So...you want to buy a house?

This is a brief summary of the home purchase process...some realistic news you can use...

Buying a home is a huge responsibility and a great investment in oneself. Instead of making someone else wealthy, we can take those same amounts you pay in rent each month towards your mortgage. This way you are building equity. Investopedia explains that home equity represents one of the largest sources of net worth for most investors. Home equity can be borrowed against through a home equity loan or home equity line of credit (HELOC). There are tax benefits as well as credit worthiness benefits.

First things first, do you know your credit score??? This score will either propel you or stop you dead in your tracks. Nowadays, you can qualify for a FHA, VA or USDA loan with just above 640. Conventional loans have higher score requirements, and down payments. However, we won't discuss conventional loans for now. These loans, with the exception of the USDA (which requires no down payment), will require a 3% down payment.

3%?? Yes, 3% of the purchase price. For example, if you are buying a $100, 000 house, you need to have $3,000 at closing. In addition, it is good to have earnest money. Although not required for an offer submission, it sure makes your offer look that much better. Do you have to give that to the seller?? No, it is debited from the purchase price at closing.

They accepted your offer!!! Whooohooo!!! This is where time is of the essence! You should receive a good faith estimate showing closing costs and what is due on closing day.  Closing costs? Yes! Closing costs....all the people you need to pay for this wonderful transaction mostly the government with taxes and fees. It can add up to a significant amount meaning thousands of dollars. What?!?! I don't have that. I just started my job a year ago, and I am paying student loans and other debt. I may have an option for you...SHIP or Florida Housing Finance corporation can be of service. Currently, SHIP will give you $7,000 towards closing costs with attendance to a first time home buyer course, and using a lender who provided SHIP.  This non interest bearing loan disappears after 9 years. It has income limits, and if you make too much money for SHIP, you may want to consider FHFC, and they will give you $10,000 towards your down payment and closing due back to them upon resale of the home or payoff. Just some options to consider.

Not only will you need the earnest money deposited within the time frame stated on the offer, but now we need to pay for inspections and appraisals. Home Inspections run about $175, WDO (wood destroying organism) inspections run from $75-$125 depending on the company, and appraisals about $450. After careful addition, it looks like another $800. $800?!?! Yes, Freddy First Time Home Buyer, it is worth the $800 for piece of mind. Isn't it? Most of which has to be done within 15days!

After inspections, you find that your almost new home was never lunch for some wood hungry organisms. Here comes the good part....count down to closing!! Pardon, my sarcasm, this will seem like the longest days of your life although it can be as short as a few weeks. In between requests from the underwriters for last bank statements and pay stubs or anything else they can imagine. You wait, and wait, and fulfill orders, and wait...

Closing day comes! You sign your life away, and give them whatever is due. You are a new home owner! Congratulations....sound simple enough? Well, what are you waiting for?!?!? Check your credit and your finances today! Call a REALTOR tomorrow!

What the P.U.D.?

So you want a condo, or townhouse? Not really interested in doing yard maintenance...you are on the hunt for that perfect spot. Each time you ask your REALTOR® about a cool spot you found on Trulia.com, Zillow, or Realtor.com;  you realize it cannot be financed because it is a condo! You get annoyed with your mortgage lender because you keep hearing  'NO!' They tell you, "If it's a P.U.D., its a go!" Instead of asking, "What exactly is a P.U.D.?" you say, "Oh, ok, I'll look for a P.U.D. then."

Bewildered and a bit confused, you set out on the hunt. You are searching Trulia, Zillow, and Realtor.com to find that perfect P.U.D. Full of excitement, you email it to your realtor and she says, "No can do, its a condo!" Finally, in a fit of rage you say, "What the PUD?!?!?!?!" Shockingly, your realtor realizes that you have no idea what a P.U.D. is although you spoke so eloquently about them merely repeating the words of the loan officer. Are you ready to intelligently speak of a PUD? Good.

P.U.D. is an acronym for Planned Unit Development

Frequently, P.U.D.s take on a variety of forms ranging from small clusters of houses combined with open spaces to new and developing towns with thousands of residents and various land uses. However, the definition of a P.U.D. does not take into consideration these types of developments unless they fit into a category of size ranging from 100 to 200 acres (40 to 81 ha). In a P.U.D., the property owner owns the land the dwelling sits on.

