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Starting the Mortgage Conversation: The Paperwork

November 26, 2010 Leave a comment

Lender Checklist:

Paperwork You’ll Need for a Mortgage

  1.  W-2 forms — or business tax return forms if you’re self-employed — for the last two or three years for every person signing the loan.
  2. Copies of at least one pay stub for each person signing the loan.
  3. Account numbers of all your credit cards and the amounts for any outstanding balances.
  4. Copies of two to four months of bank or credit union statements for both checking and savings accounts.
  5. Lender, loan number, and amount owed on other installment loans, such as student loans and car loans. 
  6. Addresses where you’ve lived for the last five to seven years, with names of landlords if appropriate.
  7. Copies of brokerage account statements for two to four months, as well as a list of any other major assets of value, such as a boat, RV, or stocks or bonds not held in a brokerage account.
  8. Copies of your most recent 401(k) or other retirement account statement.
  9. Documentation to verify additional income, such as child support or a pension.
  10. Copies of personal tax forms for the last two to three years.  

Reprinted from REALTOR® magazine (REALTOR.org/realtormag) with permission of the NATIONAL ASSOCIATION OF REALTORS®.

Copyright 2008. All rights reserved.


Andrew C. WilsonAndrew’s Take:

Some lenders will require additional documentation to what is listed here, but if you pull together the items above early in your search and keep them organized in a binder or folder, you will be well on your way to a successful approval!  Don’t forget that in the wake of the mortgage crisis, it is more important than ever to be able to document to a lender that you are worthy of a loan. 

 Further, in the Queens and Nassau real estate markets, co-op apartments are common and board applications will require this documentation as well.  All the more reason to stay organized.


Work with a buyer’s agent who is also a licensed architect.

Andrew Wilson: NY Architect and REALTOR®

Looking for Queens or Long Island Real Estate? Contact Andrew Today:

andrew.wilson@realestate.com

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Categories: Real Estate, Top Tips

FHA Loans: Rule Changes You Should Know

August 16, 2010 Leave a comment

If you are interested in obtaining FHA financing in the near future, you will be interested in the changes that could implemented very soon…  Thanks for the heads up from @CalculatedRisk. (Twitter)

The basics: Looks like the total amount of allowable consessions will be halved (from 6% to 3%) and credit score requirements will be increased (what took so long?) in order to qualify for the 3.5% down payment program.

Within that blog post from calulated risk, here is a link to a related post from The Wall Street Journal.

Categories: Economy, Real Estate, Top Tips

Mortgage Loan Types to Consider: The Basics

August 11, 2010 Leave a comment

Loan Types to Consider:

Which is right for you?

Brush up on these mortgage basics to help you determine the loan that will best suit your needs.

  • Mortgage terms. Mortgages are generally available at 15-, 20-, or 30-year terms. In general, the longer the term, the lower the monthly payment. However, you pay more interest overall if you borrow for a longer term.
  • Fixed or adjustable interest rates. A fixed rate allows you to lock in a low rate as long as you hold the mortgage and, in general, is usually a good choice if interest rates are low. An adjustable-rate mortgage is designed so that your loan’s interest rate will rise as market interest rates increase. ARMs usually offer a lower rate in the first years of the mortgage. ARMs also usually have a limit as to how much the interest rate can be increased and how frequently they can be raised. These types of mortgages are a good choice when fixed interest rates are high or when you expect your income to grow significantly in the coming years.
  • Balloon mortgages. These mortgages offer very low interest rates for a short period of time — often three to seven years. Payments usually cover only the interest so the principal owed is not reduced. However, this type of loan may be a good choice if you think you will sell your home in a few years.
  • Government-backed loans. These loans are sponsored by agencies such as the Federal Housing Administration (www.fha.gov) or the Department of Veterans Affairs (www.va.gov) and offer special terms, including lower down payments or reduced interest rates to qualified buyers.

Slight variations in interest rates, loan amounts, and terms can significantly affect your monthly payment. For help in determining how much your monthly payment will be for various loan amounts, use Fannie Mae’s online mortgage calculators.


Reprinted from REALTOR® magazine (REALTOR.org/realtormag) with permission of the NATIONAL ASSOCIATION OF REALTORS®. Copyright 2008. All rights reserved.


