If mortgage companies plan to remain relevant in today’s tech-savvy world, they must take a close look at what technology has to offer. Consider this – in 2018, close to 45% of prospective homebuyers began their search for homes online. In addition, around 11% used the internet to learn about the home buying process before getting in touch with a loan officer or a real estate professional.

 

Several mortgage companies in the United States are adapting to evolving technologies. This, in part, is because of new regulations, and also because mortgage customers are now looking for quicker and paperless processes. Besides, the fact that customers are looking for a better digital experience when purchasing a home or getting a mortgage is hard to ignore.

 

Mortgage companies that have woken up to the digital revolution are not just offering great user experiences through their websites, they are also simplifying how people may apply for mortgages. In addition, several FinTech players have entered the field to provide relevant solutions for banks and other financial institutions that offer mortgages. With online mortgages finding traction, the typical back-and-forth movement along with considerable paperwork is now making way for online applications, e-signatures, and document uploads.

 

What Are Mortgage Companies Doing to Market Their Products?

An average homebuyer, even with access to the internet, typically spends more than two months to find a home. This gives mortgage companies enough opportunities to market their mortgages using different online tools.

 

Mortgage companies that have embraced technology are working in curating content that helps position themselves as solution providers. For instance, probable applicants are often found looking for information such as the differences between mortgages on offer, how to save money for a down payment, and what differentiates pre-qualification from pre-approval.

 

Blogs are now commonly seen to be part of websites of various mortgage companies. This is because blogs give businesses easy means to provide tailored content for specific demographics, without cluttering a website. Creating short informative videos is a tactic that some mortgage companies have already put to good use. The process also involves effectively promoting videos on different social networking platforms such as Twitter, Facebook, and Instagram.

 

Another aspect that shows how mortgage companies are coming of the digital age is the increased use of organic and inorganic search strategies. Well designed landing pages that include clear calls to action (CTAs) encourage probable borrowers to provide their contact information so they may get more details. Search engine optimization (SEO) is quickly becoming part of the parcel, where content-driven landing pages make use of keywords related to specific mortgage-related queries. Mortgage companies have also started taking cues by understanding the habits of specific consumer groups, and they optimize their strategies accordingly.

 

Mortgage providers that are yet to make the most of what technology has to offer need to start by reviewing their existing websites. They need to identify which areas borrowers find useful. They need to diversify content and ensure that it remains relevant to the questions and requirements of different generations of homebuyers.

 

The Importance of Creating a Good UI and UX

User interface (UI) includes various elements that go into creating a website or an application. These include menus, buttons, blocks, and controls. From a borrower’s perspective, UI essentially refers to the steps or commands that one needs to follow to interact with a digital offering. Mortgage companies are now relying on this aspect to create their brand identity, and are using the latest in design principles to try and keep prospective clients from leaving their websites.

 

User experience (UX), on the other hand, is about how borrowers feel when they interact with digital products. While web design plays a significant role in creating a good UX, environmental factors, as well as individual preferences, may also affect the outcome. Aspects that mortgage companies need to address in creating good UX include design, utility, performance, accessibility, and usability.

 

Statistics surrounding the importance of creating good UI and UX clearly show why mortgage companies need to pay attention to these aspects.

• Around 38% of all users do not engage with websites that have unattractive content or layout
• More than 35% of users choose to leave websites because of poor design or navigation
• Slow loading images result in around 40% of users leaving websites
• Over 30% of users leave websites that make use of auto-loading audios or videos
• More than three-fourths of all advertising agencies state that focusing on creating better UX would benefit their customers

 

Given that an increasing number of prospective borrowers now use their mobile devices to look for suitable alternatives, mortgage companies must create responsive websites. Such websites not only work well with just about any kind of device, but they also find favor with search engines such as Google and Bing.

 

 

Providing a Personalized Experience

Millennials have grown up with the internet at their fingertips. They have access to music and video streaming services that take little time to identify their preferences, and then provide content in accordance. After all, it is not uncommon for apps to create curated playlists based on browsing history. When people provide information about themselves to online businesses, what they expect in return is products and services customized to meet their preferences. Besides, they look for complete information about what they’re interested in online.

 

Most people will look for mortgages no more than a few times during their entire lives. While many borrowers try to learn as much about mortgages as they can online, it is also common for them to turn to lenders to get a better understanding of where they stand and what they might expect. As a result, the onus to provide mortgages that are ideal for borrowers depending on their circumstances falls on mortgage companies.

 

Borrowers should have easy means to compare the impact of trading points, be it through paying less monthly and more upfront, or the other way around. Through online tools, mortgage companies can make way for complete transparency by giving borrowers the ability to take a close look at estimated fees, and how their monthly payments may differ depending on variables such as loan amount, term, interest rate, down payment, and creditworthiness.

