How to Buy a Home in Denver, Colorado

As one of the top five fastest-growing cities in the US, Denver is quickly becoming the place to be. The vibrant city life, the outdoor culture, and the growing economy are attracting numerous people looking to become Denver homeowners.

If you, like many others, have noticed how much this Colorado city has to offer, you might be wondering how home-buying works in Denver. We’ve got you covered. Here’s what every Denverite or potential Denverite needs to know about becoming a homeowner.

Start With a Budget

Before the hunt for your dream home can begin, you’ll need to determine how much you can afford. Get in touch with a lender to talk this through. Your lender will help you determine how much of a down payment you’ll need, as well as what kind of monthly payment you can expect.

Once you speak with a lender, you’ll know what kind of loan you qualify for, and you can narrow down your search to homes within your budget. Now you’re ready to really get serious about finding your future home.

When looking for a lender, many people start with their bank. Your bank isn’t a bad place to start, but don’t forget to shop around for the best rate. If you don’t check out all the options, you might miss out on deals from companies like Homie Loans. Homie Loans guarantees they can get you the best rate possible. In fact, if you find any lender with a better rate, they’ll give you $500 cash*.

Find the Right Agent

Most people work with an agent while buying a home, but not everyone knows how essential it is to find the right agent to work with. The right agent will be experienced and knowledgeable about the highly competitive Denver market.

Your agent should also understand your goals and interests as a prospective buyer. They’ll use their knowledge of your goals with their knowledge of different neighborhood vibes to help you find the perfect fit for you. If easy access to the mountains is one of your priorities, your agent will tell you which cities to look at. If downtown living is your thing, your agent can help you find a good deal in a vibrant, Denver neighborhood.

When you have an expert agent on your side throughout the whole home buying experience, you’ll never have to stress about missing out on important information or getting the bad end of a deal. There are a lot of pieces to the puzzle when it comes to real estate, but agents are there to make each step along the way easy on you. That’s why the sooner you bring an agent in to help, the better.

Check Out the Options

Now it’s time to start looking at homes. For many people, this is the fun part of buying a home. Your agent will help you find homes in the areas you’re interested in. It can be a lot of fun to visit potential neighborhoods and imagine yourself as a resident. If a home really catches your eye, don’t be afraid to visit more than once. You want to be sure that it’s the right one for you.

Be sure to be thorough when checking out your options. You don’t need to settle for something you’re not happy with. If you’re not looking for the extra work that comes with a fixer-upper, don’t skip the home inspection. Some homes have issues that you wouldn’t have noticed without an inspection. You want to find a home that’s in great condition.

When you’ve found the perfect home, your agent will help you determine if it’s listed at a fair price. A home could check every box on your wishlist, but if the price isn’t right, it may not be the right one for you. One of your agent’s main jobs is to help you negotiate to get a price that works for you. On the other hand, if the price is where you’d like it, your agent will help jump on that home faster than any of the other potential buyers.

Streamline the Process With Homie

Whether you’re a home-buying veteran or this is your first rodeo, Homie will make your experience the best it can be. Searching for your dream home is a breeze when you have our easy-to-use app.

When you work with Homie, you don’t only get access to the app, though. You’ll also have your very own, top-ranked licensed agent who will help you every step of the way. Our buyers’ agents are dedicated only to their buyers, so you’ll get the best quality service throughout the process.

To get access to amazing homebuying tools and some of the best agents in the state, you might think you’d have to pay top double, but not with Homie. We want to make homeownership accessible to everyone, which is why working with Homie is more affordable than working with any traditional realtor. We offer buyers a refund of up to $2,500 at closing. With those savings and those benefits, buying with Homie is a no-brainer. Click here to start the process.

*Subject to terms and conditions.

Get more tips on buying your Denver home!

5 Tips to Help You Afford Your First Home
Common Home Buying Fears and How To Overcome Them
Can You Buy and Sell a Home at the Same Time?

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The post How to Buy a Home in Denver, Colorado appeared first on Homie Blog.

Source: homie.com

What This Military Family Faced—and Fought—To Buy Its First House

first time home buyerNatalie Johnson

First-time home buyers today face a tough road, shopping for homes during a pandemic, high housing prices, and deep economic uncertainty. For military families deployed overseas, it’s all even trickier to figure out.

In this second story in our new series “First-Time Home Buyer Confessions,” we talked with husband and wife Kyle LaVallee and Natalie Johnson. They were renting an apartment in Fayetteville, NC, when they decided to start shopping for their own home in the area in April.

At the time, LaVallee was stationed in the Middle East as a sergeant in the U.S. Army. Yet even though he was thousands of miles away, he managed to attend every home tour with Johnson via FaceTime. In July, they closed on a brick, ranch-style three-bedroom that LaVallee would not see in person until a long-awaited trip home in October.

Here’s the couple’s home-buying story, the hardest challenges they faced, and what LaVallee thought of his new house once he home managed to lay eyes on it for the first time.

Location: Fayetteville, NC

House specs: 1,166 square feet, 3 bedrooms, 2 bathrooms
List price: $111,900
Price paid: $115,000

A pandemic plus deployment seems like a tough time to buy your first house. What convinced you to forge ahead?

Johnson: Kyle was deployed in October 2019 while we were renting a one-bedroom apartment in Fayetteville. Kyle wasn’t fond of renewing the apartment lease—we had been there for two years and were running out of space. We wanted to get a dog; we wanted a yard, and our own property where we can do anything we wanted.

We started educating ourselves on the process. We knew a mortgage was going to be significantly less than what we were paying in rent. Kyle thought it would be smart to buy because [nearby] Fort Bragg is one of the biggest military bases in the world. If we ever leave or get stationed somewhere else, we’re not going to have a problem finding anyone to rent it. And we could always come back.

