FHA 203 K (Rehab) Loans Explained

FHA 203k Loans: What You Need to Know By Keith Loria Whether you’re actively searching for a new place to call home or simply entertaining the idea of moving to a new location, you more than likely have a dream home in mind. However, if your dreams are out of line with your budget, getting into that dream home may seem next to impossible. But for those willing to do a little work, your dream home can be well within reach, thanks in large part to an FHA 203k loan. Designed for people who want to buy a home that needs renovations or major upgrades, the FHA 203k loan program allows one to borrow the purchase price of the home, plus receive money for renovations, all with the convenience of a single loan and closing. While most mortgage financing plans provide only permanent financing where the lender will only close on the loan and release the mortgage if the condition and value of the property provide adequate loan security, if you’re talking about purchasing a home as-is, the money probably won’t be coming to you until the improvements are made. But that’s not the case with a 203k loan. FHA 203k loans are designated for houses that are damaged or sorely in need of rehabilitation. The loan covers not only the cost of the property, but also the cost of necessary home repairs. It’s especially beneficial to those who cannot afford a finished home and are willing to take on a fixer-upper. According to the U.S. Department of Housing and Urban Development, the 203k loan program is an excellent means for lenders to demonstrate their commitment to lending in lower-income communities and to help meet their responsibilities under the Community Reinvestment Act (CRA). There are two types of FHA 203k loans: regular and streamlined. Regular 203k loans are for homes that need structural repairs, and streamlined loans are for those that need non-structural repairs. The extent of the rehabilitation may range from relatively minor work (starting at $5,000) to major reconstruction on the home’s structure. Categories for work allowed include modernization and improvements to the home’s function, elimination of health and safety hazards, adding or replacing roofing, gutters, and downspouts, enhancing accessibility for a disabled person, making energy conservation improvements and changes that improve appearance and eliminate obsolescence. Repairs can include numerous items, such as plumbing, roofing, room additions, providing disability access, adding new siding, site grading or even kitchen remodeling. When a 203k loan closes, a repair escrow account is set up and renovation can begin. Repairs must start within 30 days of closing and be completed within six months. To be eligible for the FHA 203k mortgage program, homes must be owner-occupied, must be only 1-4 units and must be at least one year old. New homes are not considered. For more information about FHA 203k loans, contact our office today. Judy Gratton Your Real Estate Edge Reprinted with permission from RISMedia. ©2014. All rights reserved.

Spring Is For Buyers!

Buyers Bloom in the Springtime Daffodils, April showers, robins and a new crop of For Sale signs seem to be working their seasonal magic on home buyers. The latest Fannie Mae survey, conducted in March, reports that the gloominess that shrouded buyers during the bitter winter months has melted away and attitudes are nearly as positive as they were a year ago. Consumers who say it’s a good time to buy reached 69 percent, the highest buyer confidence has been since September and just below 71 percent levels of March and April last year. Confidence fell as low as 65 percent in January when concern over interest rates was high. Concern over rates fell markedly in March. The percentage of those who expect rates to rise fell from 56 to 54 percent from February to March and those who expect rates to fall rose from 34 to 38 percent. Expectations that prices will increase also declined from February to March and contributed to buyer confidence. Those who expect prices to increase fell slightly from 50 to 48 percent and those who expect prices to stay the same shot up from 38 to 42 percent. Some 7 percent expect prices to fall, up from 5 percent in February. Overall, those participating in the survey expect prices to rise only 2.7 percent in 2014, down from 3.2 percent in February. Sellers are feeling better about the real estate markets as well. Some 38 percent of consumers say this is a good time to sell, up from 34 percent in February. The Fannie Mae National Housing Survey polled a nationally representative sample of 1,005 respondents aged 18 and older between March 1, 2014 and March 23, 2014. Most of the data collection occurred during the first two weeks of this period. Findings were compared to the same survey conducted monthly beginning June 2010. For more information, visit www.realestateeconomywatch.com. Judy Gratton Your Real Estate Edge Reprinted with permission from RISMedia. ©2014. All rights reserved.

