The Affordable Home: Washing the Dishes

 The Affordable Home, Uncategorized  Comments Off on The Affordable Home: Washing the Dishes
Nov 252013
 

I believe in The Affordable Home.

dishmasterI’ve debated for many years with various folks, friends and family members over washing the dishes, not that I mind the household chore, rather the expense of hand-washing dishes versus using a dishwasher.

Thanks to the National Resource Defense Council, I’m both wrong and I’m right!

They say that using a newer Energy STAR efficient washing machine is the least expensive way to wash your dishes. But they make a good case for “efficient” hand-washing. A new Energy STAR efficient dishwasher uses 3-5 gallons of water and 1kWh energy. dishwasher

Efficient hand-washing, where you use separate tubs to soap the dishes and wash them by hand then rinse in a separate tub thereby not running the water the whole time is nearly as efficient with 8 gallons and 1kWh. More efficient than an older dishwasher which can use up to 15 gallons and 2-3 kWh!

Make your home more affordable: either invest in a new Energy STAR efficient dishwasher or get more efficient in the way you wash your dishes by hand.

More on the NRDC website HERENational Resource Defense Council

 

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Do you have questions?  Click on ASK TREVOR and I’ll respond to any and all inquiries, even if you’re not buying a home in New York State.

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Key Points for VA Loans

 First Time Homebuyers, The Affordable Home, Veterans  Comments Off on Key Points for VA Loans
Sep 052013
 

veterans 1More Veterans are using their Veterans Benefits to buy homes today with VA Loans.  The problem many of them encounter is this: Mortgage Loan Originators (MLO) don’t have sufficient experience with VA Loans.  This can make for some troublesome times when a Veteran is buying a home.  You definitely want to work with an experienced MLO, someone with at least 15 years experience.   Take some time when shopping for your VA Loan to interview the MLO before you make a decision.

Some key points for you to know when you interview a Licensed Mortgage Loan Originator (MLO) for your VA Loan:

VA Funding Fee is 2.15% of the Loan Amount (and is always financed) for Active Duty Veterans with at least 180 Days active duty. No Funding Fee for Disabled Veterans.

The Funding Fee is different for other service types/periods, including Reservists.

A Veteran can finance 100% of the purchase price of the home.modern home 191

A Seller can pay all of a Veteran’s Closing Costs, and more.

There’s a lot of misinformation out there about VA Loans and your MLO will need to be available to explain and reassure the Seller and the real estate agents of the VA process. For example, many Sellers and/or real estate agents believe that VA Loans take “a LONG TIME” to approve and close. Not true. (My average closing time on VA loans is about 6-8 weeks compared to 3-4 weeks for FHA). They also believe that VA Appraisals ALWAYS slash the value of the house. Not true. I’ve only seen one VA Appraisal come in slightly less than purchase price in the last couple of years, and, in that case, both the Listing Agent and I suspected the value might be tight before. Bottom Line: your MLO has to have clear communication to make it easier for you to negotiate with Sellers when competing against other Buyers with different financing terms.

If your MLO asks you for your DD-214 right away, then you know you’re dealing with someone with experience. You don’t need the Certificate of Eligibility or COE as we MLO’s can obtain that directly from VA on your behalf.

thank you veteransFor a New York Purchase you’ll need some cash for your “Good Faith Deposit” when you sign the contract of sale. It’s the rare Seller who will sign a contract with a Buyer who doesn’t at least put $10,000 on the contract (refundable to the Veteran at closing due to the 100% financing). Not that it’s impossible (I’m working with 3 Veterans right now who have less than $5,000 to put down), but it will require serious negotiating on the part of your MLO, real estate agent, and Attorney.

VA Condos: few and far between because the VA just doesn’t approve enough Condos, so focus on Single Family Homes. Find VA Approved Condos

Two Family Homes: unless you have experience in property management (and can prove it), you’ll have to qualify with your own INCOME for the purchase; rental income will be excluded from the qualifications.

You’ll need a Termite Report but YOU CANNOT PAY FOR IT, the Seller must pay.

We qualify Veterans’ Income two ways: a percentage of monthly gross income, or “Debt to Income Ratio” AND a residual income method which is similar to doing a family budget, so it’s a pretty cool way to qualify you. idyll

 

Do you have questions?  Click on ASK TREVOR and I’ll respond to any and all inquiries, even if you’re not buying a home in New York State.