Andrew C. WilsonAndrew’s Take:

There is no one-size-fits-all mortgage type, and major terms (like interest rates) are always changing and are different with each bank.  Doing some research on your own is definitely important, but speak with a mortgage professional sooner than later to find out which options are most realistic for you.

Refinancing is definitely possible if you get the wrong loan type, but it is expensive!  It is important that you take your time and pick the right loan product from the beginning.  It could be with you for the next 30 years!

Categories: Real Estate, Top Tips

7 Steps to Take Before You Buy a Home

August 3, 2010 Leave a comment

Article From BuyAndSell.HouseLogic.com

By: G. M. Filisko
Published: February 10, 2010

By doing your homework before you buy, you’ll feel more content about your new home.

Most potential homebuyers are a smidge daunted by the fact that they’re about to agree to a hefty mortgage that they’ll be paying for the next few decades. The best way to relieve that anxiety is to be confident you’re purchasing the best home at a price you can afford with the most favorable financing. These seven steps will help you make smart decisions about your biggest purchase.

1. Decide how much home you can afford

Generally, you can afford a home priced 2 to 3 times your gross income. Remember to consider costs every homeowner must cover: property taxes, insurance, maintenance, utilities, and community association fees, if applicable, as well as costs specific to your family, such as day care if you plan to have children.

2. Develop your home wish list

Be honest about which features you must have and which you’d like to have. Handicap accessibility for an aging parent or special needs child is a must. Granite countertops and stainless steel appliances are in the bonus category. Come up with your top-five must-haves and top-five wants to help you focus your search and make a logical, rather than emotional, choice when home shopping.

3. Select where you want to live

Make a list of your top-five community priorities, such as commute time, schools, and recreational facilities. Ask your REALTOR®; to help you identify three to four target neighborhoods based on your priorities.

4. Start saving

Have you saved enough money to qualify for a mortgage and cover your downpayment? Ideally, you should have 20% of the purchase price set aside for a downpayment, but some lenders allow as little as 5% down. A small downpayment preserves your savings for emergencies.

However, the lower your downpayment, the higher the loan amount you’ll need to qualify for, and if you still qualify, the higher your monthly payment. Your downpayment size can also influence your interest rate and the type of loan you can get.

Finally, if your downpayment is less than 20%, you’ll be required to purchase private mortgage insurance. Depending on the size of your loan, PMI can add hundreds to your monthly payment. Check with your state and local government for mortgage and downpayment assistance programs for first-time buyers.

5. Ask about all the costs before you sign

A downpayment is just one homebuying cost. Your REALTOR®; can tell you what other costs buyers commonly pay in your area-including home inspections, attorneys’ fees, and transfer fees of 2% to 7% of the home price. Tally up the extras you’ll also want to buy after you move-in, such as window coverings and patio furniture for your new yard.

6. Get your credit in order

A credit report details your borrowing history, including any late payments and bad debts, and typically includes a credit score. Lenders lean heavily on your credit report and credit score in determining whether, how much, and at what interest rate to lend for a home. Most require a minimum credit score of 620 for a home mortgage.

You’re entitled to free copies of your credit reports annually from the major credit bureaus: Equifax, Experian, and TransUnion. Order and then pore over them to ensure the information is accurate, and try to correct any errors before you buy. If your credit score isn’t up to snuff, the easiest ways to improve it are to pay every bill on time and pay down high credit card debt.

7. Get prequalified

Meet with a lender to get a prequalification letter that says how much house you’re qualified to buy. Start gathering the paperwork your lender says it needs. Most want to see W-2 forms verifying your employment and income, copies of pay stubs, and two to four months of banking statements.

If you’re self-employed, you’ll need your current profit and loss statement, a current balance sheet, and personal and business income tax returns for the previous two years.

Consider your financing options. The longer the loan, the smaller your monthly payment. Fixed-rate mortgages offer payment certainty; an adjustable-rate mortgage offers a lower monthly payment. However, an adjustable-rate mortgage may adjust dramatically. Be sure to calculate your affordability at both the lowest and highest possible ARM rate.

