DEAN GRAZIOSI: DEAN GRAZIOSI REVIEW – REAL ESTATE FEED BY DEAN GRAZIOSI

We’ve all heard the stories about how demanding and outlandish some HOA’s can be.  While some of the demands and regulations put in place by HOA’s are designed to help maintain home values in the neighborhood, they may seem as a bit intrusive to some homeowners.  What many homeowners fail to take into consideration when looking for a new home is how living in an HOA residential neighborhood can impact their lives. 

This is why it is important for prospective homeowners to take into consideration the demands that living in an HOA residence involve.  If you are not familiar with the regulations and rules associated with the HOA in the area you are looking to purchase a home, you should become familiar with what you can expect.  If you feel that you will have trouble living up to the expectations put in place by an HOA, you should consider looking at homes outside of the neighborhood.  However, if you fall in love with a home that falls under HOA regulations, we are going to provide you with some helpful ways in which you can peacefully coexist with your HOA.

One of the first things that any homeowner should do is to completely read through all of the house rules and regulations enforced by your HOA.  These rules and guidelines will explain in detail any restrictions on how your home should look from the street.  This includes the color of the paint that you choose for your home, lawn and garden decorations, and in some cases the types of trees that you can plant in your yard.  The more familiar you become with these rules and regulations, the easier it will be for you to make decisions that will not require the HOA to contact you.  There is nothing worse than pulling into your driveway and seeing a notice from the HOA taped to your door.

The next thing that any prospective home buyer should review, are the financials of the HOA.  You should be skeptical of any HOA that has trouble covering their monthly expenses.  Because of the recent housing crisis, many HOA’s have been forced to foreclose on homeowners who were behind on their HOA fees.  With so many vacant homes in the neighborhood, the HOA may be experiencing financial problems of their own.  If you are not comfortable with the financial state of the HOA in the neighborhood you’re interested in, you may be wise to begin searching for homes elsewhere.  HOA’s were designed to protect and maintain the dignity of a neighborhood, but if you are not comfortable with all of the rules and requirements associated with HOA properties, you may be better off viewing homes in neighborhoods without an HOA.

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A home loan can be quite stressful to secure. Acquiring a new property brings with it a lot of responsibility and sometimes finding the finances to cover it can seem impossible. There are many options where home loans are concerned and it’s a good idea to do your homework carefully before making any final decisions.

The best way to secure a home loan in 2013 is to make the necessary preparations ahead of time. While it isn’t necessary to make a down payment on a property, it’s always a great idea to consider. Making a down payment will decrease the amount of your monthly house payments. You’ll also own that much less on your home once you have paid down on it.

Save all the money you can. Buying a home isn’t a decision you make quickly. You’ve probably been considering it for quite some time. The first step is to make a list of all the projected expenses you think might be relevant. There are, of course, always some you didn’t think of or even know about, but you’ll be able to get the basics down on paper.

Know your finances. Consider any debts you currently have and figure out what it would take to pay them back. Remember, you will need to have enough money left over each month to pay on your debts so this should factor into the home buying decision.

Figure out how much you may have to spend on your new home. If you already own property you plan to sell in the near future, you will be able to use the money made from that sale to pay down on your new home, or perhaps to buy it outright if you are extremely fortunate. If not, a lot of saving is in store.

Get pre-approved. Before viewing properties, it is a good idea to talk to a mortgage company to find out around how much you’ll have to spend. They can review all your credit information and amount of debt you have incurred and give you a figure. This will make the process of viewing homes much easier. If you already know how much you’ll be able to spend, you can look at properties that fall only within that price range.

Think conservatively. Don’t spend at the top of your price range. Instead, make sure you still have some money left over at the end of it all. Save this money for the next property venture or to pay off debt. If your monthly house payments are at the top of your range, you may run into difficulty in the future when attempting to make them. Planning for financial issues that may or may not occur will serve you well should the need for money ever arise.

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Mortgage interest rates are the lowest they have been in 60 years, and there are plenty of affordable homes available, so why hasn’t the market improved more than it has.  It could be because the market is still burdened by the high unemployment rates, tight credit and more foreclosures that continue to drag the already struggling market even lower. 

Since the bubble burst in 2006, we have witnessed median prices of existing homes fall by 27%, with homeowners in California being hit the hardest.  During this time many homeowners discovered that they were now underwater on their mortgages.  This leaves them stuck in their situation, because they are not able to sell their home and walk away with enough money to purchase another one.  This forces them to remain in their home, virtually stuck and unable to move forward unless they ask their lender to approve a short sale.

