Best Things To Do Now To Get Your Finances Mortgage Ready

Posted in Mortgage by Michigan Real Estate Expert on October 11th, 2018

Best Things To Do Now To Get Your Finances Mortgage ReadyYou probably already know that qualifying for a mortgage can be the biggest hurdle — aside from actually finding that dream property — along the path to home ownership.

Rather than agonizing about it, however, there are some positive actions you can take in advance to help you realize your dream.

Take A Close Look At Your Budget

If you don’t currently operate with a comprehensive household budget, get started now to analyze your income and monitor your spending habits. There’s no better way to prepare for home ownership than by being realistic about how you spend your money. If you don’t have a regular savings program, or if you’re constantly short on cash prior to the next payday, take steps to remedy the problem. Plan for the future by getting the present in check.

Gather Employment And Earnings Records

Mortgage lenders want to see stability and commitment. Finding and organize your employment records to show a consistent earnings pattern and, hopefully, a record of growth, both in terms of income and responsibility. Simplify the task of gathering required documents by collecting all records in a binder or notebook that can easily be copies when it’s time to submit them to a lender. It’s a confidence-building step as well.

Organize Your Banking Records

Lenders will not only want to see employment records, but they will require copies of all bank and investment accounts as well. Again, by being organized and getting a handle on your dollar inflow and outflow, you’ll gain insights into your individual spending habits and make the job easier for a mortgage specialist.

Make Copies Of Your Tax Returns

Tax returns confirm and validate all the other financial information that you will be required to supply. Typically, returns for the past two or three years will be required. If you own a small business or have income in addition to that from paid employment, make copies of those records as well.

Put A Halt To Spending

Perhaps the best way to demonstrate your serious intent to purchase — and pay for — a new home is by curtailing your spending on impulse purchases and expensive entertainment. This is not the time to buy a new car, book an exotic vacation, purchase major electronics or even home furnishings, or commit to time payments of any sort. Frugality should become your mantra in the months leading up to loan qualification.

Monitor Your Credit Cards

If your credit rating is within acceptable limits, do what you can to make all payments on time, pay down balances, minimize new purchases and demonstrate your continuing ability to “live within your means.” Do not apply for new credit cards, no matter how tempting the offers, because increased account activity can adversely affect your FICO score. In addition, if you have a blip on your credit report, do what you can to repair it prior to making a mortgage loan application, or be prepared to explain the circumstances, in detail and in writing.

Applying for a loan need not be scary. Understanding the financial reality is a great benefit.

Securing your financing is an important part of the home buying experience. Your trusted real estate agent is ready to help you every step of the way.

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Mistakes Seasoned Home Buyers Often Make

Posted in Real Estate by Michigan Real Estate Expert on September 28th, 2018

Mistakes Seasoned Home Buyers Often MakeIt’s not uncommon today to move several times during adulthood, whether across town or across the country. Seasoned home buyers have been through the real estate process, often more than once. However, even if the home purchase has become routine, there are mistakes that can be avoided.

Stuck In The Past

The real estate market doesn’t stand still. It cycles and shifts, which is why it’s often recommended to rely on a real estate professional for an understanding of the current market. Home buyers with property purchased ten years ago, likely won’t have the same experience buying today. Don’t get stuck in the past, thinking the process will play out the same. It may, but it’s important to be ready for changes.

Skipping Homework

Whether upgrading to a larger home to accommodate a growing family or downsizing as the nest empties, it’s essential to do the homework before placing the current home on the market and committing to a new one. Certain homework needs to be done before beginning the buying process, especially if the purchase is reliant on the sale of the current home.

  • Determine if buying with cash or need to sell current home.
  • If need to sell current home first, will seller of new home offer contingency?
  • Is a flexible timeline needed for closing on current home/buying new?

Working out these types of critical details, even for seasoned home buyers, can be daunting, which is why it can be helpful to have a trusted real estate agent.

Allowing Emotions To Lead

Maybe the current house wasn’t the “forever” home. Seasoned home buyers, just like first-timers, can find themselves lost in emotions when searching for the perfect house. It’s a pitfall every home buyer should work to avoid. The home may have some of the exact features desired or be in the ideal location, but if it doesn’t fit the budget or has other issues, it’s not the right one.

Overextending Resources

Home buying is an exciting experience and it can be easy to become caught up in the process. However, overextending resources can make life after the purchase difficult. To help protect against overextension of resources later, always factor in the following when buying a home:

  • Budget
  • Time
  • DIY Abilities

Overextending on budget can directly affect the ability to make any needed repairs and if schedules are hectic, there might not be enough time for projects. In addition, it’s important to honestly take stock of DIY ability, and it’s okay to acknowledge that some jobs/repairs will require professionals or some level of assistance. 

The key for seasoned home buyers, as well as first-timers, is to never be afraid to ask questions, make lists, and rely on professional help from your trusted real estate professional.  

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Clever Tips for Paying Off Your Home Mortgage Faster

Posted in Personal Finance by Michigan Real Estate Expert on February 12th, 2013

Pay Off Mortgage Faster

Paying off the mortgage on your Bloomfield Hills home faster not only means that you’ll be able to enjoy the peace of mind that comes with completely owning your property earlier, but you may also save thousands of dollars in interest payments.

Below are seven clever tips to help you get your mortgage payments on the fast track.

1. Save for a large down payment

Pay as large a down payment as you can reasonably afford. The more you can put down, then the less you’ll have to borrow from the bank.

2. Read the fine print

When you are choosing a mortgage, look at the fine print to find out if any restrictions apply to paying early. Some lenders will charge you for making extra or early payments. 

3. Prepay early in the life of the mortgage

This is when the loan is the most interest-heavy. In the first five to seven years you are likely paying mostly interest. Request an amortization schedule of your mortgage to get a clear picture of how this works.

4. Be smart with unforeseen fortune

If you get an unexpected chunk of cash, such as a gift, prize, work bonus, inheritance, tax refund or other windfall, consider applying it straight to paying down the principal on your mortgage.

5. Double-check your records

When you make extra payments, ensure that they are processed correctly. Sometimes when the lender receives a payment that is outside of the monthly cycle, they may not know what to do with it. Make a special note and keep track of the payments yourself, so you can make sure they’ve been applied to your principal.

6. Increase your payment

Even increasing your payment by a small amount every month may take years off the length of your mortgage. Consider how much you can afford to pay every month rather than just the minimum payment amount.

7. Think about a bi-weekly payment

You might want to switch to an accelerated bi-weekly mortgage payment rather than a monthly payment. This typically applies an extra payment each year.

These are just a few techniques you can use to pay off your mortgage faster.

Remember, the quicker you pay off your mortgage, the less interest you will be paying.

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