4 MOST IMPORTANT THINGS TO KNOW BEFORE LOCKING A MORTGAGE

4 Most Important Things to Know Before Locking a Mortgage

In today’s difficult lending environment it is advisable to do your due diligence before locking a mortgage rate and a loan offer. These are the four most common unknown facts that could delay, in some cases even deny, your loan. This information can save you and everyone involved on this transaction a great deal of headaches and last minute issues. All of this could be easily avoidable if you are a well informed borrower.

1) The Rate Lock applies to the Property, NOT to the borrower.

Before asking your Professional Loan Officer to lock a rate offer, make sure that you are absolutely certain that this is the property that you would like to buy. If for any reason you change your mind on that property and you choose to buy another one, the lock will have to expire and you will have to start a new process from the beginning with that new house. Most of the same borrower documentation can be used, but it will have to be a brand new approval and rate lock.

2) Make sure to do a full inspection on the property before locking that loan.

Once you lock a loan, the clock starts ticking. In today's extremely difficult lending environment where thousands of people are buying and refinancing simultaneously, most lenders are overwhelmed due to stringent guidelines and high volume, there is no time to waste in order to close on time. Most properties will have some issues that need to be renegotiated after the home inspection (even brand new homes). Negotiations after the inspection can take time; make sure that you are fully satisfied with the property that you are purchasing after the original inspection. On a side note, home inspections and appraisal are two different things. Appraisals are required by all lenders and they are mainly designed to determine the value of the property. Home Inspections are NOT required by mortgage lenders; however, it is highly advisable to do an inspection for your own peace of mind and to ensure that the property is in good condition.

3) Provide all of your income and assets documentation to your Loan Officer in advance.

A high credit score and money in the bank are not enough to qualify for a mortgage anymore. A face to face meeting with your Professional Loan Officer and providing all your documentation up front is the best way to ensure a smooth process and fast approval. A good Mortgage Professional should revise in advance your complete loan application, full credit report, last two years of tax returns (every page), latest two months of bank statement (every page) and any large deposits or transfers should be well documented. These are just the basics, every single person has a unique situation and it should be addressed from the start to have an action plan. If you are self employed, your documentation should be even more detailed.

4) If you are buying a townhome, due your upfront diligence to confirm it is not a condo.

Townhomes are very popular these days. Townhomes and condos can very similar and it is, in many instances, difficult to tell them apart. Here is the big issue with this scenario: As far as the lending industry is concerned, townhomes are treated the same as a primary residence. A simple questionnaire filled out by the Home Owners Association and their master policy insurance may be sufficient to get the property approved. Condominiums are a completely different story, for starters, mortgage rates for condos are higher with all banks, lending guidelines are more stringent, most lenders have their own internal list of “approved condo projects” and those lists are not very big. If the condo project is not on that“approved list”, it is very time consuming to get them approved through the internal condo approval department of each bank, an average of a three week process. If you have a 30 day lock, you will easily run out of time. The only way to ensure the type of property is to speak up front with the HOA and title company to make sure they both agree on that description, ask your Professional Realtor to get that description in writing.

Reshared by Michelle Cannon
Cannon Realty & Associates

THE STATE WITH THE HIGHEST HOUSING AFFORDABILITY IS TEXAS!

The state with the highest housing affordability is … Texas!

Record-low interest rates and low median home prices have made Texas the state with the most affordable homes, according to the Real Estate Center at Texas A&M University. Fort Worth is the state’s most affordable major metro, while Austin has the highest median home price.

“The home purchasing power of a dollar in income increases dramatically as interest rates fall,” says Jim Gaines, research economist with the Real Estate Center. “With an 80% loan at 10% interest, $1 of income buys about $3 of housing. At 7%, it buys $4 of housing. At 4%, it buys nearly $5.50.”

But the gap between Texas and the rest of the nation is narrowing. The national median home price fell 25% from 2006-2011, while the median price in Texas increased 4%. Gaines says that Texas affordability may soon decrease as home prices begin to rise faster than incomes in some areas of the state.

