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Over Half of Housing Markets Hit Price Peaks

More than half of housing markets saw home sale prices peak at the end of 2016, according to the National Association of REALTORS®’ (NAR) recently released quarterly report, contributing to the best quarterly sales pace of the year. Eighty-nine percent of markets saw home prices increase in the fourth quarter, compared to 87 percent in the third quarter, with 17 percent experiencing double-digital increases. “Buyer interest stayed elevated in most areas thanks to mortgage rates under 4 percent for most of the year and the creation of 1.7 million new jobs edging the job market clo... Read More

If You’re Buying a Home This Year, Whip Your Taxes Into Shape Now

Ah, tax time—that magical time when all your accomplishments of the previous year can be used against you. After all, the more you made, the more you owe! No wonder there’s so much advice out there about finding (perfectly legal) ways to whittle down your adjusted gross income. But if you’re looking to buy a home, you’ll want to try a different tack—the higher your reported income, the bigger the home loan you’ll qualify for. So if you’re planning to buy a house in the next year or two, you may want to be less aggressive about claiming write-offs. As Brian Decker, a loa... Read More

Lender Checklist: What You Need for a Mortgage

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W-2 forms — or business tax return forms if you’re self-employed — for the last two or three years for every person signing the loan. Copies of at least one pay stub for each person signing the loan. Account numbers of all your credit cards and the amounts for any outstanding balances. Copies of two to four months of bank or credit union statements for both checking and savings accounts. Lender, loan number, and amount owed on other installment loans, such as student loans and car loans. Addresses where you’ve lived for the last five to seven years, with names of landlords... Read More

How Big of a Mortgage Can I Afford?

Not only does owning a home give you a haven for yourself and your family, it also makes great financial sense because of the tax benefits — which you can’t take advantage of when paying rent. The following calculation assumes a 28 percent income tax bracket. If your bracket is higher, your savings will be, too. Based on your current rent, use this calculation to figure out how much mortgage you can afford. Rent: _________________________ Multiplier: x 1.32 Mortgage payment: _________________________ Because of tax deductions, you can make a mortgage payment — including ... Read More

10 Questions to Ask Your Lender

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What are the most popular mortgages you offer? Why are they so popular? Which type of mortgage plan do you think would be best for me? Why? Are your rates, terms, fees, and closing costs negotiable? Will I have to buy private mortgage insurance? If so, how much will it cost, and how long will it be required? (NOTE: Private mortgage insurance is usually required if your down payment is less than 20 percent. However, most lenders will let you discontinue PMI when you’ve acquired a certain amount of equity by paying down the loan.) Who will service the loan — your bank or another c... Read More

Field Guide to Credit Scoring

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Credit scoring has become a serious issue in the lending community and it can affect your ability to obtain or refinance your next mortgage. Credit scoring systems can gauge a mortgage applicant’s credit rating and assign an interest rate and risk value based upon information provided in the loan application. Credit scoring offers several advantages. It provides quick recommendations while taking human judgment out of the equation. Credit scoring also is extremely efficient and, usually, inexpensive. This updated field guide includes articles and books relating to credit scoring. (D. McCormi... Read More

7 Common Credit Report Mistakes

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Learn how to improve consumers’ credit by spotting damaging errors on a credit report. Consumers see the ads in the newspaper and read the signs nailed to telephone poles: “Credit problems? We erase bad debt.” It sounds so easy. Just call the phone number and pay a fee, and your credit woes will disappear. The reality is that bad credit does not vanish by paying someone to remove it. Are there legitimate credit repair organizations out there? Sure, and they can help remove inaccurate information from credit reports. But even they can’t get rid of correct information, however damagi... Read More

Rx for Consumers’ Credit

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For a better rate and terms, buyers should take these five steps before they fill out a mortgage application. Bad credit can ruin a deal. Bad credit translates into financing rejections, prohibitively high loan rates, and failed deals. That’s why real estate professionals need to educate themselves about the credit system and show prospective buyers the value of repairing their credit, if necessary, in order to qualify for a mortgage. Unfortunately for borrowers, most credit reports contain inaccurate information. A June 2004 study performed by the U.S. Public Interest Research Grou... Read More

Specialty Mortgages: Risks and Rewards

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In high-priced housing markets, it can be difficult to afford a home. That’s why a growing number of home buyers are forgoing traditional fixed-rate mortgages and standard adjustable-rate mortgages and instead opting for a specialty mortgage that lets them “stretch” their income so they can qualify for a larger loan. But before you choose one of these mortgages, make sure you understand the risks and how they work. Specialty mortgages often begin with a low introductory interest rate or payment plan — a “teaser”— but the monthly mortgage payments are likely to increase a lo... Read More

5 Property Tax Questions You Need to Ask

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What is the assessed value of the property? Note that assessed value is generally less than market value. Ask to see a recent copy of the seller’s tax bill to help you determine this information. How often are properties reassessed, and when was the last reassessment done? In general, taxes jump most significantly when a property is reassessed. Will the sale of the property trigger a tax increase? The assessed value of the property may increase based on the amount you pay for the property. And in some areas, such as California, taxes may be frozen until resale. Is the amount of taxe... Read More