There is increasing difficulty for first-time home buyers to save for their down payment as indicated in the graph. Several factors that contribute to this trend include rising rents, rising home prices, student loan debt and flat wages.
Some would-be buyers feel they cannot buy a home today but a large part of those decisions may be based on inaccurate assumptions.
Nine out of ten non-owners believe they need ten percent or more for a down payment. The typical down payment for first-time buyers is six percent. VA has 100% loan programs as well as USDA for certain qualifying areas and buyers. FHA is known for 3.5% down payments. And FNMA and Freddie Mac have down payments as low as 3% and 5%.
There are gift provisions available for buyers who have an “angel” who would like to help them with their down payment.
There are ways to borrow against a person’s qualified retirement program for a down payment. It isn’t necessarily limited to the buyer but could include a relative. Interestingly, a son or daughter can borrow against their retirement to benefit their parents.
In some respects, having good credit and sufficient income is more important than the down payment. Don’t rely on “common knowledge.” Get expert advice and counsel to see if there is a way to advance your dream of owning a home.
If you haven’t heard of a CLUE report, it has nothing to do with the table game searching for a murderer. It is a report showing the insurance claims on your home and car for the past five to seven years.
This database is used by insurance companies to evaluate risks and determine rates. C.L.U.E. stands for Comprehensive Loss Underwriting Exchange. Rates can be increased not only due to legitimate claims but data entry errors also. Sometimes, simply asking a question without filing a claim can be logged as a claim.
For that reason, similar to verifying the accuracy of your credit report, it is important to check out the CLUE report on your home and car. The reports are free and there is a process for correcting mistakes.
An interesting and sometimes costly surprise occurs during the home buying process. The claim experience of the prior seller could impact the price of the premium of the new buyer. For that reason, you can ask for a copy of the CLUE report on the home you’re interested in buying prior to writing a contract.
Mickey Mantle said “If I knew I was going to live this long, I’d have taken better care of myself.”
Similarly, if people planning their summer travel knew they were going to have an emergency, they would have the right things available. Only 5% of drivers carry all recommended emergency supplies in their cars.
The Federal Emergency Management Agency (FEMA) recommends that all Americans have some basic supplies on hand in order to survive for at least three days if an emergency occurs. Some of these things would be more important if you lived or traveled in remote areas.
- Reflective hazard triangle or road flares
- Spare tire
- Jumper cables
- First-aid kit
- Flashlight and extra batteries
- Cell phone and charger
- Crucial medications
- Emergency radio with batteries
- Bottled water for each person and pet in your car
- Non-perishable, high-calorie food
- Distress signal flag
- Matches or lighter
During cold weather, additional items are recommended:
- Windshield scraper and brush
- Blankets and extra warm clothing
- Road salt or cat litter to help with tire traction
- Tarp for working outside in weather
It is recommended that emergency supplies should be checked at least twice a year to see that all of the items are in working order and in good condition. It is important that items are replaced if any of them are used during the year.
The American Red Cross is among many sources where emergency preparedness kits and supplies can be purchased.
Businesses must treat customers fairly if they expect to do business with them again or get recommendations to their friends. Customers of stores like Nordstrom’s understand that a salesperson is an employee and represents the company.
The line becomes less clear in some industries, especially ones that involve real estate. Agency is a legal relationship authorizing a person to act for or in the place of another. It involves responsibilities that exceed treating a person fairly.
The duties a buyer or seller can expect to receive from a real estate salesperson or broker include but are not limited to honesty, accountability, full disclosure, representation and reasonable skill and care. Buyers and sellers might additionally expect obedience, loyalty and confidentiality. State laws can differ on specific duties.
Mortgage and title officers are limited in their duties to the buyer to honesty and accountability and specific requirements under the federal Real Estate Settlement and Procedures Act.
A special relationship with a real estate agent makes it advantageous to have them coordinate efforts with the other professionals in the home buying process. Since most buyers’ and sellers’ transactions are infrequent, the agent can bring valuable experience to the transaction.
Every buyer and seller should discuss the level of service they expect from the real estate professional they work with. Another good question is what happens if the purchase and sale are within the same company.
Hands-only CPR can save lives. The American Heart Association states that “Almost 90% of people who suffer out-of-hospital cardiac arrests die. CPR, especially if performed in the first few minutes of cardiac arrest, can double or triple a person’s chance of survival.” Most people who survive a cardiac emergency are helped by a bystander.
- Check for responsiveness – shake the person and shout “Are you OK?”
- Call 9-1-1 – either tell someone to call or make the call yourself
- Compress – Push hard and fast in the center of the chest at a rate of 100 per minute.
The victim should be flat on their back preferably on the floor. Place the heel of one hand on the center of the victim’s chest and place the heel on top of the other hand lacing your fingers together. Lock your elbows and compress the chest forcefully; make sure you lift enough to let the chest recoil.
Chest compressions should be continued until the person shows obvious life-like breathing, the scene becomes unsafe, an AED (automatic external defibrillator) becomes available, or a trained responder takes over the emergency treatment.
Alternating mouth-to-mouth breaths is not necessary using this method. Compressions are adequate except in drowning or drug overdose situations where 30 chest compressions are followed by two mouth-to-mouth breaths.
Watch this two-minute video and consider taking instructions from the Red Cross or other qualified provider. Every household should have at least one person trained in life-saving skills.
Surely, you remember being a child at an amusement park when after having stood in line with your friends and family, waiting to get on a terrific ride, you discovered the sign that read, “you must be this tall to ride.”
Not only was it disappointing, it was slightly embarrassing. You never want to go through that again.
A remarkably similar situation occurs when people are buying a home. After finding the right home and negotiating the contract, they find out that they don’t measure up financially. It’s not something that anyone wants to go through if they have a choice.
Regardless of what you think you know, if you’re buying a home with a loan, you need to physically visit with a trusted mortgage professional before you get serious.
- You’ll find out your credit score which will directly affect the mortgage rate you’ll pay.
- You might discover blemishes on your credit that possibly can be corrected.
- You’ll even get a pre-approval letter that you can submit with an offer which could dramatically affect your negotiations in the current competitive market.
Some rides don’t turn out to be as good as you thought they were going to be. A person certainly doesn’t want that disappointment with a lender. Contact me for a recommendation of trusted mortgage professional.
59% of non-owners are not comfortable taking on a mortgage with their student debt according to the Aspiring Home Buyers 2017 survey. It is estimated that the college graduates have an average of $37,172 in student debt.
Fannie Mae, who has loan programs with as little as three to five percent down payments, has announced changes to how student loan debt is treated that could make the difference in qualifying for a mortgage.
For the 5 million borrowers who participate in the reduced payment plans, actual payments are considered for calculating debt-to-income ratio rather than maximum payment amount.
Non-mortgage debts paid by another party for at least 12 months won’t be included in calculating debt-to-income ratio. For example, payments being made on a student loan by the parents would not be counted against the DTI ratio for the student.
These changes can make it possible for would-be buyers with student debt to get a home now instead of waiting for years. Being pre-approved by a trusted mortgage professional is the best way to confirm that these changes apply to your situation. Call today for a recommendation of a trusted mortgage professional.