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5 Tips to Shopping for a Mortgage

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5 Tips to Shopping for a MortgageShopping for a mortgage should be just as important as shopping for a home but sadly, many homebuyers miss this crucial step. They simply go with either their bank, credit union, or Joe blow that someone has recommended. But that might not be the best lender for their needs. If you’re currently looking for a home loan or looking for homes and haven’t quite yet searched for a mortgage, here are 5 tips to shopping for a mortgage.

#1. Shopping for a mortgage is more than just getting the best interest rate.

There are many more fees and costs involved to obtaining a mortgage than just the interest rate. Yes, you want the absolute best interest rate possible, which is calculated using your down payment and credit history, but this is just one factor of many. There are several additional things to consider when shopping for your first mortgage. You’ll want to ask about closing costs, private mortgage insurance, the type of loan program, and the fees charged by your loan officer or broker. Typically, fees from a bank or credit union can be lower than a private mortgage officer, but banks can only offer you one program whereas a mortgage officer can provide hundreds of different programs and options through several different banks and lenders across the country. An interest rate might get you the best deal on the interest rate itself, but closing costs and fees can range anywhere from $2000-$15,000, which is quite a range.

More: Simple Steps to the Homebuying Process

#2. Where to shop for the mortgage?

Like I just mentioned, there are several places to shop for a mortgage. A bank will offer just its products and a mortgage lender will have a larger pool of programs to choose from. Make sure you contact a few lenders and mortgage officers to get the very best deal and the right program for your needs both now and in the future. You might be able to even research private investors, owner financing, or gift funds.

#3. Important questions to ask when shopping for a mortgage.

What programs do you recommend? What are the closing costs for each program? What are the interest fees and closing costs? What do you need for preapproval? Do I need to raise my credit score quickly? What kind of service can I expect?

#4. Make sure you compare evenly when looking at mortgages.

Do a side-by-side comparison on private mortgage insurance if you’re putting down less than 20% in down payments. Take a look at the taxes, homeowners insurance, association fees, principal and interest. You should just compare the monthly cost but closing costs and fees to obtaining the loan as well.

#5. What factors are considered when determining the best interest rate?

Lenders, whether private, corporate, or through a bank or credit union will determine the best interest rate based on a variety of factors including the amount of your down payment, loan to value ratio, debt to income ratio, your credit score, the type of property you’re purchasing, the private mortgage insurance rate, and the type of loan. Loan programs could include FHA, VA, USDA, or conventional and they all come with different costs and interest rates.

There are a lot of factors to consider when shopping for a mortgage but the more you understand and educate yourself, the better rate and program you’ll likely receive.

Feel free to contact us for more information on reputable lenders and loan officers throughout Sunset Beach and surrounding areas. We’ve worked with hundreds of lenders over the years and have tried and true methods of getting you the best rate and the best deal on your mortgage.

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January is the New Hot Month to Start Looking at Homes

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January is the New Hot Month to Start Looking at Homes

We may not have snow on the ground but winter is still here. However, most people think that the best time to look for homes is in the springtime and while you might have more options, you will be paying more. In a new article by Realtor.com, January appears to be the new hot month to start looking at homes. In about 20% of the nation’s largest housing markets, January with the month in which buyers logged the most listing views. Buyers seem to be trying to get ahead of the competition before the spring rush hits.

This last November 2019, the number of properties for sale drops 9.5% compared to 2018. And first-time homebuyers trying to get a deal were out of luck as the number of homes priced below $200,000 fell 16.5% over the same.

Housing markets across the country have become more competitive due to rising prices and low inventory. So savvy buyers are choosing to search for home earlier and earlier. Now that we are out of the holiday rush, homebuyers may already start thinking about buying a home in spring and starting their search now. Last year at this time, January was the busiest month for listing views on record for homebuyers in a lot of major metropolitan areas. As everyone is so busy during the holidays, buying or selling a home just isn’t on the priority list. But now that we’re passed that, the holiday decorations have been put away, buyers want to get a jump on the home-buying season.

This also means that homebuyers should consider locking in rates while their low. December had some of the lowest rates on record for any December in the past seven years so January is just a carryover from those low rates. Locking in a rate now might get you a better deal on a home within the next month or two. Many rate locks can last anywhere from 30 to 60 days so it will give you some time to search for homes without losing a low-interest rate.

Contact Us for a Reputable Lender

We love to help you find the property you’re looking for in Brunswick County or throughout Sunset Beach North Carolina and surrounding suburbs and communities. Start your online search here or contact our office at any time to get in touch with a lender in our area that we recommend or for more details on any listing you see.

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What is Home Buying Power and How can a Buyer Use It?