More from HouseLogic

Learn how Fannie Mae and Freddie Mac mortgages can help you save on financing

Learn more about the costs of homeownership

 Other web resources

Homebuyer counseling resources

Get a free credit report from each of the three credit reporting bureaus

 G.M. Filisko is an attorney and award-winning writer who has thrice survived the homebuying process. A frequent contributor to many national publications including Bankrate.com, REALTOR®; Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.


Andrew C. WilsonAndrew’s Take:

Being organized and realistic about all of the steps involved will help eliminate unwarranted anxiety.  There is no sense in putting off any of the above steps if you are serious about purchasing a new home, because there is no way to get around the increased lending requirements if you are financing your purchase.  Even if you are purchasing with cash, Steps 1 – 5 will still apply and are good to keep in mind.


Work with a buyer’s agent who is also a licensed architect.

Andrew Wilson: NY Architect and REALTOR®

Looking for Queens or Long Island Real Estate? Contact Andrew Today:

andrew.wilson@realestate.com

Categories: Real Estate, Top Tips

Buyers: Should You Hire a Buyer’s Agent?

July 26, 2010 Leave a comment

Should I use a buyer’s agent for my home purchase? Almost certainly, “Yes.”

Check out some of the pros here in one of my previous posts.

Also, hear what other agents, including me, have to say on Trulia in response to a similar recent question.


Work with a buyer’s agent who is also a licensed architect.

Andrew Wilson: NY Architect and REALTOR®

Looking for Queens or Long Island Real Estate? Contact Andrew Today:

andrew.wilson@realestate.com

Categories: Top Tips

Take the Stress Out of Buying a Home

July 23, 2010 Leave a comment

Take the Stress Out of Homebuying: Ten Tips

Photo by SashaW

Buying a home should be fun, not stressful. As you look for your dream home, keep in mind these tips for making the process as peaceful as possible.

  1. Find a real estate agent who you connect with.
    1. Home buying is not only a big financial commitment, but also an emotional one. It’s critical that the REALTOR® you chose is both highly skilled and a good fit with your personality
  2. Remember, there’s no “right” time to buy, just as there’s no perfect time to sell.
    1. If you find a home now, don’t try to second-guess interest rates or the housing market by waiting longer — you risk losing out on the home of your dreams. The housing market usually doesn’t change fast enough to make that much difference in price, and a good home won’t stay on the market long
  3. Don’t ask for too many opinions.
    1. It’s natural to want reassurance for such a big decision, but too many ideas from too many people will make it much harder to make a decision. Focus on the wants and needs of your immediate family — the people who will be living in the home
  4. Accept that no house is ever perfect.
    1. If it’s in the right location, the yard may be a bit smaller than you had hoped. The kitchen may be perfect, but the roof needs repair. Make a list of your top priorities and focus in on things that are most important to you. Let the minor ones go
  5. Don’t try to be a killer negotiator.
    1. Negotiation is definitely a part of the real estate process, but trying to “win” by getting an extra-low price or by refusing to budge on your offer may cost you the home you love. Negotiation is give and take
  6. Remember your home doesn’t exist in a vacuum.
    1. Don’t get so caught up in the physical aspects of the house itself — room size, kitchen, etc. — that you forget about important issues as noise level, location to amenities, and other aspects that also have a big impact on your quality of life
  7. Plan ahead.
    1. Don’t wait until you’ve found a home and made an offer to get approved for a mortgage, investigate home insurance, and consider a schedule for moving. Presenting an offer contingent on a lot of unresolved issues will make your bid much less attractive to sellers
  8. Factor in maintenance and repair costs in your post-home buying budget.
    1. Even if you buy a new home, there will be costs. Don’t leave yourself short and let your home deteriorate. 
  9. Accept that a little buyer’s remorse is inevitable and will probably pass.
    1. Buying a home, especially for the first time, is a big financial commitment. But it also yields big benefits. Don’t lose sight of why you wanted to buy a home and what made you fall in love with the property you purchased
  10. Choose a home first because you love it; then think about appreciation.
    1. While U.S. homes have appreciated an average of 5.4 percent annually over from 1998 to 2002, a home’s most important role is to serve as a comfortable, safe place to live.

Reprinted from REALTOR® magazine (REALTOR.org/realtormag) with permission of the NATIONAL ASSOCIATION OF REALTORS®.

