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In addition to saving for a down payment, you’ll need to budget for the money required to close your mortgage. Closing costs generally run between 2% and 5% of your loan amount. You can shop around and compare prices for certain closing expenses, such as homeowners insurance, home inspections and title searches. You can also defray costs by asking the seller to pay for a portion of your closing costs when you make an offer. Calculate your expected closing costs to help you set your budget.

Don’t obsess with trying to time the market and figure out when is the best time to buy. Trying to anticipate the housing market is impossible. The best time to buy is when you find your perfect house and you can afford it.  Real estate is cyclical, it goes up and it goes down and it goes back up again. So, if you try to wait for the perfect time, you’re probably going to miss out.

There is a big difference between a buyer being pre-qualified and a buyer who has a pre-approved mortgage. Anybody can get pre-qualified for a loan. Getting pre-approved means a lender has looked at all of your financial information and they’ve let you know how much you can afford and how much they will lend you. Being pre-approved will save you a lot of time and energy so you are not running around looking at houses you can't afford. It also gives you the opportunity to shop around for the best deal and the best interest rates. Be sure to do your research: Learn about junk fees, processing fees or points and make sure there aren’t any hidden costs in the loan.

If you have little saved for a down payment or your credit isn’t stellar, you might have a hard time qualifying for a conventional loan.  You might assume you have no financing options and delay your home search. Consider looking into one of the three  government-insured loan programs  backed by the Federal Housing Administration (FHA loans), U.S. Department of Veterans Affairs (VA loans) and U.S Department of Agriculture (USDA loans).  Here’s a brief overview of each: FHA loans  require just 3.5% down with a minimum 580 credit score. FHA loans can fill the gap for borrowers who don’t have top-notch credit or little money saved up. The major drawback to these loans, though, is mandatory mortgage insurance, paid both annually and upfront at closing. VA loans  are backed by the VA for eligible active-duty and veteran military service members and their spouses. These loans don’t require a down payment, but some borrowers may pay a funding fee. VA loans are offered through private

It’s not wise to make any huge purchases or move your money around 3-6 months before buying a new home. You don’t want to take chances with your credit profile. Lenders need to see that you’re reliable and they want a thorough paper trail so that they can get you the best loan possible. If you open new credit cards, accumulate too much debt or buy too many big-ticket items, you’re going to have a hard time getting a loan.

Home buyers with little to no down payment savings looking to grow their down payment, can do so through contributions from friends  and family through HomeFundIt, the down payment crowdfunding platform.  What a great resource for engaged couples to send to their wedding list in lieu of a wedding registry! In addition to crowdfunding, buyers can increase your down payment  savings with UpIt, the only cash back program approved for a mortgage down payment. When you (or friends and family) shop online with UpIt retailers, a portion of your purchases goes to your down payment savings.  Visit  homefundit.com  for more information.

As the temperature in many areas of the country starts to cool down, you might think that the housing market will do the same. This couldn’t be further from the truth! Here are 4 reasons you should consider buying your dream home this winter instead of waiting for spring! 1. Prices Will Continue to Rise CoreLogic’s   latest   Home Price Index   reports that home prices have appreciated by 6.3% over the last 12 months. The same report predicts that prices will continue to increase at a rate of 5.2% over the next year. The bottom in home prices has come and gone. Home values will continue to appreciate for years. Waiting no longer makes sense. 2. Mortgage Interest Rates are Projected to Increase Your monthly housing cost is as much related to the price you pay for your home as it is to the mortgage interest rate you secure. Freddie Mac’s Primary Mortgage Market   Survey   shows that interest rates for a 30-year mortgage are currently at 4.08%. The   Mortgage Bankers Associa

New rules have taken effect that will change your home buying experience! The Know Before You Owe mortgage initiative is designed to empower consumers with the information they need to make informed mortgage choices. It includes the implementation of the TILA-RESPA Integrated Disclosure rule, which is often referred to as “TRID.”  Mortgages are complex and confusing. This new rule primarily does two things: It simplifies and consolidates some of the required loan disclosures, and It changes the timing of some activities in the mortgage process. If you are a buyer and would like to better understand the complicated process of applying for a mortgage, click here for a helpful step-by-step guide that includes information on the mortgage process and the new  regulatory changes.  This booklet is a toolkit that can help you make better choices along your path to owning a home.