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Buyers always want to have the upper hand when it comes to purchasing a property or at least getting an offer accepted. In a buyers market, the homebuyers definitely have the upper hand. This means there are plenty of properties on the market and prices are relatively low. In a seller’s market, there are plenty of buyers and very few homes, which means sellers can up the price of their property and get more eyes on their home. But how can homebuyers harness the power in a buyers market?

What is Home Buying Power and How can a Buyer Use It?

There are several steps to organizing your home buying power position before actually looking at property.

#1. Organize your finances.

Before looking at homes it’s important to understand how much you can actually afford in a monthly mortgage payment. Remember, that payment should include property taxes and maybe homeowner’s insurance as well. A $1000 mortgage can easily bump up to $1500 with these added fees, taxes, and potential homeowner association fees. Understanding how much you’ll be paying each month in a monthly mortgage payment plus general upkeep, you can attack the real estate market with a little more confidence and preparedness

#2. Consider up and coming neighborhoods.

An up-and-coming neighborhood is one that may have gotten a bad reputation in the past but could be turning itself around. You might see a lot of major renovation going on throughout the community and it has close proximity to other higher-end neighborhoods. Ask local stores and restaurant owners of prices have gone up in the last couple of years and if there’s a lot of young people, artists, and musicians in the area, chances are it’s on its way up. But, you can buy now and be ahead of the game later on when property values really increase.

#3. Be patient.

Finding the right home does take some know-how, knowledge, the right real estate agent, and a whole lot of patients. It’s okay to make a lowball offer but if you don’t get the counter offer you had in mind, simply be patient and perhaps wait it out. A seller can change their mind and come back to the buyer’s agent asking for another offer. Don’t be afraid to walk away because it’s sellers know that you are extremely motivated to buy their home, they’re not going to budge on price or terms.

#4. Mind your manners.

This is a very elementary thing but agents take careful note of customers who view properties and polite and respectful behavior can go a long way. Even if you’re only dealing with a buyers agent, that buyers agent wants to work the best for you and being polite and courteous along the way can really work wonders. They may offer extra tips, work extra hard, or put in those extra late-night hours simply to get you the exact terms and price you want. A little “please” and “Thank you’s” really can work wonders.

#5. Penny wise, pound foolish.

Try not to get so focused on getting every aspect of the deal exactly the way you want it because you tend to lose the big picture. If you are nickel and dining the seller to death they may throw their hands up and reject everything. A good rule of thumb to remember in the home inspection report is if you ask for everything you’re likely to get nothing so run over the mandatory items and deal breakers with your real estate agent and pick and choose your battles so that everyone gets a win-win in the end.

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How to Sweeten the Deal in a Multi-Offer Situation

We Submitted an Offer But Haven’t Heard a Thing, Now What?

How to Sweeten the Deal in a Multiple Offer Situation

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Homebuyers can get frustrated when there are multiple offers on a highly desirable property. Even a solid, full price offer may not be enough to sweeten the deal. There’s smaller inventory than there was a few years ago and the demand is strong so buyers need to know how to create an amazing offer that will stand out above the crowd. Here are some simple ways to sweeten the deal on a multiple offer situation.How to Sweeten the Deal in a Multiple Offer Situation

#1. It’s not always about the price.

Sellers are looking for more than just the price. You might’ve even offered over the asking price, but if other terms are not as favorable, your offer may get rejected.

#2. Minimize contingencies.

Of course, you’ll want the home inspected but if you know you’re going to buy the home regardless of what you find, you can waive the home inspection or offer shorter deadlines to accommodate the seller.

#3. Get preapproved.

Most buyers are preapproved for a home loan before even making an offer but if you haven’t done this, you will probably get rejected right away. Make sure you are preapproved for the exact amount you are offering and sent a letter of preapproval along with the offer to prove you’ve done your financial homework.

#4. Simplify the offer.

You don’t need a lot of flowery words to sweeten the deal. Sometimes, unneeded language can lengthen the offer and feels a little threatening to the seller. Spell out the terms of the deal without complicating things and make it as easy and as flexible as possible.

#5. Have your agent stay on the ball.

Sometimes just communicating with the listing agent is enough to stand out above the crowd. Think of it this way, if the listing agent has some random offer come faxing in or email without any communication, it probably will not get as much attention as the agent that’s talking to the listing agent, communicating on what the seller really wants, and trying to be flexible with dates and solidifying the offer before actually submitting it.

We want all of our buyers to get exactly what they’re looking for and that means submitting an offer that stands out and is really attractive to the seller. Our experience with buyers and listing agents can put your offer ahead of the crowd.

We Submitted an Offer and Haven’t Heard a Thing? What Now?

Is a Verbal Acceptance of an Offer Good Enough?

We Submitted an Offer and Haven’t Heard a Thing? What Now?

