Sunrise Homes & Renovations, Inc.

4 Ways To Get Your Home Loan Closed Faster

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4 Ways To Get Your Home Loan Closed FasterYou’ve finally found the perfect home for your family. Now the only thing standing between you and domestic bliss is the loan process. Use these techniques to shorten the amount of time between placing your bid and getting the final approval on your new home mortgage.

Perfect Your Credit Rating

Your credit score is a measure of your financial responsibility. Lenders look closely at your creditworthiness in their attempt to decide your loan’s risk. Before you start shopping, take some time to clean up your credit history.

Some credit habits that help shorten your loan approval period include:

  • At least one year of on-time payments for utilities, loans, and other regular obligations.
  • A low debt-to-income ratio.
  • A credit utilization rate of 20% or less.

Lenders spend less time researching your financial history when your credit report is clear, which means you spend less time waiting to move in.

Practice Patience

Driven by the excitement of their new home purchase, many buyers spend the closing period investing in new furniture and appliances for their potential home. However, it’s better to wait until the final paperwork goes through before committing to new lines of credit.

Even after applications are filed, lenders still monitor your credit usage. Suddenly spending large amounts of money can cause red flags that delay your loan processing. Practice a little restraint and wait until you’re sure the process is complete before indulging in a spending spree.

Stabilize Yourself

Your ability to repay is a big part of your creditworthiness. A long and solid work history is your best ally in the fight for quality loan products. Establish at least one year of solid work history before starting the loan application process. Hold off on any career changes until you’re comfortably moved into your new residence.

Open The Lines Of Communication

Stay in touch with your trusted home mortgage professional to ensure a smooth loan process. If you move or change your phone number, be sure to update your information right away. While most institutions are very professional about keeping loan applicants updated, don’t be afraid to call and ask about the status of your account. If you feel you haven’t heard back in a timely manner, send a short email or leave a voicemail to ensure you haven’t missed any important requests.

These tips help you spend less time waiting and more time enjoying your new home purchase.

4 Ways To Pay Off My Mortgage Faster

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4 Ways To Pay Off My Mortgage FasterFor most people, the mortgage payment is the biggest monthly expense. Whether you’re facing retirement or still working, it would be nice to be free of this debt. Although you probably can’t pay it off in one lump sum, it is possible to pay off your mortgage sooner than expected.

Here are four strategies to try.

1. Make Bi-Weekly Payments

You could shave eight years off a 30-year mortgage simply by breaking down your monthly payments into two payments instead of one. You’ll pay the same amount each month while the interest paid over the length of the loan is reduced. 

2. Make Principal-Only Payments

If you look at your mortgage payment slip, you’ll notice that the majority of your monthly payment goes toward interest. Slash years off your mortgage by making occasional principal-only payments on top of your regular payments. Consult your lender to see how many of these are allowed per year. If they’re limited, maximize each opportunity by making as large a principal-only payment as you can manage.

3. Refinance When Rates Drop

If your mortgage originated when interest rates were high, refinance it now that rates are still historically lower. You may need to pay closing costs, but you’ll still end up dramatically lowering the amount of interest you are paying on your mortgage. While you’re at the refinancing game, consider getting into a shorter term length. This tactic will probably increase your monthly payment, but if you can afford it, it’s a good strategy for paying down your mortgage quicker.

4. Pay Extra Each Month

If you can afford it, pad your monthly payment with a little extra as often as possible. Just paying $50 or $100 extra will enable you to get rid of your mortgage a little faster. Find the extra money by cutting back on small niceties, such as subscriptions, take-out food and more. You won’t notice the lack of small conveniences, but you will certainly notice a shortened mortgage loan term.

When you work to pay off your mortgage faster, you essentially save thousands of dollars in interest over the life of the loan. Implement one or more of these ideas to become mortgage-free just a little bit sooner.

If you are interested in purchasing a new property or listing your current home, be sure to contact your trusted real estate professional.