Easter Gift Ideas

Easy Easter Gifts That Inspire (Family Features)—From the brimming basket itself to the goodies within, Easter has become a true gift-giving occasion. With sugar-coated marshmallow chicks and giant chocolate bunnies, there are endless ways to give your little ones gifts that fit this beloved holiday's traditionally sweet offerings. But with the health of children top of mind, some parents are using this special springtime occasion as a way to give better-for-you gifts that stimulate the brain and inspire creativity. Gifts that promote creativity—This Easter, instead of giving unhealthy candy that only lasts a few bites, consider long-lasting gifts that inspire the imagination and provide endless hours of enjoyment. Here are some creative gift-giving ideas for your little recipient. Explore artistic worlds—Foster some artistic spirit with a basket filled with paint brushes, pastels, papers, molding clay and other imaginative tools. Just be sure to buy supplies that are age appropriate and safe for the recipient. Encourage pretend play—Give kids toys that allow them to express themselves, such as the Hopscotch Rabbit Family from Calico Critters. It is one of many cute and lovable critter families your child can collect this Easter. These award-winning miniature animals promote wholesome family values and inspire the imagination. Begin a love for books—Let the adventures begin with stories your little ones will want you to read them over and over again. Look for seasonal books that share the stories of the Easter holiday or those with a springtime theme. Dress up for fun—Let their inner princess, super hero and ballerina shine through by lining their basket with a variety of colorful, fun outfits and accessories. Dress up play encourages hours of imaginative play and can even allow the parents to join in on the role playing excitement. Build the mind—From oversized pieces suitable for tiny tikes to complete, intricate sets for older kids, there are many great building toys for children of all ages. Since they're loved by all, building block sets are a great choice for families with boys and girls. Create beautiful music—From mini xylophones to tambourines and recorders, add some booming beats and expressive harmonies to their day with musical instruments. Include a lesson book with songs and they'll be playing a tune in no time. Discover outdoor play—Unglue them from their tablets, smartphones and televisions, and encourage outdoor play for stimulating physical activity. Tuck a basketball, kite or even a jump rope inside those baskets and it's game on. Plant the seed—For the budding gardener, fill those plastic eggs with seeds and give them gloves, shovels and terra cotta pots to begin their own garden. They will learn a valuable lesson about how plants are grown and some pointers on responsibility, too. Get crafty—Beads, baubles, yarn and other craft goods allow children to create anything they put their mind to. Visit the clearance section at your local craft store to find a variety of materials young hands will love to work with. Inspire theatrical performances—From birds to humans to dinosaurs, puppets allow kids to put on a show wherever they are. Look for those that engage in learning, such as puppets in the shape of farm animals or even fruits and vegetables. From exploring new worlds in a picture book to learning to play a musical instrument, your little ones will adore receiving these thoughtful and brain-boosting gifts this Easter. Making Easter memories Many families use this special holiday as an opportunity to create new traditions and teachable moments for their youngsters. Here are some ways your family can do the same: •Make discovering the basket part of the fun with a treasure hunt using a series of hidden clues or a hand-crafted map. •Ask your children to join you in preparing and delivering baskets to a senior living residence in your community. •Theme your baskets for a family activity, with each child receiving a critical piece of the overall project. For example, one child receives a garden spade, another gets packets full of seeds, and so on. •Baby wants a basket, too—Although the littlest members of the family certainly won't be sinking their teeth into gooey chocolate bunnies, these ideas for creating a small basket of age-appropriate items will let baby join older siblings in the fun. •Rather than a traditional woven basket, choose a snuggly plush container reflecting a favorite character or an Easter-themed animal such as a bunny, chick or lamb. •You're never too young for an Easter present. Include your infant in the holiday festivities by introducing them to a world of wonderment with Earlyears toys, such as their award-winning Soft Baby Blocks or Baby Farm Friends Bowling. These products are not only fun and colorful, but they help your baby learn and develop every step of the way. •Look for gifts that celebrate the season that can be used every day. This can include a hooded bath towel in the character of a duck or bunny. •Avoid using plastic grass as a filler, which can pose a choking hazard. Instead opt for shredded paper or tissue paper. Or get creative and line the basket with useful items such as new washcloths or burp rags. •To round out baby's basket, consider the developmental stage and incorporate relevant items. For example, if you'll soon be saying farewell to bottles, use Easter as an opportunity to get your baby excited about using a brand new sippy cup. Source: www.calicocritters.com and www.earlyears.com. Judy Gratton Your Real Estate Edge Reprinted with permission from RISMedia. ©2014. All rights reserved.

Kitchen Counter Alternatives

Unusual Household hints

8 Surprising Household Hints
By Barbara Pronin


Home store shelves are full of goop and gadgets for cleaning or fixing just about anything. But, says Julie Edelman, better known to readers and viewers as The Accidental Housewife, you can save a lot of money by cleaning and fixing things with the goop and gadgets you already have at home.
 