Reshared by Michelle Cannon
Cannon Realty & Associates

HOW TO CLEAN AND REPAIR GUTTERS

How to Clean and Repair Gutters

Cleaning roof gutters is a small task that can prevent big problems. Every spring and fall, thoroughly cleaning your home’s gutters will keep them working like they should. Leaves can build up and clog the downspouts, which can cause water damage to your roof and fascia (board behind the gutter). All that water pouring over the gutters can end up next to your home’s foundation, and maybe in the basement or crawlspace. Follow these simple steps for cleaning your home’s gutters and making simple gutter repairs.

Select an appropriate ladder to clean gutters. Use a step ladder if possible. For a two-story home, you may need an extension ladder. For all ladders, make sure the legs are set on a solid and level surface.

Removing Debris
Begin cleaning the gutter near a downspout. Remove the large debris (leaves, twigs, etc.) with a trowel and dump it in a bucket. To clean out finer materials, flush the gutter lengths with a hose starting at the end opposite the downspout. Alternatively, you can use a gutter-cleaning attachment on a hose. If the water doesn’t drain, recheck the downspout strainer, and clean as necessary. If gutter water still doesn’t drain, the downspout may be clogged.

Check the drain end. If the downspout runs underground, remove it from the pipe as needed. Install a small nozzle on the hose and lock it at full pressure. Turn on the water and feed the hose up from the bottom of the spout. If this doesn’t clear the downspout or the nozzle is too big, use a plumber’s snake tool to clear the blockage. Reattach the downspout.

Repairing Gutters
After flushing the gutter, if there is still standing water, the gutter may not be sloped correctly and will require adjustment. The length of the system should decline at least ¼” every 10’ toward the downspout. If the gutter doesn’t slope enough, detach the hangers and adjust the gutter enough to drain properly, then reattach. It may be easiest to work on small sections at a time to prevent the entire gutter system from falling. Inspect the gutter for obvious damage and missing parts. Support hangers should be spaced every 2’along the gutter.

Repair any leaks in the gutter. Identify gutter leaks by filling the gutter with water, but make sure the gutters have dried before repairing. To repair leaks at the seams, make sure the gutter lengths are tight against each other, and run a bead of gutter sealant on both sides of all joints. To repair leaks at the end caps, add sealant along the inside of the joint. To repair holes in the gutter material, ask a Lowe’s associate for products designed to repair aluminum or fiberglass gutters.

Apply gutter touch-up paint to cover any blemishes as desired. If necessary, repaint some or all of the gutters in the home’s exterior color.

Reshared by Michelle Cannon
Cannon Realty & Associates

HOME BUYING MISTAKES THAT LEAD TO REGRETS

Home Buying Mistakes that Lead to Regrets

There are home buying mistakes that every buyer should avoid, mainly because of the extent of their impact on the buyer. For first time home buyers, it is even more important to be aware of the common errors committed by home buyers so that their first foray into homeownership will be a memorable one – for all the right reasons.

The good news is that it is quite easy to avoid these mistakes, as long as the buyer remains open-minded and willing to listen. To be a happier home shopper and, eventually, a content homeowner, here are some things you should never do.

1. Favoring looks over function. As a first time home buyer, it is to be expected that you will have a picture in your mind of what your house should look like. It is fine, as long as you can afford it. However, even if you have the money to go for a more expensive house, do not base your decision solely on aesthetics. The house may be affordable to you and looks exactly like your dream home, but if it is located in the wrong area, you will end up losing in the end. If the features of the house that add to its cost are useless to you, opt for a lower-priced dwelling without the pointless add-ons.

2. Choosing the wrong real estate agent. The agent who smiles all the time and agrees with everything you say is not exactly the ideal person to provide you with a sound advice. Interview agents and base your decision on how extensive their knowledge of the market is. Conduct a background research and look at their past deals and past clients. You are hiring them to give you good advice and if they think your idea is not good, they should be able to tell you.

3. Spending all your money on the house. You do not need to unload all your money, including your savings, into your home. Leave some for emergencies and do not touch your retirement savings. Buy the house and if you still have money left, take care of the improvements and upgrades you want. But if you need to touch your retirement money or borrow from others to upgrade the home to make it look like your dream house, forget it. Save for the upgrades and work on them later.