 

Giving Borrowers Increased Control

Prospective homebuyers remain wary of mistakes they might make at some point during the home buying process. When it comes to getting mortgages, it is not uncommon for borrowers to want some kind of control. They look for products that are customized to meet their specific needs even during the application and approval process.

 

Mortgage providers that are keeping up with technological advances take into account that the application process needs to be interactive and intuitive. For instance, the process should be able to differentiate the needs of a first-time homebuyer from the requirements of someone looking to refinance an existing loan. Besides, borrowers can now navigate through specially designed apps provided by mortgage companies on their own, with built-in tips guiding them on their way.

 

After borrowers narrow down on mortgages that suit their needs, they like to be kept in the loop at every stage right until closing. As a result, mortgage providers now give borrowers the ability to check the status of their applications at any time and from anywhere, provided they have access to internet-enabled devices. Apps also make way for feedback and interactions. Mortgage companies, on their part, use their online platforms to deliver qualification decisions as quickly as possible.

 

 

Making the Overall Process More Effective

People who are accustomed to the online world have realized that the cost of several services involving middlemen has reduced because of technological changes. Data suggests that the average cost of originating a loan has increased significantly over the last decade, mainly because of increased investor and regulatory requirements. Increased reliance on manual processes, with double and triple checks to avoid errors, has contributed to making the processing time consuming as well as costly.

 

With technology at the forefront, several mortgage companies have created digital platforms to automate large parts of the process. While this adds to cost-effectiveness from the loan provider’s point of view, increasing operational efficiency results in quicker, more accurate, and cheaper loan processing for borrowers. Data models employed by some mortgage companies no longer rely just on aggregate numbers, they also collect and analyze metadata that plays a role in the decision-making process.

 

Where Does the Appraiser Stand?

When industries transform, there is often a question mark surrounding the future of different roles. With the mortgage industry going the digital way, this happens to be the case with appraisers. However, while their numbers have dwindled in the recent past, their relevance stands. Even as digital mortgages gain traction, mortgage providers still need appraisers to look closely when enough data is not available, as well as in cases of complicated home-buying deals.

 

The strategy, moving forward, requires integration with the digital process. Besides, the changes that state regulatory boards have started to implement following their introduction by the Appraiser Qualifications Board of the Appraisal Foundation in 2018 aim to simplify entry into this field.

 

 

Meadowbrook at the Forefront

Understanding fully well that a significant number of people now use their mobile devices to get through the mortgage process, Meadowbrook decided to launch its app. Prospective borrowers may use this app with devices that run either on iOS or Android. Through the app, Meadowbrook aims to simplify the mortgage experience.

 

Users get quick and flexible solutions when applying for mortgages. They may use the app to upload their documents, check the status of their applications, or even get in touch with a Meadowbrook representative. The app comes with various features, which include, but are not limited to:

• Mortgage calculators. Borrowers get access to mortgage calculators that they may use to determine if their desired mortgage amount suits their budgets. Alternatives they get to choose from including a purchase calculator, a refinance calculator, and an affordability calculator. They get to enter different variables and then get a detailed breakup of costs. The option to save their calculations exists, so they may refer to them again when comparing their alternatives. If the numbers they see for the house they wish to purchase are up to their liking, they may begin their application process from the same screen.
• Pre-approvals. Once you submit your application, you do not have to wait indefinitely to receive pre-approval. The loan officer gets to view your application through the app, and a pre-approval letter is sent online almost as soon as your application is reviewed.
• Constant communication with your loan officer. If you wish to send a quick message to your loan officer, doing so through the app is easy. Your loan officer can also use the app to get in touch with you. Once you send a message, a notification appears on the recipient’s phone.
• Milestones to keep track of the process. Borrowers get to keep track of the loan process by using the app rather easily. The app also lets you view milestones surrounding your mortgage, giving you a clear indication of where it stands and what you may expect going forward.

 

Conclusion

Technology has played a significant role in how people shop, travel, and bank, and advancements in the field of mortgages are more than welcome. The number of prospective homebuyers who use the internet to look for mortgages and get quotes continues to rise, as do instances of people submitting online applications.

 

Given that not all mortgage companies have jumped on the technology bandwagon yet, there is still some time for the market to become completely digitalized. However, the fact that several mortgage providers continue rolling out various digital innovations does make way for a promising future. It is not out of place to suggest that most existing consumer demands will be met shortly, only to result in even more changes.

Homebuyers in the United States typically need to pay around 10% to 20% of a home’s selling price as a down payment. This requirement serves as a safeguard for lenders, while also indicating to them that you are financially responsible. However, the down payment is often looked upon as a big obstacle to the path toward homeownership. Even in modestly priced neighborhoods, the down payment can amount to thousands of dollars.

 

Fortunately, there are different types of mortgage programs that require little to no down payment. Zero and low down payment home loans are made available to individuals who meet specific eligibility criteria, which include having good creditworthiness. So, what options might you have?

