, New Jobless claims Fall

Freddie Mac reported higher mortgage rates last week. The average rate for a 30-year fixed rate mortgage averaged eight basis points higher at 4.60 percent; the average rate for a 15-year fixed rate mortgage rose six basis points to 4.07 percent.

Rates for a 5/1 adjustable rate mortgage were nine basis points higher at 3.83 percent on average. Freddie Mac analysts said that demand for homes is holding steady despite higher mortgage rates.

First-time jobless claims fell by 4,000 new claims to 218,000 new claims filed. Analysts expected 225,000 new claims to be filed based on the prior week’s reading of 222,000 new jobless claims filed.

What‘s Ahead

This week’s scheduled economic reports include NAHB Housing Market Indices, Commerce Department readings on housing starts and building permits issued and National Association of Realtors® reports on sales of previously-owned homes. Weekly readings on mortgage rates and new jobless claims will also be released.

15 Jun 2018
By Kevin Gahagan

Is Buying A Short Sale Right For You?

Real Estate

Is Buying A Short Sale Right For YouIf you have been looking for a new home, and you find one offered under a short sale, this may be to your advantage. While some buyers are wary about buying a home that needs to be sold with the approval of the lender, it’s a great way to get a bargain on a home that you love.

A short sale may be a perfect way to buy a home, as long as you are able to wait until the offer is approved.

The Basics Of A Short Sale

A short sale occurs when the homeowner is facing a foreclosure and trying to avoid it. The true owner of the property, is the lender who provided the money to purchase the home. The borrower owes more on the home than it is worth, and many stop making mortgage payments. Instead of allowing the home to sit there and go to a foreclosure, the lender tries to cut their losses through the process of a short sale.

Additionally, there may be other liens on the home that have to be satisfied by the sale of the property. Anyone that holds a lien on the property has to negotiate the money they are willing to accept for the deal to be finalized.

Why A Short Sale Benefits The Buyer

When you make an offer on a home that is selling under a short sale, you can usually offer less than what the home is worth. The homeowner is eager to sell the home. The homeowner will want to accept an offer fast to get the process started and avoid a foreclosure.

While you may have to wait longer for a short sale to go through than a traditional sale, the savings on the price of the home are usually worth it. Lien holders understand that a short sale is usually the best option to get most of their money, so they are anxious to settle the deal fast.

A short sale is right for you if you aren’t trying to buy a home fast. When you are a savvy buyer, you can make an offer less than the asking price, but you’ll have to wait for all lien holders to accept it. If your current living situation provides you with the opportunity to wait, a short sale will give you more house for your money.

Contact your trusted mortgage professional to secure your financing pre-approval, a necessity prior to negotiating this type of transaction.