Author: lcogdill

Posted on

FHA Streamline Refinance

FHA Streamline Refinance Loan

Print PDF Version

The FHA Streamline Refinance is an unusual home loan item, majorly for property owners with existing FHA mortgages. It is otherwise known as a FHA-to-FHA loan. FHA Streamline Refinance are the quickest and easiest means for FHA-guaranteed property holders to refinance their home loans into the present home loan rates. You can even utilize a FHA Streamline if the property is not your main home anymore.

It is seamless for borrowers to renegotiate old FHA contracts into new FHA contracts, without much effort, due to the fact that FHA supports these loans. If you evade or miss payment, you would have to remunerate your lender. By making it simple for FHA borrowers to show signs of improvement contracts, the organization eliminates the possibility of default while also assisting property holders secure better loans. This is very good for both parties.

The FHA Streamline Loan program gets its name since it enables borrowers to renegotiate a current FHA credit to a lower rate rapidly. By getting rid of excess paperwork and usually without an appraisal, the Streamline spares borrowers time and cash.

You can moderate the loan fee on your present home loan without a full credit check, yet you must have remunerated your home loan promptly over the last year. There is no prerequisite for income authentication either. FHA Streamline is devoid of excess paper work, eligibility is straightforward and  it has a number of highlights which makes it exceptionally appealing for borrowers.

FHA Streamline Refinance Process

Before you make any renegotiating steps, ensure you meet the couple of rules created by the FHA:

 

  • Your present home loan must be insured by FHA.
  • You mortgage payment must be prompt and complete in the last year.
  • Your FICO financial assessment must be no less than 620 or higher. A few banks require a FICO assessment of 640 or 680 on a FHA loan.
  • You can’t have renegotiated inside the previous 210 days.

In the event that you meet these rules, you can contact your present lender to ask about a streamline loan. You can likewise contact other banks to analyze rates and charges. Various banks have diverse credit prerequisites, so regardless of the possibility that one moneylender turns you down, another might be enthusiastic to finance you.

Notwithstanding different individual home loan moneylender necessities, you have to meet the FHA “net tangible benefit” prerequisite, which states that refinancing will either enable you to evade future home loan rate increments or will lessen your scheduled instalment.

FHA Streamline Refinance: Advantages

Property holders with existing FHA home loans might be qualified for a new FHA Streamline Loan. This program gives a chance to improve contract terms at a lower cost.

The program makes it less demanding to qualify and more affordable to pull off as a result of the following reasons:

 

  • Simple to Qualify. FHA financing is intended to help borrowers with a not-too-good credit. In the event that your FICO assessment is under 740 or more 620 or 640, look at your choices for FHA financing. In the event that your FICO rating is over 740, conventional financing is probably going to be your best option.
  • It disposes of the prerequisite for business and income authentication
  • Statements of account are not requested from borrowers.
  • There are no financial assessments
  • The program gets rid of home evaluations
  • Property holders can utilize the program to diminish their FHA mortgage insurance premiums (MIP) and get improved contract with their new credits.

Disadvantages of FHA Streamline Refinance

  • Mortgage Insurance. When you borrow another FHA credit, you would have to pay forthright mortgage insurance once more. Furthermore, if your loan-to-value is more than 78%, you would have to pay yearly premiums. The insurance raises your loan balance and your scheduled instalments.
  • Closing Charges. The FHA insists that borrowers can’t fund their closing charges into their loan balance. Closing charges differ with respect to location. On average, the closing charge is roughly 3% of the credit sum, or $3,000 on a $100,000 advance. Most creditors enable you to wrap fund your closing charges into your loan balance. Your choices on a FHA streamline renegotiate, in any case, are to pay your closing charges with money or to find a creditor willing to do a “zero cost refinance.”
Posted on

Buying a home vs renting

Buying a home versus renting

Having to make a decision between buying a home or renting it is amongst the greatest monetary decisions that many individuals would have to make in their lifetime. The choice of purchasing an apartment of renting it is a major decision. It is difficult to decipher the better deal as the cost of purchasing a home is muddled and more varied than the cost of renting an apartment.

