Phoenix Bank Owned Foreclosure Homes--Phoenix Real Estate Vlog » Financing

11 Steps to Buying a Phoenix Home Series-Financing

Joe Martin — Fri, 14 Jan 2011 18:31:45 +0000

Table of contents for 11 Steps to Buying a Phoenix Home Series

Secure a Phoenix home loan before you start your home search

If you have been following the future posts in this 11 Steps to Buying a Phoenix Home Series we touched briefly on how to establish or clean up your credit if needed. Now for the purposes of this series moving forward we will assume you have a least a 620 credit score, a steady documented income for the previous 12 months and your DTI is 41% or less as indicated in our previous post regarding debt-to-income ratios…the next step is to get pre-qualified with a Phoenix home loan.

Ask for referrals to qualified Phoenix home loan specialists

Word of mouth is the best way to find a great loan specialist for your Phoenix home loan and your Realtor is a great place to start. Your Realtor should have excellent referrals for you as they tend to use the same preferred lenders over and over again that make them look good and give their clients the best service available. Just like any business if you do a good job, word gets out about your services and others refer you business. I do not recommend just haphazardly going online and completing online questionnaires or applications. 9 times out of 10 your information is sold and you can get bombarded with loan professionals. Find a few that come highly recommended by asking your family, friends, neighbors and Realtor and start there. A lender should be able to take a phone application and/or secure online application and have answers for you the same day. Unless of course you go to a brick and mortar bank where a pre-qualification can take up to five business days.

Understand the terms and fees associated with your Phoenix home loan

After you complete the application process via online, over the phone or in person you will be provided with a pre-qualification letter that will state the amount of financing you qualify for. In Arizona specifically your Phoenix home loan qualification letter may be issued on as an LSR or Loan Status Report. An LSR will be required to write any offer and typically required prior to view homes. If this is your first time buying a home and applying for a Phoenix home loan you will have several questions. Your lender should be able to tell you your rate (which can still change until you lock it), your estimated mortgage payment including taxes and insurance, your estimated closing costs to bring to the closing table (which you can negotiate the Sellers contribute to), and your required down payment for your particular Phoenix home loan program. First time home buyers will typically use an FHA loan with 3.5% of the purchase price required as a down payment.

Example: 100,000 purchase price x 3.5% = $3500 down payment

There are also Phoenix home loan programs such as a USDA loan which allows first time home buyers to purchase at $0 down provided the property is located in a qualifying area. Phoenix-Metro areas that qualify mainly are Queen Creek, San Tan Valley as well as parts of Apache Junction.

The next step once you receive your Phoenix home loan qualification letter is to select a Realtor to represent you if you have not already done so which we will discuss in the next post in this 11 Steps to Buying a Phoenix Home Series.

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11 Steps to Buying a Phoenix Home Series-Budget and DTI

Joe Martin — Tue, 11 Jan 2011 20:56:16 +0000

Table of contents for 11 Steps to Buying a Phoenix Home Series

The Phoenix home buying planning process means time to budget

It is time to finally track your spending and put pen to paper an itemized list of where you spend money each month and how much. The goal here is to see how much Phoenix home you can afford within your budget. The good thing is right now in Phoenix-Metro area you can own for less per month that what you can rent in many areas so your living expenses might actually go down once you buy!

Accurate figures are important to the Phoenix home buying planning process

Start with making a list of all your expenses such as utilities and living expenses such as electricity and groceries, then all monthly expenses such as credit card bills, car insurance and yes add your entertainment, clothes, etc. as well. If you spend $40/week on movies and you want to continue to spend $40/week on movies than include it, otherwise remove or lower it to something you feel is reasonable and then follow that. You may be surprised to find out how much money you spend on certain things that with a few minor changes here and there you can drastically reduce your overall monthly expenditures. After you total everything and subtract it from your income you will have a figure. From that figure take a certain percentage off the top to add to your savings accounts and/or retirement plan, etc and the final figure leftover (assuming you already accounted for miscellaneous disposable income in your list) is what you can afford as a mortgage payment with/without any lifestyle changes while growing your savings.