 

USDA Loans

The United States Department of Agriculture (USDA) is responsible for issuing USDA loans through its Rural Development Guaranteed Housing Loan Program. You may think about applying for this zero down payment loan if you are an eligible rural or suburban home buyer. USDA loans come in three forms:

• Loan guarantees. In this scenario, USDA guarantees mortgages issued by participating local lenders. However, if you choose to pay little or nothing toward the down payment, you will need to get mortgage insurance.
• Direct loans. The USDA issues these loans for individuals who fall under the low and very low-income brackets. Where you live might have a bearing on income thresholds. With the right types of subsidies in place, you may look forward to an interest rate as low as 1%.
• Home improvement loans/grants. While not quite a solution for homebuyers, these loans and grants work well for existing homeowners. These loans or monetary grants give homeowners the ability to upgrade or repair their homes. By combining a grant and a loan, you may get the assistance of up to $27,500.

 

One of the benefits of getting a USDA home loan without a down payment is the lower insurance premium when compared to other types of loans. In addition, if you take a look at the USDA eligibility map based on the type of property you wish to purchase, you will notice that most areas outside of the country’s major cities also qualify as rural areas.

 

There is no minimum credit score requirement for a USDA loan. However, you become ineligible if you have existing delinquency of a nontax federal debt. Applicants without adequate credit history may consider applying because other factors are then taken into account. If your credit score is lower than 640, your application goes through a more stringent underwriting process.

 

How much you may borrow through a USDA loan depends on the location of your desired home, and limits vary from one county to the next. Limits in most countries range between $120,000 and $250,000, although they can go up to around $570,000.

 

 

VA Loans

The U.S. Department of Veteran Affairs is responsible for providing VA loans. People who may qualify include existing service members, veterans, as well as eligible surviving spouses. These home loans without down payment also take away the worry of making monthly mortgage insurance payments. However, you need to pay a funding fee that may vary depending on your military category and the type of loan you get. The offerings include:

• Purchase Loans and Cash-Out Refinance. You may apply for a purchase loan to buy a house. If you wish to borrow against the equity you have built in your existing home, you may go the cash-out refinancing way.
• Native American Direct Loan (NADL) Program. Meant specifically for eligible Native American Veterans, this program lets applicants purchase, construct, or improve their existing homes on Federal Trust Land. Applicants may even make use of this program to further reduce interest rates on VA loans.
• Interest Rate Reduction Refinance Loan (IRRRL). The IRRRL is also referred to as the Streamline Refinance Loan. It gives existing VA loan holders the ability to get lower interest rates.
• Adapted Housing Grants. These grants are meant for veterans who suffer from a permanent and total service-connected disability. Applicants may use the funds to build or buy adapted homes or to modify existing homes to make them more suitable for living.

 

While the VA loan program does not have a minimum credit score requirement, it is not unusual for lenders who accept a minimum down payment for home loans to have their own requirements. Most lenders look for credit scores in between 620 and 640, although there are some that accept lower scores. You will also need a valid Certificate of Eligibility (CoE).

 

There is no maximum limit surrounding how much you may borrow through a VA loan. However, there is a limit on the amount that the VA guarantees. For a single-unit property, this limit currently stands at $484,350 in most states across the country. If you are looking at buying a home in a high-cost market, the limit extends up to $726,525.

 

 

FHA Loans

If minimum down payment for home loans is your main criteria in looking for a mortgage, you might benefit by taking a look at what the Federal Housing Administration (FHA) has to offer. FHA was founded in 1934, with the aim of reducing requirements to get a home loan and encouraging homeownership. FHA loans are issued by FHA-approved lenders, and they are insured by FHA.

 

While you cannot get a home loan without down payment through FHA, you might qualify to make a 3.5% or 10% down payment. What makes FHA loans particularly popular is that they offer increased flexibility through the eligibility criteria.

 

Since FHA works as a guarantor on your loan, you need to make mortgage insurance premium payments. This is because if you end up defaulting on the loan, FHA is responsible for repaying the lender the amount you owe toward the mortgage. How long you need to keep paying mortgage insurance premium depends on the loan-to-value ratio as well as the loan term.

 

Conventional 97 Loans

Fannie Mae provides these loans for first time home buyers who wish to purchase primary residences. You need to pay at least 3% as a down payment. Private mortgage insurance remains in place until you acquire at least 20% equity in your home. Most lenders who provide these loans require credit scores of 680 and above.

 

HomeReady Loans

Fannie Mae provides these loans for low and moderate-income earners who wish to purchase primary residences as well as for those who want to refinance existing primary residence mortgages. These loans require 5% down payment. Until you get 20% equity in your house, you keep making payments toward private mortgage insurance. A credit score of 680 or above is typically required.

 

Home Possible Advantage Loans

Freddie Mac provides these purchase and refinances loans to applicants who do not own any other property, although it makes a few exceptions. You need to pay at least 5% as down payment, and private mortgage insurance is part of the parcel. Your credit score needs to be 660 or above.