There is good news for homeowners who are underwater on their mortgage, prices and home values are steadily on the rise.  Median home prices have increased 3.6% last year, and in the harder hit state of California they experienced an increase of 5%.  While these numbers and the amount of homes that were sold are still lower than they were in 2009, they are steadily increasing.  What this means for homeowners is that if they continue to remain patient, their homes will likely increase in value allowing them to sell or simply be worth what the owner believes they should be.

The recovery process may seem like it is taking an unbelievably long time, it is said that a true recovery will take between five to seven years.  It may take longer for some areas to recover fully compared to others, but it is happening.  The driving force behind the current upswing in the market is the sales of foreclosures and short sales.  These types of homes have accounted for approximately 1/3 of home sales. 

While the market may not have improved as quickly as many had hoped, it is continuing to make strides in the right direction.  We can expect to see more increases in home values as well as more people buying homes as it improves.  The improvement in the market that many have been hoping for is within our grasp.  We will soon begin to notice that our homes are once again increasing in value and that homes are selling for more than they were a year ago.  This is all good news, but there is still more on the way.

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There is a tax exemption in place that allows homeowners to avoid taxation on debt forgiven in a short sale, foreclosure or loan modification.  However, this exemption is due to expire on January 1, 2013.  If this isn’t changed, borrowers will have to count mortgage relief from lenders as income on their federal tax returns.

So, if a borrower manages to avoid foreclosure either by a principal reduction of $100,000 or the bank taking a $50,000 loss in a short sale, the borrower would be required to declare this as income on their tax return, a blow that many would find impossible to deal with since they’re already in financial hardship situations.  Some housing market and mortgage analysts predict that letting this exemption expire will damage the fragile recovery that’s beginning in the housing market.

Many predict that there will be an extension of the Mortgage Forgiveness Debt Relief Act of 2007, but it’s not certain, with some major fiscal issues to overcome in coming sessions of Congress.  While it seems that most of those involved consider it a worthy goal to extend the exemption, there is caution in that it will carry a heavy cost, or at least that’s the current opinion.

With this extension up in the air, many involved in short sale transactions and negotiations are speeding their efforts to get deals done.  With most short sales taking between two and four months to complete, it’s already threatening many deals in progress.  In 2011,. the estimated tax savings to borrowers due to this exemption is estimated at more than $1 billion. 

Congressional spokes people are speaking of this “cost” as considerable, but many wonder why the same people don’t consider expenditures in the billions for many other government programs of dubious value to be a problem.  The debate continues.

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Your credit score affects just about everything. If you are in a significant amount of debt that you’re barely paying off, chances are your score is lower than before. This can affect various aspects of the home buying process.

A lower credit score will mean you aren’t approved for as much money on a loan than you would be if it increased. It can also affect several aspects of owning a home to include obtaining home owners insurance.

Insurance is all about risk management. Home owners insurance companies are, like any other similar endeavor, in the business of risk. They count on it to keep them afloat. Companies attempt to estimate the number of claims their  customers will file each year. This is only an average. It is then used to charge premiums that are sufficient enough to cover at least that amount of liability.

Studies have shown those with lower credit scores are more likely to file an insurance claim. This can be a problem since someone with a low credit score is considered to be financially responsible than someone with a high score. These customers are riskier to insure.

That is why insurance companies develop their own  rating numbers to use based on the credit score of each customer. Those with high scores are offered the low rates and terms while those with low scores will pay a lot more.

So how do you find the best insurance rates? Begin by talking to the various insurance companies. Inquire about the type of scoring system they use. Find out whether or not you qualify for the best rates and terms. If you don’t, find out why this is the case and what you can do to change that.

As a general rule, anything that will improve your credit score will also lower your insurance costs. Making payments on time and maintaining low balances on your credit cards will help. If you are having difficulty lowering your balance, save enough money to begin paying more on that card each month. If you have several, begin putting a larger amount of money toward them one at a time. Keep paying on all of them, but concentrate heavily on one at a time.

If you have bad credit but have paid off all your debt, you will need to rebuild it. This may mean getting a secured card. To do this, you’ll deposit a certain amount of money and receive a card with that spending limit. Make small charges on it to keep it active and pay them off right away. This keeps you from having to pay any interest and looks great in the eyes of lenders and everyone else who must run a credit check on you.

After a specified amount of time has passed, you’ll get your deposit back provided you pay on time. Your credit limit and score will also increase as you rebuild credit. 

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If you have decided that you are ready to become a homeowner, there are some things that you should know about preparing your homebuyers budget.  If you are currently living from paycheck to paycheck, in order for you to become a homeowner, you are going to need to make some financial changes.  Once you make the decision to purchase a home, it should become your number one priority.  To be able to purchase a home that you can call your own; you may have to begin making financial sacrifices in order to make your dream come true.  To financially prepare yourself for the purchase of a home, you should begin planning at least one to two years before you ever make an offer.