5 Options To Consider When Your Appraisal Comes In Low

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5 Options To Consider When Your Appraisal Comes In LowYikes! You are set on buying the home that you picked out and the appraisal comes back at a lower amount than the amount needed for the home loan to be approved. What do you do? After you calm down your significant other and then take three deep breaths, here are some options to consider.

Request A New Appraisal

Appraisals are only one person’s professional opinion. There are rules that must be followed when making an appraisal; however, there is still some flexibility in how to apply the rules. Check the comparables (also called “comps”) that the appraiser used as the basis for setting the appraised value.

There usually have to be at least three houses that are a similar size, similar age, have a similar condition, and are located in a similar neighborhood. If the home that you want to buy just had major renovation with a lot of work done on it, the appraiser may have missed this and should add more to the appraisal for the home having a better condition than the comparables.

Check to determine if any of the comparables are wrong. For example, if the appraiser uses a home that is in poor condition that may cause the appraisal to be too low. When there is another choice of a home in a better condition, which is more similar to the one being sold, the appraisal might be higher.

If you find problems with how the appraisal was done, request a review from your lender and see if they will allow you to pay for a second appraisal. Getting a new appraisal with a higher value is the easiest way to fix this problem.

If that does not work, then you can try these other options:

Negotiate With The Lender

Some lenders may cooperate with a loan restructuring if you qualify for a program with a higher loan-to-value (LTV). This may also require private mortgage insurance (PMI) if your loan amount exceeds 80% of the appraised value of the home. Working with your trusted mortgage professional can lead to unexpected options to get your home purchase completed.

Negotiate With The Seller

Trouble may come up if an appraiser cannot find comps that meet the selling price of the home. This may be caused by the home having unique qualities, a market that does not have other homes like it, or possibly that the sale price is more than the home is actually worth. If the price of the home is actually too high based on the appraisal, the seller might lower the sales price in order to keep the transaction together.

Increase Your Down Payment

If the amount of the difference is small and you can cover it, you can still proceed by taking a lower amount for the loan and adding money to your down payment to make up the difference.

Find Another Home To Buy

Your purchase offer should be subject to obtaining financing. If the appraisal comes in low and that prevents you from obtaining financing at the original sales price, you likely will be able to cancel the purchase agreement without penalty and search for a new home.

Your trusted real estate professional is well-versed in these types of issues and ready and willing to assist you with your successful home purchase.

Managing Finances Before Applying For A Mortgage

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Managing Finances Before Applying For A MortgageAre you planning on using a mortgage to help cover the cost of a new home? If so, you will want to prepare your finances and figure out how you will manage all those wallet-draining monthly expenses. Let’s take a look at how to run a quick financial health check to ensure you are ready to apply for a mortgage.

Update (Or Start) Your Monthly Budget

First, it is essential to get the basics out of the way. If you haven’t already, it’s time to start a monthly budget to keep track of your income and expenses. Once you have a mortgage, it will be important to prioritize your monthly payments so that you don’t end up falling behind.

Starting a budget is easy and can be done with mobile apps, software, a spreadsheet or a pen and paper. List all sources of income so that you know exactly how much cash you are working with. Then, list out every one of your expenses. It can be tough to remember them all, so consider using debit and credit card statements from the past few months as a reminder.

Get A Copy Of Your Credit Report

Next, you will want to get a copy of your credit report so you can see what potential mortgage lenders will see when assessing your financial history. This is a free service that you can request once per year, so be sure to take advantage. Note that you will want to use government-approved websites for requesting your credit report. Be wary of scams.

Do You Have A Down Payment?

A down payment is not required for every home purchase, but having one saved up can make the buying process easier. The amount you will want to have saved up will depend on the cost of your home, whether you plan on carrying private mortgage insurance and a variety of other factors. If possible, try to save up an amount close to (or more than) twenty percent of the home’s purchase price.

Ready? Chat With A Professional

Now that you have your financial health in check, it is time to meet with a mortgage professional to discuss your financing options. 

As soon as you know what you can afford, the next step is to contact your trusted real estate agent who can help you find the house of your dreams!