 

 

Is a Zero or Low Down Payment Home Loan Right for You?

You might benefit by getting a home loan with a low or no down payment if you want to buy a house quickly, but do not have money to put toward the down payment. Given the existing market scenario and mortgage interest rates, this might be as good a time as any to consider going the homeownership way. Some people also get home loans with a low or no down payment so they may continue to have more cash on hand to take care of other expenses or to make investments.

 

 

Can You Go Wrong With a Zero Down Payment Home Loan?

The idea of paying zero or minimum down payment for home loans comes with its share of drawbacks. Even if you get a competitive interest rate, you will, in all likelihood, end up making a higher monthly repayment. Other drawbacks might include:

• Higher mortgage insurance. More often than not, home loans without down payment require that you make ongoing payments toward mortgage insurance. Besides, the lesser you pay as down payment, the more you pay toward mortgage insurance.
• Some home loans without down payment attract funding fees, which can be a tidy sum. Even if the fee is incorporated into the loan, the buyer is still responsible for paying it at some point.
• Financial risk. When you get a zero down payment home loan, you start by having absolutely no equity in the house you purchase. In such a scenario, if the market experiences a downturn, your exposure to financial risk might be significant. This is especially the case if you need to sell the house, and end up getting less than what you paid. Even if you do not sell the house, you still end up owing more toward your mortgage than the actual worth of the house.

 

Conclusion

Several homebuyers look at paying zero or minimum down payment for home loans. Depending on factors such as your income, creditworthiness, and what you do for a living, you might qualify for a home loan without down payment or one that requires you to pay 3% to 10% as a down payment. However, the type of loan you get notwithstanding, it is important that determine if you can afford to make mortgage payments and keep up with other homeownership costs. Once you get that out of the way, all you need to do is contact a reliable lender.

Buying a home is probably the biggest investment you will make. As a result, it is crucial that you know what you’re getting into at the very onset. You don’t want to overlook an important aspect that you may regret later. Fortunately, you can avoid commonly made home buying mistakes if you follow some basic guidelines before and during the process. So, what are the common home buying mistakes to avoid?

 

Not Contacting a Lender Early Enough

It is important that you contact a lender soon after you decide you wish to go the homeownership way. This gives you insight into the types of loans on offer, the down payment you need to pay, interest rates, loan terms, and whether or not you might require private mortgage insurance (PMI). Consider getting pre-approved as this gives you an indication of how much you can afford. It also serves as an indicator that you are serious about making a purchase.

 

Buying While Still in Debt

If you go through first-time home buyer tips, you will notice that thinking about buying a home when you have considerable debt is not the way to go. Think about it this way – would you want to run a marathon with ankle weights slowing you down? Debt has a way of eating into your monthly budget, and it might even cause problems when it comes to keeping up with regular monthly repayments toward your mortgage. If you’re in debt, reduce it, build your savings, and then think about buying a home.

 

Using Credit Carelessly

It is common for lenders to check borrowers’ credit reports at the time of preapproval, and then again at the time of closing. A mortgage provider does this to ensure that there is no change in an applicant’s financial position during this period. Once you apply for a loan, make sure you don’t apply for other new forms of credit until the closing. Refrain from making big-ticket purchases on credit as well. This is because any significant change in your debt-to-income ratio can get an underwriter to reject your application or provide revised terms that are less than favorable.

 

What you should try to do is get your existing outstanding balances to below 30% of your available credit limit, while paying all your bills in full and on time every month.

 

Thinking You Need a Down Payment of At Least 20%

Several first-time home buyers think that they need to pay at least 20% of a home’s selling cost as a down payment. This is not true. However, if you pay 20% or more as down payment, you do not have to worry about getting PMI. The flipside is that it might take you several years to save the required 20%, and you might also limit your cash flow during the period.

 

Depending on the type of loan you get, you can pay as little as 3% down payment for a conventional loan. With some government-insured loans, you can pay even lesser.

 

 

Not Considering Government-Insured Loans

Not taking a look at what different government-insured loans have to offer is among the top home buying mistakes you should avoid. The ones that require your attention include the United States Department of Agriculture (USDA) loans, Federal Housing Administration (FHA) loans, and U.S. Department of Veterans Affairs (VA) loans.

• USDA loans are available for rural homebuyers, suburban homebuyers, as well as buyers looking for homes in towns where populations are below 25,000. These loans are designed for low-to-moderate income earners.
• FHA loans are ideal for borrowers with less-than-perfect creditworthiness. However, they come with mandatory mortgage insurance.
• VA loans are designed for veteran and active-duty military service personnel and their spouses. Veterans have the option of not paying any down payment.

 

Rushing the Process

Getting a mortgage to buy a home can be a complicated process. One of the most important things to avoid when buying a house is to rush through the process of getting a loan. If you rush through things, you get little time to save money for the down payment, and you will probably miss fixing errors on your credit report. Bear in mind that it may take months or even years to repair poor credit. As a result, map out a suitable home buying timeline well in advance.