Kyle LaVallee and Natalie Johnson at one of their favorite hangouts in Fayetteville, where they’ve decided to put down roots

Natalie Johnson

LaVallee: I was interested in gaining equity and ownership, rather than just paying to rent something I’d never own in the end.

Johnson: We started looking at houses back in January. In April, we kept seeing information about lowering interest rates. That’s why we got serious about the process in the middle of the pandemic, and when we connected with our real estate agent, Justin Kirk with Century 21.

How much did you put down on the house—and how’d you save for it?

Johnson: We put 20% down.

LaVallee: I was making a lot of money while I was deployed, and I had no expenses really. I was just saving everything I had, knowing I wanted to invest it in a house.

Johnson: I cut spending. I didn’t buy things I wanted, just what I needed. The pandemic helped a lot, honestly because we obviously couldn’t go out.

LaVallee: We qualified for a VA loan, but we just wound up using a conventional loan. Most people in the military will use a VA loan where you don’t put any money down, but [since we had enough saved] we wanted the lowest monthly mortgage payments.

first time home buyer
LaVallee and Johnson on LaVallee’s first morning in the new house after coming home from deployment

Natalie Johnson

What were you looking for in a house?

LaVallee: We knew we might [eventually] be moving, so it wasn’t like it had to be a house we would stay in forever, more of an investment property.

Johnson: We were looking for things that would be attractive to future renters. We had a military family in mind because Fayetteville’s got more than 50,000 active-duty. We looked for a location close to a Fort Bragg entrance. We thought three bedrooms was perfect for us because our families are close with each other, so they’ll all come down at the same time so we’ll have two extra bedrooms for them. Kyle really wanted a garage, so that was a huge thing.

LaVallee: Garages aren’t very common down here, so that limited a lot of options for us. A lot of houses have carports, or they finish the garage and turn it into a bonus room.

Johnson: We wanted something that needed a bit of fixing up, because we like to be handy and put our personal touch on everything, and we ultimately knew that would be a lower-cost house.

Johnson and LaVallee’s new kitchen

realtor.com

How many homes did you see in person, and how did Kyle participate from overseas?

Johnson: It was 10 or 12 homes. We were out three to four times a week looking at places with our real estate agent. We wore our masks for the tours, and I used hand sanitizer since I was opening and closing drawers and closets. Most were vacant, but we did tour one house that still had people living in it, although they were gone during the tour, so we avoided touching a lot of things.

During tours we FaceTimed Kyle in. We figured that was probably the most convenient way to do it since he could see every single house and room in detail.

The large living room in Johnson and LaVallee’s new house

realtor.com

LaVallee: Well, I couldn’t really see all the details.

Johnson: He got to know our real estate agent really well via FaceTime. Our agent would say, “Let me know if you need me to hold Kyle while you go look in this room.” I felt so bad, though, because I work full time, so I’d tour homes around 5:30 in the evening, which for Kyle was 2:30 in the morning. But he stayed up for every single tour.

LaVallee: I was sometimes frustrated not being able to be there. I left it all up to her. I had to trust the feelings and vibes she got from each house.

The big backyard where Johnson and LaVallee hope a dog will someday run around

realtor.com

How many offers did you make before you had one accepted?

Johnson: We put three earlier offers in.

LaVallee: They would be listed and the next day would be sold. The first three offers we put in were asking price, and I’m pretty sure everybody else offered more, and ours were never even considered.

Johnson: It was ridiculous. It was definitely a seller’s market, so you had to act really fast and you had to be really competitive. On our fourth offer, we ended up at $3,100 over asking. I felt like we had to fight for this house.

Johnson had to move into the new home without LaVallee’s help.

Natalie Johnson

Were you competing with other offers for the house you bought?

LaVallee: There were multiple offers.

Johnson: Our real estate agent told us, “You should definitely write a letter and talk about how Kyle’s gone right now and you’re first-time home buyers and this one really clicked with you,” which it did. The second I walked in, it’s this adorable brick house, it’s super homey, it has a great yard. In the letter, we just talked about how all of that was so attractive to us as first-time home buyers, and we were really excited and could see ourselves in this home.

Our real estate agent suggested going in higher than asking, so we just rounded up to $115,000. He also suggested doing a higher due diligence payment—we usually did $200, but this time around we did $500. And the earnest fee we put in was $500 or $600.

After our offer was accepted, we knew it was going to be kind of difficult with the home inspection. They were already redoing the roof, which was a huge cost on their part, so asking for more was definitely going to be a challenge. So we didn’t ask for much.

LaVallee and Johnson are happy they stuck it out in a competitive seller’s market and landed this home.

Natalie Johnson

What surprised you about the home-buying process?

Johnson: How fast it went, for me at least. Our first home tour was in April and then by June, we had found our house and the contracts were written up. I guess I was expecting it maybe to be double the time that it actually was, but houses were just turning over so fast, we had to act fast.

LaVallee: From my side, I thought it happened very slowly! I felt like so much was happening in between each step in the process. I had to be patient because I had so little control of the situation, other than just trying to stay involved and be a part of it.

Johnson: You never really think that when you’re married, you’re going to buy your first house while your husband is on the other side of the world. But we got through it.

Johnson and LaVallee (pictured on the right) on the day LaVallee returned from deployment

Natalie Johnson

So Natalie, you were living in the house for a few months before Kyle returned from deployment in October to see it. What was that homecoming like?

Johnson: He came home a few days shy of the 365-day mark. We were anxious and excited. Several other families and I waited outside of a hangar on base, and soon after hearing their plane landing, we saw the group walking toward us and everyone start cheering and crying.

Because it was dark when we got home, Kyle couldn’t see the outside of the house much, or the “Welcome Home” decorations I hung up! But the moment he set foot in the front door, he just stood there and looked around with the biggest smile on his face.

I gave him the grand tour the next morning. He said it looked much bigger than what he saw on FaceTime. We celebrated with a home-cooked meal and the wine our agent gave us when we closed. It was really special.