Lenders consider Debt-to-income (DTI) ratios during the Phoenix home buying pre-qualification process

The above budget is mainly for your purposes so you can determine during the Phoenix home buying process your comfort level with the money in and money out every month and also help identify spending habits that can be modified to help strengthen your overall financials. Lenders will take your debt such as current mortgage/rent, credit cards, car payments and compare it to your income (aka DTI ratio). The qualifying ratio will vary by loan program and fico score but for our example we will use FHA which is 41%.

Lets consider a quick scenario in determining DTI for a Phoenix home buying loan applicant;

Your Monthly payment on mortgage/rent = 1200
Minimum Monthly Credit Card Payments = 300
Monthly Car Loan Payments = 450
Other Loan payment = 300

Thus, your total monthly debt payment = $2250

Now, let’s consider your Gross Annual Salary = $75000
So, gross monthly salary = $6250
Other monthly income = $1000
Thus, your gross monthly income = $7250

So, mortgage debt to income ratio = (monthly debt payment)/(gross monthly income)
= ($2250/$7250) = .310 or 31% which is well within the standard DTI ratio.

Hopefully now you have a good idea of how much you can comfortable afford every month, what changes to you budget need to be made if any and if your debt-to-income (DTI) ratio is in-line with qualifying. If not you may have to pay off some debt to get your ratio where it needs to be as part of the Phoenix home buying process.

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11 Steps to Buying a Phoenix Home Series-Repairing Credit

Joe Martin — Fri, 07 Jan 2011 20:04:54 +0000

Table of contents for 11 Steps to Buying a Phoenix Home Series

Repairing credit to buy a Phoenix home takes time…

If you read the previous post in this 11 Steps to Buying a Phoenix Home Series regarding establishing credit we are back to the same notion of maintaining a good credit history. So it will take time. Repairing credit is all about correcting the negative references on your report and keeping the items in good standing …in good standing! There are many reasons one might have bad credit. For the purpose of this post and buying a Phoenix home we will address general misuse or overuse, etc. We will not touch on bankruptcy issues, short sales, or foreclosures in this post as they are different in terms of recovery.

Nowadays, you will most likely need a 620 credit score or higher to buy a Phoenix home with traditional financing

Some things to consider when you review your credit report;

When you look at your report there are some things you should keep in mind. If you have too many credit lines this could be hurting your score. You would need to pay off and cancel or at least cancel all but a preferred three cards. The cards that you should keep should be the ones you have had the longest. Longer histories with a creditor helps your score. Try to negotiate lower rates on the three that you keep.
Pay down balances on all three remaining cards to 30% or less of the credit limit (10% is better).
Put together a budget to pay down any outstanding/delinquent payments or satisfy any debt/judgments. Many times these balances can be settled and negotiated for less than the full amount.

Keep in mind that to buy a Phoenix home is not a given right but a reward and responsibility

Once your credit is in check make sure you take the necessary steps to keep it that way. Set up automatic payments whenever possible. Don’t wait until the last minute to mail a payment to your creditors. Make sure you don’t overspend or have to high of limits. Report any unauthorized use of your credit. Once you implement these strategies it is just a matter of time and history until you have good credit to buy a Phoenix home. Your preferred mortgage finance specialist can give you a ball park estimate based on your current credit scenario just how long until your credit should be good enough to qualify for the best rates available to buy a Phoenix home.

If you have questions or comments on credit issues that are stopping you from qualifying to buy a Phoenix home please post them below, we would love to hear from you!

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11 Steps to Buying a Phoenix Home Series-No Credit

Joe Martin — Thu, 06 Jan 2011 18:29:19 +0000

Table of contents for 11 Steps to Buying a Phoenix Home Series

Buying a Phoenix home requires good credit history

No credit is not good credit. No credit will stop you from buying a Phoenix home. Some people assume they have good credit just because they have not used it or damaged it yet. This is not the case. The good news is there are easy ways to establish credit. I spoke with a client that asked, “Why do I need credit cards in order to buy a home?,” as she had no debt and did not want to get a credit card. The answer is you don’t. You can always save up and pay cash for a Phoenix home which many people sometimes do, however, if you are going to require a loan to finance your purchase you may have to consider the scenario from the lenders POV. If you were going to loan money to someone you will probably want to see that they have a history or managing debt responsibly prior to doing so in order to analyze the risk, i.e. the likelihood they will pay you back.

