First of all:
Be sure to speak to a bankruptcy attorney AS WELL AS a trusted mortgage lender! While both professionals will be educated in their fields of expertise, you will need both perspectives to get an accurate view of how to accomplish your home buying goals!
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While I am not a mortgage lender, I will tell you what I've heard from the grapevine! Please trust, but verify!
If you file bankruptcy, you can qualify for a mortgage 2 years after it is finalized... IF... you establish 3 or 4 positive trade lines of credit during that two year window of time.
Here are some ideas on what that means:
1. Get 3 or 4 security deposit credit cards. Capital One has a good one that takes any credit type. Here's how it works: You put down a deposit ($200 for example) and that's exactly what your credit limit is. NEVER charge more than 10% of your credit limit, in this example... $20 dollars. ALWAYS pay it off on time!
2. You can also do this same thing with a certificate of deposit. Most people don't know you can borrow against those as collateral from your bank. Apply the same concept... don't borrow more than 10% of the CD's value.
Bankruptcies do not wipe away government debts like student loans or tax liens. Nor does it wipe away legal judgements, like lawsuits filed against you or back child support.
Now, here is my most controversial response:
I think going to a bank for a home loan is a very dumb idea, even if you had an 850 credit score!
Why?
Well, there are many reasons:
1) Banks make you jump through hoops, red tape, and require a DNA sample.
2) If you get a mortgage in your name, the banks have sophisticated technology to report your debt to the credit bureaus. Also, you are showing to the credit bureaus you have a big obligation and a huge responsibility, so they shy away from lending you even more money.
3) If you are ever late on your payment, you will be reported and it will drop your credit score. If that happens, you have to wait 12 months or longer to refinance or buy another house.
4) Almost always, always, always... you have to sell the home you buy before you can buy another one.
5) If you get sick of the house or want to move, you have the stress and strain of listing the home, paying commissions, waiting for it to sell, and straining to make the payment every month when you just want to move on with your life.
I know, I know... when you buy a house... it will be the last house you will ever buy! You are going to retire and live in that house forever! Yadda, yadda, yadda. But statisics show... you will sell the house you buy in 4 to 7 years and buy another one!
So, what is my point and what is the solution?
If you get financed through a private seller, where the private seller acts like the bank:
1) There is no red tape! They don't ask for your credit report in most cases!
2) The private seller doesn't tell Transunion, Equifax and Experian (top 3 credit bureaus) you have a mortgage in your name, so you can buy other goodies you normally wouldn't be able to buy because you don't show an "over leverage" of debt.
3) If you are late on your payment, the seller won't appreciate that... but it won't be reported to the credit bureau as a slow or late pay - which will hurt you badly if you have a bank loan.
4) If you get a loan through a private seller, you don't have to wait to buy a new home. You can lease that property out and since the credit bureaus show no signs of you owning anything on your credit report, you can qualify for a new mortgage and buy something else, or maybe an investment property.
5) If you decided to move and didn't want to lease, you would still have to sell the home. But if it doesn't sell, you can negotiate a deed in lieu of foreclosure with the original seller which will not effect your credit. Basically, the seller gets the house back without having to foreclose on you.
Hope this helps, and good luck with your home buying goals!
Saturday, March 24, 2012
Friday, March 23, 2012
Title Work Explained
If you get an attorney's opinion of title, which is just a general report of what liens exist on the property (if any) and who actually owns the property, the cost of the report and attorney's opinion is $75 to $150 dollars. But keep in mind it is just that... an opinion of title.
If the buyer wants a guarantee they have clear and marketable title, the attorney will have to analyze the abstract. An abstract looks like a phone book in most cases, depending on how old the property is. It is a record of every single person who has ever owned the property since it was built. The attorney combs through this data and determines that everybody's i's were dotted and t's were crossed over the past 50 to 100 years, or whenever the property was built. After the abstract has been thoroughly analyzed, the attorney makes a more informed "opinion" of how clear the title actually is. And since a lot more thorough investigation has been performed, a group of guys who own a title insurance company will grant a policy on the property based on this attorney's findings. This insurance policy GUARANTEES the title is clear and marketable, even if the attorney made a mistake when analyzing the abstract. So, if somebody from the past comes along and claims to have equitable interest in the property, the insurance will pay them off if their case has validity - no questions asked. A title policy will normally cost the buyer $350 to $500 dollars.
