Category Archives: Buying A Home

Tips to Make Your Roof Last as Long as Possible

If you pay for something for 15 ,20, or 30 years, the typical loan term, you want to make sure it lasts.

Good roof

The article give several, easy tips to maintain your home’s roof so it stays the valuable asset you purchased.

Here.

Don't let your roof get like this....

Don’t let your roof get like this….

If you are buying a home and getting a home mortgage, the roof is examined as part of the appraisal.  The appraiser has to look at the home’s roof and make a statement if they think the roof has a remaining life of at least two years.  The appraiser is not a roof inspector, and will state that and the buyer should get a certified roof inspection if they are concerned about the remaining life of the roof.

If you are selling a home, consider this and make any necessary repairs before you list the home so your buyers loan doesn’t have problems that come up in the appraisal stage.

                               For more information about the appraisal process , go here.

Some loan programs allow for roof replacement and repairs, the FHA 203k and Fannie Mae Home style renovation.

Still, most people won’t have roof issues when they buy a home if they take a good look at the roof for sagging, missing shingles or other signs.  When in doubt, get an inspection it’s very inexpensive assurance in the long run.

After all, if you get a home loan and make mortgage payments for 15,20, or 30 years, you want to enjoy it after you have paid off your home.

 

 

 

 

 

 

Electronic and smart locks for your home, they are here!

Here is a new article, on my other site:

http://loansbyrogerhowell.com/electronic-and-smart-locks-for-your-home/

smart locks for your home

Electronic locks

The days of leaving a spare key under a rock in your yard may be over.  Thanks to the amazing power we now hold in our hands, the smart phone, we can lock, unlock and monitor our homes without having to carry a key.

Already, my newest car has a fob instead of a key and its a natural step to put the electronic lock into your home.

Electronic locks are not new, I have a couple older ones sitting in my shed. They were quite useful for rental homes, new construction, or homes we would fix and flip.  You would set the code and give it out to whoever needed it.  After the project was done, or the home was rented, you changed the combination.  This is much less expensive than a locksmith and the lock could be taken to a new property if needed.

Some people might be concerned about the electronic nature of securing our homes, but is your home really secure with a manual lock and key when anyone could probably enter by way of a window and rock?  If your phone is dead or power goes out, there would be a back up using a traditional manual key.

If you want a new home with all the latest features like electronic locks, we can get you pre-approved quickly and before you know it, you will be moving into the new home.

Summer home sales in Boise, Idaho are smoking hot!

the Independence day weekend marks the mid point for summer sales for most of us. Boise’s 2015 sales season has been very hot from the early spring.  Unlike 2014, when we had a prolonged, colder winter, people seemed to be ready to start shopping in February.

Earlier on, in the start of the season, we say several homes sold at or above asking price.  Many others, have come back over the appraised value and some people still bought.  In most cases, a cancellation or re-negotiating  of the sales price happened.

Other interesting fact, the local real estate appraisers are factoring the “Production Builder penalty” into their valuations.  Without naming any specific names, we have several builders in the Treasure Valley who build hundreds of homes a year, typically in their own subdivisions.  If they build for less than “Custom Home Builders”, the value a home owner is going to be compared to other homes built by that builder.  They could be as much as $20/foot or more less than a custom home of the same size and finishes.  This has led to some upset realtors and home owner’s but its something to consider when buying or building a new home.

Realtors I work with are reporting multiple offers on newly listed homes in a matter of days if not the first day a home is listed on the local MLS.

As a result of our hot market, I am seeing longer times to appraise a home.  Loan underwriting times are getting longer as well as more home purchase loans are submitted.  FYI, Fairway Independent Mortgage Corporation underwriting times are about 5 business days right now.  Most loans are getting finished within 30 days of application.

Another trend I am seeing is people relocating from California, Nevada, and other states to the Boise area.  Many times they are retirees with pensions and cash from the sale of their previous home.  They can pay cash and close in a couple of days if they wish.  This may not be the best use of that lump sum, the HECM for Purchase Loan enables borrowers 62 or up to put up a fraction of the price of the new home and a reverse mortgage, or HECM, will cover the rest.  Expect to put down half and the Reverse Mortgage covers the rest.  Save the rest of your cash for getting outdoor and enjoying what Idaho has to offer.

