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Preparing Your Home for an Appraisal

hands holding home  You’ve sold your home. Or, you are thinking of refinancing your current mortgage.

One of the things that the lender will require is a property appraisal. While the actual appraisal inspection may take only an hour or two, the appraiser must go back to the office, research other homes that have sold in your area, and write a 20 to 30 page report.

Here are some tips to help the appraiser with additional information–and in most instances a faster turn-around time to complete the report.

  • Compile a list of recent improvements. If possible include “before and after” pictures, copies of paid receipts for work completed. If major updates were made, provide a detailed copy of the bid from the contractor.
  • Make sure all areas are accessible, including the attic, basement and crawl spaces. This includes the garage.
  • If the home is part of a homeowner’s association, include a copy of the fees paid, and the name and phone number of the association president or executive director.
  • Straighten up each room. Appraisers are required to photograph each room, and while it may not make a difference to them if the room is messy, there may be an underwriter who is less objective.
  • If there are any unfinished projects, make sure they are completed before the inspection.
  • If there are any easements, encroachments or unusual deed restrictions, you may want to provide a copy of the list.

A little help from you goes a long way to make sure that the appraisal report is complete and accurate.

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How Soon Can You Purchase A Home After A Bankruptcy, Foreclosure, Or Short Sale?

How about 1 day?

In the past if you had a Bankruptcy you would have to wait 2 years with an FHA loan and 4 years with a conventional loan. With a Foreclosure the wait would be at least 3 years (FHA loan) and 7 years with a non-FHA loan. A VA (for military veterans) loan requires a 2 year waiting period.

I can reduce the waiting period to 1 day after completion of a bankruptcy or foreclosure. Call me at 847-441-4116 or send me an email – herb@1steaglemortgage.com – if you or someone you know has had one of these “life events” and wishes to purchase a new home without waiting.

While it’s true that “bad things happen to good people” there is now an alternative to renting.

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FICO Scores – How Many Does A Person Have?

Most consumers think they have only 3 FICO scores – one for each bureau-Equifax, Experian and Transunion.  Actually, a person has dozens of FICO scores.

There are six major types of FICO scores–General, Auto, Mortgage, Credit Card, Installment loan, and Personal Finance.  Different factors are taken into account to generate a score.  For example, an auto FICO score places more importance on the history of any previous auto loan that the consumer had.  A credit card FICO score looks more at a person’s handling of credit card balances and payment history.  Some even look at whether more than the minimum payment is made every month.

The highest FICO scores are personal ones that fall under the General score category.  One of the most frequent questions we get is based on this scenario:  a borrower will go to a loan officer after having pulled their own credit and walk in with a 740 score.  The lender then pulls the credit of the borrower using  the Mortgage program used by banks and mortgage companies, and the score is 680. This is because the FICO scores are based on different criteria.  While it’s a good idea for everyone to order their free credit report every year, it’s not necessary to order (and pay for) the scores that go along with them.  Personal scores aren’t used by any industry for any reason.   They are more of a “warm and fuzzy” number to make a person feel good about scores than anything else.

The bottom line is that a consumer shouldn’t get caught up in all the various FICO scores.  Instead, focus should be on the important things that surround all FICO scores: paying bills on time, not running up a lot of revolving debt, keeping revolving balances below 20% of the high  credit limit, not closing accounts, and only opening new accounts when absolutely necessary.  These action will ensure a good FICO score no matter what model it is being pulled from.

For additional information about credit report and scores, click here

Image result for credit scores

 

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Low credit scores can boost home insurance premiums

Depending on your credit score, you may be paying more for home insurance premiums. Homeowners with low credit scores can pay anywhere from 29 to 91 percent more, order according to an InsurnaceQuotes.com study. Home insurers use their own credit-scoring models for calculating rates. Insurers have found a direct correlation between a consumer’s credit and the likelihood that he or she will make a home claim. This results in higher costs to the homeowner in those states where insurers are allowed to use credit information to set their insurance rates.

Overall, for sale paying your bills on time and keeping your credit card balances to less than 30 percent of available credit is the key to a healthy credit report. You can get one free report each year from each of the three credit bureaus – Equifax, Experian and Transunion – go to:  www.annualcreditreport.com.

While these free reports don’t give you a credit score, consumers can see exactly what is on their reports and can dispute any items that are incorrect.

For additional information, call Herb Levin at 847-441-4116 or email at herb@1steaglemortgage.com

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Can You Be Approved for a Home Loan Without A Contract?

Realtors and home sellers want to know that the buyer is approved for a mortgage. There are several levels of “approval” beginning with a brief look at credit and income. The next level would be an automated underwriting system, and finally a complete underwriting approval that guarantees you’re a ready and willing buyer. It can save time and disappointment if you know you’re approved for a mortgage without a purchase agreement.

1st Eagle Mortgage offers this complete underwriting approval system while you’re looking for a home. We don’t need an address. This results in the assurance that you’ll get the mortgage once you find a home and also shortens the time from contract to closing. Once your offer is accepted and the home passes inspection, we’ll order the appraisal. Once done, the contract and appraisal are reviewed by the underwriter and we can close within days, not weeks.

Call 1st Eagle Mortgage at 847-441-4116.

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A Thought About Fiscal And Financial Health

Why go to a 15 year mortgage? Yes, doctor it is a lower rate and you’ll save many thousands of dollars in interest compared to a 20 or 30 year mortgage.

Remember, unhealthy you don’t make money by paying down your mortgage. Your home will appreciate (or not) based on the real estate market.

In my opinion, ask a 15 year (or 10 year) fixed rate mortgage makes sense if:

  1. You’re able to continue to maximize your retirement contribution each year.
  2. You’ve paid off your credit cards (or have paid them down 10% or 15% of the the available limit.)
  3. You have 6 to 12 months of mortgage payments (including taxes and insurance) in readily available funds (money market, CD stocks, etc.)

I realize that in some cases, the desire to pay off your mortgage as soon as possible is so strong that it overrides any other consideration. However, I would suggest you at least consider the three items mentioned above.

I have several financial advisers that I can recommend.

Call 1st Eagle Mortgage at 847-441-4116.

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1st Eagle Now Offering the E-Z Doc Program!

Do you have self-employed borrowers looking for a Jumbo loan? Our EZ-Doc program provides options for self-employed borrowers who have the ability to pay their mortgage with ease but may not be able to supply the rigorous documentation that is required in today’s mortgage marketplace. This program is appropriate for:

  • Income is stated but not verified
  • Loan amounts to $2M
  • Minimum qualifying credit score 700
  • LTV’s/CLTVs up to 70%
  • Purch/RT/Cashout Accepted
  • Max Cashout $400, ed 000
  • DTI 33/43%
  • Self-employed only

Eligible Property Types

  • Primary Residence
  • Second Homes
  • 1 Unit SFR/PUD

Additional Details

  • Caps: 5/2/5
  • Margin: 2.5%
  • Index: 1 Year LIBOR

Call 1st Eagle Mortgage at 847-441-4116.

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