The first thing you should be doing during this time is building a strong credit rating.  The better your credit rating is, the easier it will be for you to be approved for a home loan.  If you have some problem areas in your credit history, now is the time to take care of those problems.  Experts suggest that buyers clear any unpaid accounts as soon as possible.  You should also request and carefully look over your credit report.  If you find any errors it is important that you contact the reporting agencies and get it fixed as soon as possible.  If you are like many of us and have balances on your credit cards and outstanding car loans or student loans, it is important that you keep all of these accounts current and do your best to avoid missing any payments.

The next thing all prospective home buyers should do during this time is start saving cash.  This can easily be done by placing so much every month into your savings account.  The cash that you save during this time can later be used for a down payment.  The amount needed for a down payment can vary depending on the type of loan you will be applying for.  This is also where buyers will need to start making sacrifices.  During this time you should avoid making any unnecessary purchases that can take away from your savings.  Weigh your needs against your wants and make practical spending decisions.

During this time you should also be working to reduce the amount of outstanding debts that you may have.  If you have a lot of debt, experts suggest that you pay it off before starting to save.  By keeping your debt at a level that you can financially handle, lenders will feel that you are a good risk.  If your debt is out of control but you have accumulated a large amount of savings, they may feel that your priorities were not in the right order.  It is important that you do everything possible to pay off or manage your debt responsibly during this time.

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Buying a home can be a great adventure. It is a time to explore all options and find the location that is best suited to the lifestyle you desire. Making the choice between city real estate and suburban real estate is a decision best made early to save on house-hunting time. Here are eight features to consider when making your choice.

1.     Amenities

The city provides a wealth of exciting entertainment and handy conveniences. There is a wider variety of restaurants, bars, shopping and a long list of readily available services. Many people who love the idea of going to different places frequently will enjoy the variety found in the city. However, suburbs have at least most of these amenities on a limited scale. Would you rather go to a different restaurant every time you go out, or do you enjoy the intimacy of a local eating establishment? The choice is yours when you choose city or suburb.

2.     Elbow Room

Some people find it more relaxing and enjoyable to live in a spacious house with a big yard. These buyers may be happiest living in the suburbs. The city has many advantages, but plenty of elbow room is rarely one of them.

3.     Transportation

Cities offer a variety of transportation opportunities. Take the bus, a cab or a train, and you can cut down on fuel costs. Take a limo for the ultimate in luxury. However, many people prefer to drive their own cars anyway, and suburban real estate is a viable option for those people.

4.     Cultural Venues

Do you like to surround yourself with cultural venues? Perhaps you would like to live in the city where you can attend concerts, ballet performances, operas, theatrical productions and movies. Of course, living in the suburbs does not mean you cannot make a trip into the city for special events; it is just more time-consuming and inconvenient.

5.     Social Life

Choosing between city and suburbs does not have to be a choice between having a social life or not. It simply determines what type of social life is available to you. In city life, socializing may consist of meeting friends for drinks or coffee, attending block parties, exchanging pleasantries with other apartment or condo dwellers, or having friends to your place. Suburban neighborhoods may be more conducive to church activities, family time or casual get-togethers on the back patio.

6.     Employment

Employment is a major consideration for most homebuyers. They want to be where the jobs are. Before you make your decision between city real estate or suburban real estate, look at the job situation in your field and in your area.

7.     Family

Large families generally prefer to live in the suburbs. There is more room for children to play, the streets are safer, and schools may be better. Couples, individuals and small families often like the excitement of the city more.

8.     Price

The choice between city real estate and suburban real estate does not necessarily limit your price range. There are both upscale and inexpensive homes in both types of locations. Before you make your selection, learn about the city neighborhoods and suburban areas.

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Investing in real estate for whatever reason is a great way to build up your investment portfolio, or simply have something of your very own to live in. Whatever your reasons for investing in real estate, you will need to be able to fund that investment. There are many options for investing in real estate. Which option you choose will depend on your goals, your financial status, the type of investment you are making, and your personal preference. Here are the most common ways to finance real estate investments.

Conventional Loan

This is a typical home loan that is not backed by any government agency, and is gained through a bank or other lender. These loans usually come with a high down payment requirement and a higher interest rate. They also tend to have fixed rate terms. The two advantages to using conventional loans is that the fees are negotiable and that you can use something other than the real estate in question as collateral. You might want to get a conventional loan if you cannot qualify for government backed loans, and if you are purchasing real estate to rent out or live in.

Conforming Loan

This is a loan that meets the qualifications of Freddie Mac and Fannie Mae. These loans are purchased from the lenders, and securities backed by these loans are sold to investors. A conforming loan requires that you have verifiable income, a good sized down payment, and good credit. There are also limits to the amounts of money that can be borrowed through a conforming loan. These loans are best if you plan to live in the real estate you are buying.