Depending on if you have the abstract in your possession or if it was lost years and years ago depends on your cost. If you have to rebuild the abstract from scratch, it can cost upwards of $1,500 to $2,000 dollars. If you have the abstract in your possession or if it is in a security deposit box at the title company you closed the property at, then it will save you hundreds of dollars. In that case, you are looking at about $500 to $1,000 dollars.
Hypothetically speaking, if you just do a title report and attorney's opinion plus recording fees for the deed, closing costs will run $250 to $400.
If the buyer opts to get title insurance and you have the abstract in your possession, you are looking at $350 to $500 for title insurance (usually paid by the buyer) and another $250 to $500 for the attorney to analyze the abstract (Usually split 50/50 between buyer and seller since it benefits them both - they want to buy and you want to sell)
If you don't have the abstract and the attorney has to rebuild it, it will cost $1,000 to $1,500 or more plus $350 to $500 for title insurance.
If the buyer wants a guarantee they have clear and marketable title, the attorney will have to analyze the abstract. An abstract looks like a phone book in most cases, depending on how old the property is. It is a record of every single person who has ever owned the property since it was built. The attorney combs through this data and determines that everybody's i's were dotted and t's were crossed over the past 50 to 100 years, or whenever the property was built. After the abstract has been thoroughly analyzed, the attorney makes a more informed "opinion" of how clear the title actually is. And since a lot more thorough investigation has been performed, a group of guys who own a title insurance company will grant a policy on the property based on this attorney's findings. This insurance policy GUARANTEES the title is clear and marketable, even if the attorney made a mistake when analyzing the abstract. So, if somebody from the past comes along and claims to have equitable interest in the property, the insurance will pay them off if their case has validity - no questions asked. A title policy will normally cost the buyer $350 to $500 dollars.
Depending on if you have the abstract in your possession or if it was lost years and years ago depends on your cost. If you have to rebuild the abstract from scratch, it can cost upwards of $1,500 to $2,000 dollars. If you have the abstract in your possession or if it is in a security deposit box at the title company you closed the property at, then it will save you hundreds of dollars. In that case, you are looking at about $500 to $1,000 dollars.
Hypothetically speaking, if you just do a title report and attorney's opinion plus recording fees for the deed, closing costs will run $250 to $400.
If the buyer opts to get title insurance and you have the abstract in your possession, you are looking at $350 to $500 for title insurance (usually paid by the buyer) and another $250 to $500 for the attorney to analyze the abstract (Usually split 50/50 between buyer and seller since it benefits them both - they want to buy and you want to sell)
If you don't have the abstract and the attorney has to rebuild it, it will cost $1,000 to $1,500 or more plus $350 to $500 for title insurance.
Monday, November 28, 2011
What To Watch Out For When Purchasing A Foreclosure Home?
Foreclosure homes are very enticing BECAUSE of their area and price. However, one thing foreclosure companies are notorious for doing is dropping the price low to intice a bidding war between buyers.
The first thing to ask your mortgage lender is which of these three types of loans do you have:
1) FHA
2) VA
3) Conventional
If you have an FHA or VA loan, the house must be in pristine, move in condition. Both of these programs are government backed loans. The only exception to this rule is if you have a FHA construction loan, which is rather rare in this market climate. Your mortgage brokers FHA / VA appraiser will be able to tell you the qualifications for FHA / VA loans.
If you have a conventional loan, the criteria will be less strict because the loan is coming from a private party or a corporate lending institution, in most cases. But you will need to find out what your lenders specific qualifications are.
All foreclosures are listed with Realtors, and all Realtors are required to recommend that you obtain a home inspection. As a matter of fact, you have to waive your rights to a home inspection by signing a form if that is your choice. But it is strongly recommended that you obtain a home inspection. All lending institutions require that you have a termite inspection.
The cost for a home inspection can range between $200 to $400 dollars, and termite inspections are between $150 to $250 dollars, depending on the size of the home.
We all wish it were as easy as driving through the neighborhood with some high powered x-ray goggles. That would save all of us a lot of money! But the truth is, you never know what you are going to get when you purchase a house, and this is especially true for a foreclosure. And since purchasing a home is one of the biggest financial investments you will ever make in your lifetime, spending a little extra to make sure you aren't sinking your funds into a money pit is well worth it. And of course, some lending institutions require this measure before they will back you on purchasing the home.
