FICO and Finances
It’s an unfortunate reality, but due to fewer work opportunities and high medical debt, ability-disadvantaged individuals tend to hold a lesser share of wealth than the general population. For this reason, it can be harder to save for a down payment and ensure that your credit score is high enough to qualify for a loan. Down payment assistance, housing counseling, and other resources for disabled buyers are available through HUD, the FHA, and Fannie Mae. The Simple Dollar has more information about these and additional resources.
As for your credit, when it comes time to apply for a mortgage, the higher the credit score, the better. It’s possible to obtain a mortgage with a credit score as low as 550, but you’ll definitely get better rates and terms as you inch closer to 700. Try to raise your credit score by paying your bills in full and on time and taking care of any misreported information on your credit report, which you want to get a copy of from each of the major reporting agencies: TransUnion, Equifax, and Experian. Keep in mind that saving for your new home and improving your credit takes time. Neither will be achieved overnight, and you don’t want to rush through either step.
Know Your Needs (and Plan Ahead for Them)
As you get your finances in order, it’s a good idea to identify your needs so that you can maintain an open dialogue with your real estate agent. If you are in a wheelchair, for instance, you may ask them to help you find a home all on a single story and with doorways that have already been widened. Many builders are now incorporating elements of universal design into new construction. If you aren’t familiar with the term, you should know that universal design is essentially inclusive design. It is an approach that strives to address barriers of usability incurred by people of all abilities and in all stages of life.
If your disability requires you make frequent trips to your healthcare provider, let your realtor know this information, too. He or she can help you locate a home where you will have access to public transportation or ridesharing services if needed.
Since not all properties are already configured for those with disabilities, it may be wise to put aside some cash to make upgrades. Good Financial Cents explains that saving money is much easier if you have it set up automatically. The site also suggests stashing any cash windfalls or raises. This advice applies to saving for any specific goal, including home renovations.
Get Ready to Go
When it’s time to finally move, there are a few things you should do before opening your new front door. One of these is rekeying or changing the locks, which will add between $96 and $210 to your moving expenses. If anyone in your family has allergies, it’s also wise to bring in a cleaning crew to get rid of dust, dander, smoke and other potential irritants left behind by the previous owners. Don’t forget to have the utilities turned on and make sure to keep a few boxes of your belongings with you in case the movers get delayed. This should include a weeks’ worth of clothing, basic kitchen utensils and gear, and any medications and toiletries you use daily.
Moving can be exhausting and intimidating, especially if you have special needs. But it’s not impossible, and the sooner you begin planning, the easier the process will be. Here at MAE Capital Real Estate and Loan we understand and can help folks that have special needs for housing. We have the ability to find and finance such housing and are looking forward to assisting you on your journey. Call today 916-672-6130 Special Thanks to Natalie Jones for providing the content of this article.
So 2017 is the year you are going to buy a home. I would say that is the best financial goal anyone could have. Aside from the tax advantages owning your home changes the way you look at life. As a home owner, you are entitled to fix your home as you please, paint it any color or colors you like, and when you nail the first picture on your wall in your home it suddenly becomes real that you are about to put a hole in your home, so the once simple task of nailing up a picture has changed to add a little more thought to the process. Home ownership also gives you an inner sense of achievement that only other homeowners feel. But before you get to enjoy all the good that is owning a home you first have to go through the process of qualifying for a home loan and looking for a home in your price range. It’s like my father would say to me when I was growing up “anything worth having is worth working for”.
If 2017 has been the year you have designated to purchase your first home, there are some important steps you must go through in order to get your goal. The first step should be figuring out how much money you should have saved to buy this home. It’s not too late it is still early in the year and you have time to save. The minimum down you would need to have saved without any kind of down payment assistance would be only 3.5% of the sale price unless you are a Veteran and we can get you into a home with no money out of pocket (Thank you for your service). So, if you have been looking at buying a $350,000 home you would need to be able to show $12,250 (3.5%) and that could come from savings or a gift from a parent or an employer, again zero if you are a Veteran. Now if this amount is too hard to save up for there are some programs that can assist with the down payment and closing costs. Most of these programs will require that you attend a class either on line or a traditional classroom setting. These programs can help with the money it takes to acquire a home, but there are some limitations. The biggest limitation is income you can make. You see if you make too much money you don’t qualify for the programs and each program will have different income limitations. You would have to call and speak with one of our qualified loan officers to get the correct income limits per program.
