First Time Homebuyers – Trevor Curran

How I Bought My First Home – Part 4

How I bought my first home in 30 minutes.

I’m not kidding! It sounds NUTS, doesn’t it? But you can do the same.

I walked in to a FSBO—for sale by owner—toured the house for about 7 minutes and announced to the owner, “I’d like to make you an Offer. Can we sit down in your dining room and discuss it?”

The poor guy nearly fell over with a heart attack. He ran into the kitchen and called his wife up from the family room downstairs, “Honey, come upstairs, this young couple wants to buy our house!”

We sat down and I cut right to it: “I love your house and I really like this neighborhood, I’d like to buy it for $190,000.”

The man laughed, shook his head and told me I wasn’t even close. Within a minute or so I wrangled his “bottom line” price of $268,000 out of him. I exited the house with a “Nice to meet you and Good Luck!” within another minute or so.

I bought the house six weeks later for $210,000. I came up a little and he came down a LOT. Altogether my negotiating “real time” was 30 minutes. What I’m telling you is this: it’s not complicated buying a home as long as you PREPARE and you are HONEST with yourself.

Look around here for more great advice on buying your first home.

Follow me on Twitter! @tcurranmortgage https://twitter.com/tcurranmortgage

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

Check out my Zillow profile HERE

Find me on TWITTER: @tcurranmortgage

Happy House Hunting!

How I Bought My First Home – Part 3

My first day in the mortgage business was very exciting. I learned I could buy a home with an FHA mortgage with only 2.25% down payment! Average prices were $125,000 so I thought I could easily save up the money for that down payment.

Day 2 in the mortgage business wasn’t as exciting, in fact, it was a bit of a letdown. I learned that closing costs here in New York would be approximately 6% of the purchase price!

First day calculations to become a homeowner quickly went from saving $3,000 for a down payment to realizing I would need more than $10,000 for the down payment and closing costs! Back in 1989, beginning a new career after losing a good job, I knew this would be a real challenge, especially with the high cost of living here in New York City.

But then I learned about “Seller’s concessions.” When I made an Offer to buy a home, my real estate agent could negotiate to include some of my closing costs (up to 6%) into the purchase price of the home.

I translated my education into something I could use for my clients.

And I’ve been helping many of them the same way ever since: with different loan programs including the FHA program and its low down payment (today it’s 3.5%) and a Seller’s concession to help out with the closing costs.

I hit the streets in earnest, travelling to different towns in Long Island to survey property types and price ranges so that I could make the best decision possible as to where I would buy my first home. It was hard work, I will tell you! But it was an investment well worth the time because I knew I made the right decision when I finally bought my first home.

Next week: How I bought my first home in 15 minutes.

Take a look around and fine more great advice on buying your first home.

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https://twitter.com/tcurranmortgage

How I Bought My First Home – Part 2

Last week I told you of the real estate agent who laughed me out of his office in 1987. I was dejected yet determined that one day I would own a home. Today I want to share with you the nasty surprise I received on my birthday and how that led to my becoming a homeowner.

It was my birthday!!!

It was October, 1989 and I was unwrapping a beautiful red Fender Stratocaster guitar for my birthday. We had a few friends and family over to my apartment in Astoria.

The phone rang; it was my boss, Rich.

“Trevor I have some bad news. The company is out of business; don’t come back to work tomorrow. Human Resources will be in touch about any s

everance you might be owed.”

I was shocked because I thought we had been working for months to save the company from disaster. I was obviously wrong. I had a great position as Regional Manager in Customer Service and I had worked my way up from lowly Customer Service Rep at the company.

“Happy Birthday to me, by the way.”

Three weeks later I had an invitation for an interview with a mortgage company on Long Island. Someone in the family knew someone whose brother owned a mortgage bank. I met the man and soon thereafter began my career as a Mortgage Banker just 30 days after losing my job in electronics.

I was determined to accomplish three things:

1. Work on commission and never work in the corporate world again

2. Buy my first home

3. Help my Mom and Dad buy their first home.

I’m happy to report that I have accomplished all three goals thanks to that nasty birthday surprise.

Stay Tuned: Next week, my mortgage education and house hunting

Take a look around here and find more great advice on buying your first home.

Follow me on Twitter! @tcurranmortgage – https://twitter.com/tcurranmortgage

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

Check out my Zillow profile HERE

Find me on TWITTER: @tcurranmortgage

Happy House Hunting!

