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Over the past couple of days, I’ve heard from a couple of loan officers I trust. They wanted to let me know that lenders are beginning to tighten their lending standards even more. Folks, it is about to get a little more difficult to obtain a mortgage.
I was told that the minimum credit score required for an FHA loan may be going from 580 to 600. I’m speaking in general terms here – there are always exceptions. The score I’m talking about would be your mid credit score. Basically, you have a credit score from three agencies, and the number that matters is the one in the middle. The other thing that is on the verge of changing is the back end ratio. That’s a fancy way of saying that your house payment, along with your other debts, will be allowed to take up less of your overall income.
Yes, this is the day of tighter standards. Why? That’s easy. It’s because standards over the past couple of years were WAYYYY too loose. I think the standard of qualifying for a loan 2 years ago was an answer of “yes” to the following two questions: “Do you want to buy a home?” and “Do you have a pulse?”. Because of that, lenders are really tightening things now, maybe even overreacting a bit.
Here’s the good news. If you have historically paid your bills, you can probably still qualify for a home. If you can qualify, it’s a great time to buy with great deals available and unbelievably low interest rates. The other good news is this: Eventually, the standards will relax and settle somewhere in the middle of where they used to be and where they are now. When will that happen? That’s a good question. My guess is that it’s going to take a while.
Article by W. Cody Robinson, Owner/Buyer Specialist, North Texas Home Finders
Contact Cody at 972.365.0432 or Cody@NorthTexasHomeFinders.com
Get a Buyer Specialist and rest easy! The builder pays our service charge from their advertising budget which is built into every home they sell. Since these fees do not come out of the home construction budget, you cannot negotiate one penny of a better deal alone. We also work with preowned homes where the seller pays our fees! Visit www.northtexashomefinders.com for more information.
According to the Dallas Morning News article on January 26th, Mercedes homes filed for Chapter 11 Bankruptcy. The 25 -year -old Florida based builder has about half a dozen current neighborhoods in DFW ranging from the 130-400K range.
The current economic problems are causing many privately funded builders, like Mercedes,Wall and Sotherby most recently, to throw in the towel. Currently, banks are not freely loaning money to builders, because these loans are considered to be more risky.
The simple economic principle of “supply and demand” explains much of the problem. Builders had too many spec homes on the ground when the economy started declining, and they had to pay monthly construction costs on unsold homes sitting empty for months to a year or more. A builder can only float for so long, and when the bank refuses to loan the builder any more money, well, bankruptcy usually follows.
In my opinion, it’s never a good thing when a builder goes bankrupt. When bankrupt homes go into foreclosure, it affects every home owner near the foreclosed property. The comparable properties in a given area dictate what a home is worth, whether we like it or not. A foreclosure selling for $50.00 a sq. ft., is going to hurt someone who has their home on the market for $80.00 a sq. ft. . A home’s selling price is dictated by the current market, and foreclosures definitely affect those prices.
Having more builders helps the consumer. Competition among builders will lead to better pricing, and a better built home. For example, if XYZ builder is putting in tank-less water heaters, then ABC builder will have to keep up with the demand or lose business.
Lately, I have heard some builder representatives mentioning their competitors bankruptcy to help boost their sales, but as we can see, no builder is completely immune to bankruptcy in this current market.
I wish Mercedes the best, and hope they can restructure and come back strong. Mercedes builds a good quality home, and there are plenty builders in the DFW area with a far inferior product that are somehow going strong…for now?
If you need help finding your new home, please contact Amy Underwood at Amy@NorthTexasHomeFinders.com or call 972-921-8787 for a quicker response. Remember, a Buyer’s Agent services are free of charge.
You have finally decided that apartment life is not for you any longer. In fact you cannot wait another minute to get out of there! Now what do you do?
A. Find a Real Estate Professional to help you through the entire process. Ask your friends for referrals. When interviewing your potential agent, be sure you are comfortable with them. After all a GOOD agent will become a member of your family during this process. They will really understand what you need and help you find it.
B. Get pre-approved for a mortgage. You can hook up with a trusted and recommended Buyer Specialist that can help you find the perfect home and the perfect mortgage. The very 1st step is to discover your purchasing power. How much home can you really afford without being house poor. We all need a cushion and want to be able to eat out or go on vacation. Your agent can recommend a professional that can get you ready to go. This not only helps you understand your budget, but also shows sellers you are serious when you submit your letter with your offer.
