Real Estate News & More

Get prequalified, or get preapproved?

If you’re considering the purchase of a new home, you may be concerned with the issue of finance. Attaining the right mortgage is a key step in the home bhands for testimonial (Small)uying process, but it doesn’t have to be a stress-inducing one. Most lenders offer prequalification, pre-approval or both to help you know where you stand. Let me explain the difference between prequalification and preapproval:

Prequalification: Prequalification is a preliminary estimate of how much you can afford to pay for a home based on information you provide. Because credit and employment information aren’t validated for prequalification, it can only be considered a rough idea of a monthly mortgage payment and loan size. This can be a useful guide as you begin the home buying process, however.

Preapproval: Preapproval is a written commitment from a lender to finance your home purchase up to a set amount. This indicates that the lender has taken a close look into your financial history and has agreed to lend you a specific amount of money, reliant on certain details like a finalized sales contract and professional inspection. Pre-approval indicates to sellers that you are a serious homebuyer.

I recommend you take both steps and you’ll be able to shop with much more confidence. Why wait until you find the perfect home to discover problems with obtaining a mortgage?

America’s 132 Million Homes

1948 New Home

1948 New Home

What is the median age of a home built in the America? Good question… would you believe it is 40! In 1974, when those houses were built, the interest rate on a 30-year fixed mortgage was 9.1%; the median existing home price was $32,000; President Gerald Ford announced a $300 million mortgage credit initiative to help alleviate the housing market recession; and the energy crisis had spurred the incorporation of energy-efficient features in new construction.

What does the U.S. housing stock by age look like?

  • 14% or 18 million homes were built from 1980 to 1999 (0-14 years old).
  • 55% or 40 million homes were built from 1960 to 1979 (15-54 years old)
  • 31% of homes are 55-95+ years old. We can break that down further to: 21 million (16%) were built from 1940 to 1950 (55-74 years old); 11 million (8%) were built from 1920 to 1939 (75-94 years old) and 9 million (7%) were built in 1919 or earlier.

 

Source: U.S. Census Bureau’s 2011 Housing Profile, published July 2013.

Short Sale/Deed in Lieu of Foreclosure Waiting Period Changes Effective August 16, 2014

Fannie Mae has recently announced the waiting period requirements for borrowers who have has a previous deed-in-lieu of foreclosure or pre-foreclosure sale are being updated to now require a four-year waiting period; through a two-year waiting period will be permitted if the event was due to extenuating circumstances. The loan-to-value restrictions previously tied to different waiting period time-frames are also being removed.

This is good news for those conventional mortgage loan borrowers who do not have the 20% down payment and only have the 10% down payment on a home purchase. You no longer need a 10% down payment to qualify for a conventional mortgage load after the 4 year waiting period requirement. Fannie Mae will allow a home buyer to only put a 5% down payment on a home purchase to qualify for a conventional mortgage load 4 years after a short sale or deed in lieu of foreclosure.

Short Sale/Deed in Lieu of Foreclosure

(Changes for applications taken on August 16, 2014 or later)

 Waiting Periods Under the Old Guideline                                                                                                                         (On or before 8/15/2014)

  • 7 years if the borrower puts <10% down (Recovery period must have elapsed prior to the date of the application.)
  • 4 years of the borrower outs 10% down (Recovery period must have elapsed prior to the date of application.)
  • 2 years if the borrower puts 20% down (Recovery period must have elapsed prior to the date of application.)

Waiting Periods Under the New Guideline                                                                                                                         (On or after 8/16/2014)

  • 4 years from the date the deed to the property was transferred back to the servicer. No LTV/CLTV limitations.

Green – not just for Kermit anymore!

GREENDid you know that nearly 40% of home buyers consider energy-efficient features to be “very important”? A 2012 study also found that green certified homes – with labels such as Energy Star or GreenPoint Rated – sold for up to 9% more than homes without a green label. *

Green building, also known as high-performance building or sustainable construction, has been practiced by builders and remodelers for centuries but the modern era of sustainable construction started in the 1970’s as oil prices rose and the need for energy efficiency increased.

New high-performance homes are designed and built to incorporate environmental considerations and resource efficiency to minimize the home’s environmental impact. Green building is in response to a variety of issues that affect all of us — like increasing energy prices, water resources and changing weather patterns.

Choosing green means making intentional decisions about:

Energy-efficiency improvements such as a high-performance building envelope, efficient HVAC systems, high-performance windows and energy-efficient appliances and lighting

Water conservation measures such as water-efficient appliances and fixtures, filtration systems and drought-resistant or low-maintenance landscaping

Resource conservation using materials and techniques such as engineered wood and wood alternatives, recycled building materials, sustainably harvested lumber and more durable products

Indoor environmental quality such as effective HVAC equipment, formaldehyde-free finishes, low-allergen materials, and products with minimum off-gassing or low volatile organic compounds (VOCs)

Not in the market for a new green certified home? Here are some quick tips to make your home more eco-friendly.

Turn off the lights when not needed, even as you go from room to room in the course of your day (or evening). According to ENERGY STAR, as much as 20 percent of a home’s energy use comes from light bulbs. Using a compact fluorescent light bulb (CFL) requires about 75 percent less energy than incandescent, but lights that are turned off save the most energy of all.

Wash clothes in cold water. According to the US Department of Energy, a washing machine uses up to 90 percent of its energy to simply heat the water in a laundry load, and the higher the temperature, the greater the cost to you and the environment. Not only will cold water will save energy but it will make your clothes last longer.

Clean the lint filter in your gas or electric clothes dryer. Tests have shown that keeping the lint trap clean may provide savings of up to $34 in energy costs each year (ENERGY STAR).

Give up cleaning products for plain old hot water and white vinegar – the ultimate green living product. If you need something more powerful, most stores now carry lines of easily identifiable environmentally friendly cleaning products that are less toxic and come in recyclable packaging.

Ready to remodel or update your home? Three things to think about…

Ask for ‘reclaimed wood’ in new flooring or furniture. Reclaimed and recycled wood from salvaged timbers found in old barns, homes, bridges and even sunk at the bottom of our creeks and rivers can also be used to reduce chemically treated wood for floors, furniture and construction supports.

Use low VOC paint available at all major paint suppliers.   Why use low VOC paint? Typical household paint contains up to 10,000 chemicals, of which 300 are known toxins and 150 have been linked to cancer**. Some of the most harmful chemicals found in paint are volatile organic compounds, or VOCs. These chemicals aren’t something you want to spray on your body or potentially even keep inside your house.

Buy products that have the ENERGY STAR label. Products earn these labels by meeting the energy efficiency requirements set forth by ENERGY STAR product specifications established by the EPA. These products include: building products, electronics, office equipment, appliances, lighting and fans, heating and cooling, water heaters and other products such as pool pumps.

* Builtgreen.org

** www.appropedia.org/Natural_paint_basics