Posts Tagged home loans
VA Loans Make Home Buying Easier!
Posted by Victoria Belle-Miller in Finances on 04/20/2010
There are many great reasons for borrowers to purchase a new home with a VA loan. This type of financing makes the home-buying process simpler by providing multiple benefits to the borrower, including relaxed eligibility requirements. These loans are specifically for veterans and men and women currently serving in the military.
This Type of Financing Helps Homeowners Save Money
Unlike other types of home loans that can require large down payments, this type of financing does not require the borrower to make any down payment on the home that he or she is buying. The absence of this typical requirement automatically saves the borrower money that can then be used for other expenses associated with buying a new home.
Usually, home loans require that the borrower pay mortgage insurance on the loan to cover costs in the case of default, but this type of financing does not require the borrower to pay any mortgage insurance. The VA guarantees repayment of these loans, so the lender is still protected in the event of a default. The absence of mortgage insurance also saves borrowers a great deal of money that they can use toward all of their other expenses.
These loans tend to have lower interest rates than many other types of home loans. With a lower interest rate, homeowners can obtain a lower monthly mortgage payments. Homeowners can save thousands of dollars and have more money available each month that they can put toward their other bills.
VA Loans Have Lenient Qualifications
The VA does not require borrowers to have certain credit scores or large incomes in order to qualify for this type of financing, but borrowers must have gone at least twelve months without having any delinquent payments in their credit histories. Many lenders will require that a borrower have a credit score of at least 620 to qualify. Borrowers also have to meet maximum debt to income ratio and minimum residual income requirements, (which vary based on family size and location) to show that they will be able to make their monthly payments.
Because these loans are solely for veterans and current members of the military, borrowers must also meet service length requirements, which vary based on year of enlistment and certain other factors. Veterans must have been discharged under conditions other than dishonorable to be eligible for this loan. In certain cases, spouses of veterans may also qualify for this type of financing.
Buy Your New Home with a VA Loan!
These loans can save homeowners thousands of dollars, which is great news for first-time home buyers who are just starting out or for veterans returning home who want to simply get back to everyday life. First-time home buyers can also take advantage of the first-time homebuyer’s tax credit along with their VA loans and receive up to $8000 in tax credits! This incentive will be over at the end of April, so first-time home buyers should act now to save even more money with their new homes!
Victoria Belle-Miller is the newest member of the VeteransLoans.com writing staff. Her background in journalistic writing and ability to evaluate the issues that Americans face in daily life make her a strong addition to the VA loans team and a valuable source of sound mortgage advice.
How To Obtain Lower Home Loan Rates
Posted by Travis Kitsap in Finances on 04/19/2010
Home loan rate may not be completely within your control, however you do have some control nonetheless. With this article, you’ll find helpful tips to help you locate lower home loan rates and more competive loan programs. Most homebuyers know that clicking their heels while envisioning a future home is not enough to nab the most affordable mortgage. However, many homebuyers don’t know that getting an affordable home loan payment is not simply up to their lender. By taking some steps, homeowners can grab onto both lower home loan rates and payments for their dream homes.
1. Home Loan Payment Budget Assessment
First, take some time to understand what you can afford by crunching the figures of your monthly spending habits. Calculate how much money each month goes towards rent, insurance, car payments, groceries, credit card bills and kids. Remember to calculate larger annual expenses like vacations and gift-giving seasons. After realizing how much of your income goes towards your basic expenses, you can now more clearly see how much money is free to go towards homeowner expenses. Remember that joining the homeowners club doesn’t happen with one single, simple monthly mortgage payment. Home loan payments, on top of principal and interest payments, include property tax and homeowners insurance. Don’t forget essential additional payments like maintenance, utility bills and extras like outfitting and furnishing your home according to your budget and lifestyle.