 

Not Considering Other Costs

Not factoring in costs other than the home’s selling price makes it to the list of home buying mistakes to avoid, and not without reason. There is no dearth of first-time homebuyers who focus on making the down payment and forget to account for closing costs. Typically, closing costs hover between 2% to 4% of a home’s selling price.

 

You need to take the cost of homeownership into account as well. In addition to making repayments toward your mortgage, you will also need to pay property taxes and any applicable home insurance premiums. Ongoing repair and maintenance costs require your attention as well, failing which you might find yourself overshooting your monthly budget. You should ideally aim to set aside around 1% to 3% of the home’s buying price each year for repairs and maintenance.

 

Buying a House Outside Your Budget

It is not uncommon for people to fall in love with homes and buy them even if it requires them to stretch their pockets. This is one of the things to avoid when buying a house, even if you qualify for a mortgage. This is because the mortgage payments, homeowners insurance, and property taxes might add a severe burden on your finances. While the added cost might not seem like much initially, it might turn out to be problematic in the long run.

 

Not Saving Enough

Not saving enough money before you buy a home makes it to the list of home buying mistakes to avoid for different reasons. For starters, while saving money for the down payment is important, you also need to consider ongoing repair and maintenance costs. In addition, spending all or a major portion of your savings toward the down payment is definitely not suggested. While paying 20% or more toward down payment does away with the need for PMI and helps reduce monthly costs, you should have some savings in place to account for unexpected expenses. You should ideally aim to keep an emergency fund with at least six months of living expenses.

 

Not Giving the Neighborhood Enough Attention

Another home buying mistake you should avoid is to give more priority to a house than its neighborhood. Consider this – you find a house that suits all your requirements perfectly, but once you move in you find out that you don’t quite like the neighborhood. Narrowing down on the right suburb or town can make a significant difference when it comes to the lifestyle you lead as well as family development.

 

The neighborhood you select should ideally not be a mismatch with the culture and values you follow. Once you find the right neighborhood, you can always consider buying a house that you can tailor to your needs. Aspects that typically need your attention include school ratings and crime rate as well as access to public transportation and healthcare.

 

Not Carrying Out an Inspection

It is crucial that you have a good idea about what shape a house is in before the closing of a sale. This is because you don’t want to end up with a house that requires unexpected repairs, especially when they burn a hole in your pocket. While inspecting a home on your own gives you a basic indication of its condition, you might be better off using the services of a professional home inspector. This is because they know just what to look for and where, and can end up saving you heartache and money in the long run.

 

Paying Too Much Attention to Aesthetics

It is only natural to want to buy a house that appeals to you visually. However, some cosmetic changes, such as replacing old wallpaper, may well be worth the cost. Not buying a home simply because you don’t like its paint job, landscaping, or carpeting is a rookie mistake you should avoid. If you look for a home with the approach of not minding making a few cosmetic changes, the possibility of landing a good deal increases.

 

Physical appearances can take a backseat if you are getting a house that fits your budget and meets your other requirements such as size and location. Remember that owning a home is usually a long-term proposition, and you can always think about making changes further down the road. Some of the other aspects you need to focus on include the home’s floor plan, it’s roofing, its foundation, as well as its plumbing and electrical systems.

 

Remember that fixing a house on your own or hiring a contractor to do the job is typically more cost effective than buying a house that has recently been fixed by its existing owner. Besides, you can then do up the house according to your own liking.

 

Not Getting a Homebuyer Rebate

One of the most common first-time homebuyer tips that pass the attention of people is to get homebuyer rebates or commission rebates. The rebate can be up to one percent of a home’s selling price. It is deducted from the buyer’s agent’s commission. First-time home buyers can benefit by getting this rebate in most states in the U.S. If you plan to buy a house in a state that allows homebuyer rebates, find out if your agent will offer the rebate before closing. The states that prohibit homebuyer rebates include:

• Alaska
• Alabama
• Iowa
• Kansas
• Louisiana
• Mississippi
• Missouri
• Oklahoma
• Oregon
• Tennessee

 

 

Buying Without a Real Estate Agent

Given the widespread use of the internet and easy access to real estate listings, some prospective buyers feel that can get through the process of purchasing a house on their own. However, using the services of a professional real estate agent might be in your best interest. According to data released by the National Association of Realtors, 87% of buyers bought their homes through real estate agents or brokers in 2018.

 

Typically, the seller pays the buyer’s agent’s commission, so this is an aspect you don’t have to worry about.  In addition, a real estate agent can:

• Help you determine what types of homes you can expect to find within your budget
• Give you access to a wide range of homes in your desired neighborhood based on your requirements
• Give you an edge over other prospective buyers who are without buyers’ agents
• Provide valuable assistance at the negotiating table

 

Not Getting All the Details on Paper

Not getting all the details surrounding a purchase in writing makes it to the list of buying mistakes to avoid for good reason. There have been instances of homebuyers assuming that the kitchen appliances they see during their inspections are part of the deal, only to find kitchens bereft of any equipment after the deal is done.