How I Bought My First Home – Part 1

In 1987 I walked into a real estate office. I wanted to buy a home in New Hyde Park, Long Island. I worked in the electronics industry and I knew nothing about buying a home. I only wanted to become a homeowner. I felt if I put my trust in the real estate agent he would guide me along the path to my goal. I WAS WRONG.

The man in this office in New Hyde Park in 1987 basically laughed at me. He asked some key questions about salary, cash I had saved up, and credit. I answered honestly and in complete detail. He said, “You can’t afford a home here in New Hyde Park,” then turned his back on me.

Not being a person who takes, “No” for an answer, I pushed him.

“Is there nothing here in this town we can afford?” I said.

He grudgingly took out the MLS book (no computer back then, it was a BOOK the size of a phone book) and pointed to a tiny black and white photo of a house.

I looked at the photo and said to him, “Well, okay, I guess that looks like a nice house.”

“You should know it doesn’t have a driveway or a garage.”

I was a little flummoxed because I really wanted my own driveway. I was tired of driving around Astoria looking for a parking spot and my dream of homeownership in New Hyde Park included a driveway. BUT I really wanted to buy a home and so was willing to compromise.

“Okay,” I said, “I really wanted a driveway, but I’d be willing to settle if it meant I could buy a home of my own.”

He had a “poker face” on, looked me straight in the eye and said, “You should know there’s no on-street parking allowed after Midnight every day.”

I walked out of that real estate office feeling very dejected.

Stay tuned: Next week, I discuss my nasty birthday surprise that turned into Homeownership.

You can find more great advice on buying your first home on this website. Take a look around.

Follow me on Twitter! @tcurranmortgage – https://twitter.com/tcurranmortgage

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

Check out my Zillow profile HERE

Find me on TWITTER: @tcurranmortgage

Happy House Hunting!

Negotiating on a New House

When negotiating on the purchase of your first home, I strongly advocate making an Offer the SAME DAY you see it.

Strike while the iron is hot!

I mean that you should make an Offer when you first visit a home that meets the two following conditions:

* Comes close to your “Wish List.” The “dream home” exists only in our minds. Smart first time buyers who search for a home by first creating a comprehensive wish list—and writing it down for constant review as you house hunt—can make a prompt decision on any given home. When a home hits most of the points on your list, it’s time to make an Offer.

* Matches Your Affordability Level. By knowing your “numbers” you’ll know when a given home matches your level of affordability for a monthly payment. It’s all about monthly payment. When a home matches what you can afford monthly, it’s time to make an Offer.

Make an Offer NOW; don’t go home and think about it!

Too many first time Buyers do that and they wind up losing out on a great house because of their tardiness.

Here in New York you are not committed to the transaction at the Offer-stage; not until you sign a contract of sale with your Attorney (usually about a week later) are you prevented from changing your mind.

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

Check out my Zillow profile HERE

Find me on TWITTER: @tcurranmortgage

Happy House Hunting!

The Trevor Method

The Trevor Method, affectionately designated by a happy client now living in her dream home, and named after Yours Truly, has been developed over the past 28 years in two ways. First and foremost, it’s exactly how I purchased my first home and my second home where I currently live. I practice what I preach!

Secondly, these are my observations of the process and the assistance to First Time Buyers throughout my career. With hundreds and hundreds (and hundreds) of purchase transactions, I’ve developed an understanding of what works for homebuyers, and what doesn’t. When someone doesn’t listen to me, the statistics fall into the latter bucket of “what doesn’t”. Let’s keep you in the “what works” bucket so we can get you into your new next home.

I have a propensity to narrow complicated issues down to their simplest essence. I do that with the homebuying experience in the form of the advice I give with The Trevor Method. Let me exercise my Method for you and bring it down to an even more essential form:

Please listen to my advice when working with you, otherwise we will kick tires, spin wheels, waste time, be frustrated and delay getting you into your home.

The FOUR things are both simple and difficult. If you do these FOUR things, I guarantee that you will be spectacularly successful with your goal of finding a home you love at a price and monthly payment you can afford.

I observed over the past 3 years, since implementing “The Trevor Method” as the primary way of conducting my mortgage business, that the people who did these FOUR things were successful. The people who ignored or didn’t follow exactly these FOUR steps, well, they still haven’t purchased a home: they’re still out shopping!