2. Credit Cleansing For A Home Loan:
You can make yourself a magnet for lower home loan rates and payments via cleaning your credit. To secure those affordable mortgages with a lower interest rates, you need to lower your credit score. Experts recommend that you order your statement far ahead of any mortgage seeking process and that you take at least 6 months to clean up your credit. You can easily do this by making on time payments, paying off debts, and closing any unused credit accounts. The longer your history of good credit, the better your chance to secure a mortgage with a lower rate. So buckling down to work towards a clean credit history can pay off.
3. Shopping Home Loan Rates Online:
In order to understand what kind of home loan rates are available, jump online. Before entering into the emotionally charged arena of home grabbing, arm yourself with an informed understanding of the kinds of mortgages available to you. Online lending sites provide a wide variety of lenders from across the nation and offer handy, effective comparisons. These powerful resources save you from spending time on lengthy research, and in the end you are aware of a range of mortgage options from lenders near and far.
4. Securing Home Loan Interest Rates:
Now you are ready to see what your lender will allow to spend on a house. Once you hit the markets for house shopping, your chosen lender will pre-qualify you. You provide your credit score, income, liabilities, assets, and credit card expenses. In return you are pre-qualified and have an idea of what kind of market range you can shop in. Once your heart is set on your desired home, ask your chosen lender to pre-approve your loan so that you can make an firm, serious offer. You provide hard documents so that your lender can officially offer you a loan pre-approval.
5. Conclusion:
With some research and preparation homebuyers can secure lower home loan rates. As mortgages can be the biggest monthly burden for most households, you can reasonably spend some time to maximize your mortgage offers and secure a lower monthly payment. By following some basic tips in preparing and informing yourself about your options, your mortgage just might turn out to be your best investment.
The author writes about current Home Loan Rates and programs and may visit the site http://www.paramountfinancial.com for more home financing tips.
5 Great Reasons to Finance With an FHA Mortgage!
Posted by Victoria Belle-Miller in Finances on 03/16/2010
FHA mortgages are great for people looking to purchase a home and current homeowners who want to refinance their mortgages. With all of the advantages this type of loan offers, borrowers can finance their homes and save money in the process! A low down payment requirement and competitive rates leave borrowers with more money to spend on other expenses.
Easy to Qualify
The Federal Housing Administration (FHA), which insures these loans, does not have strict income or credit score requirements. The FHA only considers the preceding twelve months of a borrower’s credit history to determine if he or she qualifies, though most lenders still require a minimum credit score of 620. So, an applicant with a troubled financial past can qualify for this type of financing if he or she has had no delinquent payments within the last twelve months.
Low Interest Rates
Because the FHA insures this loan, lenders can offer lower interest rates than on other home loans. A homeowner will save money on his or her monthly mortgage payment when he or she has a low interest rate and, over time, can end up saving thousands of dollars in interest!
Low Down Payment Requirement
This type of financing is great for first-time homebuyers who may not have a lot of money or who have yet to build up their credit histories. Compared with other home loans, this loan has a fairly low down payment requirement. Typically, the FHA requires a down payment of 3.5% of the purchase price of the home. By paying less money out of pocket, first time homebuyers can have more money to cover the other expenses associated with buying a new home.
Refinancing Options
With the rate/term refinance mortgage, a homeowner can change the rate and/or terms of his or current mortgage. If current interest rates are lower than when the homeowner took out the original mortgage, he or she may be eligible to receive the lower interest rate. Homeowners can also switch from an adjustable mortgage rate to fixed rate. This change can end up saving the homeowner thousands of dollars over time because the rate will no longer fluctuate. The length of the mortgage can also be changed, if desired.
With the cash-out refinance mortgage, a homeowner can receive cash back by refinancing his or her mortgage. The homeowner would take out a loan for a higher amount than his or her current mortgage and receive whatever is left over after paying off the existing mortgage. There are no restrictions on how the cash is used. The funds can be used to pay for home repairs, medical expenses or other expenses.
There is also a debt-consolidation refinance mortgage. This FHA mortgage allows homeowners to combine some or all of their debt into one monthly payment. This not only makes it easier to pay off the debt, but it also saves the homeowner a significant amount of money in interest and tax savings.