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You Need To Build Credit: Where to Begin

 All You Need To Know About Credit, First Time Homebuyers  Comments Off on You Need To Build Credit: Where to Begin
Aug 232013
 

You need to build more good credit. I recommend opening the following accounts as a way to build credit:pile of cash

  • Sunoco http://www.gosunoco.com/ways-to-save/gas-credit-cards/
  • CareCredit: available at your Dentist. http://www.carecredit.com/apply/landing.html
  • CapitalONE secured credit card http://www.capitalone.com/creditcards/mastercard-secured-credit-card/

A secured credit card works like this: you deposit with the credit card company a pre-determined amount, say, $500. This amount is your credit limit. You swipe and use the card same as a regular credit card; the secured card activity gets reported on your credit report thus building your credit history. My advice: open the account and use no more than 50% of your “limit.” Then make MINIMUM monthly payments; don’t replenish the total amount! This type of activity gets much better results on a credit report.

  • Bank Debit/Credit Card: If your bank offers a card attached to your checking account that can be used as either credit or debit, then you should use the card as credit. Check with your bank to see if they offer this type of card AND if they report the activity to the credit bureaus when you use the card as a credit instead of debit.

Visit my Useful Links page for other great websites that provide accurate and honest advice on building credit.

 

Do you have questions?  Click on ASK TREVOR and I’ll respond to any and all inquiries, even if you’re not buying a home in New York State.

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Definitions: Earnest Money Deposit or EMD

 Definitions, First Time Homebuyers, The Affordable Home, Veterans  Comments Off on Definitions: Earnest Money Deposit or EMD
Aug 192013
 

Earnest Money Deposit or EMD

When you sign a contract to purchase a home, you’ll provide an “earnest money deposit” to be held until closing in an escrow account by the attorney for the homeowner. If you are purchasing a HUD Home the EMD check is presented with your Offer by the HUD Approved Broker in the bidding process.

If you’re applying for an FHA loan, the EMD usually equals your 3.5% down payment. If you apply for other types of financing—-VA or Conventional—then your  Real Estate Agent or Attorney will guide you as to the amount requested by the Seller.

There is no “set” or required amount for the EMD, although many Sellers’ often request 10% of the purchase price. This is a matter of some negotiations between your Real Estate Agent/Attorney and the Seller’s Agent/Attorney.

For example, what if you’re closing out a CD for your entire down payment but you only have $10,000 cash on hand for the EMD today? It’s important to discuss with your Real Estate Agent/Attorney before you come in to sign the contract the amount of the EMD.

Do you have questions?  Click on ASK TREVOR and I’ll respond to any and all inquiries, even if you’re not buying a home in New York State.

Check out my Trulia profile HERE

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Definitions: Short Sale

 Definitions, First Time Homebuyers, Veterans  Comments Off on Definitions: Short Sale
Aug 162013
 

Definitions: Short Sale

The definition of a short sale is when a homeowner owes more to their current mortgage lender than they can sell the house for on the open market and sells the house for the market price
after negotiating with their lender to accept less.

For example, Henrietta and John own a single family house. The balance on their current mortgage is $267,000. John lost his job and they wish to sell the house to relocate to another state for better employment opportunities. They invite local Realtors to make a “Listing Presentation” as to how much Henrietta and John’s house could sell for under current market conditions. The consensus among these Realtors is a price range of $195,000-$220,000.

Henrietta and John owe more than the house can be sold for. They retain the services of a local attorney who specializes in negotiating short sales. Their attorney then negotiates with their existing Lender to accept less than the $267,000 owed on the house and basically to accept payment based on whatever Henrietta and John can sell the house for.

The negotiating of the short sale is a complicated and difficult process. Henrietta and John’s attorney will need to present comprehensive income documentation to their Lender. The Lender will in turn conduct it’s own analysis of the value of the house and the merits of accepting Henrietta and John’s offer of less money rather than conducting a foreclosure proceeding.

Thanks to recent Federal Government initiatives, the process to negotiate a short sale has become easier. What used to take nearly a year to accomplish can now be negotiated in as little as 45 days, although the average processing time for a short sale approval is probably closer to six months.

When Henrietta and John receive the approval for their short sale, there will be some fundamental conditions in place.