The Trevor Method: I ask you to do these FOUR Things:

WISH LIST. Make it. Write it down. Carry it with you. Read it when you’re in a home you like. Prioritize the items on the WISH LIST while you’re standing in the kitchen of that home. Decide if the home comes “close enough” to your Dream Home.
MAKE OFFERS. Make no mistake, you MUST MAKE OFFERS. And make Offers the same day you see a home, not two days later.
GET OUT THERE, BOOTS ON THE GROUND. There is NO substitute for viewing homes in person. You have to get out there and physically look at the homes, not on the internet. You have to do this A LOT. OFTEN. FREQUENTLY. Until you feel you’re exhausted and you simply can’t look at another home!!! (I looked at over 150 homes the first time; over 30 the second)
FOLLOW MY TREVOR METHOD ADVICE. I’ve designed my Method to walk you carefully, step-by-step, to your goal of owning a home. Those folks who were spectacularly successful listened to and followed my advice. Those folks still shopping? They pick and choose on their own which advice to heed, which to ignore.

I have no other objective but to help you buy your first home with no drama, with clear and concise information, and with optimism. I’m completely on YOUR SIDE. Please do these FOUR things: I guarantee you will be successful if you do!

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

Check out my Zillow profile HERE

Find me on TWITTER: @tcurranmortgage

Happy House Hunting!

Buy NOW or WAIT to Buy a Home?

There are two schools of thought when it comes to buying your first home.

Wait until you save up enough money for a large down payment and closing costs. This way you get a lower monthly mortgage payment.
Don’t wait: buy your home today, enjoy the personal and financial benefits of homeownership now. Finance as much of the price of the home as the bank will lend you: use very little of your own money.

I subscribe to the first concept.

I believe it’s a fantastic idea to save up the money, and get the lowest monthly payment. Who wants a large monthly mortgage payment? The choice of course is that your struggle is in the years it takes to save up the money. I definitely believe in that idea: you see a real benefit from your years of hard work, sacrifice and saving.

Here’s the problem with that line of thinking: we live in the NY Metro area, one of the highest cost-of-living areas in all the United States. Even if you were to live on the most absurdly frugal budget, work three jobs seven days a week, and save every penny of your money, it could be a long, long while before you save up the considerable monies needed for a “large” down payment and the closing costs.

Start with the closing costs: New York State has among the highest closing costs in the nation. On average, 4.5-5% of the purchase price is money allocated JUST to closing costs.

Now to the “large” down payment: because rates are so low, if you are like most of my clients and you want to see a substantial reduction in your monthly mortgage expense (let’s say, $600 or so) then you’re going to need a LOT of money down. In dollars and cents that means, if my proposed mortgage payment is $3100 a month and I want to pay no more than $2500 a month, I’ll need a whopping $94,900 towards the downpayment! Holy cow!

Even if you could work three jobs, seven days, live super-frugal, and bank every penny, the average family would still need to wait 4 years or more to save up that kind of money (assuming you could put away $30,000 a year).

So, while I love the first concept of waiting/saving, I live in the real world.

It’s the rare individual or family that can manage that strict of a lifestyle to save such money. That’s why I’ve always specialized in low down payment mortgages. Because in the real world of the NY Metro area, we just can’t get that kind of a leg up on housing. Prices go up, interest rates change, etc, etc.

Financing the whole shebang (purchase price and some of the closing costs) seems like a crazy idea when you see the numbers (monthly payment), but realistically it works to your benefit.

The mortgage interest is tax deductible for most homeowners (please consult with your tax professional). Your take home pay increases because you own a home! You don’t have to live a no-frills lifestyle sacrificing for something that seems so far away and unattainable. You can have your home, improve your life both with the real financial benefits and the intangible benefits (pride of ownership, financial awareness) that come with homeownership.

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

Check out my Zillow profile HERE

Find me on TWITTER: @tcurranmortgage

Happy House Hunting!

What’s A Seller’s Concession?

Home Buyers in the New York area often present an Offer to purchase a home with a request to include closing costs in the purchase price. In the terminology, we call this a “Seller’s Concession.” Although it’s not a “true” Seller’s concession (see bottom).

Seller’s Concession: this is the process where you present an Offer to buy a home with the request of the Homeowner that the price include some or most of your closing costs. When you sign the contract of sale the price will include the closing cost “concession” and there will appear language in the contract stating, “Seller to pay $XX,XXX of Purchaser’s closing costs.” See limits on Seller’s concessions below.