But even if you are spending cash, do not skip this important step!
Hope this helps!
Call or text Rose Wilkinson @ 405-881-5958
The first thing to ask your mortgage lender is which of these three types of loans do you have:
1) FHA
2) VA
3) Conventional
If you have an FHA or VA loan, the house must be in pristine, move in condition. Both of these programs are government backed loans. The only exception to this rule is if you have a FHA construction loan, which is rather rare in this market climate. Your mortgage brokers FHA / VA appraiser will be able to tell you the qualifications for FHA / VA loans.
If you have a conventional loan, the criteria will be less strict because the loan is coming from a private party or a corporate lending institution, in most cases. But you will need to find out what your lenders specific qualifications are.
All foreclosures are listed with Realtors, and all Realtors are required to recommend that you obtain a home inspection. As a matter of fact, you have to waive your rights to a home inspection by signing a form if that is your choice. But it is strongly recommended that you obtain a home inspection. All lending institutions require that you have a termite inspection.
The cost for a home inspection can range between $200 to $400 dollars, and termite inspections are between $150 to $250 dollars, depending on the size of the home.
We all wish it were as easy as driving through the neighborhood with some high powered x-ray goggles. That would save all of us a lot of money! But the truth is, you never know what you are going to get when you purchase a house, and this is especially true for a foreclosure. And since purchasing a home is one of the biggest financial investments you will ever make in your lifetime, spending a little extra to make sure you aren't sinking your funds into a money pit is well worth it. And of course, some lending institutions require this measure before they will back you on purchasing the home.
But even if you are spending cash, do not skip this important step!
Hope this helps!
Call or text Rose Wilkinson @ 405-881-5958
What Are Popular Areas In Oklahoma City For Young Urban Professionals?
A really up and coming area in Oklahoma City right now is Paseo / Central Park Addition. If you look on the tax records, you will notice that most of the people who own properties in this addition are also owner occupants, which is a really good sign for stability and resell value.
The price range of the area is between $75,000 all the way up to $160,000 for all the extras and amenities, including stainless steel appliances, crown molding, granite countertops, refinished hardwood floors and basically a complete remodel.
Most of the homes were built between 1929 and 1940, and are 1,500 square feet or less. This is a perfect size for a young professional couple starting out in life with no children.
Within walking distance, there is a little alley way where a lot of neat shops and restaurants are located. Every May, there is an arts festival in this alley way where local artist set up shop to feature their art work. There is also an art gallery right around the corner from the alley way that is exquisite.
The pride of ownership truly shows in Paseo / Central Park.
You might also want to check the Nichols Hills / The Village areas. There are many young urban professionals who reside there, because of it's close proximity to Chesapeake, which is one of Oklahoma City's biggest employers.
And of course, you could never go wrong with anywhere in Edmond, Oklahoma. Edmond is considered the "Beverly Hills" of Oklahoma, but is shockingly affordable. Homes range anywhere from $85,000 all the way up to several millions of dollars. And of course, everything in between.
Best of luck in your home search!
The price range of the area is between $75,000 all the way up to $160,000 for all the extras and amenities, including stainless steel appliances, crown molding, granite countertops, refinished hardwood floors and basically a complete remodel.
Most of the homes were built between 1929 and 1940, and are 1,500 square feet or less. This is a perfect size for a young professional couple starting out in life with no children.
Within walking distance, there is a little alley way where a lot of neat shops and restaurants are located. Every May, there is an arts festival in this alley way where local artist set up shop to feature their art work. There is also an art gallery right around the corner from the alley way that is exquisite.
The pride of ownership truly shows in Paseo / Central Park.
You might also want to check the Nichols Hills / The Village areas. There are many young urban professionals who reside there, because of it's close proximity to Chesapeake, which is one of Oklahoma City's biggest employers.
And of course, you could never go wrong with anywhere in Edmond, Oklahoma. Edmond is considered the "Beverly Hills" of Oklahoma, but is shockingly affordable. Homes range anywhere from $85,000 all the way up to several millions of dollars. And of course, everything in between.
Best of luck in your home search!
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