 

Expect a home’s previous owner to take all that can be detached away once you buy the house. This can include hot tubs, bath fixtures, light fixtures, washers, dryers, ceiling fans, and other home appliances. Make sure you go through the contract in great detail before the closing. It any of the items you think come with the house are missing, get them added before signing on the dotted line.

 

Conclusion

Buying a home might seem like a daunting task, although carrying out a little groundwork ensures that you minimize the possibility of getting a bad deal. The best place to start is to contact a lender and establish how much you can afford to borrow. Then, make a list of what you require from the new home and the locality, and look for homes accordingly. Do not hesitate to seek professional assistance because doing so makes the process considerably simpler.

The spring season, more often than not, sees the real estate market buzzing with more activity than usual. For sale signs displayed on posts become a fairly common sight, with buyers and real estate agents scouting local neighborhoods for possible leads. The market is typically filled with inventory, and buyers are found looking for great deals. Given the widespread use of the internet, this medium simplifies the entire process considerably.

 

When is Spring?

Spring does not come at the same time in all American states. For instance, while spring in New York and most of the United States extends from late March to the end of June, this is not the case in all parts of the country. In Minnesota, the spring home-buying season gets underway pretty much as soon as the snow starts to melt and might continue until May. In Sacramento, it’s usually January to May.

 

One of the main reasons behind people wanting to sell during the spring season is the vacation period of July to August that follows. Between the four months, April tends to find the most amount of home buying activity.

 

Tips to Buy a Home in Spring

If you plan to make an offer for a home during the spring season, it is important that you prepare yourself to make a quick decision. This is because the market is typically awash with competition at this time, and even a little indecisiveness can result in you losing out on the home you wish to buy. While conventional home buying tips apply even during the spring season, there are other aspects that require your attention too.

 

Review of Credit History and Consolidate Debt

You need to ensure that your finances are in order even before you start looking for a home. Emergency funds you keep to tide over unforeseeable circumstances should be kept aside and not included in your budget. Go through your credit report carefully and look for any possible errors. If you spot any, work on getting them corrected.

 

Think about consolidating your debt. With lower monthly payments, you end up improving your debt-to-income ratio. This is an important aspect lenders look at and it can help you get a better interest rate.

 

 

Select the Right Lender

If you wish to get a home loan, you get to choose from a plethora of options. These essentially come in the form of banks, credit unions, mortgage bankers/lenders, mortgage brokers, and hard-money lenders. To determine which one will work best for you, you need to pay attention to your individual circumstances and requirements. The basic aspects you need to address include interest rate, fees, flexibility in terms and conditions, as well as customer service.

 

Get Preapproved

Given the competition that you might face during the spring season in the form of other probable buyers, getting preapproval for a home loan gives sellers an indication that you are serious about making a purchase. The lender you select should ideally have adequate experience with home mortgages and should have different types of loans on offer.

 

If your monetary savings do not account for much, it is crucial that you start saving and minimize your expenses as much as possible. If you are expecting a raise, wait for it to happen before you seek pre-approval. This is because any extra spending power works in your favor, be it through a higher loan amount or better interest rates. What’s important is that you meet your lender early in the process.

 

Get Alerts

New properties hit the market regularly during the spring season. As a result, setting up email or text alerts based on the type of home you seek and your budget can work well for you. This way, you get notified of new listings as soon as they hit the market. The sooner you find out about a home that is up for sale, the sooner you can present your offer and close the deal. When sellers receive multiple offers, it is not uncommon for them to pay more attention to the ones they receive first.

 

Check Listing Websites

While setting up alerts is a good idea, it is also important that you check listing websites regularly. A significant number of homebuyers now turn online to carry out searches, which is why real estate listing websites find several takers. If you come by a listing that you find interesting, visit the property as soon as possible, and make a quick decision. If you like what you see, do not hesitate to make an offer immediately.

 

Don’t Focus on the Seller

When buying a home, try not to focus on what you feel about its owner, good or bad, or it may affect your ability to make a rational decision. You do, after all, wish to buy a home, and not forge a long-term relationship with its owner. Don’t let foreclosures and short sales deter you from buying a home. What you need to focus on, instead, is determining if the house you select meets your requirements.

 

 

Work With a Real Estate Agent

Do not rely on the internet too much. During the busy spring season, some properties find buyers even before they are listed online. As a result, consider using the services of a real estate agent. Work with someone who has experience and has worked in the locality in which you wish to purchase a home. This is because local knowledge often plays a key role.

