Buying a Home

Have you ever found your dream home, BUT, it needs a little TLC? Maybe you love the layout, but the whole house has carpet and EEK! You hate carpets! You don’t want to walk away from the house but you’re wondering if you can afford an expensive hardwood installation after using all your cash for the down payment.

Before you walk away from your dream home, you might want to consider your options.

First of all, you’re not alone! This is a very common situation, especially in hot markets when inventory might be low and people are going into multiple offers. What we’re finding, especially now, is that people are often paying above asking. And due to low supply, they might be buying a home that needs some improvement. This type of situation will often leave a home buyer with little money left-over to do upgrades, especially if they use all their cash for the down payment.

So, if you find yourself in this situation, don’t despair!

The good news is that there is a great product out there called Purchase Plus Improvement Mortgage that is available to home buyers. If you’re planning on buying a home and you have enough for a down payment, but you don’t have enough cash leftover for improvements, you can just add the cost of your renovations to your mortgage. If you want to update the appliances, put new flooring in, paint the walls, or whatever have you, the lender can actually help you finance that improvement. And the best part is that it doesn’t cost you anything extra in interest rates and fees. You still get a great mortgage rate and product and you get to create the home you want.

If you’re planning on buying a home and have questions about renovations, reach out to me. I can offer some advice and can help you find the right fit for you.

If you’re going from renting to buying, you probably have some questions about your financing.

One of the most common questions I get asked is – “Do I need to have a 20% down payment?” The quick answer is – no! You can buy a home with as little as 5% down depending on what the purchase price is. There are only two situations where you would need to put down 20% – if you’re buying a property over $1 million or if you’re buying an investment property.

When determinng your down payment though, you should consider what your monthly mortgage payments will be. For example, if you have 5% down then what type of monthly payments are you going to be looking at? That’s a big part of the conversation when going from renting to buying. Make sure you’re budgeting accordingly. Figure out how much you can afford each month to still be able to have a life that you enjoy. If you enjoy going on a vacation once a year, then what type of mortgage budget do you need to stay within to still be able to afford that?

If you have a fairly good idea of what your future mortgage payments will be, start budgeting for that and putting it into practice. For example, if you’re currently renting for $2000 and you can budget $2400 towards a mortgage payment, start putting an extra $400 aside. Act like you’re making those payments now. This will give you a better feel for home ownership and what your finances will look like.

However, the best piece of advice that I give my clients is to stay in the range that they feel comfortable in. Even if you get qualified for way more, if you feel more comfortable paying less, then do your best to stay in that bracket. The last thing you would want is to be in a position where you have to sell your home because you realize you can’t afford it. This is why it’s important to have a Realtor® that will work with your goals and keep your budget in mind.

If you have questions about going from renting to buying, it’s best to speak with a Realtor®. They’ll provide guidance and will let you know what to expect in the buying process. They can also refer you to a reputable mortgage broker who can determine how much you qualify for and how much you should be budgeting for.

If you have any questions about going from renting to buying, or if you need a referral for a reputable mortgage broker, get in touch with me today. I’m happy to help out!

If you’re planning on purchasing a home you’ll need to decide if you’re going to use a mortgage broker or a bank for your financing. So…what’s the difference?

The best way I like to explain it is with an analogy. Imagine you’re planning on purchasing a vehicle. You probably have a checklist of what you’re looking for; if you’re a family then you might want a spacious car that is safe for your kids, but if you’re young and single then you might want a fun and fast car. If you decide to go to a FORD dealership to buy your vehicle, the dealership will be able to offer you FORD cars only, even though Nissan, Honda or Ferrari might be a better fit for you. On the other hand, if you go to a vehicle broker, they will look at your list and will search ALL the dealerships in order to find a make and model that best suits your needs.

Banks and mortgage brokers kind of work the same way. A bank will be able to offer you their products only, whereas a mortgage broker will be able to offer you all the products and rates that are available on the market. So if you want to shop around, then a mortgage broker is the way to go.

One of the main advantages of using a broker is that they usually make themselves readily available and will work for you around the clock. If I have a question on Saturday night at 8pm I know I can reach the mortgage broker right away. Whereas with the bank, I’m working with their hours. This might not seem like a big deal but it certainly is when you’re working in a multiple offer scenario for a client and need a quick response. In a hot market, speed is essential and mortgage brokers know this. That’s why they will work their hardest to get a response – usually within 24 to 48 hours – in order to meet deadlines for financing. They can also work with multiple lenders to see who can get back to us the fastest with the best rates and products.

The other advantage of working with a mortgage broker is that they are genuinely interested in building and growing a relationship with the client. A broker wants to help you with your current transaction, but also with your future goals. For example, if your goal is to have an income property then a broker can let you know how to get there. If you’re planning on growing your family and will need to upgrade to a bigger home in 5 years, a broker can help you with the transition.

Having a mortgage broker by your side can be very valuable. Not only will they work diligently with your Realtor® to ensure the transaction is as stress free as possible, they will be there to provide guidance, advice and knowledge every step of the way.

If you’re looking for a reputable Mortgage Broker or have questions about qualifying for a mortgage, reach out to me. I can help steer you in the right direction.