Establish credit as early as possible prior to when you plan on buying a Phoenix home

Establishing credit takes time. Having no credit does not illustrate you a.) know how to manage it or that b.) you will not abuse it. You may have credit card offers come in the mail or when you go to your bank. It is ideal that you open three credit lines but no more with either your bank, department store, mail offer, etc. Most will come with a low or zero APR for the first year or so and of course you want the best rate and perks. Instead of paying cash for things like groceries, gas, medicine, etc. just set your cash aside and use your card. Then when the bill comes pay it off with the cash you stashed. If you are going to carry a small balance vs. paying it off completely each month carry no more than 10% of the credit line for an optimal credit rating although paying it off each month in full is ideal. If you only carry a small balance and only buy things you would normally have to buy regardless, then you should be fine with managing your credit. In three to six months you should be on your way to having great credit to buy a Phoenix home.

Remember these 5 things when building your credit for buying a Phoenix home or any other purpose

Make your payments on time every time or it will lower your credit score
Always keep your credit card balance at 30% or less of your total credit line in the event you don’t pay it off in full each month
Once you have a history request a credit line increase from at least one of your cards to be at 5K or more
Don’t have more than 3 credit lines at any one time
Don’t buy things you don’t need on credit, just buy the things you would buy anyway

Also it is important to note that it is a good idea to keep your cards for the duration. Don’t cancel one and hop to another just because they offer you a short term introductory rate. Try to negotiate the rates with the cards you have. Overall the length that you hold each credit line open will impact your score, i.e. the longer the better. This will in turn possibly get you better home loan rate when buying a Phoenix home and possibly a quicker approval process.

Many cards offer a cash back option. This means for every dollar you spend with the card (even when you pay the balance off in full each month) you will receive typically 1% or 2% cash back. So lets say you spend $2,000/month on groceries, food, gas, medicine, clothing, etc. you would have earned $40 cash back which is $40 more than you would have made if you bought the exact same items but just paid cash for them.

This post is not intended to be in any way a form or financial and/or credit counseling and it is advised you see a professional finance/credit specialist for further insight or questions regarding your credit prior to buying a Phoenix home. We have plenty of wonderful referrals!

I hope so far you are finding this 11 Steps to Buying a Phoenix Home Series helpful and I welcome any comments you may have below as we move through the series.

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Common Costly Home Buying Mistakes You Must Avoid!

Joe Martin — Sun, 28 Nov 2010 21:56:23 +0000

Do You Make Any of These Common Home Buying Mistakes?

What Every Homebuyer Ought to Know About Avoiding These Costly Home Buying Mistakes!

Keep Reading to Discover How You Can Learn to Avoid Them…

John was excited about purchasing his brand new home, but he was preparing to make one of the most common home buying mistakes made by would be home buyers. John thought driving up in his brand new car would be a great idea. The ‘new car’ smell was mesmerizing and the vision of the wind flowing through his wife’s hair as they cruised through their new neighborhood with the top down became irresistible. He drove off the lot with a big joyful smile and a gleam in his smiling eyes.

Unfortunately, his smile soon turned into a frown of sadness when his lender informed him his new car purchase showed up on his credit report right before they were getting ready to fund the loan and close. John’s car purchase had just disqualified him from his new home loan. Indeed, costly home buying mistakes like this happen every day.

The new car monthly payments were added into John’s monthly expenses and raised his debt to income ratio to a higher level, immediately disqualifying him A very sad state of affairs, but common home buying mistakes like this are all too common, I hate to say.

These type of home buying mistakes are very costly, but are not isolated to just new car purchases. Home buying mistakes also occur when would be buyers want to have things in order and finance appliances and furniture in advance of closing on their new home loan. Even racking up charges on your charge cards can increase your debt to income ratios enough to disqualify you for your new home loan.

Recommended: avoid these common home buying mistakes by eliminating all major purchases as much as possible before purchasing a home. If you must make them, check with your lender first and have them re-run the numbers to make sure you don’t end up spending the night in your convertible instead of your new home, like our poor friend John.

More Costly Home Buying Mistakes

Costly home buying mistakes made by many would be tenant buyers lately is to hand over their down payment money directly to the for sale by owner. It looks like a great deal, buying direct from the owner, the price seemed right and the owner was willing to work with you on accepting a fair rent until you were able to qualify for a loan to finish the purchase, but one of the most common (and costly) home buying mistakes was in the making.

One day, typically a real estate agent, knocks on your door asking if you are the owner. You explain you’re the tenant and are purchasing the home from the owner and the agent goes on to inform you the owner has been foreclosed on, asks to view your lease and offers you a relocation assistance program to help you with your move from the new owners at the bank.

I’ve personally seen these type of home buying mistakes made time and again. One would be tenant buyer gave someone posing as the owner, not only their down payment money, but their first and last months rent. Ouch!

Recommended: Use a real estate agent to help you avoid these common home buying mistakes that are running rampant right now with all the foreclosures happening. At worst, get your down payment money into a 3rd party escrow account, so access to the money can’t be gained by either party until either the house closes or the deal falls through. You may want to also screen the owner and get some credentials from them to prove who they really are and check the county recorders office to see if a Notice of Foreclosure Sale has been filed. Search the tax assessor and county recorder websites to find out who really owns the home and don’t ever hand over cash money to the owner, one of the very large and costly home buying mistakes.

Costly Home Buying Mistakes – Utilities Not Turned On…

Believe it or not, some home buyers actually forget to have their utilities turned on in their new home before they move in. Of course, Murphy’s law is in full effect, as this usually is discovered on a late Friday going into a weekend when no one is going to help you until Monday. That makes for a very uncomfortable inauguration into your new home, especially at 110 degrees in Phoenix, Arizona or in the dead of winter with no fireplace. Recommended: make a note to yourself to arrange two things: (1) turning off utilities at your old residence and (2) getting them turned on at your new home.

Avoid Common Home Buying Mistakes…

Having a good real estate agent to look out for your interests as you go through the process of buying your new home is an extremely important asset you don’t want to overlook. Their services are paid for by the seller and they can literally save you thousands of dollars in grief avoidance with their expertise in helping you avoid not only these, but many other common (and costly) home buying mistakes made by would be home buyers.

It’s their job to keep up with all the details of the transaction from day-to-day, and keep everything moving smoothly and on track towards the exciting day of closing. They help shield you from a great deal of the frustration associated with buying a new home and help you stay up with the requirements of the lender as the home progresses to closing too. They arrange home inspections, remind you to turn on utilities and keep things on track.

Many home buyers fail to do this and then find themselves way behind in the process at the very last minute. This can sometimes lead to delay or even cancellation of the transaction. Recommended: take care of your side of the fence by staying on the same page as the lender all the way through the process.

The better educated you are about potential and costly home buying mistakes you could make when buying a home, the better chance you have to keep the entire home buying process cruising along smoothly toward a successful close.

By the way, after you’ve closed and you want the wind blowing through your hair in that new ragtop, go for it knowing you have avoided those treacherous common costly home buying mistakes.

Realizing How Buying A New House – Advantages For Homeowners

Adriana Noton — Sat, 23 Oct 2010 15:23:47 +0000

Buying a home can be a fun and exciting time period. There may be lots of shopping and looking involved as well as different house options. A couple may be torn between a recent model home and an older resale property. To better decide, it is a good idea to know that buying a new house – advantages for homeowners is real. There are many good aspects to making the plunge into the new real estate market.

One of the advantages to buying a recent property, is that the home may take several months or years to create. That can give someone the time they may need to make financial plans and save the down payment. With an older home, the down payment has to be made at the time of sale. With most resale homes offering quick closings that doesn’t give someone much time to save. A new home can provide people with the time they need to put a large down payment down on the listing.

Picking a model home, can also allow a couple to pick how the house will look. They can pick everything from the brick color, to the floor type and accessories in the kitchen and bathroom. Choosing the materials and colors can be a fun and exciting experience for anyone to engage in.