C. Decide what is important to you in your new home. You should provide your agent with the answers to the following questions:
1. When do you want to be living in your new home?
2. How many bedrooms?
3. How many bathrooms?
4. What size yard?
5. What kind of kitchen?
6. What monthly payment including taxes and insurance are you hoping to stay within?
7. Have you decided on an area you would like to live? Be specific with cross streets and neighborhoods.
8. Are you trying to stay a certain distance from work? This is just in case the area you LOVE is out of our comfort zone with regards to payment. J
9. Is there anything that you must have when you think about your new home?
D. Let your agent do the work. Now it is time to sit back and let the professionals search through the 1000s of homes on MLS and their other sources to find the best fit based on your situation. They will narrow it down and eliminate the ones that will not work.
E. Go look at homes with your agent and find the one that you feel the best when you first step through the door. This one is your HOME!!!
F. Your agent will help you through the offer process and prepare all the necessary paperwork.
G. Once negotiations are completed, you must have the home inspected. In the meantime, you will need to work with your mortgage professional and supply them with any necessary documentation to complete your loan.
H. Wait. This is the hardest part. But now you wait. You wait for final loan approval and the inspections to be completed. Any items identified in the inspections, you work with your agent to get them repaired.
I. Closing Day. The day finally arrives, usually 30 to 45 days after the contract negotations are completed. Be sure you have done your hand exercises, because you will have a ton of signing to do!
J. Move those boxes and set up your utilities. Now you can unpack and get settled in your new home. Don’t forget about your agent. Remember, referrals are the way they feed their families!
Article by Teresa Robinson, Owner/Buyer Specialist, North Texas Home Finders
Get a Buyer Specialist and rest easy! The builder pays our service charge from their advertising budget which is built into every home they sell. Since these fees do not come out of the home construction budget, you cannot negotiate one penny of a better deal alone. Visit www.northtexashomefinders.com for more information. Email Teresa directly at teresa@northtexashomefinders.com
Absolutely beautiful brick and stone-work accent the exterior of this home. Extended, covered front and back porches offer you the comfort of shade on a hot, sunny day. This home includes a wet bar in the bonus room, complete with wine racks, granite counters and a stainless steel sink. Elements of the outdoors are pulled inside where you will find hand-scraped hardwood floors, a stone fireplace and double arched, brick pass through into an open kitchen/family layout. This is the perfect home for entertaining!
This home was originally listed at $384,563
It’s now discounted to $342,563
North Texas Home Finders can get you this home for $318,584!
Call today to schedule a showing
I’m shocked at the amount of confusion out there regarding the first time home buyer tax credit. I don’t mean confusion within the general public, I mean within circles of mortgage professionals and real estate professionals. My intention in this article is to give some basic facts regarding the 2008 Housing Assistance Tax Act.
The simple summary is this: First-time homeowners may receive a $7,500 tax credit if they purchase a home between the dates of April 8, 2008 and July 1, 2009. This credit is actually a loan that will be paid back over a 15 year period ($500 per year). If the home is sold before the end of that period, and the seller profits more than the balance owed, the balance will be paid from the proceeds of the sale.
This is a CREDIT, not a deduction. Bottom line — if you would other wise pay $2,500 in taxes, with this credit you would now receive a $5,000 refund. Pretty nice for first-timers! Some other facts:
- a first-time homebuyer is defined as someone who, along with his/her spouse, has not owned a residence during the past three years. (you don’t have to be a TRUE first-timer)
- only “principal residences” qualify for the credit…no investment homes, 2nd homes, etc.
- if you purchase your home in the first part of 2009, you can still claim the credit on your 2008 taxes, or you can wait until your 2009 return
- if your household income is greater than $75,000 (single) or $150,000 (married), you may be eligible for only a portion of the credit, or maybe not at all
I hope that makes things as clear as mud! Bottom line is this – consult with your tax attorney and your Realtor to find out if you qualify for this credit and whether you should take advantage. It’s just one more factor that makes this a wonderful market if you are searching for a new home.