Finance Now Before FHA Guidelines Change
The FHA plans to implement a few guideline changes very soon. Some of these changes include an increase of the mortgage insurance premium, as well as an increase in the down payment amount for borrowers who have credit scores below 580. Interest rates are also subject to change daily, so now is a great time to see what an FHA mortgage can offer you.
Victoria Belle-Miller is the newest member of the FHAMortgageBank.com writing staff. Her background in journalistic writing and ability to evaluate the issues that Americans face in daily life make her a strong addition to the FHA loans team and a valuable source of sound mortgage advice.
Obtain Low VA Mortgage Rates and Save Money!
Posted by Victoria Belle-Miller in Finances on 03/13/2010
VA mortgages are a great financing option for both first time homebuyers and current homeowners. These types of loans have multiple benefits, including no down payment on purchases and no mortgage insurance. The absence of these costs, which are required on most mortgages today, saves borrowers money for their other expenses. Borrowers can also save money because this type of financing tends to have lower interest rates than other types of home loans.
Why Low Rates are Beneficial
First time homebuyers or homeowners who are purchasing a new home and are eligible for VA financing can receive a low VA mortgage rate on their home loan. Having a low interest rate will lower the borrower’s monthly mortgage payment and save him or her money in the long run. A borrower can use the money he or she saves for personal expenses or for other expenses related to the new home. First time homebuyers can also use the $8000 first time homebuyer tax credit to maximize their savings. The tax credit is slated to end in April, so first time homebuyers should consider taking advantage of this incentive now.
Obtaining lower rates by refinancing
Current homeowners can refinance their existing VA mortgages in order to receive lower interest rates on their home loans. There are a few different home-loan refinancing options homeowners can choose from. With a lower interest rate, a homeowner can lower his or her monthly mortgage payment and save a great deal of money in the long run. In addition to lowering one’s interest rate and monthly payment, refinancing also gives homeowners the option to change the terms of their loans, consolidate debt and/or take cash out.
Requirements to Qualify
To be eligible for this type of financing, the borrower must be either a veteran or a current member of the U.S. military. If the borrower is a veteran, in order to qualify for a loan, he or she must have been discharged under conditions other than dishonorable. There are certain other service length requirements that borrowers must also meet. A home loan specialist can help potential borrowers determine their service eligibility.
In addition to service requirements, an applicant must meet a residual income requirement and have an acceptable debt-to-income ratio so that the lender knows he or she can make the loan’s monthly payments. The VA does not require that applicants have a high credit score, but most lenders will require a credit score of at least 620.
In some cases, a veteran or current service member’s spouse may qualify for loan benefits in the event of a death caused by or related to military service or other special circumstances. Disabled veterans who were disabled while in service or as a result of service may be entitled to additional loan benefits, such as being exempt from paying the loan funding fee. They may also be able to receive accommodation grants that they can use to make their home more accessible for their disabilities, or they may be exempt from having to pay property taxes, depending on the laws in the state in which they reside.
This type of loan is a great financial solution for those who have served our country. Borrowers can receive low interest rates, which will lower their monthly payments and leave them with more money for their other expenses. The absence of mortgage insurance and a down payment (for purchases) saves borrowers even more money overall. Interest rates are continually fluctuating, so now is a great time to take advantage of low VA mortgage rates to save money on home financing.
Victoria Belle-Miller is the newest member of the VeteransLoans.com writing staff. Her background in journalistic writing and ability to evaluate the issues that Americans face in daily life make her a strong addition to the VA loans team and a valuable source of sound mortgage advice.
FHA 203k Loan Information
Posted by Victoria Belle-Miller in Finances on 03/05/2010
FHA home loans, which are insured by the Federal Housing Administration (FHA), are great financing options for any homeowner who wants to purchase a house or refinance his or her current mortgage. These loans have low interest rates and usually only require down payments of 3.5 percent! FHA loan requirements are simple, so current and potential homeowners are more likely to qualify for these loans than other types of loans.
