Month: February 2013

Tips For Buying A Foreclosed Home

Many people are interested in buying a foreclosed home because they typically sell for cheaper prices than comparable homes in the area that have not been foreclosed upon. However, many people aren’t aware of all of the risks involved in purchasing a foreclosure. The risks are minimal if you do your research though. From CNN, here are some tips for buying a foreclosed home.

 

First, it is important to know what a reasonable price for a foreclosed home is. This means, you should know the prices of comparable homes in the area that have sold. The bigger the gap in price is between a foreclosed home and a non foreclosed home, the more work a home needs (generally). Don’t be fooled into thinking you’re getting a great deal on a move-in ready home; you need to account for the fact that buying a foreclosure almost always requires that you put time, money, and effort into making it ready for living in. Moreover, you need to make sure that you are prepared to take on the project of repairing a home.

With that in mind, you should get a home inspection, if at all possible, or at least inspect the home yourself. This is the best way for you to get an estimate of what repairing and updating the home will cost you. A home inspector can tell you if there are any out of date or non-working systems (electrical, heating, cooling, etc.) and what needs to be done to ensure your safety and comfort. This will allow you to assess how much money, time, and effort will have to go into the home. From here, you can determine whether or not you can afford to purchase the home.

Also, be sure to look into the neighborhood and surrounding homes and areas. If there are numerous other homes in the area that have been foreclosed upon, it’s probably not a good idea to buy the home. This is because areas with a high number of foreclosures (regardless of the reason for it) have lower property values than areas with a negligible number of foreclosures.

Do not buy a foreclosure in order to turn a quick profit. You should only buy a home if you are financially able, in need of a place to live, are happy with the area, etc. That is, you should plan to have to do at least a little work on a home that’s been foreclosed upon before even being able to live comfortably in it, let alone sell it for a profit. You can most certainly buy a foreclosure in the hopes of fixing it up and selling it for a profit, but it will most likely not be a quick process.

For more tips on buying a foreclosure, check out this article.

Buying A Home After College

For young adults just out of school, buying a home after college is a great opportunity to build wealth and to build your credit. With your initial salary, it may be tough to afford a mortgage and with minimal savings, it could be tough to get approved for a loan. Here are some helpful tips to make it happen…

Getting Approved For A Loan

  • Save During College: If you are still in college, get a job and start putting money away. Even a couple thousand dollars may be the difference between getting approved and not getting approved.
  • Get A Partner: Purchasing your first house with a good friend is a smart idea. By splitting ownership, the hefty down payment could be more affordable.
  • Get A Private Loan: If you think the property could be a good investment, consider presenting your case to a family member for a private loan to help with the down payment. You may be able to convince your relative to not charge interest but instead receive a part of any gains made on the house on the back-end.

Affording The Monthly Payments
After you have been approved for a loan, your next step is budgeting to pay your monthly payments. Unfortunately, in most cases, your monthly payment will also include taxes and insurance which seems to make many properties transition from affordable to un-affordable. Here are some ways to make the payment less painful.

  • Interest Only: Depending on the rates and the environment, it may make sense for you to do an interest-only loan. This can help keep the payment down. This should only be  your option if you are sure you will not be in the property longer than a few years.
  • Find Renters: Make sure your friends have secure jobs and will be able to pay you each month. Avoid freeloaders. Also, consider drafting basic lease agreements to protect yourself.

Position Yourself For The Future
Eliminating debt and putting money away are the basics of positioning yourself. Owning a home at a young age may be an opportunity to continue this process. While your home is unlikely to double in value and you probably won’t pay off much of the interest, you will be investing in an asset and building your credit at the same time. Furthermore, you can take advantage of the tax breaks that home ownership brings.

Being a homeowner for the first time is a great learning experience. You are forced to learn to take care of something and take pride in something you own. You will learn the process of getting a loan and closing a large transaction. It is a great value and learning experience.

For more information check out the original article here.

Helpful Tips for Pennsylvania Retired Homeowners

Making the move from a homeowner to a retired homeowner entails more than one might expect. Typically, retired homeowners have less money to spend both on mortgage payments and on other activities. Here are some helpful tips for Pennsylvania retired homeowners…

1. Income is still important. Once you’re retired, lenders will most likely use retirement income, including a pension or monthly Social Security stipend, to see if you qualify for a home mortgage. They view and treat your loan application in the same way that they treat the applications of non-retired borrowers. The lender will check your credit, look at your most recent tax returns, view statements from all your checking and saving accounts, and they will ask to see your Social Security and pension or other retirement system award letters.

2. Sell first or buy first? This is a question that concerns buyers at all stages of their homeownership. Choosing to sell first leaves you with the challenge of finding a temporary place to live while you wait to find or close on your new house. The benefit to selling first is that you know exactly how much money you have (from the sale of your home) to spend on your next home. In choosing to buy first, you may face financial stress if your home doesn’t sell as quickly as you thought it would or for as much as you expected it to. In short, you could end up having to make two house payments at the same time until you sell your current home. The benefit to buying first is that you won’t be pressed to find a temporary home while you search for your next one.

3. Do some research. By talking to a trusted mortgage broker, you can learn more about all of your options, including whether you can qualify for a new mortgage without selling. For example, in many states, if (1) you’re buying to downsize, (2) you’re moving to a less expensive area, (3) you have a large amount in savings or (4) the homes you’re looking at are modestly priced (for your income/SSI), you might not need to sell your existing home before you qualify to buy the next one.

4. Get creative. As a retired homeowner in Pennsylvania, you have many options you may not have even considered. For instance, you may want to consider the possibility of selling your home, then spending some time traveling while you continue your house hunt. You could also look into the possibility of selling your home and then leasing it back from the buyer. To get a more detailed list of the many options available to you as a retired homeowner, talk to a local real estate agent.

To view the original article by Inman News click here.

 

Susan Rupert
Kissinger, Bigatel & Brower
susankbb@gmail.com
www.StateCollegePARealEstate.com
Office: (814) 234-4000 EXT: 3213

Susan Rupert Group

Realtor, ABR, CRS, SRES, MCNE, e-PRO
Kissinger Bigatel & Brower

2300 South Atherton Street
State College, PA 16801
Mobile/Direct: 814-280-0364
Office: 814-234-4000 ext. 3213
Email: Susan@StateCollegePARealEstate.com

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