After you have figured out how much money it will take to buy a home you should also know if your credit is good enough to qualify. Generally, you can have a Credit Score (low mid score for a couple or mid score for single people) of no lower than 550 and that would be for an FHA loan or a VA loan. If you were putting 10% or more down and you were looking for a conventional loan your score would need to be above 640. If you are not sure what your score is we do run your credit as part of the Pre-Approval process.
Before even looking at homes that might be outside of your price range we recommend that we get you Pre-Approved before looking. The Pre-Approval process is fairly simple, we gather some documents from you, analyze your finical position, and we will give you a Purchase price that you would qualify for, and you could purchase any home up to that limit. We would have you either apply online or you could call in and we can take you application over the phone or we can meet in person. The idea is that we are here to help you. We have an online checklist of the items we would need you to provide us with. The basic items we will need you to provide are: 1. Current Pay-Stubs for the last 30 days; 2. Your last 2 months Bank Statements; 3. Your last 2 years W2’s; 4. Your last 2 years Federal Tax Returns. We would ask for divorce documents or child support information if you paid or received any support. If you are retired, we would ask for your retirement information. If you have a complex financial situation we can figure out how to be able to show it documents. Our job, when qualifying our you, is to be able to paint your financial picture to someone who has never met you with your financial paperwork and letters from you to fill the gaps so the lender can see you as a good credit risk. This is an art and has taken many years of experience to be able to do this efficiently and we are here to get it done for you.
Once we have taken your application, ran your credit report, reviewed your income documents, and determined you have enough funds we then issue the Pre-Approval Letter. This letter is essential to be able to be given to a potential seller of a house to show them you have already gone through the process and are ready to buy. This letter can put you at a competitive advantage as other people wanting to purchase the same house may not have the same letter, thus making your offer more attractive and more apt to be accepted. At MAE Capital Real Estate and Loan we work with you on the loan side and the Real Estate side so you only have to go to one place to get you needs fulfilled. When you work with us with the loan and as your Realtor we will bundle our services and reduce your fees and we will buy you a home warranty. This could save you thousands of dollars upfront to do with as you please.
Now comes the fun part, looking for the house you are now qualified to purchase. We have a free online toolkit to get you organized in your planning of the wants and needs of the home you want to buy. We recommend that you use these tools as it will help you organize what you want in the house and our Realtors can use your lists to search for the homes that fit your wants and needs. Our Agents use the Multiple Listing Service (MLS) to search for homes as well as word of mouth from other Agents in the industry. Having your list of items you want in a home such as number of bedrooms and bathrooms, size, location, whether it has a pool or not, whether you want land, horse property, can all be inputted into our system and we can only show you the homes that fit your parameters saving you time money and energy.
Also in our toolkit are comparison sheets so when you are out looking at the houses you can write down what they have and don’t have and be able to easily compare what you just looked at. Don’t get discouraged it is rare that you find your dream home the first time you go out looking. It is our Agent’s jobs to show you everything you would like to see on the market in the areas you want to be in. This process can take weeks and sometimes months as you may want to wait for other homes to come on the market in the specific area you want to live.
Once you do find a house that meets your expectations and you want to buy it you will need to make an offer to the seller to buy their home. Our Agents are experienced in the art of negotiating the sale price for you. Negotiation techniques will vary based on the type of market we are in (i.e. a buyer market or a seller’s market). If it is a buyer’s market usually there are more homes on the market than there are buyers to buy them and sellers have to be aware of this and be willing to negotiate on their price or pay cost for potential buyers. In a Seller’s market, there are generally more buyers interested in buying homes in the area than there are sellers to sell them, thus prices are generally firm and there might be multiple offers on the same house. Each type of market your Agent will know and advise you accordingly before you even start looking. As a first time buyer, you also want to make sure the house is sound when you purchase it. Our Agents make sure home inspections, pest reports, and any other inspections are complete so you know exactly what you are buying and the condition of it. Again, our Agents will buy you a home warranty at the close of escrow so if anything goes wrong with the house in the first year after purchasing it you will be covered. The warranty covers, appliances, plumbing, and the heating and air, giving you peace of mind that you have been taken care of by MAE Capital Real Estate and Loan.
We here a MAE Capital Real Estate and Loan strive to help our clients have a smooth and easy experience. We will walk you through the process every step of the way. We will make sure you are compliant with the paperwork and we will take care of the title company that will act as a disinterested third party to bring buyer and seller together to sign at the end of the transaction. We look forward to working with you in your 2017 goal achievement of purchasing a new home.