Hard Money Loan

A hard money loan is a short term loan that usually comes with a high interest rate. These are also sometimes called bridge loans, because they can be gotten quickly and then paid off with a more traditional loan type with a lower interest rate later. These loans are preferable to some people because they can be gotten very quickly, allowing you to close a real estate deal faster than if you used another finance type. These loans are also great if you plan on flipping a house, because you won’t need long term funding if you are selling again in a few months.

Government Loan

There are two types of government agencies that make loans for real estate. These are the FHA and the VA. For either government agency to loan money to you, you generally have to be a first time home buyer. In addition, you have to have a minimal down payment, and decent credit history. A big advantage to these loans is that they can be easier to get than traditional loan options. They also usually come with a lower interest rate. In most cases you can only use these loans if you are going to be living in the property.

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Veterans sacrifice a great deal for the country and in recognition of that fact the Veteran’s Administration (VA) offers many benefits for veterans. One of these benefits is a home loan program that can help veterans own the home of their dreams. Most veterans are eligible for the program and loans are guaranteed, making it easier to get approval from a recognized lender.

Veterans who are eligible for a VA home loan are those who are currently on active duty or who have been honorably discharged. Veterans who are currently in training are not considered to be eligible for a home loan until they have finished with their training and have been on active duty for at least 90 days. If a veteran has anything other than an honorable discharge, he or she may still be eligible for a VA home loan after the circumstances surrounding the discharge have been investigated. Spouses of veterans, including those who are considered MIA or POW, are also eligible for a home loan through the VA. However, single veterans who are stationed overseas are not eligible because the law requires the veteran or a spouse to be living in the home.

Veterans generally get $36,000 for a home loan. If the veteran wants a home that costs $144,000 or wants to build one that will cost more than that, then they may be able to add onto the loan. Each county in the United States has a maximum limit that the VA will guarantee for veteran’s loans. The average is $417,000 but this may be higher or lower depending on the county. Up to 25 percent of the guaranteed amount of the loans may be added to a veteran’s home loan if the veteran is eligible.

VA loans can be used to buy single family homes, condos, and manufactured homes that are on permanent foundations. The property will need to be appraised and will have to be inspected by an inspector that the VA approves. No money will be given if the home does not pass inspection, and this includes funds to repair or upgrade the home. Veterans will need to obtain a Certificate of Eligibility before applying for a loan. Many lenders are able to confirm eligibility online but all veterans should speak to their local VA office in order to obtain any proof needed, such as discharge papers.

There are many benefits to getting a VA loan. Interest rates are negotiable and usually are low. The majority of the time, there is no down payment required though some lenders may ask for one. There are no mortgage insurance premiums with a VA loan, which can save veterans money. For those who are having financial difficulty, the VA offers assistance to help veterans keep their homes and avoid foreclosures. 

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Certain events in life can make it impossible to stay in your current dwelling. If you get a job on the other side of the country, you may have no choice but to sell. There are other times, though, when you have the options of selling or staying in your home. There are several things to consider as you decide.

Real Estate Market

It may or may not be to your advantage to sell at any given moment. The real estate market fluctuates, even within a general trend. It helps to get a number of different facts and opinions about the market before you make that leap. Do your due diligences and find out whether the market seems the most favorable right now, or if a change is expected at the local level.

Occupancy Changes

The number of people who live in your home may change dramatically within a few years. Children may grow up and move away. Elderly parents may come to live with you. The most crucial thing to consider in these situations is whether the change will likely be temporary or more permanent. If the number of occupants in your home changes from when you bought your home, it may be time to get a bigger or smaller home.

Commuting Issues

When your job becomes too far to commute to from your home, it is time to consider moving. It is certainly more convenient to be near your work. It also can result in large savings in transportation costs. Before you pick up and move somewhere else, consider options like carpooling or telecommuting. If you cannot find a way to lower your transportation costs, it may become necessary to move.

Medical Problems

The medical problems of family members may demand consideration in whether or not to sell your home. If a family member becomes disabled, there are two basic options. You can retrofit your home to make it more accessible for your loved one or you can move to a home that already has the special features you need. It also may become necessary to be closer to doctors and hospitals if your family member has a severe illness. Moving may be your best bet to solve the problem.

Home Value

In a perfect world, the best time to move is when your current home is at its peak value. MSN Real Estate explains some of the home value factors to consider when deciding whether or not to move. For instance, you might feel ready to sell your home in the wake of a local disaster. If you can hold on until the crisis is over, you will have a much easier time selling for a desirable price.

In the final analysis, you almost always have the option of staying or moving. You simply have to decide how you can best deal with your current situation. When you do that, you have an opportunity to make your life better.

http://realestate.msn.com/article.aspx?cp-documentid=13108470

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