As we see signs of a housing market recovery and the glimpse that things seem ready to return to normal, major markets across the U.S. are about to be impacted by a new housing crisis… a shortage of housing. According to the National Association of Realtors, a comparison of the second quarter of 2011 to the second quarter of 2012 indicates: Existing home sales are up 8.6% Existing inventory for sale is down 24.4% Median home prices are up 7.3% Individually, each of these statistics indicates a major market transition. Collectively, they show unprecedented one-year movement in the housing market. According to the U.S. Census, the recent history of housing construction has been relatively consistent (between one and two million homes produced since 1968): Between 1968 and 2008 at least one million homes were constructed each year The year with the greatest output was 1973 at 2,100,500 homes The year with the lowest output was 1982 at 1,005,500 homes The average output

100% financing is still available through Rural Development. Many of my buyers are finding this program hard to pass up: No Down Payment No Monthly PMI (until Oct 1st – so don’t delay!) Allows Closing Costs to be rolled into the loan Unlimited Seller Concessions (great opportunity for a "buy down" & lower monthly payments) 30yr Fixed Rates ranging from 5.0 to 5.25% over the last 6 months No Re-capture Period or Pre-payment Penalty – Ever! Credit Scores all the way down to 640 However, beginning October 1, 2011, all RD purchase loans transactions will be charged an annual fee of 0.3 percent of the unpaid principal balance (monthly PMI). On a $200K home, this is $50/month or $600/yr. These changes will not be effective until October 1, 2011. So there is plenty of time between now & October for buyers to still avoid this additional cost. Click here for more real estate news and advice. For more mortgage and finance information, visit my website's mortgage center .

The Federal Housing Administration (FHA) is giving homeowners and buyers until October 4 to lock in a low monthly insurance premium. After October 4, the monthly insurance premiums on FHA loans will increase by over 63%. What does this mean for home buyers? A home buyer purchasing a $200,000 home using a $193,000 FHA mortgage before October 4 would pay an insurance premium of $88.46 per month. If the same home buyer waits until after October 4, the insurance premium would jump to $148.01. Although the upfront mortgage insurance premium is going down after October 4, the long term impact to the home buyer is actually a net increase in their out of pocket costs because the monthly premium is going up by 63%. Sellers can pay the upfront premium or it can be financed into the loan amount, so homebuyers rarely pay the upfront premium out of pocket. On the other hand, the increase in the monthly premiums will be paid right out of the home buyer's pocket with their mortgage payment each m

The Federal Reserve released a proposal earlier this week to give mortgage applicants three days to change their minds. The proposal was part of a 930-page document that clarifies and finalizes the new financial reform law. The Fed's document says that for closed-end loans secured by real property or a dwelling, a creditor must: "Refund any appraisal or other fees paid by the consumer (other than a credit report fee), if the consumer decides not to proceed with a closed-end mortgage transaction within three business days of receiving the early disclosures (fees imposed after this three-day period would not be refundable); and "Disclose the right to a refund of fees to consumers before they apply for a closed-end mortgage loan." The Fed says this proposal will make it easier and cheaper for consumers to comparison shop. It also acknowledged that borrowers who want to close a transaction in a hurry would be handicapped because most lenders will delay sending out an app

With home mortgage rates at historic lows, many people are eager to refinance their current mortgage loan to lock in a low rate. Existing home owners with adjustable rate mortgage may never get a better time to refinance out of their current mortgage and into a more conservative and consistent 15 or even 30 year mortgage loan. When deciding to refinance a home mortgage, be sure to understand the refinancing costs associated with doing so and then try to limit them as much as possible. Refinancing an existing mortgage is very similar to securing an initial mortgage. In fact, your new mortgage will be used to pay off your existing one, so it is just like buying your home all over again. There are certain costs associated with a refinancing, just as there was when the original mortgage was secured. Closing costs such as broker fees, appraisal fees, title search, inspections and various administrative fees are all part of the fee structure associated with a mortgage refinance. To reduce yo

Interest rates are at all-time lows, there are lots of houses to choose from and prices are incredibley low. It is so tempting to buy right now. But is the timing right for you? As a first-time home buyer, there is a lot to consider when making the decision to rent or buy a home. Potential buyers should ask themselves several key questions before making this important decision: 1. What will monthly costs be and can I afford the payments? Keeping mortgage payments under 30 percent of your monthly income is a good rule of thumb. If you can't keep mortgage payments below that, you may be better off renting for awhile. 2. What other debt do I have? Total rent or mortgage payments plus credit obligations should not exceed 35 to 40 percent of monthly income. 3. What is my credit score? Can I qualify for a good interest rate? A high credit score indicates strong creditworthiness, and that qualifies you for better interest rates on a mortgage. Maxing out on your credit lines and paying bil