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We Submitted an Offer and Haven't Heard a Thing? What Now?Every real estate transaction brings about a different scenario because every party involved in a real estate transaction differs. Even if you have different lenders, appraisers, and escrow officers, your buyer and seller and even the opposite agent will be different so this combination provides a different scenario for absolutely every real estate transaction. This is where I cannot stress enough the importance of an experienced agent or broker. Yes, we have to have continuing education and take tests on what we know, but nothing beats the experience of going through dozens if not hundreds of real estate transactions a year. That being said, this is a common issue we’ve had where we have submitted an offer and hear nothing back from the listing agent. What’s going on here?

When we submitted an offer to a listing agent we will usually contact that agent first to ask some questions about the listing and the sellers. This will help us draw up a solid and tight real estate offer catering to the seller. We want to know how motivated the seller is if there have been any other offers, along the properties been on the market, and why the owner is selling. All of this will lend information to create a better offer. However, this doesn’t necessarily mean we have an accepted offer just because the listing agent and the buying agent are talking. Once we have an idea of the offer to submit we will write up a solid offer for our buyer’s terms and price. This offer is typically submitted either through facts, in person, or through email. From there, the listing agent must submit the offer to the seller. There is a three day waiting period for the seller to review the offer.

Technically, after three days, if there is no mutual acceptance or counteroffer, the deal is terminated. However, this doesn’t necessarily mean that the buyer needs to resubmitted offer. Listing agents know that they have three days to respond to an offer and if they don’t that offer can become null and void. This means that the buyer could go present an offer to another seller and if that original seller comes back with an accepted offer, the buyer is not obligated to buy because the time limitation ran out.

Related Post: How to Beat Cash Offers

If the listing agent responds to the buyers within those three days, that time can get extended. For instance, if the listing agent cannot meet with the seller within those three days they may speak to the buyer’s agent and ask for a few more days. This communication will give the buyer some peace of mind that they are still reviewing the offer.

But what if there’s no communication and you don’t hear back from the listing agent or the seller within those three days?

We try to contact the listing agent to find out what’s going on. This is perfectly acceptable. We can contact the listing agent to make sure they receive the offer and if the seller is willing to entertain the offer or if they’re going to reject it. This communication will give everyone a good heads-up as to what’s going on and the timeframe. However, the listing agent isn’t required to respond. Those three days could come and go and in the meantime, the seller could receive a better offer, except it, and the first buyer has no idea.

Related: 5 Way to Get Your Offer Accepted

Again, we feel communication is really the key to getting everybody what they want and for a win-win for all. If we don’t hear from the listing agent within three days we contact them. We can certainly chat over the phone or in person about the details of the offer if things need to change, and what the seller is expecting. We can then alter our offer or ask for a counteroffer. If the seller has no other offers on the table and the buyer has no interest in another property, this verbal communication could go back and forth for some time, however, nothing is enforceable until it is in writing and signed by both parties.

For more answers to your real estate questions give us a call at any time.

Is a Verbal Acceptance of an Offer Good Enough?

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In the real estate world, you see a lot of things, primarily because every transaction presents a different buyer, seller, and all parties involved. The combination creates a different experience each and every time. This is a common question that comes up in a real estate transaction. Does verbal changes, acceptance, or agreements count in the scheme of things?Is a Verbal Acceptance of an Offer Good Enough?

The short answer is no. A real estate transaction is a legally binding contract, which means that everything should be in writing and initialed and signed off on by all parties involved. For instance, take this scenario:

As a real estate agent; “my buyer clients made an offer on a house listed by another company. The listing agent told me that he had called his seller and that the seller had accepted my clients offer. I never received the written acceptance and I have since found out that the seller entered into a contract with another buyer. My buyer believes that he should get the house because of the verbal acceptance of his offer.” [Source]

A contract for the sale of real estate must be in the form of assigned and written document in order to be enforceable. If acceptance comes through verbal communications between the seller, the listing agent, or the buyer’s agent but never actually in a signed and written offer, the contract is unenforceable.

This can get quite frustrating for buyers and sellers. Sellers may feel that they get verbal agreements to certain contract stipulations and details but if they are never written down and signed or initialed by both buyer and seller, neither party can enforce it. This is why it is crucial to get every bit of communication in writing and signed. Most all of our communication either goes through email, text or in writing. If something is agreed-upon over the phone it needs to be immediately put in writing and signed by all parties.

Related: Does the highest price offer always get accepted?

Sticking with a real estate contract and the legal and right way to do things protects everyone involved including the real estate agents. Real estate agents don’t want to get called out because so and so said something but was never actually written down so no one can hold them to it.

Real estate agents can communicate over the phone or in person about certain details of a transaction but for them to be enforceable and to follow through on the transaction they must be written down and signed. There’s really no way around this.

For more answers to your real estate questions give us a call at any time.

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