Here's the secret, you cannot really look at property and determine whether it is a P.U.D. However, you can look at the legal description. If it says CONDOMINIUM, it is not a P.U.D. You will see PB or LOT # in P.U.D. legal descriptions. Sometimes, if CONDOMINIUM is the name of the subdivision. It is not a PUD. However, it is always best to look at the legal description or ask your lender or REALTOR® to double check for you. It makes no sense in falling in financially forbidden love! Don't get me wrong, if you have the 20% to put down and the ability to make the payments including HOA fees. Please by all means get the condo of your choice, if you can find an institution who is willing to finance one.

In Gainesville and surrounding areas there are several P.U.D.s to choose from in your house hunt, and thanks to Zodie Green-Harper, REALTOR® for her contribution to the P.U.D. list:

Blues Creek

Boardwalk

Cedar Creek

Courtyards

Creek wood Villas

Cumberland circle

Cypress Pointe

Forest of the Unicorn (The Lakes)

Haystacks

Hobbits Glen

Hobbits Glen

HP Quail Court

HP/Magnolia Walk

HP/Plantation Villas

Las Pampas

Lenox Place

Meadowbrook (Hills of Santa Fe)

Meadowbrook (Williamsburg)

Mile Run

Mill Pond (Monticello)

Mill Run

Mossy Oaks

Pebble Creek Villas

Phoenix

Serenola Manor

Shell Rock Villas

The Courtyards

Tiffany

Timber way

Tower Oaks Manor

Tower Oaks Ridge

Town homes at the Lakes

Turkey Creek (St. Alban's Wood)

Villas of West End

Vintage View

Wood Creek Village

 

Although this list is not exhaustive. You will have a good running start. Talk to your REALTOR®, if it's me-you have my number, about what they can find in your price point. Don't forget to ask about the HOA fees, covenants and restrictions, and bylaws. It would be good to know if your neighborhood has banned your best buddy, Benny the Boxer, because he was perceived as an aggressive breed. These are great questions to ask because they can make or break a deal. Hope this helps....


 

$350 Million For Florida Home Owners!!

MIAMI (AP) – Sept. 23, 2013 – Thousands of Florida homeowners who owe far more on mortgages than their houses are worth could get a break of up to $50,000 if they qualify under a new state program, housing officials said Friday.

The Florida Housing Finance Corp. said people who meet eligibility requirements will be able to apply online for money to reduce mortgage principal beginning Wednesday under the $350 million plan. The program is restricted to homeowners whose mortgages are 125 percent or more than the current market value of their house, which is considered to be severely underwater on a mortgage.

The program, formally known as the Florida Hardest Hit Principal Reduction Program, also envisions that most affected mortgages will be refinanced or recast, reducing monthly payments.

“For those who qualify, this new program can help to reduce their principal balance, which can result in a lower monthly payment and put more money in their pockets,” said Steve Auger, Florida Housing’s executive director.

The online application process will begin at 9 a.m. on Wednesday at www.principalreductionflhhf.org. The unpaid balance of the mortgage cannot exceed $350,000.

Initially, the program will be restricted to 25,000 applications on a first-come, first-served basis but could be expanded, Auger said. The money is just a portion of the $1 billion Florida has received under a federal program aimed at states where housing suffered the most during the economic recession.

At least 200,000 underwater homeowners in Florida could probably qualify for the program, said David Westcott, director of home ownership programs at Florida Housing. Out of the 25,000 initial applications, Westcott said he expects about 10,000 homeowners will actually qualify for the money.

“You have to be severely underwater,” he said.

Among the other rules to qualify:

• Homeowners must be Florida residents and legal U.S. residents and must occupy the house as a primary residence.

• Total household income for everyone 18 and older living in the home cannot exceed 140 percent of the area’s median income.

• Mortgage payments must be current, and a payment cannot have been 60 or more days late in the past 24 months.

• The mortgage had to originate prior to Jan. 1, 2010.

The money will be provided in what’s called a forgivable loan. That means, depending on the type of loan, it will either be forgiven in 20 percent increments over a five-year period or forgiven in total at the end of five years.

If the house is sold before the five years are up, Westcott said the homeowner would be required to repay the remaining, unforgiven amount of the loan if there’s enough money from the sale to do so.