LaVallee: I came home to a nice house. Natalie was worried I would come back to culture shock. But I’ve felt at home ever since I’ve been here.

Johnson decorated the house for LaVallee’s return from deployment.

Natalie Johnson

first time home buyer
After LaVallee came home, the two finally got to toast their first home with a bottle of wine, courtesy of their real estate agent.

Natalie Johnson

What’s your advice for aspiring first-time home buyers?

Johnson: I would say to go with your gut. Some of the houses you’ll tour are really logical to buy, but if they have a bad vibe or they’re just not really welcoming, then look at others. A healthy balance between logic and feeling is important.

LaVallee: We didn’t even know what we wanted until we saw five or six houses, so it’s definitely important to shop around and see what’s out there.

Johnson: We really didn’t know much. I told our real estate agent, “Hey, listen, we’re really going to need some guidance. We don’t know what things mean, we need you to break it down for us. You have to be patient with us.” I reached out to three different real estate agents, and Justin was the one who not only answered all my questions but was giving a ton of positive feedback. It was nice to have that encouragement, and it definitely made us more confident. You learn a lot by looking at houses, you learn a ton about yourself.

Johnson and LaVallee met in elementary school.

Natalie Johnson

The post What This Military Family Faced—and Fought—To Buy Its First House appeared first on Real Estate News & Insights | realtor.com®.

Source: realtor.com

6 Things Your Mortgage Lender Wants You To Know About Getting a Home Loan During COVID-19

mortgage during coronavirusGetty Images

Getting a mortgage, paying your mortgage, refinancing your mortgage: These are all major undertakings, but during a pandemic, all of it becomes more complicated. Sometimes a lot more complicated.

But make no mistake, home buyers are still taking out and paying down mortgages during the current global health crisis. There have, in fact, been some silver linings amid the economic uncertainty—hello, record-low interest rates—but also plenty of changes to keep up with. Mortgage lending looks much different now than at the start of the year.

Whether you’re applying for a new mortgage, struggling to pay your current mortgage, or curious about refinancing, here’s what mortgage lenders from around the country want you to know.

1. Rates have dropped, but getting a mortgage has gotten more complicated

First, the good news about mortgage interest rates: “Rates have been very low in recent weeks, and have come back down to their absolute lowest levels in a long time,” says Yuri Umanski, senior mortgage consultant at Premia Relocation Mortgage in Troy, MI.

That means this could be a great time to take out a mortgage and lock in a low rate. But getting a mortgage is more difficult during a pandemic.

“Across the industry, underwriting a mortgage has become an even more complex process,” says Steve Kaminski, head of U.S. residential lending at TD Bank. “Many of the third-party partners that lenders rely on—county offices, appraisal firms, and title companies—have closed or taken steps to mitigate their exposure to COVID-19.”

Even if you can file your mortgage application online, Kaminski says many steps in the process traditionally happen in person, like getting notarization, conducting a home appraisal, and signing closing documents.

As social distancing makes these steps more difficult, you might have to settle for a “drive-by appraisal” instead of a thorough, more traditional appraisal inside the home.

“And curbside closings with masks and gloves started to pop up all over the country,” Umanski adds.

2. Be ready to prove (many times) that you can pay a mortgage

If you’ve lost your job or been furloughed, you might not be able to buy your dream house (or any house) right now.

“Whether you are buying a home or refinancing your current mortgage, you must be employed and on the job,” says Tim Ross, CEO of Ross Mortgage Corp. in Troy, MI. “If someone has a loan in process and becomes unemployed, their mortgage closing would have to wait until they have returned to work and received their first paycheck.”

Lenders are also taking extra steps to verify each borrower’s employment status, which means more red tape before you can get a loan.

Normally, lenders run two or three employment verifications before approving a new loan or refinancing, but “I am now seeing employment verification needed seven to 10 times—sometimes even every three days,” says Tiffany Wolf, regional director and senior loan officer at Cabrillo Mortgage in Palm Springs, CA. “Today’s borrowers need to be patient and readily available with additional documents during this difficult and uncharted time in history.”

3. Your credit score might not make the cut anymore

Economic uncertainty means lenders are just as nervous as borrowers, and some lenders are raising their requirements for borrowers’ credit scores.

“Many lenders who were previously able to approve FHA loans with credit scores as low as 580 are now requiring at least a 620 score to qualify,” says Randall Yates, founder and CEO of The Lenders Network.

Even if you aren’t in the market for a new home today, now is a good time to work on improving your credit score if you plan to buy in the future.

“These changes are temporary, but I would expect them to stay in place until the entire country is opened back up and the unemployment numbers drop considerably,” Yates says.

4. Forbearance isn’t forgiveness—you’ll eventually need to pay up

The CARES (Coronavirus Aid, Relief, and Economic Security) Act requires loan servicers to provide forbearance (aka deferment) to homeowners with federally backed mortgages. That means if you’ve lost your job and are struggling to make your mortgage payments, you could go months without owing a payment. But forbearance isn’t a given, and it isn’t always all it’s cracked up to be.

“The CARES Act is not designed to create a freedom from the obligation, and the forbearance is not forgiveness,” Ross says. “Missed payments will have to be made up.”

You’ll still be on the hook for the payments you missed after your forbearance period ends, so if you can afford to keep paying your mortgage now, you should.

To determine if you’re eligible for forbearance, call your loan servicer—don’t just stop making payments.

If your deferment period is ending and you’re still unable to make payments, you can request delaying payments for additional months, says Mark O’ Donovan, CEO of Chase Home Lending at JPMorgan Chase.

After you resume making your payments, you may be able to defer your missed payments to the end of your mortgage, O’Donovan says. Check with your loan servicer to be sure.

5. Don’t be too fast to refinance

Current homeowners might be eager to refinance and score a lower interest rate. It’s not a bad idea, but it’s not the best move for everyone.