1. Their Lender will receive ALL proceeds of the sale AFTER Henrietta and John have paid customary closing fees for their locale and real estate commissions and legal fees to their attorney.

2. They will not be allowed to receive any funds in their pocket.

3. Their Lender may reserve the right to obtain a “deficiency judgment” against Henrietta and John for the amount of the mortgage loan left unpaid by the approved short sale.

What does a short sale mean for a Homebuyer?

1. Be PATIENT. You may have a considerable waiting period from the time you sign a contract of sale to the point when the short sale is approved on the house you are buying.

2. Get your Mortgage Approval and MAINTAIN your financial status. Once your mortgage loan application is approved and your Lender issues a loan commitment, be sure your Income, Assets, and Credit stay the same as when you made your loan application. Because it may be some time before you close, your Lender will update your documentation used for the loan approval. If your financial situation changes, you may lose your approval altogether.

3. You can’t get Something For Nothing. Don’t think you can get a house in a short sale situation for “fire sale” prices. After all, the house didn’t get burned in a fire, the Homeowner simply owes more than current market prices will bear. If you offer substantially below the market price, chances are the Lender approving the short sale for the homeowner may counter your offer to a higher price. This is based on their independent analysis of market prices for similar homes in close proximity to the house you are buying.

Do you have questions?  Click on ASK TREVOR and I’ll respond to any and all inquiries, even if you’re not buying a home in New York State.

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Sunday Dinners

 First Time Homebuyers, The Affordable Home  Comments Off on Sunday Dinners
Aug 152013
 

Sunday Dinners

I was speaking to one of my clients yesterday. She has been shopping with her husband since January for the right house. They had two houses locked down in contract only to discover in both cases the Sellers had problems that prevented my clients from closing, even though their mortgage loans were approved.

I have learned one thing in my 23 years helping First Time Homebuyers and I shared that one thing with my client yesterday as a way to help her maintain her energy and optimism.

I told her, “Someday soon in your new house, when you are sitting down to a Sunday dinner with your family at your dining room table you will remember all the hard work, disappointment, crazy sellers, and challenges you had to overcome in order to buy your first home. You will look around that Sunday dinner table and think to yourself, ‘All that hard work was worth it.’”

It’s true: the thing I learned a long, long time ago, through my early experiences as a mortgage professional and through the challenges I faced buying my first home, the thing I learned is that all the hard work pays off. To sit down with your family to that traditional Sunday dinner in YOUR dining room in YOUR own house, oh yes, that’s when you truly reap the rewards from your hard work shopping for that house.

I encourage all of you to stick with it. You will find shopping for that home to be challenging, arduous, and filled with nail-biting anxiety. But it’s all worth it in the end.

Paying rent just isn’t worth it in the long run; 

owning something that’s yours really is worth the work.

Think of your future Sunday dinners next time you are feeling

blue about the home buying experience.

Do you have questions?  Click on ASK TREVOR and I’ll respond to any and all inquiries, even if you’re not buying a home in New York State.

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Ask Trevor A Question
Nov 222011
 

Wow, 27+ years as a Mortgage Banker! I have seen the occasional short appraisal! I started in November 1989 because I wanted to become a Homeowner so I chose a path which would get me there: Mortgage Professional.

Times were tough back in that market.  Interest rates were high and property values had dropped dramatically.  The employment picture for many Americans wasn’t very promising.  There were a lot of foreclosures and homeowners had a hard time refinancing their mortgages due to lost equity.  Sounds very similar to our recent post-meltdown market with the exception of the interest rates (11% in 1989!!!).

I received a valuable part of my education early on in my career as I dealt with purchase transactions where the appraisal came in for less than the purchase price.  Buyers, Sellers and their respective Realtors are all “IN IT TO WIN IT” and make the deal happen.

How you see your house!

I carry that education with me to this day when my HomeBuyer clients ask me at application time, “What happens if the appraisal comes in for less than the Purchase Price?”   I know many HomeBuyers may think it’s a NO-BRAINER: the Seller will automatically reduce the price.  But that is NOT the case right out of the gate.  Here’s what I learned all those years ago about appraisals that come in short:

How the Appraiser sees your house

When the bank appraisal comes in for less than the contract price

there are FOUR ways to proceed with the transaction.

