Private mortgage insurance (PMI) is a term many Santa Cruz home owners have heard but few understand.  Unfortunately, even more home owners have paid PMI premiums long after it was needed because they didn't know they could cancel.

Here are answers to questions I am most frequently asked about PMI:

What is Private Mortgage Insurance (PMI)?

As its name states, PMI is insurance.  Like all insurance, it protects someone against the loss of something.  For example, car insurance protects the car owner against the loss of his car.  In this case, PMI protects lenders against the loss of their money if borrowers fail to repay their mortgage. 

If you buy a house and make a down payment of less than 20%, lenders require that you pay for PMI insurance.  Let’s…

1551 Views, 0 Comments

Read Full Post

Flopping is a short sale scam in which investors hire brokers to assess Santa Cruz real estate for less than its market value and convince lenders to sell the home for far less than market value.  Then, the investors quickly turn around and sell the property for a profit to a buyer they already have lined up.

This type of short sale "flopping" is on the rise, and it is costing lenders millions of dollars.  The greater the losses for lenders, the more difficult it becomes to make new mortgage loans available.

Here are the basics you need to know to prevent your Santa Cruz real estate from becoming a flop:
What makes flopping a scam?

The crime is in the fact that the lender was not made aware of the other, better offers.  Instead of the lender getting a…

1528 Views, 0 Comments

Read Full Post

The Internet has made researching real estate easy for anyone who knows how to surf online. Whether researching real estate to sell homes or to find for their next big investment, many property owners and home buyers think they’ll save a lot of money by doing all the work themselves.

However, statistics show that you’re more likely to sell your property quicker or find your dream house faster when you work with a professional Santa Cruz real estate agent.  Working with an agent provides you with an expanded housing database, years of property-purchasing knowledge and valuable contacts for everything from inspections to loans.

The trick is to find the right Santa Cruz real estate agent to fit your needs.  Here are 5 tips to help you find your perfect…

1538 Views, 0 Comments

Read Full Post

Looking to buy a new house? Do you have a specified budget in place? Are you going to need to take out a loan? In such a tumultuous real estate market, there are many frustrating financial hurdles that you need to jump before you can purchase your Santa Cruz home. However, with a pre-approved loan you could reduce stress and move in quicker.

A pre-approved loan is when a bank provides you with an amount they would be willing to lend you for a Santa Cruz home and a period of time for which this offer is good. They determine this amount based on several criteria that you must provide and prove, such as your current income, bank statements, income tax returns and credit history.

 

 

Perks from pre-approval


• Know what you can afford –Using a…

2014 Views, 0 Comments

Read Full Post

Shopping for a mortgage is as important as shopping for a Santa Cruz home to buy.  It’s the only way to get the best interest rate and terms with a lender you trust.  Take your time, do your research, and you’ll have peace of mind knowing that you found the mortgage that meets your needs.
Here are six tips to help you find the best mortgage to use to purchase your Santa Cruz home:


1. Find a lender you like and trust.  Ask your friends, neighbors, co-workers, and most importantly, your real estate agent for names of lenders they admire and enjoy working with.  You want to find one who is knowledgeable about the mortgage industry, will answer all your questions and can talk with you about loans in a way you understand.


2. Explore your options.  There is a…

1603 Views, 0 Comments

Read Full Post

There are a few misconceptions about how to set the sales price for your Santa Cruz real estate.  Here are five common pricing myths and the reality behind them.

Myth #1:  It’s OK to test a high price on your Santa Cruz real estate just to see if anyone will buy it at that price. 

If you’re serious about selling your home, don’t play games.  In this buyer’s market you have a very small window of opportunity to pull in serious buyers when your home first enters the market.  If you play games, like over pricing your home just to test the market, buyers will stay away in droves. 

Myth #2:  You should price your Santa Cruz real estate higher than the market value to allow for room to negotiate.

Truth:  No matter what your reasoning or rationale,…

1412 Views, 0 Comments

Read Full Post

Considering deflated real estate values, you might wonder if buying national and Santa Cruz  real estate still makes good financial sense.  According to the National Association of REALTORS® eighth annual Housing Opportunity Pulse Survey, nearly 8 out of 10 respondents believe buying a home does make good financial sense.

Surprised?  Let’s examine three reasons Americans believe buying national and Santa Cruz  real estate remains a good financial choice:

1. Lower home prices and low mortgage interest rates are making homes more affordable. 

2. Almost 7 out of 10 believe that home values have stabilized in their area; the same number expects home sales to remain about the same through the end of the year.

3. The rate of foreclosures is also seen as…

1537 Views, 0 Comments

Read Full Post

You already know all the usual reasons agents and other experts think now is a good time to buy Santa Cruz real estate.  Here are 4 reasons to buy Santa Cruz real estate now that just might surprise you:

1. Homes are in tip-top condition. Instead of selling and moving into a more expensive home, many owners have invested their money in home maintenance, repair and updates, so says the Harvard University’s Joint Center for Housing Studies.

2. Outstanding homes are coming on the market. Many homeowners who have been waiting for the real estate market to take an upturn are now putting their homes on the market.  And, those homes are in great shape (see #1).

3. Appraisals reflect reality. We can all be thankful that Fannie Mae adjusted its guidelines so…

1615 Views, 0 Comments

Read Full Post

Some Santa Cruz County home buyers have an advantage that others don’t in today’s housing market.  They can qualify for an FHA loan. 

Federal Housing Administration (FHA) loans help Santa Cruz County home buyers who would otherwise have trouble being approved for a mortgage.  You can qualify for a loan if you have less than perfect credit.  FHA loans are available even after bankruptcy and foreclosure, if you have maintained good credit for the following two to three years.

What are the requirements for FHA loans?
FHA loans have strict home appraisal guidelines.  The appraisal value helps determine the FHA mortgage limit.  Each state has its own rules regarding maximum loan limits.

What are the advantages to FHA loans?
One advantage of an FHA loan is…

1756 Views, 0 Comments

Read Full Post

If the thought of buying a Santa Cruz  home in 2011 has even so much as flitted through your mind, here are six New Year’s Resolutions you should consider making:

1. Review your credit reports.  To determine the interest rate and terms of your mortgage, lenders pull credit scores from each of the three credit reporting bureaus:  Equifax, Experian and Trans-Union.  You need to go through all three credit reports and dispute any credit report errors.

2. Establish a good credit rating.  To take advantage of today's low interest rates, your credit score needs to be above 760. The higher, the better.  To improve your credit rating, fix all errors in your credit reports and practice good credit behavior by paying your bills on time and in full each month.

…

1673 Views, 0 Comments

Read Full Post