“Homeowners should consider how long they expect to reside in their home,” Kaminski says. “They should also account for closing costs such as appraisal and title insurance policy fees, which vary by lender and market.”

If you plan to stay in your house for only the next two years, for example, refinancing might not be worth it—hefty closing costs could offset the savings you would gain from a lower interest rate.

“It’s also important to remember that refinancing is essentially underwriting a brand-new mortgage, so lenders will conduct income verification and may require the similar documentation as the first time around,” Kaminski adds.

6. Now could be a good time to take out a home equity loan

Right now, homeowners can also score low rates on a home equity line of credit, or HELOC, to finance major home improvements like a new roof or addition.

“This may be a great time to take out a home equity line to consolidate debt,” Umanski says. “This process will help reduce the total obligations on a monthly basis and allow for the balance to be refinanced into a much lower rate.”

Just be careful not to overimprove your home at a time when the economy and the housing market are both in flux.

The post 6 Things Your Mortgage Lender Wants You To Know About Getting a Home Loan During COVID-19 appeared first on Real Estate News & Insights | realtor.com®.

Source: realtor.com

A Guide To Everything You Need To Know About Home Ownership Costs [Free Download]

Along with the excitement of purchasing a new home, comes the additional costs that you will be expected to pay as a homeowner. Apart from covering the mortgage of your home, you’ll have additional expenses – such as home insurance – that you will be expected to cover. If you’re looking to budget for a home purchase, it’s important that you consider these costs as they can add up to thousands of dollars each year.

To help you make educated decisions when budgeting, we’ve compiled a list of the major home ownership costs in one free, downloadable guide. Get the Home Ownership Costs to Consider guide here.

Home Insurance

Home insurance policies help protect against serious damage and destruction, like fires, leaks, floods, or break-ins. It also protects a homeowner from personal liability. Some banks may offer home insurance products, although you can typically purchase a home insurance policy through a home insurance agent or broker. 

Tip: You may get better rates if you use a broker or agent. It’s also important to keep in mind that policies typically renew on an annual basis.

Condo Fees

The cost of maintenance fees should be taken into account when you’re buying a condo. This recurring cost is in addition to your mortgage and impacts how much home you can afford. 

Your mandatory monthly fee will vary by your building and square footage. It typically covers:

  • Utilities (such as water and garbage collection)
  • Building insurance
  • Maintenance of common areas (such as the gym, pool, front desk, hallways, landscaping)
  • Building reserve fund (covers emergencies and long-term maintenance projects such as a new roof or elevators repairs)

What Are Status Certificates?

If you’re looking to purchase a condo, you’ll want to look into obtaining a status certificate so that you have as much information about the building and your unit as possible before buying. A status certificate provides valuable information about the condo corporation and its financial

situation. It includes details on the budget, legal issues, the reserve fund, maintenance fees, and any fee increases expected in the future. 

Tip: You’ll want to carefully review your status certificate with your lawyer before making a purchase.

Property Tax

Property taxes are paid annually by homeowners to their municipality. These taxes are ongoing and are separate from your mortgage. Your annual property tax can often be paid in installments.

Tip: It’s important to remember that this cost is not due at closing, but is a recurring cost.

How Are Property Taxes Calculated?

Your property tax rate will vary depending on the value of your property as assessed by your provincial assessment authority. This is then multiplied by a rate that falls between 0.5% to 2.5%.

How Do You Pay Property Taxes?

You can pay your property taxes either through your mortgage provider or directly to your municipality. 

Your Utility Bills

When you purchase a home, you’ll have to set up or transfer your utility bills to your new home. If you live in a condo, these costs may be included in your monthly maintenance fee. Your utility bill will include:

  • Hydro (electricity)
  • Heat
  • Water and Garbage
  • Internet, Phone, Cable

For the full details on the home buyer’s journey including examples, advice, pictures and sample calculations, download a copy of our free Home Ownership Costs to Consider Guide here.

The post A Guide To Everything You Need To Know About Home Ownership Costs [Free Download] appeared first on Zoocasa Blog.

Source: zoocasa.com

Buying a Home for the First Time? Avoid These Mistakes

Buying a home, especially if you’re a first-time home buyer, can be daunting and nerve racking.

But it does not have to be. LendingTree’s online loan marketplace has got you covered – at least when it comes to getting a mortgage.

A 2016 study by the Office of Research of the Bureau of Consumer Financial Protection reveals that prospective buyers who shop for a mortgage when buying a home for the first time report “increases consumers’ knowledge of the mortgage market and increases consumers’ self confidence in their ability to deal with mortgage related issues.”

The importance of shopping for a mortgage as a first-time home buyer is that it saves you money in the long term and “reduces the cost of consumers’ mortgages,” the study found.

The home-buying process can be intimidating. So being aware of these mistakes when buying a home for the first time can help you save thousands and thousands of dollars in the long term.

Tips for Buying a Home
To guide you through a major financial decision like the purchase of a home, you may want to talk to a financial advisor.

Luckily, SmartAsset’s advisor matching tool can help you find a suitable financial advisor in your area to work with.

Get started now.

10 Mistakes to avoid when buying a home for the first time.

1. Not knowing your credit score.

We are all aware that the higher your credit score, the better.
Yet, despite this fact, many people fail to check their credit score before
buying their first home.

And a low credit score can lead to a high interest mortgage loan, or even worse, a loan rejection. Given the fact that your credit score is the number 1 item mortgage lender looks at, it pays off to know where you stand.

Credit Sesame will let you know what your credit score is for free and monitor it for you. It will also offer tips on how to raise your credit score and reduce your debt.

Just sign up for a free account – it only takes 90 seconds.

2. Not shopping and comparing mortgage rates.

Mortgage rates and fees vary across lenders. In other words, two applicants with the identical credentials can get different mortgage rates. Despite this, however, many fist-time homebuyers fail to shop and compare mortgage rates before buying their first home.