 

  1. The Purchaser comes up with the difference in cash. If the appraisal is less than the Purchase price, the Seller basically assumes the Purchaser wishes to buy the house according to the terms of the contract, including the agreed upon Purchase Price. Therefore, the Seller assumes the Purchaser will come up with the cash necessary to complete the transaction.
  2. The Purchaser and the Seller meet in the middle. The Purchaser comes up with some cash but the Seller also agrees to reduce the price enough to meet the Purchaser somewhere “in the middle.”  Both sides want to complete the transaction and so they work it out.  This is compromise at its best.
  3. The Seller reduces the Purchase Price to equal the Appraised value. This is the least likely scenario, but not an impossible one.  Sellers often want to complete the purchase transaction on the original terms of the contract, including the price. But a determined Purchaser working with a great Realtor, by digging in and working hard to negotiate can often make it happen.
  4. Nothing happens and the deal is cancelled. The Purchaser either cannot or will not come up with the extra cash and the Seller refuses to reduce the price completely or even a little bit to meet the Purchaser.  In this case the transaction is cancelled, the Down Payment is returned, and everyone goes home unhappy.  The Purchaser has to begin all over again and the Seller has to put the house on the market and try to find a new Purchaser.

In the end, the motivations of all parties to make the deal happen and close the transaction rule the day.  Those motivations drive everyone to find a solution and get the deal closed.  Or not.

Do you have questions?  Click on ASK TREVOR and I’ll respond to any and all inquiries, even if you’re not buying a home in New York State.

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Happy House Hunting!

Apr 252009
 

Recent conversations with First Time Buyers have revealed a refreshing attitude amongst today’s home buyers: affordability. People don’t want to get in over their heads with a mortgage payment they can’t afford. I really like that. I have advocated exactly that concept with my clients for my entire career: buy a home you can afford.

During The Boom my words of advice in this regard fell on deaf ears. I would do then as I do now: calculate the mortgage payment and ask the client if this number fits the family budget. In other words, “Can you afford this?” Too often the answer would be “Yes” when I truly knew it should be a “No.” I tried to tell these folks to buy a cheaper house, buy a home they could afford so as not to lead to trouble down the line. I walked away from many of those situations because I just couldn’t reconcile the math and I wouldn’t be a party to a future financial disaster. I knew full well, as I left the room, that another mortgage “professional” would sit down with those clients and tell them what they wanted to hear, give them a truly bad mortgage, collect his commission check, and march off into the sunset leaving this family with a ticking time bomb.

I sat last night with a young couple shopping for a 2 family home. They make an excellent income and have excellent credit. They’re working with not a whole lot of cash (for New York) and so we’ve qualified them for an FHA Insured mortgage loan. They had an expression, “Use a blanket that’s big enough.” In other words, buy a home you can afford. It’s truly all about the monthly payment. If you can’t reconcile that number with your family’s budget, you’re either not ready to buy, or you should look for a less expensive home.

Even though this couple could afford a pretty hefty mortgage payment based on their income, they insist on shopping for a house that allows for a mortgage payment that leaves “breathing room” in their budget. This is good, sober thinking.

When you buy a home, you’re reaching for the stars to make the dream of homeownership come true. But reaching for the stars doesn’t mean you have to launch yourself into orbit. You can make that dream come true with an affordable mortgage payment if you are honest with yourself and realize that you really need to a “blanket that’s big enough.”

Makes sense to me, a blanket that’s big enough keeps you warm at night.

I welcome Comments for all my blog entries. I will be happy to review and approve all legitimate comments provided by readers of tcurranmortgage.com. I do not permit unfettered access to comments for obvious reasons: mortgage spammers and their ilk. If you wish to Comment on any entry, please do so and I will quickly review and approve. Thanks for reading tcurranmortgage.com. Hope that helps!

Mortgage Modification Murder: Homeowner Beware!!!

 Uncategorized  Comments Off on Mortgage Modification Murder: Homeowner Beware!!!
Apr 232009
 

I received a call yesterday at our office from a homeowner in Virginia. He was looking for some kind of FHA mortgage modification company and found us instead in his Google Search. Our company is not licensed in Virginia; neither do we do mortgage modifications. We just do plain old-fashioned mortgage originations, helping people buy homes and doing some refinance work, too.

