Things To Be Aware Of Before You Purchase A Home

It cannot be denied that mortgage interest rates are very low at present. Plus, although they are rising, home prices are still affordable. This does not, however, mean that any home is bargain waiting to be snapped up. The buyers currently hold all the cards. However, you must make sure that you make careful considerations before you buy. The potential issues you may uncover when researching a property could be serious. Sometimes, this means that you need to fix a problem, but at other times it means that you shouldn’t buy. Two things are of true vital importance, however.

First, inspect the neighborhood. Does it look like everybody is leaving? Ask people who live in the area whether it is a good place to live. Have a look at how the land is shaped. Foundations could be damaged by rain water if the yard slopes downwards to the property. If you notice any bad smells, there is generally something amiss. Next, check whether there are pests. Ask community members of this, as everybody always knows when someone else has pests.

You should now look at the property itself and how it was treated. Check the property for maintenance as well. If you find that the owners haven’t look after the outside properly, the inside is likely to be the same. Make sure to inspect the wiring. Although you probably won’t be able to identify all of the problems yourself, some red flags are easy to spot. If lights flicker or outlets are warm, there is a chance that the wiring is faulty. If you notice that only a few of the walls have been painted recently, it is possible that the owners are trying to hide something. Check the windows. If a window is condensed or moldy, or it opens with difficulty, that may be a sign of very expensive problems.Never even consider purchasing a property that you cannot see in full. If you notice that walls have been changed or other structural work has been completed, you must find out whether this was done by someone qualified to do that type of work.

In the end, it is only you who can decide whether or not you will buy a property. However, you should always exert due diligence. Do only purchase a property once you have had it inspected by a professional inspector. If an inspector does find significant issues, you can decide whether you want to leave the property behind, or whether you want to bargain and bring the price down substantially. However, always be careful that you do not get tied into a money pit.

All About Short Sales: What Are They, Why Do They Occur, And What Does It Mean For You, As The Owner?


Will a Short Sale Save My House?

A short sale is what happens when a home-owner in financial trouble sells their property for less than what they still owe on their mortgage. The buyer of the property is a 3rd party (meaning, not the bank), and all proceeds from the sale go to the lender. The lender either forgives the difference, or they get a deficiency judgment against the borrower forcing the owner to pay the lender all or part of the difference between the sale price and the original value of the mortgage. In some states, this difference must legally be forgiven in a short sale. Read: Can I Buy a Home After a Short Sale or Foreclosure?

Before doing a short sale, you should certainly talk to your lender about the possibility of a revised payment plan or loan modification. One of these options might allow you to stay in your home while you recover your financial condition. Another possible option for staying in your home arises if you have private mortgage insurance (PMI). Many homeowners who purchase homes with less than 20% down are required to purchase PMI with their houses. If the PMI company thinks you have a chance at recovering from your current financial situation, it may advance funds to your lender to bring your payments up to date. Eventually, you’ll have to repay the advance. See: Home Buying: Can I Buy My Own House at a Short Sale?

At this point, you should consult an attorney, a tax professional, and a real estate agent. While you’re probably thinking that the last thing you can afford is to pay for these high-priced professional services, if you make a mistake by trying to handle a complex short sale transaction yourself, you may find yourself in even bigger financial trouble. If you’re already broke, perhaps you can pay these service fees out of the sale proceeds from your home. short-sales

When setting an asking price, make sure to factor the cost of selling the property into the total amount of money you need to get out of the situation. Of course, you want to sell the home for as close to the value of your mortgage as possible, but in a down market, there is bound to be a shortfall. In some states, even after a short sale, the bank will expect you to pay back all or part of that shortfall, but at least this amount will be significantly less than what you owed when you had a mortgage. For further reading, see: Fearing Foreclosure? A Short Sale Can Help

Gather all of the documents you’ll need to prove your financial hardship to the lender. These may include bank statements, medical bills, pay stubs, a termination notice from your former job or a divorce decree. It is up to you to come up with the short sale proposal. Be aware that the lender ultimately must approve a short sale after receiving all the details because the lender is the recipient of the proceeds. Your job is to find a buyer for your home. free-living-wills

Because short sales can take longer than regular home sales due to the need for lender approval, they often fall through. The buyer may find another property while waiting for an answer from you. Be prepared for this possibility.

What Happens When A Landlord Goes Through Foreclosure? What Will That Mean For You, As The Tenant?

While this may come as a surprise, if you’re a tenant, you could potentially face the possibility of your landlord going througlandlordh foreclosure on the property that you are renting. The unfortunate part of this situation, is that you, as the tenant, are often the last to know. This usually blindsides tenants, as they aren’t told until the very last second.

They then must run around and try to find a new place to live as soon as possible. Usually, the reason that they are the last to know, is because the owner has been spending months trying to avoid the situation. By the time you find out, it is because they have just realized that they have no other options. So keep in mind the owner hasn’t known for sure that the home is going to be foreclosed on, until right before they’ve told you.

When a homeowner defaults on their mortgage, the lender either becomes the new owner of the house, or they will sell it at a public sale. This doesn’t always mean that you have to move. Sometimes, the new owner will let you stay, as they want the house to use as a rental property as well. DE20120620-foreclosed-home

If a tenant is living in an apartment building, or a condo, sometimes they don’t even know that the property has transferred owners. Read: Renters Get Relief From Foreclosure Evictions.

They continue to pay rent to the former owner, who often pockets the money but no longer has any incentive to maintain the building it no longer owns. In the meantime, the new owners simply refuse to be landlords, never making repairs or even paying utility bills.

