By: Puja McKernan

Believe it or not, there are plenty of reasons people favor renting over buying. I loved renting for the simple fact that it was worry-free–no yard work, no expensive maintenance, no property taxes, no water bill, no commitment!

Yet it seemed everyone had a reason why it’s better to buy–investing your money instead of “throwing it away,” living in a home that reflects your personal style, having your own garden and throwing backyard barbecues were a few that stood out. Ultimately, I was convinced (by my husband and everyone else I knew) that owning was the way to go.

With our lease ending in a few months, we started the process. We knew the important things that needed to get done. We determined what we could afford, set an overall budget, came up with a down payment and got pre-approved for a loan, among other things (some of the stuff we can help you with Quizzle right now!).

With that settled, I began my house hunting on my own, with the help of the internet, without the intention to hire a real estate agent. Keep in mind this was well before I worked at In-House Realty and knew better!

Due to my over-confidence and inexperience, situations came into play that I didn’t anticipate. My husband and I worked long hours, which left only the weekends to look for homes. Searching through property listings was fun in the beginning, but calling on them to set up a showing, or worse, to find that the house had already been sold turned out to be very frustrating.

I’m also a lackluster bargainer. I can only last so long playing the stone-faced, tough-sell before giving up. It’s not that I would want to pay more than I should; it’s just that I don’t have it in me to keep that game going.

Finally, in regards to the process as a whole, I was intimidated. Not only by the pure anxiety of making the largest purchase of my life, but by all of the other things that go along with it–the endless paperwork, the inspections, research into the areas I liked and the sincerity of the seller, just to name a few. All of this together was yet another why I loved my life as a care-free renter. I was scared.

In the end, I decided to work with an agent. It just made me feel more at ease. My agent had gone through this process so many times before–she was a professional. She knew what all the acronyms meant–CMA, FSBO, PV, PW, OBO, PUD and the rest. I knew a few, but there were plenty of acronyms and other vital specifics that I didn’t know when looking for a home. It’s like they have their own language!

The home-buying process isn’t necessarily scary for everyone. There are a ton of resources online to walk you through it – you can even find a simple 7-step process right now from Quicken Loans.

They key is to make sure you’re armed with the knowledge you need to make the best decisions, get the best deal and avoid costly mistakes. For me, that required bringing someone in for reinforcement. Finding an expert you really feel you can trust will take all the worries out of big financial decisions like buying a home. If you decide to go with an agent or not, do your research and surround yourself with seasoned experts.  In-House Realty is a great place to start to find out if buying a home is right for you.

EDITOR’S NOTE: This is a great place to mention that we’re working on some wonderful new bits for buyers in Quizzle. Stay tuned and we’ll let the cat out of the bag as soon as we put the finishing touches on!

By: Puja McKernan

With a financial crisis hitting our nation, home sellers are facing more and more difficulties every day. Just take a good look at your own community. Chances are, you’ll see more “for sale” homes lining your street than ever before, and a few of them could be bank-owned (which means they’re most likely priced low).  Sellers need to determine how they can make their own home standout without having to invest too much, or worse, by dropping their asking price considerably lower than it’s worth.

The good news?  There’s something you can do.  Justify your asking price! So, how do you do that? It’s called home staging; sprucing up your home in small, inexpensive ways.

Staging is getting more and more popular as an effective marketing tool as sellers try to set their homes apart from the rest of the neighborhood. As opposed to functional improvements and repairs that may be costly, staging a home normally involves acts of an aesthetic nature, such as design, organization and overall appearance.

Start by looking at your home and thinking from the perspective of a buyer. Obviously, your home is a very personal possession.  You may have spent years decorating your home the way it is today and love every corner of it, but that doesn’t mean potential buyers will look at it in the same way.

Basic principles of home staging can involve simple tasks like cleaning, removing clutter, rearranging furniture and even packing up some of your personal items. This allows buyers the ability to imagine their possessions in the home. Focus on lighting, color and enhancing crucial areas of the home on which buyers focus, such as the kitchen.