The study reveals that 30 percent first time homebuyers do not
compare and shop for their mortgages, and more than 75 percent reported
applying for a mortgage with only one mortgage lender.

The study further reveals that “failing to comparison shop for a
mortgage costs the average homebuyer approximately $300 per year and many thousands
of dollars over the life of the loan.”

An easy way to shop and compare for a mortgage is with LendingTree. Their simple and straightforward platform can help you find and apply for the right loan all in one place.

3. Sticking with the first mortgage lender you meet.

While it’s tempting to work with your local mortgage lender who’s
only a few blocks away from your home, this decision requires more time. Take
time to meet with at least three mortgage lenders before picking the best match
for you.

Fortunately, LendingTree free online platform, allows you to quickly browse several mortgage rates with several mortgage lenders without visiting a dozen bank branches.

4. Not knowing what loans are available to you.

If you’re buying a home for the first time, one thing you need to address is what types of loans are available to me. Sometimes the answer to this can be quite simple: conventional loan. This is because most people know about this type of loan.

But conventional loan requires at least 20% down payment. And the credit score needs to be in the 700. *Note: You can put less than 20% down payment, but you will have to pay for a private insurance mortgage (PMI).

Sometimes it’s not feasible to come up with that type of money as a first time home buyer. So knowing if other loans are available to you is very important.

FHA loan

One type of loan that is popular among first time home buyers is FHA loan. It is so popular because it’s easier to get qualified for it. And the down payment is very little comparing to that of a conventional loan.

For example, FHA loans require a 580 credit score and a down payment as low as 3.5% of the home purchase price. This makes it easier to qualify for a home loan when you’re on a low income.

VA loans

VA loans are another great option for first-time homebuyers. However, you have to be a veteran. Unlike a FHA or a conventional loan, VA loans require no down payment and no mortgage insurance. This can save you thousands of dollars per year.

So if you’re in market for a loan to buy your first home, you need to educate yourself about the different available loans.


Not All Mortgage Lenders Are Created Equally

When it comes to getting a mortgage, rates and fees vary. LendingTree allows you to view and compare multiple mortgage rates from multiple mortgage lenders all in one place and at the same time, so you can choose the best rates for your needs. LendingTree makes getting a loan faster, simpler, and better. Get started today >>>


5. Not getting pre-approved for a mortgage

One of the first time home buying mistakes you should avoid making is not getting a pre-approval letter. You can simply contact a lender and request it. The mortgage lender will pull your credit report to make sure you have the minimum credit score requirement.

They will also need your bank statements, W2s, recent income tax returns, pay-stubs to verify your employment and ability to afford the loan.

Why this is important? A pre-approval letter means that you’re a serious buyer. It signals that you’re able to commit to the house once an offer has been accepted. It also makes you more desirable than the other potential buyers.

Get a Pre-Approval for a Mortgage Today

6. Not knowing how much you can afford

Buying a home is probably going to be the biggest expenses you’ve ever made. But buying a house you cannot afford can lead to financial trouble along the road. Paying an expensive mortgage for 15 to 30 years on a low income can be hard.

So it pays to know how much house you can afford before you start searching for your home.

The best way to know how much house you can afford is to look at your budget. Take into account your expenses and income and other costs associated with owning a home.

7. Not knowing other upfront costs

If you think that the only cost to buying a home is a down payment, then think again. There are several upfront costs associated with owning a house. These upfront costs include private mortgage insurance, inspection costs, loan application fees, repair costs, moving costs, appraisal costs, earnest money, home association dues.

As a first time home buyer, this may come to you as a surprise. So, be ready to have enough money to cover these costs.

8. Failure to inspect your home.

Although some banks would prefer you inspect your home before they offer you a loan, it’s not mandatory. But that does not mean you shouldn’t do it. Not inspecting your home can cost you a lot. Inspection discovers defects that you may not know about. Inspection costs can be anywhere from $300 to $700.

Don’t be stingy with these costs. It’s better to find out about any hidden defects , like a faulty wiring and plumbing, than finding about them later. To avoid regretting your decision or having to spend thousand of dollars on repairs down the road, consider an inspector.

9. Failure to check out the neighborhood.

Just because the street or the neighborhood your potential house is located is quiet or is not run down doesn’t mean crime is not a problem. So before buying your home, you should check out the neighborhood. Take a trip at night to get a feeling of the environment. Talk to residents. Most importantly, check with the local police station – they can be a great resource when it comes to crime rates in a particular location. This is simply one of the first time home buying tips you shouldn’t ignore.

10. Searching for a mortgage on your own.

There are several mortgage lenders available to you. But choosing one that is right for you can be tough.

The LendingTree online platform makes it easy and simple for you to find the right home loan for you. Now you can get matched up to several mortgage lenders all in one place and at the same time. And the whole process just takes a few minutes.

Follow these steps to get matched with the right mortgage:

  1. Go to www.lendingtree.com;
  2. Answer a few questions regarding the type pf loan yo need and you’ll use it. Within a few seconds, you’ll see multiple, competing offers from several lenders;
  3. You then shop and compare offers side by side.

Ready to get started? Find your best loan!

The bottom line is when it comes to buying a home for the first time, you should not take any shortcut. Doing so can cost a lot of money down the road. So before buying your first home, make sure you get the right mortgage loan, inspect the home, and have enough money to cover some of the upfront and ongoing costs associated with owning a house.

Speak with the Right Financial Advisor

Still looking for first time home buying tips? You can talk to a financial advisor who can review your finances and help you reach your goals (whether it is making more money, paying off debt, investing, buying a house, planning for retirement, saving, etc). Find one who meets your needs with SmartAsset’s free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.

The post Buying a Home for the First Time? Avoid These Mistakes appeared first on GrowthRapidly.

Source: growthrapidly.com

8 Upfront Costs of Buying a House

Looking to buy a home soon? There will be upfront costs of buying a house.