You've found the perfect condo and you're ready to make an offer. Before you move too quickly you should do some homework. Here are the seven most important questions you need to ask before buying a condo: 1. "What Are People Complaining About?" Take a look at the minutes of the condo association board meetings to see what the owners have been griping about. If everyone was complaining about the faulty plumbing or the gardener's absence, you know that the complex is having management difficulties. Even if there aren't any complaints, reading the minutes will reveal the sorts of projects that are under way at the complex -- projects the seller may have neglected to mention. 2. "Who's Been Naughty and Who's Been Nice?" Find out the delinquency rates of present owners. If people aren't paying their association dues on time, that is either a sign of discontent or an indication that the association might be underfunded. 3. "How Much Is In

Rates are at an all-time low! This is great news for anyone who has yet to refinance to take advantage of the lowest rates ever recorded, or to purchase that new home or investment property more affordably than ever before. Both 30 Year and 15 Year Fixed Rates clipped down to their lowest levels. All this is incredible as just months ago, many experts had anticipated that rates would be well above 5% this summer and on their way to 6% by year end. Visit my website's Mortgage Center for more helpful credit information.

Knowing the Guidelines Solves the Mystery The appraisal process often baffles consumers. They may feel that their home is worth a higher dollar amount, and so the appraised value doesn't always make sense to them. It is important to know that the appraiser is completely independent from lenders, buyers, sellers, and real estate agents, and that the guidelines to which they adhere are dictated by the Uniform Standards of Professional Appraisal Practice (USPAP) and Fannie Mae. In most states, the mortgage lenders must also disclose the purpose of the appraisal, as each transaction carries its own set of rules. In essence, these important guidelines help appraisers put a fair market value on homes based on comparable sales in the same area, and the home must be bracketed in size and value. For example, there is no set dollar figure associated with a great view, pool, spa, bathroom upgrades, etc. If a homeowner installs a custom pool that cost them $30,000, but the local marketplace su

Purchasing Tips It's critical to have the home professionally inspected before you make an offer or put down earnest money. The inspector will assess the structure's soundness and may uncover problems that would be very costly to repair. Banks usually sell foreclosed homes as-is, meaning they won't make any allowances for repair. And even in a short sale, they likely won't make any such allowances, because they're already losing money on the transaction. You should have your financing in order before pursuing a foreclosure purchase. Pre-approved buyers have the best chance of getting the property in case of multiple offers. Also, banks generally aren't interested in contingencies (for instance, needing to sell your current home before purchasing another). You might also consider hiring an appraiser who'll tell you what the house is worth. A qualified real estate agent can also perform a Comparative Market Analysis. To guide you through the process - from obt

Is a distressed property for you? Here are pros and cons of buying one: Advantages of Buying a Distressed Property First, you'll be dealing with a highly motivated seller – either a bank in the case of a foreclosure, or in a short sale, sellers who are in financial trouble and very interested in getting out of a mortgage they can no longer afford. These types of sales take much of the emotion out of the process. You won't be insulting anybody, for instance, if you make an offer that's lower than the asking price. (That's not to say that the low offer will necessarily be accepted, of course.) Lenders are extremely interested in getting these homes sold and off the liability side of their balance sheets. Many foreclosed properties can be purchased for only a percentage of what they would have commanded five years ago. (This situation is beginning to change, though; bidding wars are breaking out on some foreclosed properties these days, especially those that are moderately

A number of factors affect your credit score; improving the score requires you to take care of those factors such that you can manage your credit better. Follow these simple steps to improve your score: Improve your payment history: Avoid making late payments on your bills. Clear up all your past-due bills as soon as possible. Request your creditor for an alternative plan with low monthly payments. Negotiate with your creditors to remove charge-offs from your report and re-open those accounts. Request your creditors to erase late payment entries after you re-start paying in time. Reduce your outstanding debts: Pay off high interest debts first. Keep your balances low and try to keep your revolving debt to 50% of your available credit. Don't close old and unused accounts rapidly in order to lower your available credit. It will raise your debt-to-credit limit which has a negative impact on your score. Try to close accounts gradually over several months. Verify if the accounts closed