I spent a few minutes with this gentleman on the phone cautioning him against mortgage modification fraudsters. I told him about the many scams being perpetrated by modification companies seeking to take money from unwitting homeowners while delivering zero satisfaction or assistance. I pointed him instead to the HUD.gov website to seek out a mortgage counsellor who might better assist him with his dilemma. I told him, too, that an attorney was probably his best option.

One of our Loan Officers told us of a man he met who is losing his home to foreclosure. A little over a year ago this man had a perfect mortgage payment history. For whatever reason, he decided he needed to modify his mortgage. He hired one of these mortgage modification murderers and paid thousands of dollars in fees to the fraudster. The crooked scam-artist told the man to stop paying his mortgage; upon the advice of his paid-professional-mortgage-modification-expert, the man did indeed cease paying his mortgage.

There was no modification; no call was ever made the the Lender to negotiate on the homeowner’s behalf. Money was stolen from this man and his family; now they are losing their home to foreclosure. The lowlife scam artist has committed, IMHO, financial “murder.” The crook has taken not only this man’s hard-earned cash, but caused the loss of a home and a substantial financial asset. Disgusting.

Homeowners beware. Too many of you who I speak to or hear of are doing exactly what too many of you did during the boom years: you’re following a dangerous path, ignoring the advice of seasoned professionals, and you’re allowing yourselves to be duped out of your homes the same way many of you allowed yourselves to be duped into bad mortgage loans.

If you feel you need help modifying your mortgage, contact your Lender directly. If at first you don’t succeed, try, try, TRY again. If you don’t have the time for that because you are busy working hard to pay your mortgage and your bills, then hire an attorney. Pay your attorney a retainer fee and let a licensed legal professional work on your behalf. If you don’t have an attorney, get a referral from family or friends, or consult your local bar association. You can find local help here, on the American Bar Association website.

President Obama and Congress have provided Homeowners with an opportunity to refinance or modify as part of the 2009 Stimulus Package. Find United States Government help here: Making Home Affordable.

A list of HUD Approved mortgage counsellors can be found here: Foreclosure Avoidance Counselling

I welcome Comments for all my blog entries. I will be happy to review and approve all legitimate comments provided by readers of tcurranmortgage.com. I do not permit unfettered access to comments for obvious reasons: mortgage spammers and their ilk. If you wish to Comment on any entry, please do so and I will quickly review and approve. Thanks for reading tcurranmortgage.com. Hope that helps!

Apr 212009
 

I heard it again tonight from a client who’s looking to buy his first home for his family: he thought because his wife had no credit that meant she had “bad” credit.

This is NOT TRUE. False. Fallacy. Myth. Mis-Information. Incorrect assumption. Bad Medicine (oh, wait, this blog is NOT “Dances With Wolves!” Scratch that last part)

If a person has no credit that just means the person has no credit score and no established credit history that a financial institution can use to determine credit-worthiness for approving a car loan, student loan, personal loan, credit card, line of credit, checking account, car insurance, or a mortgage loan. No credit means just that: here’s a person who has no established credit history.

Bad credit means just that: BAAAAADDDDD CREDIT!!! When a finance professional reviews a credit report with bad credit we encounter such things as charge-offs, collection accounts and judgments. Maybe the person owes money to a former landlord or a utility in the form of a judgment. Maybe the person had a checking overdraft account that went unpaid and ultimately wound up with a collection agency. Maybe the person borrowed a book from the library and never returned it thus racking up late charges eventually resulting in a collection account (yes, I’ve seen it), or, MAYBE the person didn’t show up for jury duty and has a judgment for a fee incurred as a penalty for not reporting to jury duty from the County Clerk’s office (I can’t believe I capitalized that for a person that sues people for not showing up for jury duty).

All of that stuff is what you can easily see is BAD CREDIT. It’s NOT “no credit.” There’s some form of credit in there and it’s bad. And it’s on the person’s credit report.

Those other folks—like my client’s wife—who don’t have any credit appearing (whether Good, Bad, or Ugly), those folks have NO CREDIT.

There’s a difference. And with FHA mortgages, a person with NO CREDIT has a chance of building an alternative credit profile and getting approved for an FHA Insured mortgage loan.

The person with BAD CREDIT (and no other credit) has less of a chance of getting approved for such a mortgage loan. Let’s say “zero” chance, and leave it at that.

But get that idea out of your head right now about No Credit meaning “Bad” credit.

Hope that helps!