The housing agency has come under some criticism from U.S. Sen. Bill Nelson, D-Fla., and others who say it has been slow to get money to homeowners who need it and has been poorly managed. A federal audit was begun earlier this year at Nelson’s request, although agency officials have said their management has been favorably reviewed by the U.S. Treasury Department and state regulators.
 Copyright © 2013 The Associated Press, Curt Anderson, AP legal affairs writer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Where's the Maintenance Man?!?!?!

One of the biggest fears of owning a home is maintenance. Who will be responsible? Who will change my air filter? Who will spray for bugs? Who will fix the garbage disposal? Who, I say, who?

Well, this is a bit of a conundrum when dealing with home ownership.  Not really! Not hardly! There are these lovely thing called emergency funds or home warranties. Since I cannot assume you all have graduated from Financial Peace University, we will go with the later.

Home warranties should be provided for the you, the buyer, every single time you purchase a home. It's an added layer of protection just in case something goes wrong and breaks moments after you sign on the dotted line. You will be glad you chose to get one. 

In many cases, these home warranties save the day. I can recall getting a washer tub in the washing machine, a HVAC, and a hot water heater replaced since I have had  a home warranty.  These crazy days of appliance failure have been smooth and creamy because of my home warranty.

So, if the question is whether you need one or not, the answer is yes! Now, I am sure they will not change your air filter, but they will definitely come over and make broken things work again. The price ranges from $27-$75 per month, and worth every penny. Of course, there is a service fee when they come out. This fee ranges from $50-$125 depending on the issue and the company. Some charge a flat service fee while others have varying fees depending on the issue. 

As with everything, you should comparison shop to make sure you are getting your money's worth. Find out which one works for your budget and get one without delay! Preparation today will lead to a worry free tomorrow. 

Here are some options although there several others:

www.globalhomeusa.com

www.ahs.com

www.orhp.com

If you want customer reviews of the these programs and more: 

www.homewarrantyreviews.com

Genile L. Morris, Realtor 

My visit with Alachua County Department of Growth Management...

Today, I was on a mission. A mission to find my future homeowners some real answers. Answers to questions they didn't know they had. Questions like,"What funding is out there for me?" or "What makes me qualified to buy a home?" or "Can I use these opportunities together to make a larger down payment?"

Before you count yourself out, there is one question that you have already answered in your mind, not realizing what is available out there.

Q: Can I afford a home??? What funding is available for me?

A: Of course you can!! Your income does not need to be six figures to buy a house. It doesn't even need to be $50,00 a year. There are at least two programs that can help you. Alachua County SHIP (State Housing Initiative Program) 

How do I know? Let me tell you what Alachua county is doing for their residents. See below...

I know you are saying,"Genile, I have no idea what that means." No worries, I have an explanation for you. In essence, if you are a single person and earns up to $32,700 per year, you qualify for first time home buyer assistance! If you are two people and earn up to $37,350 per year,  you qualify for first time home buyer assistance! If you are a family of four, and the total income of the house is $46, 650, you qualify for first time home buyer assistance! People, that means that Alachua county will give you up to $7,000 towards your down payment, closing costs, and repairs(if needed). That is some really good news....

Q: How do I get this money?? 
A: There are a few steps that you must follow...

1. Register for the next Home Buyer Education Course, call NHDC (Neighborhood Housing Development Council) at 352-380-9119 . Tell them Genile Morris from Bosshardt Realty sent you. The next class is Sept. 28th. The cost is $55 for couples, and $50 for individuals. Don't worry, there will be a refund when you buy your house within one year of the class. 
2. Get pre-approved with a SHIP certified lender...guess what? I know one! She is awesome. Her name is Becky Bessinger. She can be reached at 352-240-2694 . Give her a call! She will let you know how much house you can afford, or if you need to do a few things before you can buy ( I will have some information on that later on...). 
3. Call me, 352-339-8492 (or a realtor of your preference), and let me(or your realtor) know what side of town you want to live on. In addition, you want to tell me(or your realtor) what is really a must have (deal breakers) and what you really want (a desire, but not a deal breaker). 
4. Once we find a house, we will submit an offer(a contract stating hte amount you are willing to pay)...and, with a few more activities after the offer and acceptance by the seller (agreement to your offer), YOU CLOSE!! Close? Yes, that means you have purchased your home! 
5. Move in, and invite me over for dinner! (You don't need to do that, it was a joke, but I would like to come to your house warming, I may just bring a gift...)