EXAMPLE: Purchaser and Seller have agreed on a purchase price of $412,000. But the Purchaser needs assistance with closing costs in the amount $20,000. The final price on the contract of sale will be $432,000. “Seller will pay $20,000 of Purchaser’s closing costs at closing” is the language included in the contract of sale. The Purchaser’s Down Payment and financing is based on the higher purchase price, including the Seller’s concession.

Allowable SELLER’S CONCESSIONS
1. FHA financing currently allows for up to a 6% Seller’s concession for closing costs, regardless of how much your down payment is. Minimum down payment for FHA loans is currently 3.5%
2. CONVENTIONAL financing currently allows for up to a 6% Seller’s concession for closing costs with a down payment of 10% or more. If your down payment is less than 10%, a 3% maximum Seller’s concession is allowed.

What’s a TRUE Seller’s Concession?

The true definition of a concession is when a Home owner/Seller decides to pay something out of their own pocket to encourage Buyers to buy their home. For example, in a true Seller’s concession situation, a Homeowner might have their Realtor include in the written Listing Agreement that the Seller will provide a credit at closing in the amount $750 for a new washer/dryer. The idea is for the Seller to spend a little bit of their own money to entice Buyers to buy their home, sooner, rather than later, especially in a competitive market.

Meanwhile, in New York…where closing costs are so high…many Buyers ask Sellers to include the Buyer’s closing costs in the price of the home by increasing the agreed upon price, not by asking the Seller to pay those closing costs out of the Seller’s proceeds. It can be complicated, but, then again, so is life in the Big City!

The New York State Bar Association has a special Rider to be included with the contract of sale acknowledging that all parties have agreed to this increase in the price. This way everything is transparent to a Lender when they process and approve a mortgage loan where the price includes a Seller’s concession.

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

Check out my Zillow profile HERE

Find me on TWITTER: @tcurranmortgage

Happy House Hunting!

Definitions: Closing Costs in New York

Definitions: Closing Costs in New York.

When people think of closing costs typically they think of the fees paid at the closing table. The fact is, closing costs are all fees associated with the purchase (or refinance) of a house. For our purposes in this definition, we’ll concentrate on closing costs associated with purchases in New York.

The bulk of closing costs are indeed paid at the closing table. These include:

• Origination fees and other miscellaneous fees (application, underwriting, document prep, etc.) paid to your mortgage lender
• Flood Certification Fee paid to independent verification of flood zone
• Title charges paid to the title company (including searches and insurance for you and for your mortgage)
• The fee paid to your attorney to represent you (you might pay a retainer fee to your Attorney in advance of the closing)
• Municipal fees paid to record your mortgage and record your deed
• Taxes or transfer fees required to be paid to your state, county, or local municipality
• Escrow deposits to create your escrow accounts for the purpose of paying your annual homeowner’s insurance renewal premiums and property tax bills when due
• Miscellaneous Fees associated with your loan application and/or closing: Title Closer “pickup” fee, Title endorsement fees, Bank Attorney, and etc.

You will pay other fees in advance of closing, too. These include:

• Home Inspection: All Homebuyers should obtain a Home Inspection report from a Certified Engineer or Home Inspection Service. This report will give you advance warning of the condition of the plumbing, heating, electrical, roofing, foundation and other structural and age-related issues for the house you wish to purchase.
• Appraisal Fee: An Appraisal determines the value of the house for the purpose of making a lending decision. Typically the appraisal fee is paid for within 5 days of the Lender sending you a Loan Estimate of Closing Costs. (Lenders are not permitted to incur any fees on your behalf such as an appraisal fee or application fee or an origination fee until 4 days after they have sent a Loan Estimate to you; you must have time to review this document and agree by signing an “Intent To Proceed” form before a fee such as an appraisal fee can be charged to you)
• Application Fee: Many Lenders charge application fees in the beginning of processing a loan application.

Preparing for Closing — Prepare for closing by reading your Closing Disclosure

• First Year Homeowner’s Insurance: When you buy your home you are required to purchase, prior to closing, the first full year of Homeowner’s Insurance for your home. You must present proof of this insurance, including a receipt indicating the insurance premium has been paid in full for one year, prior to closing your mortgage loan. If you are including escrows in your monthly mortgage payment for your insurance and property taxes (required by all Lenders for FHA Insured Mortgage Loans and most Conventional Loans), then your Lender will pay your renewal premium every year after your first year from your escrow account.

