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Mortgage Insurance Basics

May 21
1:01
PM
Category | General

Anytime you purchase a home and make a down payment of less than 20% of the purchase price of a home, you will need to pay for Mortgage Insurance.  Also called MI, Mortgage Insurance is an insurance policy that reduces the amount a lender loses if the borrower does not repay their mortgage.   This is a common factor in conventional, USDA, and FHA loans.  VA loans do not require MI.

If you are required to pay mortgage insurance, it will be included in your total monthly payment that you make to your lender, your costs at closing, or both.

Mortgage Insurance does not provide coverage in the event of a borrower’s death.  That is Mortgage Life Insurance.

Mortgage Insurance also does not protect against theft or damage from fire and other disasters.  That type of protection is known as Homeowner’s Insurance.

Mortgage Insurance protects the lender – not you – if you fall behind on your payments. 

Historically, making a 20% down payment has been a difficult hurdle to clear for many homebuyers.  Mortgage insurance was created to reduce that barrier and help more people afford homeownership.

If you have a conventional loan, once you’ve paid off 20% of your loan, you may be eligible to cancel your Mortgage Insurance which would lower your monthly payment.  You will need to refinance an FHA or USDA loan to remove the MI.

 

 

This ad is not from HUD, VA, or FHA and was not reviewed or approved by any government agency.


What is an Appraisal?

Apr 5
1:48
PM
Category | General

Appraisals are an important part of the homebuying process. A real estate appraisal establishes a property's market value, or the likely sales price it would bring if sold in a competitive real estate market.

Lenders require appraisals when buyers use their new homes as security for their mortgages. An appraisal provides the lender with an assurance that the property will sell for at least the amount of money it is lending.

An appraiser will go throughout the home to inspect its state of repair, its features, its square footage, etc. They’ll take note of all the details, big and small, that are required to accurately compare the home to other homes when measuring its value.

An appraisal includes:

  • Specific details about the subject property. There will be a side-by-side comparison of similar properties that have sold and are for sale.
  • An evaluation of how the real estate market is performing in the area.
  • Concerns about issues the appraiser feels are harmful to the property’s value.
  • Flagged descriptions of any significant problems such as cracks in a foundation or water penetration through the roof.
  • An estimate of the average sales time for other similar homes.
  • A view of whether home values in general are on the rise, decreasing or stable.
  • A description of the area in which the home is located such as neighborhood, country road, or busy street.

When all the details of the house are collected, the appraiser can look over the recent sales of similar homes in the area, searching for properties as identical to yours as possible, and make a comparison to deliver the final appraisal price.

This ad is not from HUD, VA, or FHA and was not reviewed or approved by any government agencies.


Pre-Qualification vs Pre-Approval

Mar 22
5:05
PM
Category | General

Pre-Qualification vs Pre-Approval

 

There’s a world of difference between the terms Pre-Qualification and Pre-Approval.  Don’t get mistaken by the two similar expressions and lose the house of your dreams in the process.

A pre-qualification is the initial step in the mortgage process and it’s generally quite simple.  You supply us with a picture of your overall financial situation and then we’ll give you our opinion of the mortgage amount that you could qualify for.  An initial application will need to be taken and credit will need to be pulled.  It can be done in person, over the phone, or online at safford.mannmortgage.com and there is no cost for the application or to pull credit.  This is a great time to discuss any goals or needs you may have regarding a mortgage and we can explain various mortgage options and recommend types that may best be suited to your situation.

Because a pre-qualification is just our opinion based on minimal information that is not substantiated, it’s not a sure thing.  It’s just a place to start when you begin looking for a home.  We can supply a pre-qualification letter to your agent to make an offer at this point but it will have more weight to it if you continue to the next step.

A pre-approval is the next step.  It is more involved and requires documents to be collected such as pay stubs, bank statements, and tax returns.  You’ll need to back up the information given in the initial application.  At this point, your pre-qualification letter that we supply to your agent when you are making an offer on a house carries more weight. 

Here at Mann Mortgage, you’ll never have to pay an application fee or pay to have your credit pulled.  So, you really have nothing to lose.

Once you’ve found the right house, we’ll fill in the details and your pre-approval will become a completed application with a set of keys.

This ad is not from HUD, VA, or FHA and was not reviewed or approved by any government agencies.


Depending on how you use them, credit cards can dramatically increase or decrease your credit score.

“Credit cards typically weigh more heavily on credit scores than other types of debt because they give greater insight into how you make borrowing and debt management decisions,” says Rod Griffin, director of public education for credit scoring company Experian. "The consumer determines how much they're going to charge and how much they're going to pay each month, so there's that element of free will that you don't have with other types of debt," Griffin says.

In general, owning a credit card is good for your credit score. 

Your payment history accounts for about 35% of your credit score and is the most influential factor in your credit score.  One of the most damaging habits you can have is to pay your bills late, but if you pay your bills on time, this will give your score a boost.  

The amount you owe on your credit cards, comprises about 30% of your credit score.  The less available credit you use, the better.  If you can’t pay off your credit card balances in full every month, try to keep your balances as low as possible.  When you utilize more than 30 percent of your available credit, it begins to hurt your credit score.

In addition, 15% of your score is focused on the length of your credit history, so keeping a few credit card accounts open for many years will help.

The remaining 20% is divided equally among the types of credit used and the new credit lines opened. Having credit card accounts open and in good standing will help, although applying for several new credit cards in a short period of time will hurt.

And keep in mind that there is a hierarchy to credit cards.  Your big names, like Visa, Mastercard, etc., are the ones that help you the most.  The second tier is your store card credit cards.  They don’t help as much but they can hurt just as much if you are more than 30 days late on a payment.  The third tier is lines of credit.

Understanding how credit card usage affects your credit score is only useful if you apply it to your specific situation. “There's no universal strategy,” says Griffin. “What hurts one person could help you.”

When you purchase a credit score, it will come with an analysis of which factors most affect your score. For example, it might tell you that you have a lot of credit card debt or point out that you have multiple late payments. Once you have that information in hand, you can make the recommended changes.

“One of the keys to a high credit score is using credit cards responsibly and consistently over a long period of time,” Griffin says. "There is no quick fix."

 

 

This ad is not from HUD, VA, or FHA and was not reviewed or approved by any government agencies.


Small Town Fun

Feb 16
10:31
AM
Category | General

Small Town Fun

Looking for something new to do in the Gila Valley?  We may be smaller than the big city, but there is definitely no lack of excitement.  Especially, if you are a little creative.  Here are some ideas to start the ideas flowing.

Enjoy Downtown -  With our antique stores, restaurants, and charming local shops, get out of the house and take a stroll downtown to just take in the atmosphere. 

Spend Time Outdoors – From astronomy, to camping, to golf - the possibilities are endless!

Host a Get-Together – It's a great way to make new friends.  Outdoor grilling is popular, so are potlucks.  And then join around the table for some board games or cards afterwards.

Hit Up the Local Garage Sales – It's a great way to take up an entire Saturday morning.  And when you find your house overflowing with other people's treasures, maybe it's time to host a Garage Sale of your own.

Join Local Committees or Boards – Every organization and event has a committee heading it up.  Volunteer in some capacity to make our city great and support our community.  Community support is a hallmark of small-town life.

If you are in need of more ideas, check out the local Chamber of Commerce for new happenings in town. 

 

 http://www.graham-chamber.com/

 

http://www.visitgrahamcounty.com/


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