You may have found a house that you like. You may have been approved for a mortgage loan, and have your down payment ready to make an offer. If you think that, at that point, all of the hard work is over, well think again.

In addition to the down payment, which can be significant depending on the price of the property, there are plenty of upfront costs of buying a home. As a first time home buyer, this may come to you as a surprise. So, be ready to have enough cash to cover these costs. In no particular order, here are 8 common upfront costs of buying a house.

If you are interested in comparing the best mortgage rates through LendingTree click here. It’s completely free.

What is an upfront cost?

An upfront cost, as the name suggests and in terms of buying a house, is out of pocket money that you pay after you have made an offer on a property. They are also referred to as closing costs and cover fees such as inspection fees, taxes, appraisal, mortgage lender fees, etc. As a home buyer, these upfront costs should not come to you as a surprise.

What are the upfront costs of buying a house?

Upfront cost # 1: Private mortgage insurance cost.

If your down payment is less than 20% of the home purchase price, then your mortgage lender will charge you a PMI (private mortgage insurance). A PMI is an extra fee to your monthly mortgage payment that really protects the lender in case you default on your loan. Again, depending on the size of the loan, a PMI can be significant. So if you know you won’t have 20% or more down payment, be ready pay an extra fee in addition to your monthly mortgage payments.


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Upfront cost #2: inspection costs.

Before you finalize on a house, it’s always a good idea to inspect the house for defects. In fact, in some states, it is mandatory. Lenders will simply not offer you a mortgage loan unless they see an inspection report. Even if it is not mandatory in your state, it’s always a good idea to inspect the home. The inspection cost is well worth any potential defects or damages you might encounter.

Inspection fee can cost you anywhere from $300-$500. And it is usually paid during the inspection. So consider this upfront cost into your budget.

Upfront cost # 3: loan application fees.

Some lenders may charge you a fee for applying for/processing a loan. This fee typically covers things like credit check for your credit score or appraisal.

Upfront cost # 4: repair costs.

Unless the house is perfect from the very first time you occupy it, you will need to do some repair. Depending on the condition of the house, repair or renovating costs can be quite significant. So consider saving up some money to cover some of these costs.

Upfront cost # 5: moving costs.

Depending on how far you’re moving and/or how much stuff you have, you may be up for some moving costs. Moving costs may include utilities connections, cleaning, moving

Upfront cost # 6: Appraisal costs.

Appraisal costs can be anywhere from $300-$500. Again that range depends on the location and price of the house. You usually pay that upfront cost after the inspection or before closing.

Upfront cost # 7: Earnest Money Costs

After you reach a mutual acceptance for the home, in some states, you may be required to pay an earnest money deposit. This upfront costs is usually 1% to 3% of the home purchase price. The amount you pay in earnest money, however, will be subtracted from your closing costs.

Upfront cost # 8: Home Associations Dues

If you’re buying a condo, you may have to pay homeowners association dues. Homeowners association dues cover operation and maintenance fees. And you will pay one month’s dues upfront at closing.

In conclusion, when it comes to buying a house, there are several upfront costs you will need to consider. Above are some of the most common upfront costs of buying a house.

Click here to compare mortgage rates through LendingTree. It’s completely FREE.

MORE ARTICLES ON BUYING A HOUSE:

10 First Time Home Buyer Mistakes to Avoid

How Much House Can I afford

5 Signs You’re Better Off Renting

7 Signs You’re Ready to Buy a House

How to Save for a House


Not All Mortgage Lenders Are Created Equally

When it comes to getting a mortgage, rates and fees vary. LendingTree allows you to view and compare multiple mortgage rates from multiple mortgage lenders all in one place and at the same time, so you can choose the best rates for your needs. LendingTree makes getting a loan faster, simpler, and better. Get started today >>>

The post 8 Upfront Costs of Buying a House appeared first on GrowthRapidly.

Source: growthrapidly.com

How Much House Should I Afford?

The internet is a treasure trove when it comes to finding information that can help you buy your first home. Unfortunately, searching for “How much house can I afford?” will mostly lead you to online calculators that use an algorithm to come up with a generic estimate.

To come up with a figure, these calculators ask you for details like your zip code, your gross annual income, your down payment amount, your monthly liabilities, and your credit score. From there, they come up with an estimate of your debt-to-income ratio (DTI), or the amount of bills and liabilities you have in relation to your monthly income. 

The truth is, most lenders prefer your debt-to-income ratio to be at 43 percent or lower, although some lenders may offer you a loan with a DTI slightly above that.

Either way, the figures these calculators throw at you are a simple reflection of what a bank is willing to lend you — not an estimate of what you really can or should spend. 

Let’s dig in a bit more to what factors to consider.

Factors that Should Impact Your Home Purchase Price

One of the main factors to consider when deciding how much to spend on a home is how much you want to pay for your mortgage each month. What kind of payment can you commit to without sacrificing other goals?

A mortgage payment calculator is a good tool to use in this case. With a mortgage calculator, you can see how much your monthly payment might be depending on the amount you borrow, the interest rate you qualify for, and the term of the loan. 

