The Widely Known Hidden Costs to Purchase a Home

With the insane housing market "sale rack" going on, buyers are definitely saving up for their down payment. However, it's not just saving for the down payment. Here is a simple break down of how much money you'll need before signing on that dotted line.

Earnest Money Deposit (EMD)
A buyer's EMD check is the key to opening escrow.For resale it's typically between 1-3% of the home price. For new construction, it sometimes depends on the builder and the home price.

Down Payment
FHA loans are currently 3.5% down. Conventional loans are typically 10-25% down depending on your credit. VA loans are 0% down. Check out your city or county programs for housing assistance programs, as well.

Home Inspection
This is paid directly to the home inspection company at time of service. Costs depends on who you choose and the home square footage. Fairly inexpensive.

Appraisal Fees
Unless it's an all cash deal, lenders will require an appraisal, which is usually a few hundred dollars, or more depending on home square footage.

Closing Costs
Always estimate high as these costs are all over the map from 1% to 8%. Your initial deposit could go toward this, but usually costs range between 3-4% of your loan.

Your lender is required to provide you with a Good Faith Estimate (GFE), which will break down all the costs line by line.

Here's an example of a $200,000 home:
Earnest Money Deposit (1-3%): $2,000-$6,000
Down Payment FHA (3.5%):     $7,000
Down Payment (10-25%):         $20,000-$50,000
Closing Costs (3-4%):               $6,000- $8,000

When 'Cash-In' Refinancing Pays Off

Typically, when a person refinances their home it's to take money out. Find out when it's a good idea to put money in.

Click Here to Read Story

0% Down in Certain Rural Areas

Find a Home for 0% Down

Are you looking for a home in a rural area? Do you want a Zero Down Loan? King County has a USDA Rural Development loan program. Just click the above link and type in the property address to see if the home will qualify.


 

Tips to Improve Your Credit Score

Are you in need of credit repair, but don't know where to start? You can begin by requesting a copy of your credit report through the credit bureaus or a credit monitoring service. On your report you can see what is making your score so low. Too many credit inquiries, outstanding balance too close to credit limit and late payments are just a few of the ways your score can dip. Focus on the main issue, and remember it does take time for positive work to reflect on your report.

One of the most effective ways to increase your score is to keep your debt under 30% of your credit limit. Anything above that will have a negative impact on your score.

Limit the amount of credit cards you have. Less is more. The minimum open lines of credit to buy a home or rent an apartment is three, so there's no need to open ten. Also, a mortgage or car lease qualifies as a line of credit that can help your score by adding to the variety of credit types.

Remember your oldest credit card and the one with the least APR% are your best friends. Keep these open and pay them down. They contain your greatest credit history. If you close them all that history goes away and so does your good score.

Overall, if you just maintain low balances and limit your lines of credit you'll be on your way to a more admiral FICO score.

3803 130th Lane SE A13, Bellevue, WA | Powered by Postlets

3803 130th Lane SE A13, Bellevue, WA | Powered by Postlets

What is Escrow-Video

What is a 203k loan?

"Due to the current structure of this home, it is deemed unsuitable for financing. Only cash offers or rehab loans accepted."

You may have heard this statement before. Usually after touring a home that was in really bad shape. Examples of major cases are foreclosures that were trashed, or the previous owners stopped right in the middle of their renovation.

If you're looking for a home in this market full of foreclosures and REOs, you might have noticed a lot of unsightly interiors. Sure, the outside may look nice, and the neighborhood may even be a highly desirable one. What happens when you found the location you want, but the inside is so bent out of shape that the bank deems it unsuitable for financing?

A 203k loan, or rehab loan, may save the day. These loans are structured in a way to help a buyer finance a home that is not "finished" or built up to code. It is basically an FHA loan where the repairs are started after the close of escrow. Escrow usually lasts 60+ days, giving buyers an extra few weeks to meet with construction companies for repair quotes to bring the home up to minimum FHA building standards. Once a buyer submits the best quote to their lender, that amount will be added to the loan after the close of escrow, and the rehab can begin.

If this seems like something you are interested in, find a good lender who specializes in 203k loans, and see if you can qualify for one.