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The Top Things To Consider When Buying Or Selling
Posted on Mon, 15 Aug 2016, 02:50:00 PM  in Home buying tips,  Home selling tips
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It doesn't matter if you actually want to buy a new home or sell the one you are currently in, so long as you remember there are a handful of things that can significantly effect the cost of the house. While many people may think it is important to have high end finishes, the truth of the matter is you need to be wary of some of the high dollar items. Finishes are just that; finishes. But, if you have to dig into the bones of a home to make changes whether you are prepping to sell or considering buying, these are the items you must be conscious of.

Mold and Mildew

considerAny time a potential buyer spies mold or mildew growing on or inside of a house it can be a significant problem. Not only does mold signify there are tremendous problems with respect to drainage or leaks, but the fact of the matter is if you have mold in or around your house it can be a nightmare. Mold isn't just an allergic and poisonous substance by itself, but it can spread and get into other things all around the rest of the home before you even know it. In order to remove the mold spores you have to pull up finishes and expose the underlying wood, and the remediation can be extremely touchy as well to make sure you have removed it all. If you are preparing to buy then you definitely need to have a mold test. And, if you are going to sell, you should ensure you know about any mold problems far in advance as well.

Rotting Wood or Dryrot

If you happen to be in an area that has termites or you think you could wind up having any other problems with unfinished and untreated wood in a given house, then you have to be aware of wood problems. Because woods are the bones of your home you should be able to imagine the complications that can occur when your structural integrity is compromised. Not only could you see minor shifts in the house or home if support starts to give away, but you can also wind up having more problems come in through the holes where wood used to be. Throw in the fact that termites or other pests may still be present once you have seen signs of them being there and you can tell why checking for dry rot or other wood problems like termites can be very important to sniff out ahead of time.

Foundation Issues

If you want to buy a house and there are cracks in it, you should keep your eyes open. Obviously houses settle and shift over time. However, if you have a problem with the actual structural foundation itself then you could absolutely be looking into significatn costs. Likewise, if you are going to try and sell your home at some point then you should verify any minor structural problems now to stop them from getting worse and to fix them for later. 

General Pests

Pests can be a problem in any home for a few reasons, but one of the worst things about pests is the damage they can leave behind. Not only will fumigating and general cleanup run a decent amount of money, but you can also see the tremendous amount of long term annoyance that can come with trying to find the holes, cracks, or entryways that pests use and will continue to use.

As long as you are able to consider all of the problems or potential pitfalls that can come with buying a house, then you should be in a much better position for pricing and awareness. However, if you are looking to sell your house then you should absolutely be aware of the highest cost items to repair when it comes time to sell.


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Breaking Down the Mortgage Payment
Posted on Mon, 30 May 2016, 10:50:00 AM  in Home buying tips
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When you buy a home, you're greeted with a complex mortgage payment that may appear confusing at first. Unlike a rental payment, the monthly mortgage amount is a mixture of several different charges. For first-time home buyers, it's important to understand what you're paying for each month. With mortgages lasting 20 years or longer, understanding them should be a top priority for investors.


Principal and Interest
The main parts to any mortgage are principal and interest. The principal is the amount you agreed to pay the sellers during the bidding process. For example, the initial home price or principal might have been $150,000. When you pay your mortgage each month, you slowly pay down the principal's initial amount. The interest amount is the money charged to your loan by the lender based on your good credit. When you begin your mortgage payments, you'll normally pay more interest than principal. As time goes by, the principal will be paid off faster than the interest. Most lending institutions use this amortisation schedule for their clients.

Trust Accounts Explained
If you only paid the principal and interest on the mortgage, you'd have a rude awakening when property taxes and insurance are due. Every year, you must calcpay a certain amount of taxes on your property. These taxes pay for community resources, such as schools and emergency services. Depending on your Canadian region, taxes could be due every quarter or on a semiannual basis. Insurance is required by the lender because the home must be covered in the event of a catastrophic accident or natural disaster. You can easily pay for taxes and insurance by adding a trust account to your mortgage payment. In one lump sum, you'll pay the principal, interest, taxes and insurance. As a result, you won't receive a huge bill for these items. They're simply paid off in small increments across the entire year.