This decision doesn’t simply influence how much cash you have left toward the month end; it likewise influences your way of life and cumulative savings. However, most people feel that purchase of homes is a better investment as it is a source of tax deductions and the value of the asset. On the flip side, people rent homes due to the reduced responsibility and the flexibility afforded.

Given the various expensive expenses related with buying a home, most youths start off by renting a home. As they climb up their career rungs and earn higher, most of them end up purchasing homes.  On the flip side of the age range, landlords close to their retirement age may offer to trade their family homes, cut back on spending and become tenants again.

Many landholders receive rewards that one can’t get from leasing, for example, stability, monetary security and tax deductions. With each installment payment, one is closer to becoming a landlord. The equity on the asset can be used for loans and refinance to enhance the home and increase its value.

Even though renting a home isn’t as beneficial in terms of monetary benefits, it is less expensive to rent a home monthly. In case you are considering how to save for installment, renting can be your way out. In costly and aggressive markets, renting might be the best option on a long-term basis. If you however, consider buying, try using a mortgage calculator to evaluate the costs and compare rates to get the best deal.

Itemized below are the reasons renting is the better option:

 

  • You have limited money

In case that you don’t have the cash for an up-front installment and extra expenses of owning a home, leasing is the best alternative. Try to make use of rent and purchase calculators of popular real estate websites to know what you can afford.

 

  • Your job security is not certain

If you are not sure about your job security or you depend on contract jobs, you should try to concentrate more on saving for unforeseen occurrence and future expenses.

 

  • You have an interim schedule

If you are contracted to a temporary job that wouldn’t last more than two years, it is more advisable to rent a home in the neighborhood rather than spending much on purchasing a home. The same advice is also feasible when you intend starting up a family in the next few years. Similarly, if you are experiencing a critical transition in your life, such as loss of family and divorce, renting is a better option before you get back your stability.

 

However, buying is the better option when:

 

  • You can take care of the extra expenses related to owning a home

Before purchasing any home, try to ensure that you can pay the up-front installment and closing costs. Most banks demand a 20 percent up-front installment. So in the event that you are buying a $250,000 home, a 20 percent upfront installment would amount to $50,000. That is notwithstanding a regular commission of 5 to 6 percent in addition to another 1 percent in closing costs. Maintenance fees are additionally a major factor to plan for.

 

  • You intend to spend about five years in the home

It’s best to purchase when you have a long-term plan. Remaining in a home that you purchase for half a decade or more means you will probably recover what you paid in transaction fees and generate a good ROI.

 

  • You need to reap the monetary rewards of ownership

Little interest costs make owning a home alluring in light of the fact that it diminishes the sum borrowers pay on their mortgages. Home loan rates are at record lows after the 2008 monetary emergency. The normal rate on a 30-year fixed mortgage low as 3.9 percent. Furthermore, you can increase the value of your home, something that isn’t conceivable with a rented apartment.

Posted on

The Top Five Things to Look For in a Real Estate Investment

Have you heard about real estate investment?

Have you given it a thought to invest in it but get stuck about how to go about it? Yes, real estate investment technical-know-how can sometimes be challenging. Let’s look into it.

Real estate investment can be described as a way of investing in property and it involves purchasing, rental, ownership, sales or management of properties for profit. It is one of the earliest forms of investment that is lucrative and profitable, and its worth keeps increasing.

If you are considering investing in the stock market, real estate can be one of the profitable investments with liquidity, unique cash flow, and huge return on investment (ROI).

However, first –time investors are often faced with the issues of what we should be looking for in a real estate investment. This becomes a matter as some realty investment industries are tricky with giving out the necessary information to benefit the investors in real estate investment. This may be as a result of hidden agenda unknown to the investors. Though there are some real estate investments out there that are truthful and straightforward, yet, you must know some basic things to look for, to serve as a guide to selecting the best real estate investment. Let’s dive into it.