There are some other types of funding available too! Can you believe it? Well, you should! I won't overwhelm you with that now...but get started. You do not want to miss out on this awesome opportunity.

Ok! Ok! Stop pulling my arm! I will give you the other one.

Q: What are the other types of funding available? 
A: Florida Bond Program: This amount is up to $10,000 ( I called one  of the lenders, and she explained the increase)

Q: How do I qualify for that??
A: The income limits are a bit different. You cannot earn more than $66, 720 for one to two person household. If you are a house of three to four,  the income cannot be more than $77, 840. The exception is you must have a credit score of 640...You cannot have owned a home within the last 3 years. If you are a purchasing in a targeted area, you do not need to be a first time home buyer. For more information, you can call 800-388-1970 or 850-432-7077. Don't worry about the area code, they serve several counties in the state.

Q: Can I combine these for one sizeable down payment? 
A: Yes! How awesome is that!?!? You must qualify for both programs though...do you realize that you can qualify for up to $17,000 with these government programs...that is pretty nice.

Now, It's GO TIME!! Go for it! You can do it! Call me if you need some assistance or some more information. I am here to help! If you want to call the Alachua County Growth Management Housing program yourself, the phone number is 352-337-6283.

Have an awesome day!!!
Genile Morris, Realtor
Bosshardt Realty Services LLC

Cheaper to OWN than rent regardless of mortgage rate (REPOST)

SAN FRANCISCO – Mar 20, 2013 – Trulia’s Winter 2013 Rent vs. Buy Report looked at homes for sale and for rent on Trulia between Dec. 1, 2012, and Feb. 28, 2013, and compared the costs, factoring in transaction costs, taxes and opportunity costs. For homeownership costs, study authors assumed a 30-year fixed-rate mortgage, 20 percent down, itemizing tax deductions at the 25% bracket and a stay of seven years in the home.

Overall, buying a home is 44 percent cheaper than renting nationwide – down just slightly from 46 percent in 2012. In each of the 100 largest metros, buying is more affordable than renting, though it ranges significantly – from 70 percent cheaper to buy than rent in Detroit to only 19 percent cheaper in San Francisco.

In the 10 Florida markets checked by Trulia, savings ranged from 40 percent to 60 percent. The include:

Miami: 43% cheaper to buy
Fort Lauderdale: 53% cheaper to buy
West Palm Beach: 56% cheaper to buy
Cape Coral-Fort Myers: 45% cheaper to buy
North Port-Bradenton-Sarasota: 51% cheaper to buy
Lakeland-Winter Haven: 55% cheaper to buy
Palm Bay-Melbourne-Titusville: 50% cheaper to buy
Orlando: 51% cheaper to buy
Tampa-St. Petersburg: 55% cheaper to buy
Jacksonville: 54% cheaper to buy

Individual own-versus-rent savings will vary depending on details, but Trulia posted an adjustable map on its website.

Visitors can change the map to suit their circumstance by choosing the mortgage rate they expect to pay (3.5%, 4.5% or 5.5%), their IRS tax bracket (none, 15%, 25%, 35%) and the length of time they expect to be in the house. The map then changes its buy-versus-rent estimates based on input.

For example, changing a Miami buy-versus-rent decision to a three-year stay, 15 percent tax bracket and 5.5 percent mortgage interest rate makes it wiser to rent for a 1 percent savings.

“People who didn’t buy a home last year may have missed the bottom of the market, but they haven’t completely missed the boat,” says Jed Kolko, Trulia’s chief economist. “Buying remains cheaper than renting in all 100 large metros. Even buyers who can’t get today’s lowest mortgage rates will still find that buying makes more financial sense than renting in nearly all local markets – so long as they can get a mortgage in the first place.”

© 2013 Florida Realtors®

 

Renting vs. owning: Which path is right for you? (REPOST)

Renting vs. owning: Which path is right for you?

June 21, 2013|By Leslie Mann, Special to Tribune Newspapers

Rent or own? Each has its merits, but the recession upended conventional wisdom that homeownership is right for everyone. (Jeremiah Simpson, iStockphoto)

Ritter Elizabeth Hoy has rented an apartment in West Chester, Ohio, for the past three years.
Renting works for her because she admits to having "no interest in fixing things; I can barely change a light bulb. Someday, if I get married, I'll have a house and a yard and I'll share the chores, but not now."