Here’s our full list of the Top 10 Home Staging Tips from In-House Realty:

1. Consider curb appeal – If you can’t landscape make sure your lawn is mowed, leaves are raked, or snow is shoveled. Also consider hanging a plant, hiding all garbage and recycling bins, and cleaning the entryway.
2. Get rid of clutter – Remember that how you live in your home and how you sell your house are two entirely different things. You’re going for a “show home” look! Go room by room, closet by closet, and look at every item. Then decide whether or not you will keep it or donate/sell it!
3. Turn excess inventory into cash or tax deductions – Consider returning or donating all unused items (light bulbs, canned goods, paper products, etc.) to get some extra cash or tax deductions*. This will obviously help to remove some clutter as well!
4. Watch where the eye goes – Walk throughout your home and check where your eye is drawn. If you notice chipped paint, nail holes, or peeling wallpaper, take the necessary steps to remedy them.
5. Find a fix-it person – Ensure cupboards open and shut and that no taps are dripping. Look in all rooms for things you never got around to fixing and decide which ones might be distracting to potential buyers. No, it’s not OK for door handles to fall off, even if you have learned to ignore it!
6. Clean, clean, and clean again – Even though it may be tough to live in a spotless home ALL the time, this is a necessary change when selling your house. Consider hiring a cleaning service who might clean in places you wouldn’t think of. Spend 30 minutes each day to maintain it yourself.
7. Let in some air- Open some windows for at least 10 minutes. There’s nothing worse than walking into a stuffy house or one that smells of smoke and pet odors.
8. Let in some light- If you’re trying to sell your home, keep it bright! Dimly lit rooms tend to look small and dingy— especially during the day. If your wall colors are too dark, paint them or add floor lamps!
9. Don’t forget fresh flowers – You don’t need to spend a fortune. Even a daisy in a bud vase brightens a bathroom counter. You can also use potted flowering plants that are in season for a low-cost solution.
10. Carefully consider music – Soft background music can help create a soothing environment and camouflage neighbor and traffic noise. But make sure the volume is very low. Blaring TVs are definitely a no-no, but you’d be surprised how many people leave them on for showings!

If you find the project too daunting to pull off by yourself, there are many professionals available to assist you. You can find Accredited Staging Professionals in your state at www.StagedHomes.com.

Also, if you’re selling in the fall (like right now) check out some of our seasonal selling tips from Quicken Loans.

By: Greg Lundgren

Greg Lundgren is a Home Loan Expert with Quicken Loans and brings more than six years of mortgage experience to share with you on the Quizzle Blog. Greg specializes in FHA financing and enjoys helping people get into the right mortgage for their unique circumstances.

The Federal Housing Administration (FHA) has been helping people become homeowners since 1934. Since that time, it has helped finance over 34 million properties. FHA loans are pretty basic mortgages consisting of principal and interest payments with a monthly private mortgage insurance (PMI) that is much lower than traditional PMI payments.

One of the main benefits of FHA loans is that these mortgages can be more forgiving when it comes to qualifying and approving homebuyers to obtain financing. FHA loans are available for both home purchases and refinances. In the last 9 months or so, FHA loans have really regained momentum and are great options for many people who may not qualify for a mortgage under tightened guidelines in the mortgage marketplace.

In the early 2000s, several new types of mortgages were created that offered zero down, interest-only, stated income and no documentation. It seemed that almost anyone could get approved for a mortgage. Some people joked and said that if you had a pulse, you could get a mortgage. In early 2007, many investors began to consider these mortgages to be less than ideal investments, which resulted in the market that ultimately backs these mortgages to stop buying the loans from lenders.

Two very common scenarios affecting the market were:

• Adjustable rates going up, which caused payments to increase;
• Mortgage loan amounts higher than the actual property value.

The relaxed mortgage qualification guidelines that everyone had grown accustomed to had vanished, which created a problem for many homeowners and potential homeowners. This is where FHA loans step in to help many people.

FHA Purchases

FHA purchase loans offer as little as 3 percent down payments. The great thing about this 3 percent down payment is that the buyer doesn’t need to come up with it. It can come from a “gift” from a family member or close relative. It can also come from a down-payment assistance program through a third party non-profit organization as well. This allows many first time buyers to get into their first home without struggling to come up with a significant down payment.

In some areas of the country, potential home buyers need to come up with 10 percent down (or more) to obtain “conventional” home financing. Because of this, FHA loans are helping jump start the market by creating more qualified buyers to invest in the over-supply of homes available right now. In addition, the sellers can also pay for most (if not all) of the buyer’s closing costs. This allows buyers to purchase a home with $0 out of pocket.

FHA  Refinances

FHA refinance loans have helped many homeowners who may have no other options when it comes to refinancing. FHA loans allow borrowers to qualify even if they have some delinquencies on their credit report. Many times, these same clients would not have been approved through conventional financing, but are still approved on FHA loans. In some cases, these clients are trying to get out of adjustable rates mortgages or take cash out to pay off the debt that is causing them to be delinquent in the first place.