While you decide on a monthly payment you can live with, there are additional details you should consider. The main ones include:

  • Down Payment: If you’re able to put down 20% of your home purchase price, you can avoid private mortgage insurance, or PMI. PMI adds an additional cost to your mortgage each month (usually around 1% of your loan amount), although you can have this charge removed from your loan once you have at least 20% equity.
  • Property Taxes: Find out the annual property taxes for any home you’re considering, then divide that amount by 12 to figure out approximately how much you’ll need to pay toward taxes in your mortgage payment each month. Also remember that your property taxes will likely go up slowly over time, which will increase your monthly housing payment along the way.
  • Homeowners Insurance: Your homeowners insurance premiums will also vary depending on the property and other factors. Make sure to get a homeowners insurance quote so you know approximately how much you’ll pay for coverage each year.
  • Home Warranty: Do you want a home warranty that will repair or replace major components of your property that break down? If so, you’ll want to price out home warranties that can provide coverage for your HVAC system, plumbing, appliances, and more. 
  • Other Monthly Bills: Take other liabilities you have into account, and especially the big ones. Daycare expenses, college tuition, utility bills, car payments, and all other bills you have should be considered and planned for.
  • Financial Goals: Are you trying to save more than usual so you can retire early? Or, are you saving in a 529 plan for future college expenses? If your financial goals are a priority (as they should be), then you’ll want to make sure your new house payment won’t make saving for other goals a challenge.
  • Upgrades and Repairs: Finally, don’t forget to come up with an estimate of how much you might want to spend on repairs or changes to your new home. A property that is new or move-in ready may not require much of anything, but money you plan to spend on a major renovation should be taken into consideration along with the purchase price of your home.

Hidden Expenses to Plan For

The factors you should consider when figuring out how much home to buy are pretty obvious, but what about all the expenses of homeownership you can’t always plan for? The reality is, you will need to do some work on your home at some point, and many of the most popular repairs can cost tens of thousands of dollars on their own. 

These repair and renovation cost estimates from Remodeling Magazine’s 2020 Cost vs. Value study are just a few examples: 

  • Garage door replacement: $3,695
  • Vinyl siding replacement: $14,459
  • Wooden window replacement: $21,495
  • Asphalt roof replacement: $24,700

In addition to major repairs like these, you’ll also have repair bills for your HVAC system, mulch to buy for your flower beds, and ongoing costs for maintenance and upkeep to pay for. You may also decide to remodel your older kitchen one day, or to add an extra bedroom as your family grows. 

As you figure out how much you should spend on a home, remember that you won’t know exactly how much you’ll need for home repairs or upgrades. Most people set aside some money for home maintenance in their emergency fund, but you can also set aside money for home repairs in a separate high-yield savings account. 

How to Calculate How Much House You Should Afford

All of the costs we’ve outlined above probably seem overwhelming, but keep in mind that most major home repairs will be spread out over the years and even decades you own your home. Not only that, but you will hopefully start earning more over the course of your career. As your paycheck grows, you’ll be able to set aside more money for emergencies and potentially even pay your mortgage off faster.

So, how do you calculate how much house you can afford? That’s really up to you, but I would start by tallying up every bill you have to pay each month including car payments, insurance, utilities, student loans, and any other debts you have. From there, add in some savings so you have money to set aside for your investing and savings goals. Also factor in money you set aside for retirement in a workplace account.

At this point, you could consider other factors that might impact how much you want to pay for a home. For example:

  • Do you need to build an emergency fund?
  • Are children on the agenda, and should you play for daycare expenses?
  • Do you like being able to save more money for a rainy day? 
  • Do you want to have one spouse stay at home in the future?
  • How long do you want to pay off your home loan?

Once you’ve considered all other factors, you may decide that you should set aside money for some other goals, like future daycare bills or college savings. Maybe you decide you want to pay double on your student loans so you can pay them off early, or that you want a 15-year-home loan with a larger monthly payment instead of a traditional 30-year loan. 

Either way, experts tend to agree that your mortgage payment should be no more than 25% of your income. For a $7,000 monthly income, that means your payment shouldn’t exceed $1,750. If your income is $5,000 per month, your monthly payment should be no more than $1,250 per month. These are ballpark estimates, and your property taxes and homeowners insurance premiums (or estimates) should also be figured into this amount. 

What to Do If You Already Spent Too Much?

If you already overspent on your home, you’re probably wondering which steps to take next. Maybe your monthly mortgage payment is making it impossible to keep up with other bills, or perhaps the home you bought required a lot more work than you realized. 

Either way, there are some steps to get back on track financially if you bit off more than you can chew. Consider these options:

  • Refinance your mortgage. Today’s incredibly low rates have made it so almost anyone can refinance an existing mortgage and save money these days. If you’re able to qualify for a new mortgage with a lower interest rate, you could lower your monthly payment and save money on interest each month. Compare mortgage refinancing rates here. 
  • Cut your expenses. Look for ways to cut your spending on a daily basis — at least until you figure out what to do in the long run. Figure out areas of your budget where you might be spending more than you realized, such as dining out, getting takeout, or going out on the weekends. If you can cut your monthly spending somewhat, you can find more money to use toward your mortgage payment each month. 
  • Get a roommate. Consider renting out your guest room in order to get some help with your mortgage. If you live in a tourist area, you can also rent out a space using platforms like Airbnb.com or VRBO.com. 
  • Sell your home and move. Finally, consider selling your home and moving if you have enough equity to do so without taking a financial loss. Sometimes the best thing you can do in a financial crisis is cut your losses and move on.

The Bottom Line

How much house you can afford isn’t always the same as how much you should afford. Only you know what your monthly bills and liabilities look like each month, and only you know the goals and dreams you really should be saving for.

When it comes to buying a home, you’re almost always better off if you err on the side of caution and borrow less a bank will lend. Buying a modest home can leave you with a lot more choices in life, but buying a home you can’t really afford can leave you struggling for years to come.

The post How Much House Should I Afford? appeared first on Good Financial Cents®.

Source: goodfinancialcents.com

8 Ways to Save Money on Date Night

Whether you’re cozying up on the couch together with a bottle of wine or headed out to the trendy restaurant everyone’s talking about, date night is an essential part of most relationships.

“Date nights are important because they give new couples a chance to get to know each other and established couples a chance to have fun or blow off some steam after a rough week,” says Holly Shaftel, a relationship expert and certified dating coach. “Penciling in a regular date can ensure that you make time for each other when your jobs and other aspects of your life might keep you busy.”

Finding ways to spend less on date night can be easy if you're willing to be creative.