Mortgage interest rates are still low.  They have moved up about .5% on a 30 year fixed rate loan from the low 3’s to the upper 3’s and low 4 percent rates as of today.  The “experts” keep saying rates are going to go up in the future, but so far they are holding at historically low rates.  You could be regretting not getting a home if you had the chance in summer of 2015 and didn’t.

 

Veterans Administration Loans for Zero Down Payment borrowers

One of the many benefits available to honorably discharged veterans is the VA Home Loan Benefit.

Basically, it will allow you to buy a home with ZERO DOWN PAYMENT and get a low-interest rate at the same time.  Normally, if you put less money down, you would expect to pay more in rate than someone with a larger down payment but this is not the case with a VA home loan.

Right now, we can get qualified veterans 30 year interest rates in the mid 3 percent range.  This equals $4.49 per thousand borrowed in a monthly payment.  A $100,000 loan would have a payment of $449 per month not including taxes and insurance.  At this rate, buying a home certainly costs less than rent in the Boise area.

How does the Veterans Administration offer this?  First of all, the loan is not from the government but instead its secured by the VA.  The loan is made by lenders to the borrowers according to the VA loan program.

If  XYZ Bank makes a loan to a veteran and later the veteran goes into foreclosure, the bank takes the initial loss.  The VA pays the bank for the defaulted loan, making them whole and takes the house back as collateral for the money lost.

This might seem risky, but the VA loan guidelines are written in such a way as to encourage responsible lending and not letting veterans get over indebted.  Furthermore, Veterans by nature of their service, have demonstrated the ability to follow the rules and generally don’t go into default nearly as much as other home buyers.

How does one qualify for a VA loan?  Its easy, you call your local lender and ask for a VA loan specialist.  If you don’t have one, I can be reached at 861-7579.  They determine quickly if you qualify and can give you an estimate of the payment on the home you are looking at.  You don’t need your original certificate of eligibility, instead, the lender will retrieve it directly from the VA.

 

Why aren’t more renters buying?

In our market, Boise Idaho, the cost of renting a house is more than the cost of a mortgage for a similar home. It would seem that everyone would be buying a home.

The Wall Street Journal did a survey on why, and here it is:

http://realestate.msn.com/blogs/post–why-more-renters-arent-buying

The top three reasons are directly related to our economy and job market, not worries about values dropping or other reasons.

What do you think? Comment below:

What is the cost of waiting to buy?

The spring is here, and that means the Boise, Idaho real estate market is awaking from its winter slumber.  Experts are saying our market will appreciate about 5% this year, but some segments might go even higher, say 10% or more.

 

Here is an info graphic that illustrates the costs of waiting.

Cost-1024x561

 

Anyway, we expect costs to go even higher as demand for housing confronts the shortage of housing in the Treasure Valley.  Combine that with expected higher rates and you can see a definite “cost” top waiting.

If you don’t want the next home to cost more, then call me today and lets put a plan together for you next home.

 

 

 

Are you buying a home next year and need an FHA loan? Better check with your lender first.

Next year the loan limits for new FHA loans has been lowered in our area.

The new loan limits are $271,050 for new FHA loans reserved after 1/1/14.

Previously, the loan limits for the Boise are was $303,750.

If you have found a home and are in the process of obtaining a home loan but plan on closing in early 2014, make sure your lender gets the FHA case file # before the end of the year.  By doing this, you get “grandfathered” in with the current, higher loan limits.

 

What does it take to buy a home in Boise? Meridian? Eagle? Nampa? Here goes…

This is a local variation of an article that MSN real estate re hashes every few months.

http://realestate.msn.com/what-you-must-earn-to-buy-a-home-in-25-cities-in-2013

The gist is that you would need to make x dollars to by the average house in these markets.

It assumes a 20% down payment and a conventional loan at the national average rate of 4.64%.  For Ada County, I will use .6% as the property tax with home owners exemption and $500/yr for home owners insurance.  I will also use the 28% housing payment ratio.