On the other hand, Barry Maher and his wife, Rose Fennell, bought a house in Corona, Calif., in 2000, to shorten Fennell's commute. Despite market fluctuations, their home value has increased at least 20 percent.
"We've built up our own equity instead of a landlord's equity," Maher said.
Rent or own? Each has its merits, but the recession upended conventional wisdom that homeownership is right for everyone. Here's why:
No longer does your real estate investment necessarily grow steadily in value after you buy it.
No longer is making real estate your No. 1 investment the best decision as it was when grandpa sank his every penny into his first house. As pensions go the way of the milkman, today's smart investor builds a diversified portfolio that ensures when one asset is down, another is up.
No longer does every household have a "honey" to tackle the honey-do list that comes with homeownership. More homeowners are single. And many couples have hectic, dual-career lives that leave little time for lawn mowing and gutter cleaning.
No longer is graduation, marriage, homeownership and children the prescribed route for young people. For many, homeownership must wait.
Yet, even during the housing bust, owning a home yielded a higher net worth for buyers than renters with similar demographics, according to a study by Michal Grinstein-Weiss, associate professor at Washington University in St. Louis, published in the April issue of the journal Housing Policy Debate.
"'Responsibly written mortgage' are the key words," Grinstein-Weiss said. "If there are low upfront costs, low interest rates and the lenders do their due diligence, owning a home can benefit the buyer."
A financial planner can help you weigh your options.
"We look at all the costs to see how the decision will affect you financially, short term and long term," said Garth Scrivner, a certified financial planner with StanCorp Investment Advisers Inc. in Albuquerque, N.M. "The economy had made people leery of buying, but not buying could mean a missed opportunity."
Much depends on your life stage, Scrivner said.
For instance, it might be a good decision for a couple in their 30s to buy a house if they plan to stay put for the next 20 years. But that same couple may be better off renting after retirement, when they want to be able to fly south for the winter while a landlord looks after their home.

Renting suits you if:
Housing market fluctuations give you the jitters.
You do not have enough money for a down payment. This is not only an obstacle for young people with few assets, Scrivner said, "but also for retired people with fixed incomes who need this money to live on." Yes, there are zero-down mortgages, but they come with high interest rates.

 

You have no time or inclination for home repairs and chores. Hoy said: "The carpet needs cleaning or the broken pipe needs fixing, and my landlord does it."
You have no emergency fund. If you tend to be short on cash at the end of the month, you probably do not have enough money to cover household crises.
You cannot afford homeowners association fees. Condos and town houses come with monthly fees that cover maintenance of common property. Many single-family-home neighborhoods have the fees too, but they are smaller and cover things like neighborhood parties or lifeguards for the association's pool.
You hate real estate taxes. If you own a home, you pay these out of pocket and you fret every local referendum that elevates them. If you rent, they are built into your monthly check.
You do not know where you will be in five years. Chances are, you are not loyal to your employer like your dad was and vice versa. Renting buys you flexibility and mobility.
You do not know the local housing market. Like dating instead of marrying, renting allows you to get to know the area without long-term commitment.
You have lousy credit. If your credit score is low, your mortgage application might be rejected.

Owning a home suits you if:
You want security. When the landlord holds the title, he can sell the property and send you packing. If you own it, you move when you want to. "We like knowing the house is ours and this is our decision," Maher said.
The mortgage interest tax deduction benefits you. If you qualify for this, it is a financial upside of having a mortgage.
You love remodeling. If spackling and painting are relaxing, not taxing, for you, use sweat equity to increase the value of the home you buy.
You love to decorate. Renting bridles the interior designer in you, but owning a home means you can decorate to your heart's desire and spend all your downtime surfing Pinterest.
Your kids are going to college. The Free Application for Federal Student Aid, the federal form colleges use to figure out if your children qualify for financial aid, does not count home equity when it tallies your assets and determines your "estimated family contribution."
You appreciate today's low interest rates. While higher rates scared off buyers in the past, today's low rates mean a lower monthly mortgage for you.
You cannot find a rental. Availability of rentals varies by market. And having a pet narrows your prospects in some locales. Hoy said she was lucky to find an apartment that would accept her Labrador retriever.
You want fixed housing costs. While the landlord is free to increase your rent annually, your mortgage (if it is a fixed-rate mortgage) stays the same. Over time, it becomes a smaller percentage of your expenses.