 

Real estate agents can do more than just help you find a suitable home. They can provide information about local taxes as well as insurance costs. Since you might have to interact with your real estate agent for an extended duration, select someone you are comfortable with and one who has good communication skills. You also need to be able to voice out of concerns without feeling reluctant. Some questions you may ask when narrowing down on a suitable real estate agent include:

• What areas do you work in?
• How many homes have you bought/sold?
• Do you have a specific field of expertise?
• What type of buyers do you usually deal with?
• Do you have any offer strategies?
• How can I get in touch with you?

 

While you would want your real estate agent to be easily contactable, reliable, and friendly, he or she should also be tactful and assertive, especially when it comes to the negotiation table.

 

Offer More Than the Listing Price

It is not uncommon for buyers to offer more than the listing price during the spring home buying season. However, this approach does not work for everyone, especially when people hope to buy homes toward the upper end of their budgets. In such a scenario, you may consider looking for homes that are a little below your price range, so your offer may be slightly above the listing price.

 

If nothing else, prepare yourself to pay at least the list price. Some buyers pay more attention to how much the asking price of the home is instead of its actual worth. This is where your real estate agent can help, by providing details of comparable sales that give you means to arrive at a home’s actual value. Simply comparing values of asking prices is not the way to go, because sellers may ask for any amount they feel is right. Besides, if you find a home you like that is priced within your budget, paying a couple of thousand dollars more will not make a significant dent in the overall scheme of things.

 

Exceed the 20% Down Payment Requirement

When you are willing to put 20% or more as a down payment, it sends a clear message to sellers that you are serious about buying a home. Setting aside extra money for the down payment not only shows sellers that you have your finances in order, doing so also reduces your loan burden. People who are willing to make a significant down payment tend to have preapproval in place, which gives them a further edge. This is why older people who have more cash or equity stand a better chance when compared to younger people who have trouble putting up 20% or more as a down payment.

 

Offer the Seller Something Unique

Given that the spring season sees several homebuyers competing against each other, it pays to give the seller a unique proposition. The purchase offer comes with various terms and conditions. Use it to your advantage by giving the seller a benefit that has no adverse effect on your situation. Negotiations, after all, are not just about money. This is another aspect where you can turn to your real estate agent for guidance. You could, for instance, give the seller a few extra days to move out.

 

Are You New in Town?

If you have recently moved to a new city, town, or neighborhood, you might want to start doing some basic groundwork before the spring season begins. Talk to the people you meet in the neighborhood where you plan to purchase a home. Drive through the locality at different times of the day, and if possible, at different times during the week. Check if the area fits your needs when it comes to schools, hospitals, and public transport.

 

Visit multiple real estate agents to narrow down on someone who makes you feel comfortable. Do the same when it comes to looking for a reliable lender. If you are a first-time homebuyer, it is all right to be a little apprehensive about the process. What helps is that you trust your instincts. Since you tend to have more competition during the spring, do not take too long to make an offer on a property you like.

 

 

Is There a Better Time Than Spring Season?

During the spring season, Easter Sunday can work well for you. This is because not as many people are out looking at homes or making offers on this day. If you find a home that you like on Easter, consider writing an offer on the same day, because come Monday, there may well be more competition. However, this approach might not have the desired effect in non-Christian neighborhoods. Easter typically falls in between the last week of March and the last week of April. It is celebrated on the first Sunday that follows the ecclesiastical moon after the vernal equinox.

 

Outside of the spring season, buying a home on Christmas Day might work in your favor. This is because there are noticeably low numbers of buyers in the market in December, and Christmas tends to witness a virtual lull. The best way is to carry out your research a few days or weeks in advance, so you get to position yourself well. Considering buying a home during the holiday season may work well for you because of multiple reasons:

• Sellers are typically in good moods because of the festivities.
• Sellers might be inclined to be more generous in their negotiation because it’s the season to give.
• Competition tends to remain particularly low.
• Prices are usually lower than at other times of the year.
• People who wish to sell their homes around Christmas are serious about selling, giving you an advantage when it comes to negotiations.

 

What’s important in such a scenario is to find a real estate agent who is willing to work on Christmas and the days before. The agent should also be persuasive enough to get the seller to spare the much needed time on Christmas.

 

Conclusion

Buying a home during the spring season may seem like a daunting task, mainly because of the competition that buyers have to face. Fortunately, following a few simple steps and paying attention to some important aspects can simplify the process considerably. Make sure you have your finances in order ahead of time, work with a reliable and trustworthy lender, and select a real estate agent who makes you feel at ease. The rest should then just fall in place.

Before you think about how to use tax refund wisely, consider what’s at stake. Data released by the Internal Revenue Service (IRS) shows that it received more than 135 million returns in 2017. It ended up processing more than 128 million of these returns. The total amount refunded stood at over $268 billion, and the individual average refund was $2,932.

What you do with your tax refund is your prerogative, no doubt. However, among the best uses for tax refunds is to use the money to fulfill your dream of becoming a homeowner or paying your mortgage off ahead of time.