Article by W. Cody Robinson, Owner/Buyer Specialist, North Texas Home Finders
Contact Cody at 972.365.0432 or Cody@NorthTexasHomeFinders.com
Get a Buyer Specialist and rest easy! The builder pays our service charge from their advertising budget which is built into every home they sell. Since these fees do not come out of the home construction budget, you cannot negotiate one penny of a better deal alone. We also work with preowned homes where the seller pays our fees! Visit www.northtexashomefinders.com for more information.
Realtors possess unique skills and expertise that place them in an advantageous position over their clients. In a Realtor/Client relationship, it is important for the client to trust the agent, and to know that they have their best interest at heart. More importantly, Realtors have an obligation to treat their clients fairly, honestly, and to set aside all selfish interests. A Realtor should always disclose all known relevant facts, and give the client the opportunity to obtain independent advice.
Example: If a Realtor shows a brand new home to a client, knowing the builder has gone bankrupt, then it is the duty of the Realtor to disclose that information, if indeed, the agent is aware of the situation. A buyer should be aware of all facts to make the wisest most informed decision.
Example: If a Realtor knows the home is in a flood plain, then the Realtor must disclose that to the client. A Realtor can face legal action if all known facts are not presented to client.
Example: If a client asks the Realtor if a home has foundation damage, then the Realtor should request that the client get an independent inspection from a licensed home inspector to make that determination. A Realtor should never make an evaluation of the foundation, because they are not licensed to make those evaluations.
Obligations of a Realtor:
Obedience
Loyalty
Disclosure
Confidentiality
Accounting
Reasonable care and diligence
At North Texas Home Finders, we promise to abide by all of the above obligations and duties. It would be our pleasure to show you how we “Are Not Your Typical Realtors” If you need help in finding a home, please call Amy Underwood at 972-921-8787 or e-mail me at amy@northtexashomefinders.com. If you visit our site, please put “AMY” in the “How Did You Hear About Us” section.
North Texas Home Finders – Where we treat your new home investment as if it were our own! Whether you are looking for your first home, relocating to the DFW area, rewarding yourself with your dream home, or downsizing, our experts will find you the best home for the money.
We specialize in all areas of new home construction, from single-family homes to townhomes and patio/garden homes to golf course homes and custom homes on acreage. We have an exclusive network of reputable builders that keep us posted daily about reduced pricing, and buyer incentives on their inventory homes. We often hear about price discounts before the general public does. With our bargaining power, you will feel confident that you are getting the best deal on your new home investment.
In addition to serving the metropolitan areas, we also find homes in the major suburbs – from McKinney, Allen, and Frisco, to Denton, North Fort Worth, Keller and everything in between! At North Texas Home Finders, we are different, because we listen to our clients.
A typical real estate agent tells you to do a Dallas/Fort Worth MLS search, give them the list, and they drive you to see the homes that you have found. Once you have signed a contract you never see them again.
We do not just show you homes; our goal is to streamline the whole buying process, saving you valuable time by doing all the hard work for you. Buying a home is often the largest purchase a person makes. You will feel comfortable that you are making a sound decision with our team on your side.
We start by listening to your needs and extensively previewing homes that fit your requirements. We then eliminate properties that will not work, and only show you homes that will be of interest to you. Next we negotiate the best price.
Finally, we attend all your builder orientations and your closing meeting to make sure your best interests are represented every step of the way!
Best of all, using a Buyer’s agent is entirely free to you.
Contact us today at 866.959.FIND or www.NorthTexasHomeFinders.com to see how it feels to have a professional on your side.
With more and more home builders closing their doors, it is wise to have to have an expert on your side. Someone that knows the marketplace and knows who is strong and who is in trouble.
The following is a sample of items that could cause you serious problems when purchasing a new home directly from a builder. Even the most experienced buyers may forget a point or two. If you don’t know how to handle each of these items and more, why would you go to one of these offices without having your advocate with you?
1. Has there been any Special Assessment Financing (SAF) for this property?
2. How often will access to the home be granted during the building process?
3. Are there any Construction Liens on the property?
4. Are there any initial contributions, annual assessments or special assessments collected by the HOA that will be paid by the buyer at closing?