I think some local insight would be helpful to my fellow Idahoans, so here it is:

Boise Metro average: Median home price:  $199,900 $964/mo estimated PITI.  You need a salary of $3442 per month or $41,299 per year.

Now to break it down into specific sub-markets

Eagle, ID Median home price: $379,500 (according to Zillow) $1814 est, PITI.  You need a salary of $6477/mo or $77,728 per year.

Meridian, ID Median home price $ 210,000, $1005 est. PITI.  You need a salary of $3590/month or $43,083 per year.

Nampa, ID Median home price $140,000, Estimated $732 per month, $2049 per month or $24,589 per year.

 

Numbers came from this site: http://www.deptofnumbers.com/asking-prices/idaho/boise-city/

and Zillow: http://www.zillow.com/local-info/ID-Ada-County-home-value/r_66/

 

With the new Qualified Mortgage rule, the debt to income limits are 43%, a bit lower than what has been approved in the past, that means if you earn $4000 per month gross income, your total debts are limited to $1720 per month.  For the record, the old banker standard of 25%/36% works very well for most people’s budgets. That would mean a person with the $4000 per month gross income should spend no more than $1000 per month on their house payment and no more than $1440 for all debts, monthly utilities and groceries excluded.

The salaries mentioned are well within the range one can find in the Boise, Idaho area.

Everyone’s situation is different, I recommend talking to a Loan Officer you know and trust and get your Pre-Qualification ahead of time.  If you don’t have one, I would love to help.

 

 

FHA’s back to work program requirements

The changes to FHA’s back to work initiative have opened up the housing market to many potential home buyers  who otherwise would have to wait another year.

The Back to work guidelines allow for a home buyer to purchase a home after 12 months from the date of a Foreclosure, Bankruptcy, or short sale.  Until now, the guidelines required 24 months or longer after those events.

Its not without its qualifications, here they are:

  • Borrower(s)      must have a FICO score of 640 and above.
  • Borrower(s)      experienced an “economic event” such as job loss, loss of income, or combination of both which caused a foreclosure/pre-foreclosure, deed-in-lieu, or short sale.
  • “Economic event” resulted in at least 20% decline in household income and      lasted six months or more.
  • A   minimum of 12 months has elapsed since “economic event”.

Borrower(s) must receive HUD-approved counseling.

 

I’m not sure how I feel about the changes, on one hand it gets people into homes earlier than in the past.  On the other hand, I didn’t feel than 24 months after a bankruptcy and 36 after a foreclosure was too long to sit out of the home ownership market.

Bottom line is, some people will be sufficiently motivated to go through the counseling, gather documents proving the economic event and have made efforts to get their credit straightened.  Those people are probably the ones who will be ok buying a home sooner than later.

 

 

Good article from USAA on building credit history from scratch

1146426_house_question_2I get many first time home buyers in my office who have no idea about their credit history much less their credit score.  With a little preparation ahead of time, they could prevent an unpleasant surprise.

If you have an adult child that is just going out into the real world or college, it would be wise to discuss this with them. https://www.usaa.com/inet/pages/advice_building_credit?offerName=logoff_advice_building_credit

You should take advantage of the free reports offered by the bureaus once per year at www.AnnualCreditReport.com.  These reports won’t give you their score-they make you pay for that, but you are looking for any surprises and how any existing creditors are reporting your credit history.

Even if you’re one of those types who says I don’t need credit, you do need a credit history to get the best financing when the day comes to apply for a mortgage.  Contrary to what some like Dave Ramsey say, living without a credit score has many disadvantages.

If you open credit accounts, buy a tank of gas a month on the account and then pay it in full when the bill comes, you’ll build a history of responsible use and avoid finance charges.  This method works well while avoiding debt building up.  After 6 months, you’ll see the positive effect on your credit score.

I would add that if you’ve had a bankruptcy or foreclosure, you really need to make an effort to repair and rebuild your credit history.  You can’t shun credit simply because you had problems.  A good part of your credit score is how you manage your credit.  Avoiding it is not the same as managing it.

With a little advance effort, you can detect any errors, bad credit, and monitor how your existing credit is showing.  It’s common for me to work with borrowers some time in advance to get ready to purchase.  Should you need this help or know someone who might, call me.

 

 

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