California Mortgage Lender

Archive for the ‘House Selling Tips’ Category

Purchasing a home will be one of the biggest investments a person or couple makes in their lifetime. One of the most important aspect of making that purchase will be the down payment. In order to plan for that down payment is wise to do some smart investing. The earlier one starts the better. Investing can be in the form of a simple savings account or as complex as investing in the stock market. The most important thing is to start early.

How Much House to Save For

Total housing expenditures should not exceed 28% of an individual or couples gross income before taxes. If a couple has a combined income of $100,000 per year before taxes, then they can spend $28,000 per year on monthly housing expenses. That works out to be about $2,300 per month. Subtract estimated Utility bills, insurance, and taxes, to arrive at a monthly figure. Using that monthly figure and a financial calculator the total price of a home can be figured. Once the full price of a home is estimated, a down payment can be saved.

Have A Rainy Day Fund

Save more than is needed for a down payment. Purchasing a home will require maintenance and other unexpected repairs. An illness or job loss can set the new homebuyer back. The way to prepare for these situations is through smart investing and saving. As a rule of thumb, save six months of total expenses and do not touch it even when you are tempted. This will be your real emergency fund.

Once The Down Payment Is Saved

After struggling, scrimping, and saving the down payment, it is time to find a qualified realtor. There will be benefits to using a big-name agency. However, there may be some advantages in using the small hometown office. The big-name agency can offer buyers protection and other types of insurance. On the other hand, the small local office will know the neighborhoods and better understand the surrounding community. Take some time to decide which one would be best in your circumstances.

Closing the Deal

After the purchase is finalized but before the loan is closed, use a financial calculator to double check everything. Make sure everything you negotiated is there. Then take the paperwork to your lawyer and have him or her look it over. They may find an error that can save you thousands over the lifetime of the loan.

This year, after a few years of a down economy, and a housing market that doesn’t seem to want to come back, there are plenty of people wondering “Should I sell my house in today’s market?” The high prices of just a few short years are still in the back of everyone’s mind, and the desire to wait for those prices again before selling is a natural inclination. however home sellers have to be practical, and look at today’s reality in the home market and the economy generally. The likelihood is that prices, even if they don’t fall farther, will stay at these levels for some time.

Here are the reasons prices are not likely to jump higher in the near future. right now, there are tow big issues facing anyone buying a home. One is the unstable job market. Some people are comfortable that their jobs are secure. But many more people are not sure whether they could be laid off, or are now struggling with being laid off. Unemployment benefit can’t help enough to hold a person and much less a family for more than a short while. Buying a house when someone is unsure of their income situation is very unlikely.

The second problem is the housing market itself. When prices are low, banks don’t like to lend. Even if a home seller does find a qualified buyer, the asking price of the house makes the bank’s appraisers nervous. The bank – and the buyers – can’t be sure what the actual market price is, whether the value of the home will drop shortly after the sale, or if it’s worth what’s being asked. Appraisers and banks play a big role in whether a buyer can actually close on a home, and many people are stuck at closing without a commitment on mortgage. Without security in the pricing and the future, banks and borrowers are both scared to invest in housing, and a homeowner wanting to sell a home fast may be waiting uselessly.

This situation may change in the future, in the next year or the next five. If you need to sell, it’s better not to wait for higher prices, which may never come, but be realistic and take the proceeds now based on the home’s value today.