Top 5 Things to Look For in a Real Estate Investment

Scrupulous examining can only determine the value and quality of a real estate investment. Many things should be factored in selecting a good and profitable real estate investment. However, this article has discussed five basic things to look out for in real estate investment. Highlight below are the top 5 priorities to look for in a real estate investment:

Location: This is one of the most important features to look for when it comes to real estate investment. The location of the property will determine the category of renters that will be attracted to the property in consideration. Critically look at the quality of the location if it can turn-in cool cash quickly. Some of the criteria of a well-located property are proximity to the public places such as market, hospital, higher institutions, major business outlets, shopping malls, parks, and much more.

Any rental properties located closer to these listed public areas attracts higher demands from the prospective renters. And this will result in huge cash flow for you as an investor of the properties.

Also, industrial areas are good locations with job opportunities, and this tends to increase the number of people migrating to these areas to live closer to their offices. All these important places with the availability of social amenities enhance the value of the property.

  • The quality and type of the property: After location consideration, the next thing to factor is the property itself. What type of property should you invest in? The type and quality of your real estate investment determine the success of the investment. This directly involves your investment strategy as an investor. Investing in building or property that requires frequent maintenance may turn to influence the success of your real estate investment.

Quality property requires not only less frequent repairs or maintenance but can also be rented or leased faster at higher rental value. If you go for quality properties, you tend to benefit from the investment in the long run as the buildings are LEED certified, which adds value to the property.

If you are investing in the real estate investment for the first time, you can consider a condo. Real estate investment on a condominium has been studied to be profitable in term of quality as it requires less repairs and maintenance. You can also look for a good and appealing property which has features that can lure renters into renting or leasing it for different purposes.

  • Cost effectiveness: Location and property quality are not the only factors to consider. The price of the property is also important in the real estate investment. The higher the cost-effectiveness of your intending real estate investment property, the more return on investment.

However, the profitability of a property not only depends on the price but also property taxes. It involves the total cost incurred in procuring and keeping the property. So, when considering buying a real estate investment property, invest based on the value of the property. Value the property very well; if possible, invite an estate agent to help you assess the property if it worth its price tag; so, not to be at a loss.

  • Expected cash flow: Every real estate investor expects huge monthly or annual cash flow from his or her investment. Your cash flow is your monthly staple which can be described as amounts (such as taxes, mortgage payment, maintenance, and repairs) invest in the property to maintain or keep the property. Find out if you can still come up with a monthly or annual positive cash flow of all the money incurred in keeping and maintaining the property.

If the investment returns are studied not to be positive, don’t try investing in it. It is important to research the property you intend to invest in, to know the history, vacancies and occupancy rate in the area. However, if you have already bought such property, try to invest more in the property by carrying out some renovations and with time, you will begin to produce huge positive cash flow as expected.

  • Investment leverage: After considering location, quality, price, and expected cash flow, another important thing to factor among the top five factors in your real estate investment is the investment leverage. This involves the risk and reward in the investment property. A good realty investment is the one in which the reward is higher than the risk. How do you calculate your leverage?

You must understand that the property would need maintenance to keep it suitable for the renters. However, the maintenance to be carried out on this property must not be too much to be a good consideration for investment. Take a look at the construction of the building if it is standard. Note that a poorly constructed or situated property tends to consume more money in maintenance. Consider how much you are investing as a start-up capital and the frequency of maintenance in the long run. If the incurred cost is higher than the returns, it is not a good choice.

Conclusions

Real estate investment generally needs more startup capital, experience, time, and working strategy than any other investment portfolios. There are many other things need to be considered in investing in a real estate. We have mentioned the top five factors but still left out with some other factors such as inflation, market rivalry, transportation, tenancy, market risk, operating agreement, debt terms, and public infrastructure, amongst others.

