Archive for June, 2019
Attention Graduates! Learn How To Start Saving For A Home Today!
Congratulations grads! You did it! Graduating is an exciting time in your life! The inevitable question always lingers: “what’s next?” If you are considering home ownership, you are already a step ahead!
Rent or Own?
One of the misconceptions people have about owning a home is that it costs more than renting. The rent prices have been increasing over the last few years making the cost of renting the same as a mortgage payment (sometimes MORE). Home ownership is associated with more up-front costs than renting however you could potentially earn that money back. The value of your future home may increase over time providing you with a return on your investment. California has an extremely profitable housing market.
Here is an example: In 1998 you purchased a home in California for $200,000. Despite the up-front costs and the down payment, you made the leap into home ownership. Fast forward to 2019, your needs have changed and you want to sell your home. You sell your home for over $600,000 dollars! That is money in your pocket and money that goes right into your next down payment! You can read more about the perks of being a first time home buyer HERE and start planning for your future today!
How Will I Afford A Down Payment?
Many first time home buyers still believe a 20% down payment is required before you can get approved for a mortgage. That is how conventional mortgages were designed however there are more options for buyers today. FHA loans, VA loans, and USDA loans provide different rates and charge insurance differently. It is important to choose the loan that fits your downpayment needs. Read more about your mortgage lending options here.
Let’s talk savings. Your best change to get the property you desire in the time frame that works for you is to have a down payment saved so you are ready when you find your perfect home. After considering your options, you have decided what your target down payment is. You just graduated, you might feel like that amount of money is unattainable for you to earn within a reasonable timeframe but what if you didn’t have to wait that long? Crowdfunding could provide you with the down payment you need, in the time you need it.
Crowdfunding is exactly what is sounds like – it is the use of small amounts of money from a large amount of people to help you finance your first home. Your graduation party is approaching, and you’ve probably heard that your graduation gift is… MONEY! Some graduates might want to spend that money ASAP. What if you INSTEAD contributed that money towards a savings account for your first home? Check out this graph:
If you invite 100 people to your graduation party and they gift you $100 dollars each, that is $10,000 going towards your down payment! Not ready to make the jump into home ownership yet? Throw that money into a savings account and earn money from interest! When you are ready, the money is yours for the taking.
How Can I Start?
When you are ready, you can reach out to Angie or the Vow2Save Team and they will help you make every step to purchasing your new home easy and exciting! Then you will be able to customize your very own website however you would like. Let your friends and family know that you have a goal of becoming a first time homeowner and direct them to donate on your website! As donations roll in, the meter on the website will grow. This encourages your friends and family to help you reach your goal.
Ready to start saving for your home? Check out Vow2Save and start planning your future today. By the time your wedding rolls around you can create a wedding registry that will fill your home with things you love!
Contact the Vow2Save team today 1 (949)-338-7408
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Assuming A Property After The Death Of A Relative
Losing a relative can be a very difficult time. We are very sorry for your loss. As you are figuring out your next steps, you may have questions about handling existing mortgage affairs. It is important to remember that you have options and we are here to help you consider the best options for your situation. An assumable mortgage is a home loan that can be transferred from the original borrower to the subsequent homeowner.
Determine if you are permitted to assume the loan
Not all mortgages are assumable – you can check the language in your note and mortgage. Certain types of government-backed loans are easier to assume than conventional loans. Typically you must meet the qualifications of the government agency in order to assume the loan. If you are not sure if you qualify – check with the lender of the loan as well as a real estate professional and a lawyer to ensure you will assume the loan properly.
Lean on professionals to help you determine if you should assume the loan
There are many benefits when assuming a mortgage. When you assume the mortgage, you keep the interest rate that the original owner had on the loan. This could increase the marketability of the property especially in a market where interest rates might be rising. Assumptions typically take less time. If you were listed on the note or in the trust agreement, the process could take only 30 days.
A properly recorded deed is public record. This means once an individual inherits the property – it becomes public record if a trust agreement was not in place. It is important to stand by your trusted professionals during this time to ensure you make the best decisions for you and your family. Offers will come your way that might encourage you to sell the home, it is important to make this decision based on what is best for you. Making sure you have the right people beside you during this difficult time is crucial to ensuring you make the best financial decisions.
Decide if selling the property would benefit you
It is important to remember that you have options. Selling the home might seem appealing and marketable however owning the home could provide an income for your family. Assuming the mortgage allows you to inherit a property at a lower cost, with potentially lower interest rates. If you assume the loan, you will have to pay taxes and assumption fees. While selling the home provides you with an advantage as a seller (lower rates, quicker closing) you could lose a valuable asset. Assuming the mortgage provides you with an opportunity to use the property as an investment. If you do not wish to reside in the home, you could consider using the property as an investment to provide a monthly income to you and your family. Real estate is an imperishable asset with an increasing value. You can learn more about how to turn a property into a source of income here.
If you have additional questions and are seeking help from a trusted professional, contact Angie at 949-338-7408. You can also fill out a contact form if you would like to discuss how you can begin the process of assuming a mortgage!
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Orange County Real Estate Success 