When a new buyer walks into a resale home, they may see many areas for improvement. Things like the paint may be of older dated colors, the floor may be old and dated as well. The kitchen and bathroom areas may also feature older cabinets and color choices, leaving a new owner with expensive bills to get it into shape.

A new house also means that things will not need to be replaced as quickly. Newer homes come with new windows, roofs and furnaces. When a resale house is bought, these major things could go and need to be replaced. They are all expensive items that could add to the stress of owning a house and paying a mortgage.

Some people find that looking for homes is challenging. There are many neighborhoods, models to choose from and interior decorations. However, a new builder will actually let the new owner pick out what they want in their home. That can make the search a one stop shop for success.

Moving into a new residence, can give people peace of mind. They don’t have to worry about the expensive of unexpected repairs, and they also do not need to think about paying thousands to upgrade certain aspects of the house. They can just move in and enjoy living there.

Finding out about buying new homes – advantages for homeowners, will give a person the right information that they need. Before a person begins their home search, they may want to decide if they want a used home or one that has not yet been built yet.

Are you looking for Tillsonburg homes?. We are the leader in premier living environments and we aspire to provide the best home for you and your family.

Tips For Hiring A Land Surveyor SC

Adele Bolton — Mon, 18 Oct 2010 17:39:54 +0000

There are many things that you should remember when you need to hire a land surveyor SC. One of the things that you should take into consideration is cost but this should not be the main deciding factor. You will want to make sure that you are hiring someone who is a well trained professional.

Land surveyors take information and measurements in order to be able to create maps that are accurate. There are a lot of things that have to be done for this to be correct. This type of science is specific and something that has to be done correctly.

You must make sure that you hire someone who is legitimate and there are some tips to help make sure that this happens. One of these to check out the licensure before you hire someone. The maps and information gained will not be considered valid if the surveyor is not licensed.

Another thing that can really protect you when hiring a surveyor is the insurance that they carry. If the property and maps are not covered by the insurance in the right way then you are going to be in trouble because you will be responsible if something is wrong. So this is one of the most important issues asides from licensing standards.

Experience is something else that can help you to know that you are choosing the right surveyor. You will find that you can easily ask about past jobs and references can be given to you. Plus you need to make sure that you are hiring the right type of surveyor for your specific job or needs.

This is because different surveyors specialize in different jobs. One of these could be choosing to make maps while others work on construction projects and still more work on making sure that home owners are able to discern their property lines. Basically you could end up with the wrong information if you hire the wrong surveyor.

It is important to choose a surveyor who will do a job well. It is also important that he be as professional as possible. You can easily tell if this is case as you talk to him because professionals will carry themselves in a certain way and will have references for you from former jobs.

These simple tips will help to make sure that the right land surveyor SC for the job is hired. There is going to be a need for a contract. The contract should specify the job, all details, and all information on payment.

Land Surveyor SC

Looking to find the single source of helpful information on Land Surveyor SC?

Mortgage Rates: Informative Tools

Quincy Marks — Fri, 08 Oct 2010 17:28:16 +0000

The factors that affect the growth and amount of mortgage rates are extremely compound, and lead many people to suppositions that are not correct. As someone who does business with mortgage brokers and has through a lot of in-depth investigation on this matter, I am stunned to see the various wild theories affecting mortgage rates. Surprisingly some mortgage brokers create mistaken assumptions too.

Here, I give standard justifications on how mortgage rates are actually dictated, and put down the allegory that they are set straight by the Federal Reserve.

Mortgage rates are supported by one fact: the mortgage backed securities marketplace. This activity is possessed by the banks and the mortgage dealers. These entities arrange their mortgage loans as one and trade it as investments titled mortgage backed securities (MBS). These MBS are eventually sold by investors as bonds, and the fee of these bonds is directly opposite with mortgage rates. That is, the higher the fee of mortgage hardbound securities, the smaller mortgage rates set off.

The amount of dealing in these MBS is the only real reason that manipulates mortgage rates. Similar to any bonds prices, mortgage backed security growth is affected by concerns around the economy, trading, and aspects that investors consider regarding long-term business prospects in the U.S.

