Renting vs Buying...

Lately I have been receiving more and more calls where customers are asking is it better to rent or to buy. I am sure for some of you out there reading this you are saying what a crazy question "buy."  However before you can rate the question as elementary you have to put yourself in the place of that first time buyer.

Right now the economy is unstable. Many individuals feel that there jobs may be on the line and may be weeks away from getting a pink slip. They wonder where will I live if I lose my job. How will I pay my rent if I am unemployed? "There is no way I am buying a home right now". "I will continue to rent."

Other concerns first time buyers have are..
A mortgage will be to expensive and make my circumstances uncomfortable. 
Taxes and insurance how will I pay for that? Down payment and closing cost how can I afford to pay them?

While it is true you may not have to pay for taxes and insurance while renting, or pay closing or down payment cost. You are still paying just as much or more in expenses by renting but you are watching your money sink down into a bottomless pit. Each penny, nickel, dime, or dollar is one that you will spend and never recover.

Don't follow me look at it this way...
It's time to move, your landlord or leasing office requires you to pay a $50.00 application fee for each adult if not more. If you were applying for a home loan it would cost the most $10-$35 to pull your credit report.
*If your approved for the rental home or apartment the leasing agent or landlord will need a deposit, which is usually equal to the rent and then they will also require the first months rent payment. Lets just say for a 3bed /2bath in a nice neighborhood you would pay at least $850.00 to $1,000.00. A $1,000 deposit plus $1,000.00 for the rent is $2000.00 dollars just to move in. You will be moving into a rental that you won't receive tax credits on at the end of the year, you will never own and will never be able to borrow against.
If you were moving into your own home not only would you receive tax credits, each payment you make goes toward building the equity in your home. Taxes and insurance can be paid in your monthly payment not a separate payment which makes things easier for you. When you close on a home in many cases you are able to skip a month before you first payment is due. I'd like to see you do that with a rental.

There are also great programs where $100.00 is all you would pay as a down payment (HUD). Or you are allowed to receive a monetary gift from a family member to cover the down payment (FHA).
In this market you can buy a home and pay less than or equal to the amount you pay for a rental. The combination of very low interest rates and decreased sale prices on homes make this possible.
There is still the argument of what if I lose my job how will I pay my rent? If you lose your job how long will it take for the leasing office to evict you? Or will you your landlord be willing to work with you until you get on your feet? Do you see my point?
Whether your renting or a homeowner you have to pay to stay. However, as a homeowner you have options. One option being if you fall behind ask your bank about a loan modification. Where they can lower your monthly payments and put your lates on the back end of the mortgage. Most banks will work with you to help you keep your home. A leasing office or landlord may evict you and move on to the next renter. They may also slap you by reporting it to the credit bureau to make sure you never rent in this town again.

When you own your own home you can show your creative side by decorating without boundaries. Pink bedroom with light green shag carpet feels right to you, than do it. Your backyard is yours you don't have to share the cookout area with a thousand other people. No more listening to loud music all hours of the night.

Ultimately you have to do whats best for you. If after reading this renting is still where your heart is than do what makes you happy. However, my guess is that your mind is now whirling around the endless possibilities of being a homeowner. If you have additional questions please send them to me in the comment section because your question may help someone else. That is how we build strong communities by helping each other.

Teachers, Policeman, Firefighters, & EMT'S do you know about The good neighbor next door loan program?

The Good Neighbor Next Door Program is a program geared toward Public servants such as teachers, firefighters, Policeman, or EMT's which helps assist them in buying homes located in the community they work in. Public servants in these fields can receive 50% off  HUD's appraised value. These homes are located in different areas it is part of the HUD revitalization program. How do you know if your eligible? Below is the criteria taken directly from the HUD website....

You may participate in the Good Neighbor Next Door program as a law enforcement officer if you are employed full-time by a law enforcement agency of the federal government, a state, a unit of general local government, or an Indian tribal government; and, in carrying out such full-time employment, you are sworn to uphold, and make arrests for violations of, federal, state, tribal, county, township, or municipal laws.

**Teachers

You may participate in the Good Neighbor Next Door program as a Teacher if you are employed as a full-time teacher by a state-accredited public school or private school that provides direct services to students in grades pre-kindergarten through 12. In addition, the public or private school where you are employed as a teacher must serve students from the area where the home you are purchasing is located in the normal course of business.

*Firefighter/Emergency Medical Technicians

You may participate in the Good Neighbor Next Door program as a Firefighter/Emergency Medical Technician if you are employed full-time as a firefighter or emergency medical technician by a fire department or emergency medical services responder unit of the federal government, a state, unit of general local government, or an Indian tribal government serving the area where the home is located.

You are able to use any financing of your choice to obtain the home. Whether it is Conventional, VA, FHA choose the one that is right for you.  HUD requires buyers to sign a second mortgage or note for the difference. Before you rule this loan out understand the second mortgage or note lies dormant. This means no payments are made on it and interest does not accrue on the second mortgage or note. Once you sell the home HUD is given the discounted portion anything over that is yours.

FYI****

You must live in the home for a mandatory 36mo. Remember the purpose of this loan is to strengthen the communities. Therefore they want these individuals to live and work in those communities.

* This loan is only for owner occupants  1-4 family unit dwellings*

* You must still put down an earnest deposit of 1% of the purchase price but it cannot be less than $500.00.

if the offer is rejected you receive the earnest money deposit back if it is accepted it goes toward your closing credits

*There are penalties for buying through this program and not being an owner occupant for 3years.

*You can pair this loan program with the 203k rehab loan program talked about in a previous blog.

* One of the best perks is down payment on a HUD HOME is just 100.00.