4. Doing without professional advice and services. You should not spend all your money on the house, but you should also not be stingy when it comes to spending money on things that matter. For example, a professional house inspector. For another, a real estate lawyer. They may cost you money, but you need them, especially if it is your first time to buy a house. You are not saving money by not paying their fees, you are actually setting yourself up for a potential major loss if you do not hire them. Home buying is all about knowing which expenses you should prioritize and which ones you can do without.

Reshared by Michelle Cannon
Cannon Realty & Associates

FIVE ESSENTIAL TOOLS FOR FIRST TIME HOMEBUYERS

Five Essential Tools for First Time Homebuyers

Buying a home for the first time will likely be one of the most exciting endeavours you’ll experience in your adult life. After years of working hard and building your savings account, it’s finally time to invest in a home or condo you can call your own.

But despite the range of emotions you’ll feel before taking that first leap into home ownership, there’s little doubt you’ll come to realize the home buying process can often be a bit overwhelming and, at times, quite stressful. So after a long and extensive home search, it’s finally time to make the ultimate decision on moving forward with such a large investment. What’s next, you ask?

Well before signing on the dotted line, it’s important to realize what resources are available to first time homebuyers and how taking advantage of each enables you to make the best possible decision moving forward. Below is a quick reference guide on the five essential tools for first time homebuyers that will help make potential homeowners aware of what information is available and how you can use it to your advantage when purchasing your first home:

1) Home Buyer Grants/Down Payment Assistance -Given the challenges facing today’s housing market, financing for a home or condo has become increasingly harder to acquire. In fact, according to recent mortgage data, the average down payment for a home has jumped to 34% of the purchase price; and as a first-time homebuyer, having this sort of cash supply is relatively unlikely, especially in larger markets. Making yourself aware of the various home buyer grants and first time home buying credits available in each individual state can sometimes mean the difference between getting a loan and having to find alternative financing. To learn more about what each state offers, visit http://www.hud.gov/buying/localbuying.cfm

2) Professional Realtors - Guiding people through the home buying process is a real estate agent’s job. Don’t just rely on a simple Google search when shopping for properties on the real estate market. Not only do local real estate agents know the market better than you, but they’re also required to know laws and regulations relating to home ownership in your area. If you have questions regarding a certain property or finding a property that fits your needs, working with a Realtor will help get you the answers you need much faster than doing the research on your own!

3) Mortgage101 - If you’re a first-time homebuyer, there’s a good chance you’re not familiar with the various types of mortgage loans available to consumers. While tons of websites out there help explain the ins and outs of mortgage loans, Mortagage101.com provides all the information you need ranging from current mortgage rates to an extensive mortgage lender directory in your desired location.

4) GreatSchools.org - If living in a particular school district or ensuring you choose a home in an area with top-rated schools is main priority when buying your first home, researching all the local schools is likely on your list of things to-do. GreatSchools.org is a phenomenal web tool that gives users school rankings based on standardized test scores, a map of the area, and contact information to every school in the area of your search. So whatever the questions or concerns you have about a particular school, many times the answer you need can easily be found on GreatSchools.org.

5) Free Credit Report Sites - Obviously your credit score will dictate how you obtain financing for your new home. If you’re like many young people considering home ownership for the first time, knowing your current credit score may not be a given. And while some of the free credit report websites may not produce as detailed a report as you’ll need to secure a loan, some of these sites do allow consumers to get a general idea of where they are in terms of basic qualifications. FreeCreditReport.com and FreeScore.comare two of the most used credit report sites in the nation and are extremely user-friendly.

Reshared by Michelle Cannon
Cannon Realty & Associates

INSPECTIONS

Don’t Forget a Home Inspection with a New Construction Home

Every home—whether it’s a resale or new—has some kind of an issue, and the reality is that there is no “perfect” house. Many homebuyers embark on their search for a home with the belief that new homes should be flawless, when this is never actually the case.

Problems are found in all homes, but the issues with new homes are totally different than the defects found in resale homes. When evaluating a resale home, most problems are often related to older systems that are near the end of their service life. On the other hand, problems in new homes typically involve incomplete work, damaged systems, missing pieces of key materials and imperfect workmanship.

Unfortunately, many people who purchase new construction homes put a lot of trust in their builder and opt not to perform a home inspection. REALTORS® can help their clients take a proactive approach to identifying underlying problems in new homes by recommending a reliable home inspection company that goes beyond the basics to provide thorough home inspections that catch even the smallest of problems. Hiring a home inspection company prior to the closing of a new home can help save homebuyers money and prevent headaches due to unexpected home repairs down the road.