Over times, investing in real estate property had been the best decision of investors and this has even improved as real estate investment properties keep appreciating every day. However, you need to link with the experienced and reliable vendors to enjoy a huge return on investment (ROI). This site has made everything simple in real estate, allowing old and new investors to invest in most quality and cost-effective real estate investment properties at good locations to give you value for your capital. Our real estate strategy is one of the best in the real estate investment portfolios. Contact us today!

Posted on

What’s Trending in Real Estate?

Current Real Estate Market

The real estate market is an ever bustling one, to say the least. For realtors, potential investors or those looking to purchase a home, it is important to be aware of the current trends as they give a peek into the future, giving you a platform to make informed decisions.

 

Younger generations coming to the fore

Understandably, the real estate market is traditionally dominated by the older generation but the narrative is gradually changing. More millennials are purchasing homes and this increase has been attributed to the friendlier financial climate. Interest rates have gone down and the time feels right to cash in on a real estate.

 

The climate looks even more favorable for Generation Z because unlike their predecessors, they are coming of age in a rapidly recovering economy implying less burden of student-loan and better job prospects. Any prospective or existing real estate entrepreneur that wishes to stay relevant in the coming years would pay more attention to the tastes of the coming generations.

 

Suburban is the new sexy

Blending the amenities in urban centers with the serenity and affordability of suburban region is what many desire, and this desire is being fulfilled with the development of suburban settlements into Suburban.

This trend is also attributable to the first as Millennials love the urban lifestyle, but can only afford houses in suburban centers. This has led to the addition of urban facilities to existing suburban centers. About 80% of residential growth is forecast to occur in suburban centers compared to the 15% forecast in urban centers.

 

Viewing from above

The turn of the new year was hugely anticipated in the real estate industry and the clearance of commercial use of drones by the Federal Aviation Administration contributed in no small part to the excitement.

Drones are no longer exclusively seller’s tools but home buyers now use drones to inspect the roofs and surroundings of houses especially when they can’t carry out proper home inspection. The drop in prices of drones also facilitates drone-viewing as more people now have access to these devices.

 

Mobile search

The real estate industry is not left out of the internet revolution. Many consumers now prefer to search for real estate online and online real estate ad clicks are rapidly increasing. Realtors are taking advantage of this by placing more focus on online advertisements. This trend is expected to continue for a very long time as the newest generation will lean toward mobile searches.

 

Given the relative stability of the real estate market, it is safe to predict these trends will dominate the near future, except something profound disrupts the present tilts.

Posted on

Why You Should Hire a Real Estate Agent

Why You Should Hire a Real Estate Agent When Selling Your Home vs. Selling On Your Own

Due to the several processes involved, selling your home may be quite a stressful task. You will need the expertise of a professional real estate agent to help you throughout the entire process of the home sale. This will save you a lot of time and stress. The following are some of the reasons why you should hire a real estate agent compared to selling the home on your own:

Expert Guide

Selling a home usually need many forms, reports, disclosures, as well as series of other technical documents. An expert real estate agent is already aware of every document involved. Why then should you stress yourself concerning what you have little knowledge of when a real estate agent can get you the best deal?

A real estate agent has adequate knowledge of the real estate sector and has a clear understanding of the language. Not only will you be getting the best deals, delays and costly errors will also be avoided.

Negotiation Skills

Many factors are often discussed before closing a deal. A real estate agent can take a glance at each angle from your viewpoint. The real worth of your home will also be determined. By taking advantage of the negotiating skills of the real estate agent, you are likely to sell your home at the real value, if not more compared to selling the home yourself where you may be in a haste to close the deal.

Property Marketing Power

Selling your property requires more than listing your home on the market. Marketing your home is important. The majority of real estate sales are from previous purchasers, family, or friends of the agent. Real estate agents have the resources, and therefore the ability to promote or market your home. This offers you the chance to sell your home fast.

All these are a couple of reasons why you should hire a real estate agent to sell your home. No one does it better than an expert. Selling your home through the expertise of a real estate agent will save you time and stress. You can be rest assured of getting the best deal.