If you are currently working in one of these fields and would like to know more about this program or know someone that may be eligible let me know. They do so much for our communities by putting there lives on the line to protect us, Educating our children, and safeguarding us against fires and other disasters it's time to give back..

Great fix-ups that can help sell your home

There are little things that you have overlooked or simply have learned to live with when it comes to your home. Such as that leaky faucet in the bathroom or that outdated wall paper in the dining rm. This may have been okay in the past but with so much competition out there the only way to sell is to make your home standout from the crowd.
One of the absolute best and cheapest way to do this is to clean your home thoroughly. Shampoo rugs and wipe all the walls don't forget the baseboards. Clean drapery or blinds and wash all windows. Mop all floors and remove all grime and scum from the bathrooms.

In addition to cleaning try these do it yourself projects
* Fill all pot holes in your driveway and tidy up walkways
* Repair any shutters and broken windows
* Fix doorbells and make sure all alarms are in working order
* Keep all counter tops clear of clutter but not empty.
* Completely degrease your oven. 
* Clean out the garages and closets nothing is more appealing to a buyer than a spacious home.
* Keep shades open as much as possible as long as there is an attractive view. for the natural light to flow through your home.
* Arrange your furniture so that it is easy to walk through each room.
* Scale back on excess photos, signs, and wall hangings. However, don't put them all away I am a firm believer that a home should feel warm and symbols of love should adorn the walls and furniture. 
* Remove debris and dust from corners and light fixtures.
* Spruce up around the home by cutting your lawn, planting flowers and tending to any cracks, holes, and throw out unwanted extras such as old outdoor furniture. 
* Place plants in strategic spots in any room the bigger and more colorful the better.

Remember the key is not to go broke trying to sale your home but to make more appealing to buyers so you are able to sale for what your home is really worth.For great tips contact me to sign up for my Lowes newsletter it's absolutely free and contains lots of great do it yourself projects to enhance the beauty of your home.

The Fha 203k Loan Program is it the right loan for you?

You found the perfect neighborhood for your family. The school district is superb and it's a short walk to a beautiful park. There are loads of stores and a gym nearby. The major highways are very conveniently located just a mile and half down the road. However, there is one thing missing the perfect home within that subdivision. The only home still available for purchase in that neighborhood is a home that was vandalized. The copper ripped from the walls, flooring and walls have holes and show signs of water damage, the ac unit has been stolen,cabinets in the kitchen are completely destroyed and the home looks as if it is beyond repair. There in the mist of all that disarray is the perfect home for the FHA 203K LOAN.
The 203k loan is a renovation loan. Most of you may have heard it referred to as the rehab loan. The beauty of this loan is if a dwelling has 10% of its remaining structure still standing than it is a potential candidate for this loan.
Eligible properties for this loan are
*Single Family Detached -Primary Residences
*Condos- some requirements with condos
*2-4 unit Unit Primary Residences
*PUD- 1 Unit

Some great features are-
FHA loans are assumable
if you don't have credit scores they can still build alternative credit by using the following trade lines gas bill or other as long as it has been consistent for two years, car insurance and cell phone bills that have been current for 12mo as well as 12mo good leasing history.
even after you close on your home you first payment is not due until 60 days after the home has been completed and you have moved in.
There are no reserve requirements
FHA allows for grants, gifts, and community 2nds that can cover down payment, closing cost and pre-paids
low credit score requirements
low down payment cost about 3.5% of total price.

There are special conditions for this loan on eligible properties
the FHA 203k does not cover luxury items such as gazebos, hot tubs, pools or alteration to support commercial use. Remember this is FHA (owner occupant residential dwelling only)
All work has to be performed by a licensed contractor.
Total cost of improvements is determined in an itemized estimate done by HUD-trained consultants

*Self help is allowed (you doing the work yourself and receiving the funds to complete the work)
however you must be a licensed contractor.
With the self help option there are other rules that apply as well such as a 20% contingency is added (padded cost for the unexpected) it is 10% if the work is being performed by a licensed contractor other than you.
The self help candidate must include labor in repair cost. This ensures you getting paid for your efforts.

If you would like to know more about the FHA 203K rehab loan you can visit the hud website www.hud.gov
you can also contact Sonia Fears a Bank Of America Retail Sales Manager at
sonia.fears@bankofamerica.com

this could be yours!

695 Dot Dr. Atlanta Ga 30349

TAX CREDIT EXTENDED UNTIL 9/30/2010

The tax credit has been extended for those who have ratified contracts in place as of April 30, 2010 but were unable to close by the June 30th deadline. Short sales may be one of the reasons why some of the buyers were unable to meet the deadline. These sales can take as long as 120 days to close. In most cases the buyer is made to wait helplessly on the sidelines until the the bank has completed there evaluation. This ext stems from the 2009 Tax Credit that was originally issued. The highlights of the tax credit are as followed.....
* You must buy or enter into a binding contract to buy a principal residence on or before April 30th 2010. The home must close before June 30th 2010. (Which has now been extended until September 30, 2010).
*To be considered a first time homebuyer you or your spouse must not have purchased a home 3 years prior to the date of purchase.
*First time buyer maximum credit is $8000. If this is your second home the maximum credit you would receive is 6500
*To be considered a longtime homebuyer you and your spouse (if married) must have owned the home as a principle residence for 5 consecutive years out of an 8 year period.

Although this extension rules out any homebuyers that have just jumped into the market to purchase a home keep in mind this is a great time to buy. Interest rates are still holding steady at the lowest they have been in years. Being able to qualify for a bigger home, with lower payments because interest rates are at there lowest may be the best credit you can receive in the long run.

For more information on how to apply for your credit after you have purchased your home visit the IRS website at http://www.irs.gov/