There’s just one small snag. Or, maybe it’s a big one. Date nights can get expensive. According to financial news website 24/7 Wall St., the cost of an average date consisting of two dinners, a bottle of wine and two movie tickets is about $102.

When you’re focused on improving your finances as a couple, finding ways to spend less on date night is a no-brainer. But you may be wondering: How can we save money on date night and still get that much-needed break from the daily grind?

There are plenty of ways to save money on date night by bringing just a little creativity into the mix. Here are eight suggestions to try:

1. Share common interests on the cheap

When Shaftel and her boyfriend were in the early stages of their relationship, they learned they were both active in sports. They were able to plan their date nights around low-cost (and sometimes free) sports activities, like hitting the driving range or playing tennis at their local park.

One way to save money on date night is to explore outdoor activities.

If you’re trying to find ways to spend less on date night, you can plan your own free or low-cost date nights around your and your partner’s shared interests. If you’re both avid readers, for example, even a simple afternoon browsing your local library’s shelves or a cool independent bookstore can make for a memorable time. If you’re both adventurous, check into your local sporting goods stores for organized hikes, stargazing outings or mountaineering workshops. They often post a schedule of events that are free, low-cost or discounted for members.

2. Create a low-budget date night bucket list

Dustyn Ferguson, a personal finance blogger at Dime Will Tell, suggests using the “bucket list” approach to find the best ways to save money on date night. To gather ideas, make it a game. At your next group gathering, ask guests to write down a fun, low-budget date night idea. The host then gets to read and keep all of the suggestions. When Ferguson and his girlfriend did this at a friend’s party, they submitted camping on the beach, which didn’t cost a dime.

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The cost of an average date consisting of two dinners, a bottle of wine and two movie tickets is about $102.

– Financial news website 24/7 Wall St.

To make your own date night bucket list with the best ways to save money on date night, sit down with your partner and come up with free or cheap activities that you normally wouldn’t think to do. Spur ideas by making it a challenge—for instance, who can come up with the most ideas of dates you can do from the couch? According to the blog Marriage Laboratory, these “couch dates” are no-cost, low-energy things you can do together after a busy week (besides watching TV). A few good ones to get your list started: utilize fun apps (apps for lip sync battles are a real thing), grab a pencil or watercolors for an artistic endeavor or work on a puzzle. If you’re looking for even more ways to spend less on date night, take the question to social media and see what turns up.

3. Alternate paid date nights with free ones

If you’re looking for ways to spend less on date night, don’t focus on cutting costs on every single date. Instead, make half of your dates spending-free. “Go out for a nice dinner one week, and the next, go for a drive and bring a picnic,” says Bethany Palmer, a financial advisor who authors the finance blog The Money Couple, along with her husband Scott.

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4. Have a date—and get stuff done

Getting stuff done around the house or yard may not sound all that romantic, but it can be one of the best ways to save money on date night when you’re trying to be budget-conscious. And, tackling your to-do list—like cleaning out the garage or raking leaves—can be much more enjoyable when you and your partner take it on together.

5. Search for off-the-wall spots

If dinner and a movie is your status quo, mix it up with some new ideas for low-cost ways to save money on date night. That might include fun things to do without spending money, like heading to your local farmer’s market, checking out free festivals or concerts in your area, geocaching—outdoor treasure hunting—around your hometown, heading to a free wine tasting or taking a free DIY class at your neighborhood arts and crafts store.

“Staying creative allows you to remain flexible and not bound to simply doing the same thing over and over,” Ferguson says.

6. Leverage coupons and deals

When researching the best ways to save money on date night, don’t overlook coupon and discount sites, where you can get deals on everything from food, retail and travel. These can be a great resource for finding deep discounts on activities you may not try otherwise. That’s how Palmer and her husband ended up on a date night where they played a game that combined lacrosse and bumper cars.

Turn to coupons and money-saving apps for fun ways to save money on date night.

There are also a ton of apps on the market that can help you find ways to save money on date night. For instance, you can find apps that offer discounts at restaurants, apps that let you purchase movie theater gift cards at a reduced price and apps that help you earn cash rewards when shopping for wine or groceries if you’re planning a date night at home.

7. Join restaurant loyalty programs

If you’re a frugal foodie and have a favorite bar or restaurant where you like to spend date nights, sign up for its rewards program and newsletter as a way to spend less on date night. You could earn points toward free drinks and food through the rewards program and get access to coupons or other discounts through your inbox. Have new restaurants on your bucket list? Sign up for their rewards programs and newsletters, too. If you’re able to score a deal, it might be time to move that date up. Pronto.

8. Make a date night out of budgeting for date night

When the well runs dry, one of the best ways to save money on date night may not be the most exciting—but it is the easiest: Devote one of your dates to a budgeting session and brainstorm ideas. Make sure to set an overall budget for what you want to spend on your dates, either weekly or monthly. Having a number and concrete plan will help you stick to your date night budget.

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“Staying creative allows you to remain flexible and not bound to simply doing the same thing over and over.”

– Dustyn Ferguson, personal finance blogger at Dime Will Tell

Ferguson says he and his girlfriend use two different numbers to create their date night budget: how much disposable income they have left after paying their monthly expenses and the number of date nights they want to have each month.

“You can decide how much money you can spend per date by dividing the total amount you can allocate to dates by the amount of dates you plan to go on,” Ferguson says. You may also decide you want to allot more to special occasions and less to regular get-togethers.

Put your date night savings toward shared goals

Once you’ve put these creative ways to save money on date night into practice, think about what you want to do with the cash you’re saving. Consider putting the money in a special savings account for a joint purpose you both agree on, such as planning a dream vacation, paying down debt or buying a home. Working as a team toward a common objective can get you excited about the future and make these budget-friendly date nights feel even more rewarding.

The post 8 Ways to Save Money on Date Night appeared first on Discover Bank – Banking Topics Blog.

Source: discover.com