FHA 203k Rehabilitation Mortgage Insurance Program
The FHA has a specific loan program to help homeowners who want to make improvements or repairs on their home, but do not have the funds to do so. These loans are called FHA 203k loans and can be used for either a purchase or a refinance. There are two types of loans in this program, one loan is for repairs that cost less than $30,000 and the other loan is for repairs that cost more than $30,000.
A streamline FHA 203k option is also available to homeowners who are interested in doing non-structural repairs or improvements. This loan requires less documentation and can be less costly. It allows a homeowner to finance up to an additional $35,000 into his or her mortgage in order to make improvements to the home. An FHA home inspector or appraiser can identify home repairs that need to be made.
How the Loan Can Be Used
Although there are some restrictions on what the loan can be used for, there are plenty of renovations and home repairs that the loan does cover. In general, these include modernization, eliminating safety or health hazards, making a home more accessible for individuals with disabilities, or making a home more energy efficient. More specifically, the loan can be used for roofing, plumbing, flooring, painting, minor remodeling and more.
Loan Requirements
There are certain requirements with this type of financing. Homeowners must spend at least $5000 on their home repairs in order to be eligible. Homeowners must get cost estimates from a licensed and insured contractor(s) before signing the sales contract. The total cost of the mortgage, including the repairs, must remain within the FHA loan limits for the county in which the home is located.
This loan cannot be used to flip houses, and the homeowner must use the loan on the home in which he or she lives. The work being done on the house must begin within 30 days of the loan closing. All work must be completed within six months to comply with the loan requirements.
If a homeowner wants to make repairs to his or her home and needs additional financing, this type of financing could be the best option. Many of the same eligibility standards used for standard FHA home loans apply to the FHA 203k loan. Most lenders will require that the borrower have a credit score of at least 620 to be eligible. To qualify for the loan, certain energy efficiency standards, as well as certain structural standards, must be met.
This loan could be great solution for homeowners who want a better way to finance home repairs and improvements without depleting their savings.
Victoria Belle-Miller is the newest member of the FHAMortgageBank.com writing staff. Her background in journalistic writing and ability to evaluate the issues that Americans face in daily life make her a strong addition to the FHA loans team and a valuable source of sound mortgage advice.
FHA 203K Loan Makes Financing a Home in Need of Repairs Simple
Posted by Anne Johnson in Finances on 02/25/2010
The FHA 203K loan is a type of financing that is insured by the Federal Housing Administration. It is a unique type of financing that allows homeowners to obtain both a purchase loan and rehabilitation financing in the same transaction. Before this transcendent loan program, a homeowner had to obtain an initial, temporary loan to purchase the home and a separate rehabilitation home loan to make any necessary repairs. Only after the repairs were complete could the homeowner gain permanent financing for their newly improved home.
FHA 203K: How does it work?
The FHA 203K loan was designed to streamline the process of buying a home in need of repairs. In order to provide funds for the repairs, the loan amount is based on an expected future appraised value that takes into consideration how much value the completed repairs will add to the current value. Up to $35,000 over the purchase price of the home can be financed into the loan to cover the cost of repairs.
The contractors chosen by the borrower to do the repairs will receive the money for their work in two draws. One draw is for 50% of the work and is disbursed at the beginning of the repairs while the remaining 50% will be disbursed after the work is completed. The repairs must begin within thirty days of the closing of the loan and must be completed within six months. The amount paid to the contractor(s) must be determined before the loan closes by obtaining written bids on material and labor costs. The homeowner can do the work himself provided that he is a licensed and bonded contractor.
What types of repairs will the FHA 203K cover?
Some of the repairs eligible to be completed with the funds from an FHA 203k loan include: roof replacement, electrical or plumbing work, kitchen remodeling, accessibility renovations, appliance purchases, and painting. Although many cosmetic renovations are allowed, luxury items and upgrades are not permitted. Also, any funds needed to repair to any detached structures, like sheds, swimming pools, and gazebos, may not be included in this loan amount.