New owners may want to terminate existing tenants because they believe that vacant properties are easier to sell. Common sense suggests otherwise, and in many situations a building full of stable, rent-paying tenants will be more valuable.

To encourage tenants to leave quickly and save on the court costs associated with an eviction, banks sometimes offer tenants a cash payout in exchange for a quick departure. They may consider suing their former landlord in small claims court.

Small claims court is a perfect place to bring such a lawsuit. The tenant can sue the original landlord for moving and apartment-searching costs, application fees, and the difference, if any, between the new rent for a comparable rental and the rent under the old lease. Though the former owner is probably not flush with money, the awards in these cases won’t be very much, and the court judgment and award will stay on the books for many years. A persistent tenant can probably collect what’s owed eventually. For further reading, see: Tenant Eviction in Foreclosure: What Are Your Rights?

Skipping One Mortgage Payment Can’t Be “That” Bad, Can It? It Sure Can. Read On To Find Out How Missed Mortgage Payments Affect You


Skipping a mortgage payment every once in a while can be tempting. After all, your house won’t get repossessed if you just miss one, right? Well…while technically you won’t go into foreclosure after one missed payment, if you delve into the regular habit of skipping mortgage payments, you’re likely to end up in quite a mess. Read: What Happens When You Skip a Payment? While you won’t lose your home, you will earn yourself major dips in your credit score. This means it will be very hard for you to get new lines of credit when you need them. It will also make it harder for you to cosign on your kids’ apartments (usually required when they are younger). So, what exactly happens when you skip a mortgage payment?


Let’s have a look:

  • When you skip a mortgage payment, you don’t actually skip a mortgage payment. This is because even though you aren’t paying it right now, you’ll still be paying it later. Except you’re tacking late fees and finance charges onto yourself which can equal hundreds of dollars.
  • Even though you only miss one payment, you’ll be kicking yourself for later on down the road. You’ll accumulate interest, which can add up to a substantial amount of money.
  • Your credit score is going to drastically go down. This is going to destroy the health of your credit score and history. You won’t be able to buy a new car, or a new house. And if younew-york-mortgage-rates-banks-are-offering-today-and-2 do get approved, you’ll likely have a higher interest rate and APR due to your low credit score.

It could potentially also hurt you in terms of getting your loan modified later on. While many lenders tell you that it won’t affect it, its very possible that it could. If you are falling behind on payments, you need to contact your lender right away. While skipping a mortgage payment doesn’t seem like a big deal to you right now, it will very much so hurt you in the long run. For further reading, see: Don’t “Skip” a Mortgage Payment When You Refinance.

Want To Buy a House, But Don’t Have The Down Payment Yet? Read On To Find Out How You Can Save Money Each Month To Go Toward Buying Your First Home


If you’ve landed on this article, chances are you’re thinking about buying your first house. Congratulations! However, you should know that it is harder to get a mortgage these days than it was long ago. Banks are now requiring buyers to put down more money than they used to have to. If you’re wanting to buy a house, you’re going to have to save quite a bit of money. Here are some creative ideas to help you save, so you can eventually buy your very first house!

•Dictate a monthly budget, and stick to it. It should be a no brainer, but you build savings by spending less than you earn. Therefore, any financial goals begin and end with your monthly budget. It’s important to be both honest and realistic about your spending habits, and then stick with your plan. Electronic bill pay is a fantastic tool, because then your payments take care of themselves.

•Look to your savings. Many people have trouble saving money because they simply see a lot of zeros in their bank account and assume that they are comfortably on track when they are not. It’s very possible that you have less money to spend at the end of the month after paying your bills, than you think you do. The simplest way to avoid this is to create a dedicated bank account just for your housing fund, and then deduct it from any spendingPay credit card keyboard. Finger

•Make savings automatic. Once you have a dedicated savings account, let the bank know how much you want from your checking account to go into that savings account each month.

•Save tax refunds and work bonuses. While it’s tempting to splurge a little even as you save a little, building up a down payment requires a lot of restraint. That applies both to your day-to-day expenses, as well as one-time infusions of cash. images

•Save big. Sure, you can save a few bucks each week by eating store-brand peanut butter instead of Jif. But you can make the biggest impact by cutting out the biggest expenses. Skipping your annual beach vacation won’t be easy, but snatching big bills where you can instead of pinching pennies is an effective way to build up savings quickly. Read: 10 Ways to Save Money to Buy a House If You Are Living Paycheck to Paycheck.

•Work more. Spending less is the obvious way to save, but working more and bringing home more money is also a great way to supercharge your savings. If you are eligible for overtime or additional work, take every opportunity that comes your way. And if you’re not, consider taking a second job on the side even if it’s only a few days or a few projects each month.

•Ask for support. Much like going on a diet, staying on a strict savings plan is much easier with the support of the people around you. Though its tempting, try to avoid or cut back your shopping trips. Make sure your friends and family know how your behavior is changing so they can meet you halfway.

•Don’t punish yourself. The math of saving for a house may be straightforward, but the emotions of saving are very complex. If saving feels painful or frustrating every single day, you’re much less likely to be successful at it. So, rather than let the frustration build up after you deny yourself every discretionary expense, take comfort in a simple pleasure once in a while. The idea is to save money, not to spend zero, and you will find it much easier to save if you’re actually enjoying your life while doing so. For further reading, see: Buying a Home: Saving For a Down Payment.