Monthly or Weekly Payments?
In most cases, you'll pay for your mortgage on a monthly basis. The interest is calculated monthly, and allows you to make 12 payments each year. This payment schedule usually culminates in a mortgage period that lasts 15 or 30 years. However, you do have the option of paying for your mortgage on a weekly basis. Essentially, your monthly payment is divided by four, and the bank withdraws this lower weekly amount on a day of your choosing. Because there are 52 weeks in a year, you'll make an extra monthly payment with this scheduling type. As a result, you'll pay fewer interest charges and complete the mortgage in less time than a standard monthly payment.

Adding Onto Your Payment
Another way to pay off your mortgage faster is adding an amount to the standard monthly payment. Every time you receive your mortgage bill, there's a section for an additional payment. Add any funds you can to the principal. Over time, you'll reduce the mortgage's length and save substantially on interest amounts. However, don't compromise your budget to add this extra amount. Always pay the required mortgage, and only add to it when it's possible. You should still have a comfortable lifestyle with any mortgage amount.

A smart way to start any home buying process is beginning with a trusted lender. This bank can look over your income and compare it to your liabilities. Using complex calculations, the lender forms a mortgage payment that you can afford. It's based on a given property value range, such as $200,000 to $250,000. Use this pre-approved lender amount to guide your property search. When you remain within the pre-approved price range, you'll have no problems affording the monthly payment.


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How to Clean Up Your Credit Before Buying a House
Posted on Sun, 15 May 2016, 11:15:00 AM  in Home buying tips,  My services
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Since mortgage interest rates have been low for several years, many home buyers are under the misconception that their credit score won’t make that much difference in the amount they pay over the life of the loan. In reality, even a point or two difference in the interest rate can easily amount to $50,000 to $100,000 over the term of the average 30-year home loan. A lower interest rate may also result in lower monthly payments, which can leave extra cash in your pocket. The secret to qualifying for the best interest rate on your mortgage is to start whipping your credit score and history into shape at least a year before applying for your loan. The following steps will help you improve your financial picture so that you can face your mortgage lender with confidence.


What Is a Good Credit Score?
Credit scores range anywhere from 300 to 850. Your score is calculated using a combination of factors, including the length of credit history, past payment history, type of credit, and amounts owed in relation to available credit. As a general rule, individuals with credit scores 740 and above are in a position to qualify for the best loan rates. You may still qualify for a mortgage even if your score is below 740; however, you will likely pay one to two points more in interest.

Get Your Credit Report:
It is important to review your credit report at least once a year, so you will have a clear picture of where you stand. Be sure to dispute any inaccuracies that youmoney may find with the credit bureaus.

Lower Your Debit-to-Income Ratio:
Your debit-to-income ratio is the amount of debt your lender believes your income will support. It is recommended that you keep housing payments at no more than 28 percent of your monthly income. You should strive to keep the total of all your debt to less than 36 percent of your income. You can lower your debt-to-income ratio by eliminating any low-balance loans that are close to being paid off and reducing your outstanding credit card debt.

Get Rid of “Toxic” Accounts:
In-store financing and rent-to-own accounts have horrendous interest rates, high payments, and have a bigger impact on your credit score than other types of debt. It is best to pay off and close these accounts as quickly as possible.

Pay on Time:
Almost everyone has had a few late payments here or there. You can lessen the effect of past payment problems by ensuring that you have at least six to 12 months of consistent on-time payments before applying for a mortgage.

Lower the Amount of Credit You Utilize:
You should try to keep credit card balances to less than 20 percent of the total credit line. You should also avoid closing credit cards as you pay them off unless they are store cards or have an annual fee. Closing the accounts will lower your amount of available credit and actually increase your debt-to-income ratio.

Avoid Applying for New Debt:
Opening up a lot of new credit lines at once can lower your credit score. Each time you apply for credit, the lender places a hard inquiry on your credit, which has an adverse effect on your overall score. An influx of new accounts also raises a red flag for lenders that you are about to become overextended. 

It can be frustrating to have to delay your home search in order to work on your credit; however, a little patience and diligence can earn you thousands of dollars in savings. 

 


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