FHA 203K: Qualifications
The FHA 203K program has the same types of eligibility requirements that exist on any FHA home loan. A homeowner must qualify on the basis of both credit and income to be eligible and the property must be FHA approved. As a general rule, the monthly mortgage payment cannot exceed 41% of the borrower’s monthly income and most lenders require at least a 620 credit score. Homes that qualify include: FHA-approved condos, 1-4 unit homes, and planned urban development homes (PUDs). The construction of the home must have been completed at least one year prior to financing in order for the home to qualify.
The FHA 203K program can be a great tool for any homeowner looking to renovate or repair his or her home. In a housing market that has seen foreclosures reach record highs, the FHA 203k loan can not only provide potential home owners with more opportunities to purchase a home, but can also help rebuild the housing market by facilitating the rehabilitation of foreclosed properties.
As a former psychology major, finding solutions to resolve problems has always been a subject of interest to me. I hope that my writing will give people the confidence to make important decisions about FHA loans. In addition to writing, I love to read, knit, spend time with friends and family, and watch the Missouri Tigers and Green Bay Packers!
Different Types of VA Refinance Mortgages Help Homeowners
Posted by Anne Johnson in Finances on 02/25/2010
One of the benefits of serving in the United States Military is the right to use the VA loan benefit. A VA refinance mortgage can help homeowners refinance their current mortgage loan in order to lower their current interest rate, eliminate mortgage insurance, and/or consolidate debt.
Types of VA Refinance Mortgages
There are three main types of VA refinance mortgages that can be used in different situations. If a homeowner who is a current service member or veteran of the Armed Forces wishes to not only refinance his current mortgage, but also consolidate debt, the cash-out VA refinance mortgage would be the best product, regardless of his or her current loan type. If a homeowner currently does not have a VA loan, but wants to take advantage of the benefits offered by this program, he should use the VA rate-term refinance mortgage. If a homeowner currently has a VA loan and wishes to lower his interest rate, the type of refinance that may best suit him is the Interest Rate Reduction Refinance Loan.
Cash-Out VA Refinance Mortgage
This type of VA refinance loan is available to anyone, regardless of their current loan type, provided that they qualify on the basis of military service, credit, and income eligibility. Currently, most lenders allow borrowers using a VA loan to cash out up to 90% of their home’s value. This money can be used to consolidate debt or simply to obtain additional funds for whatever reason the homeowner chooses. Many homeowners use this type of loan to eliminate costly revolving debt and to decrease their monthly payment obligations. Unlike credit card interest, the interest on a homeowner’s mortgage can be low, fixed, and tax deductible.
Rate-Term VA Refinance Mortgage
A rate-term VA refinance mortgage allows homeowners to refinance up to 100% of their home’s value and take advantage of all the benefits that this program has to offer. With a VA loan, the homeowner will never be required to pay monthly mortgage insurance and will have access to low, fixed rates. This type of VA refinance mortgage can significantly lower monthly payments without high out-of-pocket expenses.
Interest Rate Reduction Refinance Loan (IRRRL)
This type of VA refinance mortgage is a streamlined mortgage and is only available to homeowners who currently have a VA home loan. This refinance can be used to obtain a lower interest rate, change the terms of the loan, change the current borrowers, and change to a fixed interest rate from an adjustable rate. When a borrower uses an IRRRL, there are no out-of-pocket costs and no appraisal is required. As a convenience to those who have already used their VA home loan benefit, there are also reduced documentation requirements for income information, asset information, and employment, as well as quick application processing.
There are many different types of VA refinance mortgages that are set up to benefit veterans in different situations. VA home loans can provide great benefits to those who have served their country.
As a former psychology major, finding solutions to resolve people’s problems has always been a subject of interest to me. I hope that my writing will give people the knowledge and confidence to make important decisions about VA loans. In addition to writing, I love to read, knit, spend time with friends and family, and watch the Missouri Tigers and Green Bay Packers!
