Down Payment – 10 Things to Know Before Buying a Home

For many Americans, coming up with a down payment for their first home can be a major roadblock—and quite often the reason for renting, rather than owning a home.

A down payment is the difference between the home’s purchase price and its mortgage amount. This percentage of the sale price must be paid up-front and can vary by lender, location, and loan program. A higher down payment generally translates into lower loan interest rate requirements.

Typically, a down payment comes from personal cash savings, but it can also be a gift that is not to be repaid, or a borrowed amount secured by assets.

While conventional loan down payments may be close to 20% of the sale price, government loans typically have lower down payment requirements. This allows potential homebuyers who normally cannot meet down-payment requirements an opportunity to qualify for a mortgage. Keep in mind that down payments that are less than 20% of the sale price typically require mortgage insurance payments.

10 things to know before buying a home

  • Before you start looking for a home, get pre-qualified for a loan. This will help you determine how much home you can afford and will give you an advantage over buyers who do not have their financing setup in advance.

 

  • If you have marginal or bad credit, consult your lender. You may be able to qualify for a loan depending on how long ago and what reason(s) caused the bad credit.

 

  • You will need a down payment. Down-payment requirements vary depending on the type of loan.

 

  • You will need funds for closing costs. Closing costs are charges for services related to the closing of your real estate transaction. They include, but are not limited to: Escrow fees, title policy issuance fees, mortgage insurance fees, fire, flood, and homeowners insurance, county recorder fees, and loan origination fees. Consult your lender for an actual estimate of these costs.

 

  • Some loans have “points” and some do not. A point is a loan origination fee equivalent to 1% of the loan amount. Together with the interest rate, they constitute the yield on your loan for the lender.

 

  • Mortgage rates can be fixed or adjustable. Which one is right for you depends on whether mortgage rates are at a high or a low point when you purchase, and on how long you plan to live in the home.

 

  • There are two main types of loan categories. Conventional mortgage loans are available with fixed or adjustable interest rates. Government loans include FHA fixed and adjustable rate mortgage loans, and VA fixed rate mortgage loans.

 

  • If you are a low-to-moderate-income homebuyer, there are special programs designed to help you. These loans are available through private lenders, as well as local and state housing agencies.

 

  • You may have to pay mortgage insurance. Mortgage insurance protects the lender from potential loss if you should default on your mortgage loan payment. Mortgage insurance is always required on FHA mortgage loans.

 

  • Many organizations offer home loan counseling to prospective homebuyers. They will cover home selection, REALTOR® services, lenders, loan programs, homeownership responsibilities, saving for a down-payment, and other important pieces of information.

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Nicole Emanuel Real Estate

Coldwell Banker

(408) 410-2060

nicole.emanuel@cbnorcal.com

www.realestatebynicole.com

Pantone Has Chosen a Color of the Year…and You’re Going to Love It!

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Drum roll please….and the pantone color of the year for 2018 is officially Ultra Violet! Looks like they have chosen a fun and funky color for your new home decor or fashion trends. When looking at staging homes for sale, a pop of color such a ultra violet in a pillow or a chair can make a home feel more modern and provide a bit of fun.

Here’s an excerpt from the Pantone website (www.pantone.com) on why they chose this color this year.

“Complex and contemplative, Ultra Violet suggests the mysteries of the cosmos, the intrigue of what lies ahead, and the discoveries beyond where we are now. The vast and limitless night sky is symbolic of what is possible and continues to inspire the desire to pursue a world beyond our own.

Enigmatic purples have also long been symbolic of counterculture, unconventionality, and artistic brilliance. Musical icons Prince, David Bowie, and Jimi Hendrix brought shades of Ultra Violet to the forefront of western pop culture as personal expressions of individuality. Nuanced and full of emotion, the depth of PANTONE 18-3838 Ultra Violet symbolizes experimentation and non-conformity, spurring individuals to imagine their unique mark on the world, and push boundaries through creative outlets.

Historically, there has been a mystical or spiritual quality attached to Ultra Violet. The color is often associated with mindfulness practices, which offer a higher ground to those seeking refuge from today’s over-stimulated world. The use of purple-toned lighting in meditation spaces and other gathering places energizes the communities that gather there and inspire connection.”

Will you be using ultra violet in your home decor this year?

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Nicole Emanuel Real Estate

Coldwell Banker

(408) 410-2060

nicole.emanuel@cbnorcal.com

http://www.realestatebynicole.com

BRE 01899594

 

Home Inspections – Specialists You May Want to Check Out

While most folks settle for a home inspection, pest (termite) inspection and possibly a roof inspection, there are a myriad of specialists you can hire to investigate just about anything home-related when you are purchasing a home. The California Association of Realtors put together this short list of the most popular, but some common inspections we see  also include:

Pool & Spa – If the home has a pool and spa, its a must to get it inspected. This is often an overlooked item and failing pool pumps and heaters can be very expensive.