This takes us to the primary myth regarding mortgage rates–that they are directed by the Federal Reserve. This is just not factual. The Federal Reserve has a modest effect on mortgage rates that is indirectly and slow. The fed can at times indirectly influence mortgage rates by declaring alteration to interest rates. Changes in interest rates manipulate rates on home loans, interest rates on credit cards, money market industry, and on certificates of deposits. In part, when interest rates are adjusted by feds, investors trade money markets and CDs to exchange cash to bonds and stocks. Mortgage backed securities are a kind of bond too. The extra MBS investors acquire, the higher the value of the bonds goes. As a result mortgage rates get low.

The rules above deal especially to long-term mortgage rates, specified as fixed 30 year mortgage rates. Mortgages of short terms, like 5 year ARMs and also 7 year ARMs, are moved by many factors and do not necessarily grow with the aforesaid rules.

Jeff Deutsch studies and writes about personal finance matters and contributes to NjJumboMortgages.com. To read about New Jersey jumbo mortgage and jumbo mortgage rates NJ please click the preceding links.

Ask Joe Weekly Vlog–What Buyer Incentives Are Still Available?

Joe Martin — Mon, 27 Sep 2010 21:31:51 +0000

Fannie Mae is offering buyers up to 3.5% in closing cost assistance on HomePath properties through December 31, 2010.

This is a great opportunity for owner occupied home buyers and first-time home buyers looking for a great value on a Phoenix area foreclosure home.

http://www.youtube.com/watch?v=Jxs4bGrr0hw

Tell us what you are looking for in a home and sign up for our FREE Fannie Mae Home Hunter Service below.

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How Does Someone Get The Most Cash For My House?

Annabelle Amerman, JR. — Mon, 16 Aug 2010 18:34:06 +0000

Are you planning to sell your home sometime soon? If you are getting ready to put your home on the market, you want to be certain to get as much for your home as possible. Fortunately, there are several simple steps that you can take to make this happen. Here are five ways to sell your home for top dollar.

Tip #1: Condition Improvements

The most important step you can take toward getting top dollar for your home is to make certain it is in great shape. This doesn’t mean you need to conduct major reconstruction. Rather, you should take simple steps to make your home more presentable, such as painting the exterior and its trim, planting colorful flowers, trimming trees and shrubs, painting the front door, painting the garage door and making certain the front yard is properly trimmed.

Tip #2: Get Proper Exposure

Let’s face it – no one is ever going to buy your property if they don’t know it is on the market. To that same end, you will not be able to enjoy top dollar for your home unless you reach the right potential buyers. The simple truth is that, the more people who see your home, the greater the chances will be of getting the price you are after. Therefore, it is important to develop a solid marketing plan that includes ample local and national advertising.

Tip #3: Pick the Right Time to Sell

Of course it’s best to wait for a seller’s market. But, that’s not likely these days. Still, you can maximize your profits by selling at the most active time of the year. That’s always in the spring and summer months as well as early in the fall. You’ll want to stay informed about mortgage interest rates and terms in order to be on the market when conditions are best for your potential buyers. Just a small drop in rates can increase the number of buyers in your price range significantly.

Tip #4: Don’t Stay on the Market Too Long

If your home has been on the market for longer than expected, you should take it off and try again later if you have the time to do so. When a home stays on the market for longer than a reasonable period of time, it is said to have “staled” and a staled home generally sells for much less than one that has not staled.

Tip #5: Choose a Reasonable Price

Don’t price the home too high. The home price is determined by what a well-informed qualified buyer will pay for your home – not what you think it’s worth. Be sober, calculating and realistic. Pricing too high is harmless enough in a rising market. But, in a declining market it is foolhardy. Your pricing goal is to get the maximum total views online and live tours in the initial weeks on the market. Too high a price will spell death to that goal. Want proof? Check local listings for all the homes that have lowered list price or dropped off the market unsold in the last 90 days.

That’s it! Five Easy Steps to help you get the most for your home. Good Luck!

About the Author: John Allen represents buyers and sellers of fine Sarasota real estate, including condos. Also, special thanks to Yorba Linda Homes for Sale.