5. Can I see a plot plan of the homesite to evaluate the easements before closing?
6. Can I get a copy of the CCRs for the community before I purchase?
7. How long has this home plan been built? Will I be the first?
8. How will we document our agreement on the protected features of the homesite?
9. What type of drainage will the homesite have? Is it the correct one for the long term?
10. Is there a lot premium for our home site? Should I pay it?
11. What will be built next door, behind, in front of the homesite?
12. What is the city zoning for any undeveloped property?
13. What about a soil test? How do I know that it has been done and passed inspection?
14. Explain “binding arbitration” to me.
15. How can I ensure that this home will be built 100% city code compliant?
16. What clause should I add to the contract to ensure that any material installations performed by your workers does not void the builder included warranties?
17. What does the purchase agreement say about material changes? Don’t you have to get my approval first?
18. Is this home in a PUD or MUD district? How will that effect my property taxes?
19. When do I need to have my design selections finalized?
20. What happens if you do not complete construction of the home at the agreed time?
Article by Teresa Robinson, Owner/Buyer Specialist, North Texas Home Finders
Get a Buyer Specialist and rest easy! The builder pays our service charge from their advertising budget which is built into every home they sell. Since these fees do not come out of the home construction budget, you cannot negotiate one penny of a better deal alone. Visit www.northtexashomefinders.com for more information.
The state of Texas is unique in its application of homestead protection. Although this protection is very substantial, it presents serious limits on the ability of a homeowner to mortgage his/her homestead.
The urban residential homestead consists of a lot or lots of 10 acres or less that is located within a city or town. There is no limit on the value of the land and its improvements entitled to homestead protection. Rather, what is defined as homestead is based solely on the size or acreage of the land involved.
The Texas homestead exemption began as protection for the wives and children of the early settlers in the event the man of the house was lured into a not-so-honest game of chance or decided he needed a few dollars more to continue a night out on the town. More seriously though, the wives and children of a deceased breadwinner were secure in their home(stead) and could not be removed because of some improper or manufactured claim of debt.
As a state constitutional protection, it has withstood the test of time and remained virtually unchanged as we have moved from the 19th century through most of the 20th century.
The practical protections of the homestead laws prevent any creditor (except for the mortgage holder, a taxing authority, or the holder of a note created for a home improvement loan) from forcing the sale of the homestead to satisfy nonpayment of a debt. It is difficult to “abandon” the homestead protection to borrow against its equity. An owner who wants to maintain property ownership and be able to borrow against its equity would have to move out of the property and demonstrate it is now being used as rental/income- producing real estate and that he or she has established a new homestead elsewhere.
The protection sounds good, but do I really need it? Not only do you get the protection granted, but also a discount on your property taxes. At least $15,000 off the taxable value of your home, and up to 20% off in some cases. That makes the Texas Homestead Exemption a win-win for home owners.
For further information on the Texas Homestead Exemption
For applications contact your county’s Central Appraisal District:
In dealing with a very high number of home buyers, we obviously run into people that have credit challenges. Also, because of changes in the mortgage industry, the definition of a “buyer” has changed substantially over the past year. Credit scores required to buy a home have gone way up. As anyone that has dealt with North Texas Home Finders can attest, we strive to provide the highest level of service to our clients. Because of that, we are working on forming a relationship with a company that can help our clients that need a little boost in credit score in order to qualify for a mortgage.
We are not yet prepared to offer details, but we want home buyers to understand that we “get it” from a buying perspective. We understand the frustrations home buyers are facing and we are very close to an agreement that will serve our clients well and help to eliminate that frustration.
Check back over the next week or two for details. Sorry to tease, but I want our clients and potential clients to know that there are reasons why we say that we are NOT typical Realtors!
Article by W. Cody Robinson, Owner/Buyer Specialist, North Texas Home Finders
Contact Cody at 972.365.0432 or Cody@NorthTexasHomeFinders.com
Get a Buyer Specialist and rest easy! The builder pays our service charge from their advertising budget which is built into every home they sell. Since these fees do not come out of the home construction budget, you cannot negotiate one penny of a better deal alone. We also work with preowned homes where the seller pays our fees! Visit www.northtexashomefinders.com for more information.