New home construction problems primarily fall into four categories:

1. Incomplete work: Many new home construction projects aren’t completed properly. The incomplete work may be as simple as a layer of paint on a wall that was accidentally skipped, or a room that has no air ducting. In many cases, the unfinished or imperfect work isn’t detected until the homebuyer moves in. A home inspection company will uncover these issues prior to the move-in date.

2. Damaged systems and finishes: Homes often incur damage during construction as a result of rain impact damage and stacking and storage damage. An example of this is ducting that gets compacted under attic insulation.

3. Missing elements: Oversights during construction due to human error are more common than many REALTORS® and homebuyers think. For example, the construction team may have forgotten to install insulation in the attic. Taking a proactive approach to identify issues before moving in can prevent costly problems that could arise in the future.

4. Imperfect or sloppy workmanship: While perfect workmanship is ideal, it’s nearly impossible. In reality, any number of things can go wrong on the construction site of a new home. A contractor could get delayed by work on another site and has to hurry to finish the current home he’s working on; rain and other elements can damage a home before it’s closed in; tradesmen could be diverted to another site, etc.

Other common problems with new homes include interior and exterior finish issues, tile and floor damage, water damage, buckled siding, roofing issues and structural problems. All new homes should be inspected to uncover possible defects. Knowing upfront what issues might arise in the future can save homebuyers thousands of dollars in the long term. The most reliable way to uncover problems is by hiring an unbiased third-party home inspector.

Reshared by Michelle Cannon
Cannon Realty & Associates

TOP 5 WAYS TO MAKE EVERY DAY EARTH DAY

Top 5 Ways to Make Every Day Earth Day

We always hear a lot about Earth Day approaching, but what about now that it’s past? Did you commit to any new ways to lower your impact on the planet? While taking a day or even a month to celebrate our planet is a noble cause, it’s something we really should be doing every day of the year. Taking a few green steps doesn’t have to be difficult or costly. In fact, when you Do Your Part for the planet, you’ll also find that you’re lowering the pressure on your pocketbook.

1) Be Energy Efficient
Spring for an energy audit of your home. I was shocked at what I discovered when one was done at my home. Energy audits identify if your cooling and heating systems are working properly, if you have proper insulation, and what you can do to conserve energy and money immediately.

2) Waste Less Water
There are simple ways to start conserving water at home without suffering. Turning off the water while you brush your teeth is the simplest place to start. Then, make bigger steps such as installing low flow fixtures or water displacement devices for your toilet. Outside, a rain barrel will make it inexpensive and easy to water your garden. If you rely on a sprinkler system, use it only when necessary. A long dose of water once a week is much better than several days of short watering.

3) Cut Back on Chemical Exposure
There are so many sources of potentially dangerous chemicals that we bring into our homes — many times without even realizing. It could be from everyday household cleaners to dry cleaned clothes. Chemicals sneak into our homes every day and can contribute to all sorts of health problems. Visit DoYourPart.com/Columns to learn about these toxins and easy ways to reduce your exposure.

4) Be an Educated Buyer
When you choose to buy more earth-friendly items, you are sending a powerful message to manufacturers and retailers. There are important questions you should ask yourself before buying anything. Where does this product come from? What does it take to manufacture this product? Is it really safe? And, can it be recycled?

5) Reduce, Reuse, Recycle
This is at the heart of what it takes to be a bit greener each day. There’s no question why “Reduce” is first. When we reduce everything from the amount of energy we use at home to all the “stuff” we think we can’t live without, it helps conserves our planet’s resources. Then there’s reusing. Reusing doesn’t just mean getting more use out of a glass jar that once held foods. It means installing that rain barrel to help water your yard, buying gently worn children’s clothes instead of brand new, and even composting scraps of food. Finally, there’s recycling. I find that once I created easy-to-use recycling systems at home — everyone got on board.

There’s a lot we can—and should be—doing for our environment. When you Do Your Part and I do mine, together we’ll protect our planet for generations to come. So celebrate the Earth by doing your part every day.

Reshared by Michelle Cannon
Cannon Realty & Associates