Real Estate SOULutions

Not-so-fun fact: One out of every 215 homes was foreclosed on in 2018. It’s hard to think about losing your home. But, if a homeowner can’t make their mortgage payments, then the lender has the legal right to take possession of the property. This is called foreclosure . (And it’s a huge reason to make sure you can actually afford the home you want to buy!) Federal law states that, in most cases, the loan needs to be 120 days past due before the lender can begin the foreclosure process. If you think you might be heading down the road towards foreclosure, it’s important to act quickly . There are lots of consequences related to foreclosing on your home. And none of them are good! You’ll feel the pinch right away. Homelessness is the most immediate consequence of foreclosure. Once your loan has been in default for 120 days, you could receive a “notice of seizure”. This notice tells you that the lender is exercising their right to seize the property. Although laws and ti...

Last time, we talked about the importance of having a down payment when purchasing a new home (click here to review that post.) Although there is no hard-and-fast rule about how much a down payment “should” be, we recommend 20% since most lenders will not require you to buy Private Mortgage Insurance (PMI) if you put 20% down. How much are we talking about, here? First let’s talk about how to calculate your down payment. If you are trying to decide how much you need to save, then you can use this calculation: $[cost of the home] x [0.2] = $[20% down payment] For example: $100,000 x 0.2 = $20,000 However, you may be working from the other side of the equation. Perhaps you are selling a home, and will be able to use some proceeds from the sale as your down payment. In this case, this is the equation you need: $[amount of down payment] ÷ $[cost of the home] x 100 = [percentage]% For example: $20,000 ÷ $100,000 x 100 = 20% Once you know how much your goal is for ...

It may have been true, once upon a time, that one could buy a house outright without borrowing any money. And while this could still be true for extremely motivated people, it is definitely more common to take out a mortgage (a loan), or have the owner finance the cost when purchasing a home. When you begin talking with the bank or home owner that will be lending you money, they will ask “How much will you be putting down?” referring to your down payment. What's the purpose of a down payment? Simply put, a down payment is a portion of the total cost of the purchase that the buyer pays at the start of the loan. We talk about down payments in terms of the percentage of the total cost of the home. From the lender’s perspective, a down payment lowers their risk in lending money. Since you’re borrowing less money, the loan is less risky. Having a down payment also shows that you’re serious about your goal of home ownership, which gives the bank/home owner confidence in...

When we think about a mortgage, the principle and interest are often all we consider. But there is much more that goes into a mortgage payment that you need to take into account. It is important to understand all the components of a mortgage payment to ensure that you are protected and can afford the monthly payment.       ·          Principle – The principle is the actual loan amount that you borrow from a lender. In the case of owner financing, it is the sale price of the property minus the down payment. A portion of each monthly payment that you make goes towards the principle.   In the beginning only a small portion of your payment goes towards the balance of your loan, while a majority goes towards the interest. Gradually, as time goes on, more of your monthly payment will be used to pay off the balance of your loan and less will go towards the interest. This is the standard way an amortization (or loan repayme...

It can be frustrating when you’re ready to sell your house and it’s taking longer then you expected. We compiled a list of some of the most common mistakes home sellers make that can cause a house to sit on the market for a long time.       1.        You Didn’t Have Your House Cleaned – If you can – hire a cleaner! You may keep your house clean, but having a professional come in and really get down and “dirty” can go a long way. If you can’t hire a cleaner, have a friend come and help you. They may spot some areas that need cleaned that you have passed over, like the smear on a refrigerator, or dust on cabinet doors. Steam clean any carpets and scrub your floors. Don’t neglect cleaning the outside of your house as well. Tidy up the yard and pressure wash your house.       2.        Your House is Cluttered – It can be somewhat challenging to sell your house when you’re still living in it. ...

Being a first-time home buyer can be both exciting and nerve-racking. Often it can seem overwhelming and you may not know the best place to start. We’ve listed some things to do before and during your home search, to help you along in the right direction.           1.        Know your budget – It is important to know what you can afford, so you can rule out homes that are outside of your budget. How much money does your household take in collectively? Make sure that you factor out ALL your expenses: car payments, bills, food, etc. You want to make sure that your monthly note is not going to be outside of your means.      2.        Save for a down payment – Whether going through the traditional route and getting a loan through a lender, or buying a home through seller financing; you are going to need to have saved up a down payment. How much you have for the down payment can...