Edelman offers specific tips in a recent issue of Bottom Line Personal:
 
Polish glass and faucets with newspaper – Newsprint ink is a wonderful polishing agent, so crumple a piece of newspaper and rub.
Shine shoes and plants with banana peels – The inner peel contains oil and potassium, two of the key ingredients in shoe polish. Wipe shoes or plant leaves with the inside of the peel, then buff with a soft, clean cloth.
Clean the dishwasher with Kool-Aid – Fill the dispenser with lemonade Kool-Aid or any powdered drink mix that contains citric acid. Run the dishwasher through a full normal cycle to wash away gunk, lime or rust stains, and odors.
Quiet a squeaky door with cucumber – Rub a slice of cucumber all around the hinge. Wipe away any residue and enjoy the quiet.
Mend minor cracks in china with milk – Milk contains casein, a protein that, when heated, turns into natural, plastic-like glue. Place the cracked plate in a pot large enough to cover it with milk. Bring the milk to a boil, then reduce to a simmer and simmer for 45-60 minutes. Let the milk cool. Rinse the plate. The crack should be sealed.
Repel ants and roaches with citrus rinds – Bugs hate the oil that is found naturally in citrus rinds. Place pieces of orange or lemon rind in door or window openings or wherever bugs are prone to enter. Replace every few days.
Clean a toilet bowl with Alka Seltzer - Drop two of the tablets, or a couple of Polident effervescent tablets, into the bowl. Let them fizz and remain for 15-20 minutes. Clean with a toilet brush and flush.
Fix a small wood scratch with walnuts – Gently rub the walnut meat, with a circular motion, into small scratches on your dark wood furniture. Let the natural oil seep in for up to10 minutes, then buff with a clean cloth.

Judy Gratton Your Real Estate Edge

You Can Buy a Home With Less Than 20% Down

How to Buy a House with Less than 20 Percent Down

When many people start the process of buying a house they assume putting 20 percent down is required. However, this is not the case and many lenders and mortgage brokers offer options for borrowers looking for mortgages that have a small down payment. Don Frommeyer, CRMS, President of NAMB (The Association of Mortgage Professionals), shares his advice for potential homeowners searching for mortgages with less than 20 percent down payment.

“There are a couple of things you’ll want to make sure you have before researching mortgages, including solid credit standing and a steady income,” says Frommeyer. “The options are out there and exist to make sure that people have the ability to buy and invest in real estate, even in today’s competitive housing market and tight credit environment.” Frommeyer suggests the following tips when buying a house with a low down payment:
- Maintain a Strong Credit Score: Credit score is one of the first things lenders look at when determining who is a qualified borrower. Make payments on time and keep in mind that even small mistakes may take some time to clear from credit scores.
- Look Beyond Your Local Banks: There are many options available outside of traditional bank mortgages. Mortgage brokers offer a wide range of mortgage loans with zero down payments; an example is VA Loans. Veterans of the military and qualified retired veterans are eligible to use this benefit for a 100 percent loan. They also offer FHA loans to qualified borrowers for as little as 3.5 percent down. And in rural areas, the U.S. Department of Agriculture offers low down payment options with financing to 100 percent. A good mortgage broker will have all of these options available and will have a variety of lenders that they can put these through to stay competitive in the market. And even conventional loans have the ability to do loans with 5 percent down payment.
- Document Income and Assets: Lenders look for a steady income and sufficient savings to ensure borrowers can meet monthly payments. Make sure to have all account statements ready to establish proof of funds; lenders look for savings accounts that indicate the borrower will be able to cover a few months of payments. In addition, hold jobs for at least two years or within the same industry to demonstrate longevity and stability.
- Be Prepared to Pay More Monthly: When you do loans with limited funds down, most will require some sort of mortgage insurance to complete the loan. Conventional loans require Private Mortgage Insurance on loan to values above 80 percent. FHA loans have Mortgage Insurance on all of their loans and the VA only has a funding fee.
- Explore Options: Frommeyer suggests going to at least two lenders to be able to compare good-faith estimates. This allows you to look at two completely different options and this will help talking to more than one source when looking for a mortgage. Compare the fees, estimates, closing costs, etc. thoroughly before selecting any loan.

Give me a call,text,or email  if you would like more information on buying a home!
Judy Gratton