Arborist – Does the home have a huge tree in the front yard? Is one of the trees looking overgrown? Sometimes, it makes sense to call an arborist to make sure the trees on the property are healthy and not in danger of falling limbs or needing to be uprooted (all of which can be rather costly).

Contractors – Are you considering doing some renovating to a home after purchase? Its smart to have a contractor walk the home before you purchase to ensure you can do all the items you want. Sometimes structural modifications might not work or will be very expensive due to the placement of load-bearing walls and foundations so its something you might want to know up front if you are planning on adding on to a home or re-arranging.

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Nicole Emanuel Real Estate

Coldwell Banker

(408) 410-2060

nicole.emanuel@cbnorcal.com

http://www.realestatebynicole.com

Burglary Prevention Tips

BurglaryOne of the crimes most frequently reported to the police during the holidays is residential burglary
It’s also the most preventable. It doesn’t take much or cost much to out-smart most burglars. They’re usually not professionals, but rather people taking advantage of an easy target. Burglars may do more than steal things. If they’re surprised by someone coming home or if they choose a home that’s occupied, someone may get hurt.

Tips on Safeguarding Your Home

  • Make sure all exterior doors have good locks-at least dead-bolt locks with a 1″ throw.
  • Always lock up when you go out, even if only for a few minutes.
  • Secure sliding glass doors with bars or locks, or put a broom handle in the door track.
  • Make sure your windows have good locks, especially those at ground level.
  • Make sure all porches, entrances, and outside areas are well lit.
  • Trim any bushes or trees that hide doors or windows.
  • Maintain your yard and keep ladders and tools inside when you’re not using them.
  • Don’t hide your keys under the doormat or in a flowerpot. That’s the first place burglars look! It’s much better to give an extra key to a trusted neighbor.
  • Mark your valuable property like TVs, VCRs, computers, cameras and stereos with your driver’s license number.
  • Keep a record of your property in a safe place.
  • Install an alarm system for summoning emergency help.
  • If you park your car outside, never leave a garage door opener in the car.
  • Install a monitoring device such as a Ring Video Doorbell or Chime Doorbell. Easy to spot cameras are also a good choice.

When you go away

  • Ask a neighbor to collect your mail and newspapers, and offer to return the favor.
  • Put an automatic timer on at least two lights and a radio. Consider photoelectric sensors to turn outside lights on and off automatically.
  • Tell a trusted neighbor when you’re leaving and when you’ll return. Include an itinerary and phone numbers where you can be reached in an emergency.

Does Moving Up Make Sense?

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With prime home buying and selling season upon us, it’s a good time to ask yourself if a move up is right for you. Sometimes we talk with buyers that are considering a move but faced with the reality of a larger mortgage payment, find that its best for them to wait. Or some clients need to know what their home might sell for in order to decide if moving into a new home is right for them. There are many things to consider when deciding if selling your home and buying a new home is right for you. Whatever the case, we are here to help you decide whats best for you and your family.

Whether your family size is growing, you are running out of space or simply want to seize the opportunity to “move-up” to your next home, below are a few questions to consider as you weigh your options.

  1. Have you built substantial equity in your current home? Home equity can be defined as the value of a home, minus the amount of outstanding debt. Although equity does not generally develop in the first few years of home ownership, five or more years of home payments may create significant unrealized gains.
  2. Has your income or financial situation improved? Homeowners should consider their overall financial situation including current and future expenses in order to make an educated decision on price range for a new home. For example, an increase in salary may allow for an increased mortgage.
  3. Has your lifestyle changed? Lifestyle changes are one of the most common reasons people choose to move. Starting or adding to a family may require an extra bedroom or additional square footage, as well as a desire to live closer to work or family may provide the impetus for a move to a larger home.
  4. Is your current residence one that could potentially be rented out? For those homeowners who are ready to make a move but are concerned about purchasing a new home before the current property is sold, renting out the current residence may be a viable option. We also work with a variety of clients who decide they want to find a home to purchase before they sell their current home.
  5. Are interest rates attractive? A low interest rate means lower mortgage payments on homes of the same price. I’d be happy to refer you to a mortgage advisor should you need to check on interest rates.

No matter what you decide, you need an expert team to help you balance a concurrent purchase and sale transaction seamlessly. Nearly two-thirds of our client base is either moving up or downsizing and we have successfully assisted them with both sides of the transaction. If you want to discuss any of the questions above or have more to ask, don’t hesitate to give us a call or email! Nicole.emanuel@cbnorcal.com, (408) 410-2060.

How to Turn Your Home into a Party Pad for Football Season!

Football season has begun! Read on for tips into turning your home into the ultimate game day party pad!!! Whether you are a 49er’s fan or a Patriots fan, your guests will appreciate you being game-day ready! Check out this article to find out more!

Football Season Begins: How to Turn Your Home into a Party Pad.