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

Check out my Zillow profile HERE

Find me on TWITTER: @tcurranmortgage

Happy House Hunting!

Why Buyers are Obstructed from Using FHA Financing

There are several reasons why Buyers can’t use FHA Financing for their home purchases. You would think that Homebuyers should have the full range of loan programs options available to them when making their financing decisions. They DO! But Buyers are too often getting discouraged and diverted from using FHA Financing by realtors, home sellers, and, yes, mortgage professionals.

And many of those Buyers don’t qualify for other types of financing, which makes these reasons all the more insidious and dastardly.

REASON 1: Inexperienced FHA Appraisers. Unfortunately, the FHA program has an incorrect reputation for “difficult” appraisals, i.e., appraisals requiring lots and lots of repair items prior to closing. I hear often from real estate agents of the terrible experiences they had with FHA loans, specifically the appraisals. Thanks to the radical changes in our mortgage business since 2010, many very experienced Appraisers left the business. This deficit was eventually filled, especially as the economy improved, by new appraisers.

These Appraisers simply don’t have the necessary understanding of FHA appraisal standards. I reviewed once such appraisal yesterday. The Buyer found me after an intensive Google search for an expert mortgage professional on FHA 203k Renovation financing. She’s been trying to buy a bank-owned foreclosure property (REO) since last July! The Lender she was working with simply couldn’t figure out how to make the financing work with the renovation financing. When I reviewed the documents she submitted, I realized the main problem with her file was the appraisal.

First, this was a terrible appraisal all around: Incorrect purchase price, comments skewed all over the report instead of properly situated in the addendum, crazy comments on, and use of, comparable sales, and I mean CRAZY. Secondly, and most importantly for this poor Homebuyer, the appraiser demonstrated a crystal clear LACK of understanding of FHA “health and safety” and property condition guidelines. This appraisal is for a property in Westchester County, an area where I often hear the objection from realtors about their bad experiences with FHA appraisals.

REASON 2: Realtors’ bad experiences. First and foremost, let me state this radical idea: NO ONE gets to tell a Home Buyer what type of financing they can or can not use to complete a home purchase. But too often, that’s exactly what happens.

Because Realtors have had a bad experience with an FHA transaction—or worse, they’ve “heard” of people having bad experiences—they strongly discourage Home Buyers from using this option. I have personally had Realtors tell me on the phone, “Oh, no, they can’t use an FHA loan for this house.” No kidding! When I inquire as to the reasons why, there ensues a litany of false information embedded in the Realtor’s mind about how the FHA program works. I will then explain that, since I work for the Lender, and have extensive experience with FHA financing, these ideas in their heads are, ummm…WRONG!

Let’s be clear: if a Realtor, or a home Seller, by extension, has had a bad experience with an FHA loan, that does NOT prevent a Buyer from going ahead with the financing of their choice. I mean, what if these people once had a bad experience with home buyers who showed up driving silver four-door cars? Would they be prevented from buying the home? Of course not because that is just absurd! Well, so is the idea that a Buyer cannot use their preferred (or ONLY) method of financing a home purchase.

REASON 3: Inexperienced or misinformed mortgage professionals. The answers given to home buyers by mortgage professionals range from, “Oh, you cannot buy a home with FHA financing over $417,000 with less than 10% down.” FALSE. To, “You know, FHA financing is only for people with bad credit.” FALSE. To, “That program is only for First Time Buyers.” FALSE. To the all-time doozy, “My bank does not Offer FHA financing.” From the depository lender with the HUD Eagle on the front door!

Make no mistake, the lack of understanding of the FHA program and/or lack of experience/education by these professionals is probably the biggest reason why so many Buyers have difficulty using FHA financing (and why Realtors and Sellers have so many bad experiences).

What to do?

If you are buying a home using FHA financing, let NO ONE discourage you from using the loan program. It’s an excellent program and has been available to home buyers for more than 80 years! And, when selecting a mortgage professional, do your background research on that person’s experience in general (HERE on the NMLS Consumer Access website by clicking “Self-Reported Employment History” on an individual’s licensing profile) and for FHA financing specifically. GOOGLE is your friend!

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

Check out my Zillow profile HERE

Find me on TWITTER: @tcurranmortgage

Happy House Hunting!