Copyright 2008. All rights reserved.


Andrew’s Take:

Working with me as your buyer’s agent is one of the best ways to make sure that you don’t lose sight of these tips.  I have been through all of these situations before with my clients, and it is my job to get you the information you need to be confident in your purchasing decision.

Work with a buyer’s agent who is also a licensed architect.

Andrew Wilson: NY Architect and REALTOR® 

Looking for Queens or Long Island Real Estate? Contact Andrew Today:

andrew.wilson@realestate.com

Categories: Top Tips

How to find a Buyer’s Agent: Top 5 tips

July 13, 2010 Leave a comment

How to find a Buyer’s Agent: Top 5 tips
If you are shopping for real estate in today’s market you can and should expect more from the real estate agent (or Realtor®) helping you shop. Trust me, there are plenty of agents that would love to have your business. Don’t just settle.

These are Andrew’s top 5 tips for selecting a buyer’s agent.

#5: Don’t pick the first agent that avails his/herself:
It may seem simple, but it is important to understand that you are not obligated to work with the first real estate agent that reaches out to you, especially if you are like 80% of shoppers that start their search on their own on the internet (and I know you are because you are reading this). I recently spoke with a house-hunting couple that used the internet to find a property they were very interested in putting a bid in on, and then scheduled a showing by clicking on an agent link on the internet listing page (not the listing agent), only to find that “their agent” seemed more interested in closing the deal than getting them a good price.

#4: Real estate is local, so should your buyer’s agent be:
There is no point being loyal to the agent that sold you your current house if you are interested in relocating to a different market. Their knowledge and service will not translate unless your target market is very near your current one. Best to ask him/her nicely for a list of referrals in your target market. You can then start with a short list to interview.

#3: Don’t sign a blanket exclusive agreement with a buyer’s agent
An exclusive agreement that covers a certain period of time will lock you into working with a buyer’s agent no matter how you find the property you are interested in buying. Ask instead to implement a property-specific agreement so that you are committing to work with the agent on certain homes, but not all. This is more flexible for you, and should be reasonable to most buyer’s agents.

Some agents will try to tell you that because (in most states) the seller doesn’t pay any sort of commission, it won’t cost you anything to sign a blanket exclusive agreement. This is technically true. However, because house-seekers have so much access to online property information, an exclusive agreement is a non-starter because buyer’s agent value should be added rather than contractually obligated. If a buyer’s agent tries to push you into an exclusive agreement, it should send up warning signs about his/her intention to truly help you find and negotiate the best deal.

#2: Low volume = high attention
This one is simple, but often overlooked. You should ask a potential buyer’s agent how many clients they are currently representing. If it is more than five, there is reason to think that they may not be able to give you the attention you expect and deserve. If the agent assures you he/she has a refined customer service model, despite representing 20+ buyers at a time, be sure you are comfortable with the other agents or assistants that you will be dealing with during your hunting and transaction experience.

#1: Seek professional knowledge beyond typical agents
In most states, any licensed real estate agent can represent a buyer. It is up to you to figure out how to get the most value out of the service. Our #1 tip is to ask the agent what makes them different. Their answer should concentrate on differentiating knowledge and service. Some agents just passed their state exams. Others are licensed in other professions as well. Others have real estate investment experience in a given market. These additional licenses and perspectives help ensure you get the most from your agent.

Who will get you the best deal and give you the most confidence when writing offers to buy your first home or your next investment property? Ask the right questions.

If you have additional questions, send me a comment below.

This post was inspired by a more generic article found on Yahoo! Real Estate:
Full text of the Dian Hymer article: Be Picky When Picking a Real Estate Agent.
Dian Hymer, a real estate broker with more than 30 years’ experience, is a nationally syndicated real estate columnist and author of “House Hunting: The Take-Along Workbook for Home Buyers” and “Starting Out, The Complete Home Buyer’s Guide.”




Contact Andrew Wilson and shop for real estate with confidence knowing you’re represented by a buyer’s agent who is also a licensed architect.


Looking for Queens or Long Island Real Estate? Contact Andrew Today: andrew.wilson@realestate.com To search Long Island MLS like an agent: Click here (powered by ListingBook)

Categories: Real Estate, Top Tips