5 Key Tips To Prepare For A Quick Mortgage Approval

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5 Key Tips To Prepare For A Quick Mortgage ApprovalWhether you’re finally prepared to get into the real estate market or you want to know how you can make a deal quick, there are a few necessary documents you’ll need to prove your reliability to a mortgage lender.

Here are the documents you’ll want to have on hand when the time comes.

Previous Tax Returns

In order to ensure the earnings information you’ve provided to the lender, you’ll need to have your tax returns for the two years prior to your mortgage application. In addition, you may also be required to provide your W-2s as backup documentation.

Bank Statements

To make sure you’re a solid bet who will be able to make your down payment, you’ll need to present bank statements to ensure you have a cushion in the case that interest rates increase. If you do get money gifted to you for your down payment, you’ll need a letter to prove you’re not indebted to the provider.

Recent Pay Stubs

It can be much more difficult to get approved for a mortgage if you have a patchy work history or happen to be self-employed, so you’ll need 2 months of recent pay stubs to prove consistent employment. The pay stubs provided should also be an accurate reflection of the salary you’ve provided on your application to ensure no discrepancies.

Investment Statements

It’s certainly a good sign to the lender if you have a healthy balance in your checking and savings accounts, but you’ll also need to provide any statements for mutual funds and other investments. While they may not be necessary to prove financial soundness, they will help with approval if you have a lot of money squirreled away.

A Listing Of Debts

While it may be the least popular of the pile, a lender will also want to know about any outstanding debts like auto loans, credit card payments or student loans. It may be tempting to forego these documents, but it will give the lender a good sense of your honesty and your ability to manage your mortgage.

Mortgage approval may seem like a time-consuming process with no certain end, but by having the appropriate documentation and being upfront about your debts, you may be able to speed up the time frame.

If you’re interested in buying a new home, remember to rely on two of your best assets – your trusted real estate agent and your home mortgage professional. 

8 Ways To Maintain A Great Credit Score

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8 Ways To Maintain A Great Credit ScoreHaving an excellent credit score is very useful. The following are some tips on how to maintain a superb credit score.

Open Credit Accounts When You Do Not Need Them

If you don’t have any credit accounts, you will have a low score. The best time to open them is when you do not need them. Keep a small balance on them and pay it all off at the end of each month to avoid paying interest.

Charge Up To Half The Credit Limit Then Pay It All Back Within A Few Months

If you must use a credit line, only use half of it and pay it back quickly.

Buy Big Ticket Items With A Credit Card For Cash Back And Points

Even if you can pay cash for a big ticket item, you may find it beneficial to buy it with a card that gives a reward for making a purchase like cash back or rewards points. Then pay off the balance as quickly as you can.

Ask For An Increased Credit Line

For credit accounts that you have been paying on time, call the customer service department and tell them you are thinking about buying something that is slightly above your credit limit. Ask them if they can extend the limit. This usually works even if you do not actually buy something.

You can attempt to raise your credit limit this way about once per year. As you increase your available credit capacity while maintaining all accounts in a “paid as agreed” status, your credit score should go up.

Move Credit Balances To A New Card With Zero Interest

Many credit card companies offer a zero-interest period for transfers of credit card balances from another card. After doing this, transfer this balance, once again, to another card that has a similar offer before the zero-interest period expires.

Close Old Accounts When New Ones Are Open

Having too many credit card accounts can lower your score. Keep about half a dozen cards. Close the ones that you transferred the balance from to zero interest cards.

Use Automatic Payments To Make Sure Bills Are Paid On Time

Never miss a payment or pay late. You may want to use automatic bill payment systems to make sure you never let a bill slip by.

Monitor Credit Card Activity For Unauthorized Use

Monitor all credit card activity in real time. Immediately take action if you notice an unauthorized charge. Monitor your credit history file on the three credit bureau services of Equifax, Experian, and Transunion.

If you are interested in buying a new home or selling your current property, be sure to enlist the help of your trusted real estate professional.