Wednesday, January 27, 2016

Perfect Steps to buy a house


Home mortgage lenders easing up on home loans

The new year may bring new opportunities for consumers hoping to get a home mortgage.
More lenders are reporting easing credit standards, according to Fannie Mae, and expect standards to ease rather than tighten in the near future. This could help affordability in the housing market, which has been suffering under both tight credit and tight supply of homes for sale.
The share of lenders who expect to ease standards for government-backed loans rose to 16 percent, and the share expecting to tighten fell to 2 percent, according to a Fannie Mae survey. This is across all types of loan products.
A total of 213 senior executives completed the survey from Nov. 4 to 13, representing 194 lending institutions.
"These current practices and expectations toward easing among lenders compares to a historically relatively tight mortgage credit standard base," said Doug Duncan, senior vice president and chief economist of Fannie Mae. 
Duncan, however, points to several challenges to improvement in the housing market in 2016, affordability for first-time buyers topping the list. There are still very few starter homes on the market, and home price appreciation is lapping household income growth.
"Lenders' thoughtful easing of credit standards should help mitigate some of this affordability decline," he said.
The potential for rising interest rates, which would narrow the field of customers for loans, may increase competition among lenders and force them to ease some of the extra safeguards they added after being sued by the government for billions of dollars over bad loans dating back to the last housing boom.
Read full article here:

Beach Property in California: The Pros & Cons

A beachfront condominium probably offers the most affordable way to get your own piece of the fun-in-the-sun California lifestyle. Affordable is a relative term when buying a basic condo only steps away from the sand; it requires a starter budget of over $1 million. This $1 million buys you a condo with under 1,000 square feet, which might not even have two bedrooms, in a condominium complex with few amenities.
There are two main types of buyers for beach condominiums: those who want to live at the beach and enjoy the laid-back lifestyle and those who want to make money from the strong tourist trade while having a vacation home to visit a couple weeks a year. The friend or enemy of either residents or investors is the covenants, conditions and restrictions (CC&Rs) of the condominium complex.

Why CC&Rs Are Important

CC&Rs set the rules for the condominium complex. They cover everything from parking to what color your front door can be painted. The rules generally apply to common areas and public spaces but can regulate other aspects of ownership such as operating a home business or whether the condo can be rented out. Residents and investors are often on opposite sides of the debate on rental restrictions.

Read full article here:

How Canada is not like the United States: Home mortgage edition

Those of us who write about the housing market and the virtues of the 30-year fixed home loan -- as we did Wednesday -- can calibrate our watches by how long it takes a reader to respond as follows:
"Hey, Canada doesn't have 30-year fixed mortgages, and their housing market's doing just fine! 
Usually about a nanosecond.
This is a popular line of chatter for pundits too. Back in August, Matthew Yglesias of questioned why "there's some urgent need for the government to subsidize 30-year fixed-rate mortgages. If you cross the border into Canada it's not like people are living in yurts."
That's true. Canada doesn't have fixed 30-year mortgage terms. But that's not the only difference between the U.S. and Canadian mortgage finance systems, by a long shot. I wonder whether the consumers, bankers and free-market ideologues on the Wall Street Journal editorial page who say the problem with housing in the U.S. is government interference would really be prepared to live in the Canadian system.
Actually, I don't wonder. I know they wouldn't.
Let's see why.
To begin with, the Canadian system is considerably more creditor-friendly than the U.S. Lenders typically have full recourse in cases of default, meaning they can attach all of a borrower's assets, not only the house. In the U.S. that's not permitted in 11 states, including California, and foreclosure proceedings are complicated even in the other states.

Read full article here: 

Related article:   5 Best Real Estate Markets for 2016

Monday, January 25, 2016

4 Tips to Staying within Budget When Buying a House

Buying a house is a major milestone for many people. However, the cost of purchasing a home can be difficult to gauge at first glance. There are fees and other expenses tacked onto the sale price of a home that may push a likely candidate just beyond the reach of their budget. Here are some ways to prepare for buying a house and staying within budget:

1) Budget Realistically – This may seem obvious, but it is a really important first step. Oftentimes people plan their budgets too optimistically based on incomplete information. One of the biggest hurdles people face is overestimating income or overestimating the amount they have saved for a down payment. It’s one thing to set a goal, but it’s important to make sure that the numbers on paper are as close to reality as possible. Otherwise, even a house that is within the written budget may be beyond the scope of real month-to-month living.

2) Research and Shop – There are good deals to be had, but they usually aren’t apparent at first. Don’t get trapped by a desire to purchase right away. Instead, take some time to shop around, find a great interest rate and a house at a great price. Rushing through the shopping process will result in fewer options and will typically come at a higher cost in the end. A great price on a house may be accompanied by a hefty need for repairs or other unexpected expenses. Getting caught off guard by these things will push anyone over their budget limits.

Read full here: