Blog – Page 212 of 787 – Fred Gruber - First Rate Financial Group

24

Sep

Mortgage

Getting Your Mortgage Application Approved As A Self-Employed, First-Time Homebuyer

Getting Your Mortgage Application Approved As A Self-Employed, First-Time Homebuyer A significant number of people are self-employed, which means they might be relying on this income to apply for a mortgage. It is true that people who are self-employed may face additional challenges when trying to get approved for a home loan when compared to someone with traditional W2 income, these are obstacles that can be overcome. With the right qualifications and documentation, even first-time homebuyers who are self-employed should be able to qualify for the home loan they need.

Lenders Assess Someone’s Ability To Repay The Loan

First, lenders are trying to make sure the person will repay the loan. Lenders believe that someone with W2 income has a stable job and a guaranteed salary, which means they are more likely to repay the loan; however, someone who is self-employed has other ways of demonstrating that he or she can repay the loan. Self-employed individuals can use tax returns, payroll receipts, and records from financial institutions that serve as documentation of the applicant’s income or assets. This means standard W2 forms and pay stubs might no longer be necessary.

Navigating Eligibility Requirements

Next, self-employed individuals need to meet the eligibility requirements. This includes two years of self-employment, a reliable income, a strong credit score with a clean credit report, cash for a down payment, and a low debt to income ratio. It is possible for a first-time homebuyer to get a loan for less than five percent down; however, closing costs can be significant. Realistically, first-time homebuyers should plan on spending close to five percent of the home’s value to get approved for a first-time home loan.

Understanding Mortgage Options

Finally, self-employed first-time homebuyers should be aware that there are multiple loan options available. For example, there are FHA and VA loans for those who qualify. USDA loans and jumbo loans might also be an option. There are bank statement mortgages and conventional options available as well. Self-employed individuals might have to visit several of these programs to see which ones work the best. The programs vary in terms of their down payment, minimum credit score, and credit history requirements. It is prudent to work with a professional loan officer who has experience helping self-employed, first-time homebuyers get approved.

23

Sep

By First Rate Financial Group

Mortgage

Reviewing The Basement Options For Homeowners: What To Know

Reviewing The Basement Options For Homeowners: What To Know Even though not every home has a basement, those that do usually fall into one of three categories. The most common examples of basements include poured concrete, masonry block basement, and precast panels. What do homeowners need to know about the different types of basement construction?

Concrete Basements

Concrete basements are the most common examples. There are several advantages of going with a concrete basement. First, concrete basement walls are resilient. They can resist possible cave-ins, standing up to natural pressure created by wind, water, and soil. Furthermore, concrete basements are also fire-resistant while creating joint-free basements that can increase property values.

Even though concrete basements are water-resistant, hydrostatic pressure can allow water to permeate over time, creating mold and mildew issues. Homeowners need to keep a close eye on the humidity of a concrete basement to make sure this is not happening in their homes.

Block Masonry Basements

Another popular type of basement is called a block masonry basement. This structure is created with cinder block or masonry units that are connected to one another. Ultimately, this creates a waterproof structure. This is a highly resilient, cost-effective construction option that is much easier to install. Therefore, homeowners can save money on labor and materials. The walls are also more durable if they are reinforced using a steel rebar.

Precast Panel Basements

Finally, homeowners may also encounter a precast panel basement. These usually involve concrete panels that are molded in a different location before being transported to the construction site using a crane. Typically, these walls are strong and resilient. They do provide waterproof qualities, but if the joists have been neglected, they can develop moisture penetration issues. These panels also have to be treated with boric acid to prevent pest infestations.

Options For Basements: Homeowners Should Work With A Professional

Ultimately, there are plenty of options available when homeowners are looking to construct the basement. Examples include full basements, partial basements, walkout basement, and crawl spaces. Homeowners need to work with a construction professional who has experience building basements. Each option has its individual benefits and drawbacks, so homeowners need to inquire about permits and environmental factors that might make one type of basement superior to another.

22

Sep

By First Rate Financial Group

Home Mortgage Tips

Worried About Mortgage Rates Going Up? 3 Steps to Prepare Yourself Financially

Worried About Mortgage Rates Going Up? 3 Steps to Prepare Yourself Financially Mortgage rates have been at record lows for quite some time, making it easy for new homebuyers to finance their dream homes. But what comes down will eventually go back up, and with the world economy expected to rebound in 2016, we’re about to start seeing more expensive mortgages.

So what can you do to prepare yourself before mortgage rates start to rise? Here are three strategies that will keep you ahead of the game.

Start Saving More Money Now

If you have a variable rate mortgage, you’ve benefitted from great interest rates that this world won’t see again for quite some time. Hopefully, you’ve taken advantage of this low-interest period to save up some cash. If so, you’re going to be in a great position for when interest rates rise – and if not, you’ll want to start saving as much as you can now to ensure you can weather the storm.

It’s far easier to save money now, with interest rates low, than it will be when your mortgage payment starts to rise. So start squirreling away as much of your paycheck as you can.

Pay Down as Much of Your Principal as Possible

Another great way to prepare for the rise in interest rates is to pay down your principal amount. The total amount of interest you’ll pay goes up when rates go up, but by paying down your principal, you can take a big bite out of your debt before it has a chance to snowball. So pay down as much of your principal as you can afford – it’s easier to pay down interest on a smaller principal amount.

Switch to a Fixed Rate Mortgage

One of the best ways to take advantage of low rates and ensure you get a great deal is to switch your floating rate mortgage to a fixed rate mortgage. Locking in your low interest rate with a fixed rate mortgage means you’ll pay less interest over the term of the loan, but it also means you’ll only have a set amount of time to pay your mortgage in full. If you’re in a position to predict when you can pay back your mortgage, you’ll save a lot of money by locking in your low rate.

Mortgage rates haven’t been this low in a long time, and likely won’t be this low again for many years to come. That’s why, if you’re a homeowner, you’ll want to do everything you can to prepare for higher interest rates before they get here. Contact your trusted mortgage advisor to learn more about how to manage interest rates and make sure you have the right mortgage for your situation.