Lenient FHA Loan Guidelines Make Now a Great Time to Apply
Posted by Victoria Belle-Miller in Finances on 02/21/2010
FHA loans are a great option for first time homebuyers on the house hunt, as well as current homeowners who are looking to refinance their current mortgages. These loans offer low down payments, as well as low interest rates, which helps keep monthly mortgage payments low. This type of financing, which is insured by the Federal Housing Administration (FHA), also has more lenient credit and income qualifications than most other home loans. Even potential borrowers who have less-than-average credit scores may still be able to qualify.
Loan Eligibility
It is typically easier to qualify for this type of financing, compared with other types of home loans. While the FHA does have lenient credit score and income requirements, most lenders require that applicants have a credit score of at least 620 to qualify. The FHA also requires that applicants have a clean credit history of at least twelve months, meaning they have had no delinquent mortgage payments during the twelve months preceding their application. The house an applicant wants to finance must be his or her primary residence, which means they plan to live there at least six months out of the year.
Loan Requirements
This type of financing requires that the borrower make a down payment on the home being purchased, as well as monthly mortgage payments. The down payment can be as low as 3.5%, which is much lower than down payments on most other home loans. Applicants will also have to pay an upfront mortgage insurance premium on the loan, which is currently equal to 1.75% of the loan amount.
Before the loan can be closed, an appraisal will need to be done on the home to ensure that the home meets all of the minimum safety standards that the FHA requires and to document the value of the property. Borrowers also will be required to escrow their homeowner’s insurance and property taxes, which ensures that everything is paid up to at least one year.
There is interest on the loan, but it is typically lower than conventional loan rates. And borrowers can opt for fixed interest rates so that their rates remain unchanged over the life of their loans and their monthly mortgage payments are consistent. This option would be especially good for borrowers who have had credit issues in the past.
Loan Refinance
For a current homeowner, refinancing with an FHA loan could lower his or her interest rate, which could also lower the monthly mortgage payment. Refinancing also gives homeowners the option of changing the terms of their loans. They can extend the length of their loans or change from adjustable rates to fixed rates, which could save them thousands of dollars in the long run. With the cash-back refinancing option, homeowners can take out a loan for a higher amount than the amount needed to pay off their current mortgage and use the rest to pay off large bills or cover other expenses. There are no restrictions on how a homeowner can use the cash.
Apply Now Before Requirements Change!
This type of financing offers several benefits and has relaxed guidelines. A borrower who does not have a lot of money for a large down payment can still become a homeowner with this type of loan. Current homeowners can save money every month by refinancing and getting lower interest rates, as well as receive cash back for other financial needs.
The FHA will be changing their requirements in the next few months, so now is a good time to speak with a FHA loan specialist to determine whether this type of financing is right for you!
Victoria Belle-Miller is the newest member of the FHAMortgageBank.com writing staff. Her background in journalistic writing and ability to evaluate the issues that Americans face in daily life make her a strong addition to the FHA loans team and a valuable source of sound mortgage advice.
Valuable Reverse Mortgage Information
Posted by Victoria Belle-Miller in Finances on 02/20/2010
A reverse mortgage is not just another typical home loan. It offers several benefits that other mortgages usually do not and most are insured by the Federal Housing Administration. This type of financing is for senior homeowners who may need financial assistance and have sufficient equity in their homes that can be turned into cash. This loan will allow them to stay in their home without making monthly payments and they may even be eligible to receive additional cash back.
How the Loan Works
If a homeowner qualifies for a reverse mortgage, he or she will not be required to make any monthly mortgage payments. The loan does not need to be repaid at all until the homeowner no longer occupies the home and it is sold. He or she will be able to stay in the home without worrying about the possibility of foreclosure due to missing mortgage payments. Also, if there is enough equity in the home, it can be turned into additional cash. The amount of money a homeowner can receive depends upon the homeowner’s age, the value of his or her home, and current interest rates.