Whether you are looking to purchase or refinance, FHA loans are a great alternative to the conventional loans that have been offered in the past. Very recently, the FHA increased the loan limits from a maximum loan amount that was previously capped between $200,000 and $360,000 across the country (depending on what area the home is in) to a limit that is as high as $729,000 in some areas where home prices are higher, such as California and other high-cost areas.

Ultimately, more homeowners are turning to FHA loans to help them purchase a home or to refinance into a better loan. As mortgage guidelines continue to become more restrictive, FHA loans continue to maintain the same guidelines and in many cases, relax the guidelines to offer financing to borrowers who are in need of it.

To find out if a FHA loan may benefit your situation, contact Greg at 800-QUIZZLE (784-9953) Ext. 12655. Or make sure to always have Greg’s information at your fingertips right inside of Quizzle by creating an account through Greg’s personal referral link: http://www.quizzle.com/invite/greglundgren.

Christy Brewer, The DIFF Critic, has been thinking a lot about what goes into each person’s mortgage terms — mortgage rate, payment, how much to borrow. Today she shares what’s on her mind here on the Quizzle blog.

Most chatter around getting a mortgage seems to be about your credit score. Your credit score is a quick way for lenders (including credit card companies and other creditors) to see if you’re good at paying off debt, for sure. Ann-Marie is a great credit score coach – she’s shown us the difference between good credit and bad credit and great ways to improve your credit score.

But it’s time to look at debt in another light: your total debt load.

Your “debt-to-income” ratio, or DTI for short, is a way for lenders to look at how much you must pay each month toward your debts versus your total monthly income. The idea is to get a feel for the percentage of your available income that is already earmarked for paying off existing debts.

If you’re considering buying a home, this is a very important number, since it can limit how much home you can buy. Generally, most mortgage guidelines want you to stay within 28% of your income for housing expenses, and 36% of your income for all other regular monthly payments. Utilities don’t fall into either of these categories.

Say, for example, your annual household income is $60,000. That’s $5,000 per month, before taxes. (Don’t forget while we’re calculating this stuff that there are still taxes to be paid!)

With that $60,000 of household income, mortgage lenders will likely allow you $1,400 to pay for the mortgage payment, including principal and interest, taxes, insurance, PMI and homeowners association dues.

But, if you carry more than $1,800 a month in other debts — car loans, credit card payments, student loans, child support, or other regular debt payments -– that cuts into your ability to pay $1,400 a month on your housing. Most lenders will lower how much they will lend you, and some may not approve you.

Those DTI ratios can be higher on FHA loans, and there are other types of mortgages you could consider that have slightly relaxed guidelines. But, you’ll pay more in interest rate. The smartest thing to do is to focus on paying down your debt so that you can improve your overall financial picture, and get smart home loan financing when it’s finally time to buy that house.

If you want more information on DTI, start with this basic explanation from Wikipedia. And, remember, Quizzle looks at your DTI as well when analyzing your situation for the Quizzle Scores. Never pass up free help from an expert!

By: Joe Kustra

Joe Kustra is a Home Loan Expert with Quicken Loans and brings more than five years of mortgage experience to share with you on the Quizzle Blog. Joe loves to help and educate people about how to get in the right financial situation for their goals and circumstances.

Q: I’m thinking about buying a home. How much I should put down?

A: When deciding on how much you should put aside for a down payment on a home, it’s important to look at your overall financial situation. Buying real estate is usually one of several investments and large expenses you will have over your lifetime. A good place to start is to discuss your options with a mortgage professional, who can let you know what the minimum down payment requirements are for various loans and how the size of your down payment will affect your monthly mortgage payment.

Once you have an understanding of what loan options are available to you, you may want to meet with a financial advisor. A good financial advisor can assist you with sorting out and prioritizing your short- and long-term financial goals. That way, you can make sure putting money toward an individual goal like a home makes sense and doesn’t compromise your long-term goals.

From my experience, here are a few additional rules when deciding how much to put down on a home:

• Avoid taking a draw or loan from your 401(k).
• Do not draw money from your 3-6 month emergency fund, aka your rainy day fund.
• Evaluate your decision to purchase a new home seriously if you don’t have an emergency fund.
• Look at paying off your high interest credit cards before buying a home.

To find out how you can get into the right home loan for your personal situation, you can contact Joe at 800-QUIZZLE (784-9953) Ext. 14111. Or make sure to always have Joe’s information at your fingertips right inside of Quizzle by creating an account through Joe’s personal link: http://www.quizzle.com/invite/joekustra