Affordable Dream Home

The Affordable Dream Home: Myth or Reality?

One part of the American dream is undoubtedly living comfortably in the home of your dreams.  But exactly how attainable is this?  It may be closer than you think.  In fact, it may be only a modest mortgage and a home equity line away.

But before your hopes float too high, be forewarned: unlike the Hollywood version of this story, the real world American Dream does not happen overnight.  And no, you cannot TiVo to the good part of this story.

So, where do you begin?  First, when shopping for your new home, keep your idea of the perfect home close at hand, but keep your realistic idea of your future closer.  Think about what stage of life you want this property to house.  Furthermore, this mentality should apply not only to the aesthetics of properties, but also to the financial side of home shopping.   Remember that while a home that is too small may result in a smaller mortgage, it will also lend itself to lower price appreciation and home equity.  However, trying to buy a home that is too large could potentially end, not in ownership, but rather, in foreclosure.  Finding a happy medium is the key to being a happy homeowner. Read more

6 Pitfalls to Avoid When Buying a House

6 Pitfalls to Avoid When Buying a House

Once you’re on your way to home ownership, there are certain precautions you’ll want to take to further minimize your risks. Here are some tips to make your buying experience a more positive one:

• Know what you’re paying for upfront. Throughout the mortgage lending process, you’ll be faced with a flood of fees, some higher than others. From origination and escrow fees, to title insurance and property taxes, some may seem inflated while others fall in line with your expectations. You should never be afraid to question a fee you feel uncomfortable about or don’t understand.

• Try to avoid an early pre-payment penalty. Everyone wants to have the flexibility of paying off their 30- or 40-year mortgage early. The reward is not only owning your house outright but saving on interest charges. Work with a lender who is willing to waive any pre-payment penalties or can offer you the ability to refinance your mortgage at a better rate.

• Watch out for the classic bait-and-switch. We’ve all fallen victim to this one at some point or another. A lender may try to reel you in with low mortgage rates, no money down, or no closing costs, only to disqualify you with a less than perfect FICO® score. If you feel uncomfortable with the lender, or that they are not being truthful, then move on to someone you can trust. Read more

5 Helpful Tips Home Equity Borrowers

5 Helpful Tips for Future Home Equity Borrowers

As a homeowner, you have probably received offers in the mail to apply for a home equity line of credit (HELOC) or a home equity loan (HEL) . If handled properly, these types of loans can provide you with the income you need to handle your financial affairs. To assure that you are getting the best deal, here are some tips you will want to consider to enhance your buying experience:

• Avoid unnecessary fees.  The market for home equity loans can be very competitive. When shopping for the best offer be aware of any application fees, closing costs, or appraisal fees which can drive up your actual costs. Find a home equity loan that does not penalize you if you decide to pay off your loan early, or one that does not charge you a check writing fee each time you access your account. Read more