Homeowners can choose how the money they receive is to be disbursed so that the amount and schedule fits their lifestyles and personal needs. The disbursement options include a lump sum, line of credit, monthly payments or a personalized combination. There are absolutely no restrictions on how homeowners can spend they money they receive from their loans. Seniors can use the money they receive for medical bills, home maintenance or other expenses.
Loan Eligibility & Requirements
In order to qualify for this loan, applicants must own their home and be at least 62 years old. The home must be the applicant’s primary residence in order to qualify, which means he or she resides in the home at least six months out of the year. Because there are no monthly payments with this loan, there are no income or credit score requirements. Therefore, homeowners can still be eligible for this type of financing even if they have limited incomes or less-than-perfect credit histories.
Borrowers are not required to pay back their loans until they no longer own or occupy their home. The only instance in which a homeowner would be required to repay the entire loan amount is if he or she did not keep the homeowner’s insurance, property taxes, or home repairs up to date.
Before a homeowner can take out a reverse mortgage, he or she will be required to participate in loan counseling, which will explore all of their financing options. This loan may not be the right option for everyone, so counseling will let homeowners know if this type of financing is the best option for their financial needs.
Don’t Buy into the Hype
Many people attempt to discourage reverse mortgages by spreading misleading information about them. While this type of loan may not be the right option for every homeowner, it is by no means a bad option for senior homeowners who need to supplement their incomes or reduce their monthly expenses.
This type of financing is a great option for homeowners who plan on staying in their homes for many years and do not need to preserve their equity for any reason.
Victoria Belle-Miller is the newest member of the Senior Reverse Mortgage writing staff. Her background in journalistic writing and ability to evaluate the issues that Americans face in daily life make her a strong addition to the team and a valuable source of sound mortgage advice.
North Georgia Property an Opportunity For Investment
Posted by Rachel B in Real Estate on 02/12/2010
Weathering the storm of the recent economic recession has not been easy for many people. When you watch the news on television there is common talk of foreclosure rates and stories about people who have had to simply walk away from valuable homes or property. The causes for this situation are complex and even debatable but the end result is clear; many home buyers ended up with mortgages that were larger than the value of their homes after real estate prices began to decline sharply.
To some people this might seem like the absolute wrong time to invest in real estate but if you consider real estate to be an investment just like stocks, it might actually be a very good time if you can manage it. While it is not easy to do, the objective when it comes to stocks is to buy low and sell high. It can actually be a little bit easier to do this with real estate as prices do not move as quickly and they seem to have more of a chance of increasing when you look at a longer time frame.
North Georgia properties from Ellijay to Blue Ridge are a microcosm of what has been happening across the country. Many of these properties were sought as second homes because of the incredible views that they have and the beautiful natural surroundings. Purchased as vacation homes a number of the properties don’t have a neighbor in sight and offer spacious and well crafted homes on large lots. Because they were in such high demand, the price went up and people purchased these homes with large mortgages. Unfortunately, as the economy declined there were a great many foreclosures in the Blue Ridge and Ellijay Georgia areas.
While it is a shame that many people had to lose their homes this way, it does represent an opportunity for long term investors and first time home buyers. You can pick up some incredible deals on foreclosure properties in the area and if you can manage to finance it, it’s a fairly good bet that over time property values will rebound. If you plan to live in the property you will not only enjoy the area but it can represent an excellent investment over time. It might be better for somebody who has a longer time frame as opposed to someone engaging in the practice of flipping properties for profit.
If it is something that you want to consider doing, there are few things that you can do to prepare. Start looking at the foreclosure listings in the area and acquaint yourself with property values. It is the market that determines the value of a property and many of these are going for much less than their likely to be worth in future years. It’s always a good idea to maintain a good credit rating but even more so if you are anticipating purchasing a property in the near future. The banks are being more selective of who they finance. They have also lowered the percentage of the appraised value they will loan.
Rachel is a real estate agent in North Georgia. She covers Jasper Ga to Blue Ridge. You can visit her at Georgia Mountain Real Estate and the North GA Real Estate Hub