Buy a New House

While the housing crisis of 2006-2009 left a telling effect and resulted in a significant dip in mortgage originations, the last couple of years have shown signs of revival. For instance, while $1.4 trillion worth of new mortgages were issued in 2008, the number crossed the $2 trillion mark in 2016 – for the first time since the recession. One of the smart ways to spend your tax refund, as a result, is to use it for buying a new home.

If you have thought about buying a new home, your tax refund may give you an easy way to get the ball rolling. What also helps is that you no longer need to pay a steep deposit to get your first home loan. The median American home buyer puts down 5% of the property’s price as a down payment. Until a around decade ago, you would have to put down at least 20%.

Consider this – you wish to purchase a home that costs $100,000 and you need to pay 5% as down payment. That amounts to $5,000. You may, of course, pay a higher down payment if you can afford it as it will help lower your interest rate, or you could put as little as 3% down if you qualify for a Fannie Mae Home Ready loan.

Reduce Your Mortgage’s Existing Principal Payment

If you have an existing mortgage and are wondering how to use your tax refund wisely, consider using the money to bring down the principal amount that you owe. When you make extra payments toward the principal amount, you work in getting rid of your debt faster. Even if you make as little as one additional payment toward the principal each year, you can reduce the loan term by five to seven years!

In addition, the quicker you build equity in your home, the sooner you may be able to stop paying for private mortgage insurance. What you need to consider, though, is if there are any prepayment penalties you might need to pay.

Refinance Your Mortgage

Home loan interest rates in the United Stated hovered between 3.9% and 4% from August 2017 to January 2018. Since then, there has been a steady increase in interest rates and experts predict that the trend will continue through till 2022. This, as a result, may be a good time to refinance your existing mortgage and take advantage of lower interest rates. Refinancing a home loan can be beneficial if you are troubled with high monthly repayments. If you choose to go the cash out refinancing way, you may even borrow against the equity you have built.

Remember that while the best uses for tax refunds may vary from one person to the next, using the money to achieve financial stability is always a good idea. If you are still not sure about how to use your tax refund wisely, do not hesitate to seek professional assistance.

Please note that the above article is general in nature and for informational purposes only. It is not intended to be relied upon or interpreted as a legal opinion or advice. Kindly consult your tax advisor or attorney for more information.

Softball, cocktails, potato sack races and…Margaritaville?!

That was the recipe for Meadowbrook Financials’ first annual company picnic in Eisenhower Park. If you know Meadowbrook, you know no stone is left unturned when it comes to creating memorable company events and gatherings. Whether it’s a company get together inside of the office or out, you can guarantee you’ll leave with a full belly and a story to tell.  

This year the company decided to do something different for its annual Summer Kickoff.

A team of dedicated employees helped turn Eisenhower Park into a Margaritaville-inspired wonderland. From the balloons and blow-up palm trees to the bar and mini-umbrellaed cocktails, it definitely felt like 5’o clock somewhere. (okay, almost)

Country music, cornhole games, and cold margaritas set the tone for an afternoon under the shade of the trees.

It also helped that the weather was beautiful!

After loading up on the usual picnic snacks of various chips and dips, the very athletic, competitive (and brave) Meadowbrook employees took to the field in their company t-shirts to show their softball skills and fight for victory. This was no light game of softball, either. There were home runs, wipeouts, and lots of dirt-covered players.

Don’t forget the not-so-brave employees that chose to serve as cheerleaders on the sidelines either. (We’re important, too!) Because with every wipeout, we provided laughter. With every home run, our hands went up. And each time a co-worker stepped up to the plate…we shouted their name embarrassingly loud and proud!

A well-earned victory and huge congratulations goes out to the Black team for holding the first official Meadowbrook Financial softball game-winning title!

The softball game itself seemed to be a fan favorite amongst all employees because it gave everyone the opportunity to bond over an activity that we normally would not have experienced together…and provided laughter for hours.

At any Meadowbrook party, food seems to be the talking point…with an array of salads and heroes for lunch, plates were filled and it suddenly became much more silent as everyone devoured what was in front of them.

We also had a very special visit from the Kannoli Kings in Massapequa. If you’re a cannoli lover, this place is for you. With an assortment of flavors ranging from Reese’s peanut butter to birthday cake and pumpkin pie, your sweet tooth will be satisfied. We went with the dessert flavors but were shocked to find out they also make savory cannoli’s?!? (spinach dip, truffle mac n’ cheese and BBQ chicken to name a few!)

As Meadowbrook’s picnic came to an end, it felt more like an elementary school field day once the potato sacks came out. Several employees joined in and hopped their way to the finish line…maybe even a little too high that they crash landed on the ground.

All in all, Meadowbrook Financial’s first company picnic was an ultimate success and fun was had by all. Special thanks to the owner, Danny Nicolo for making it all possible. His generosity knows no limits. You may even see him joining in on the potato sack races and softball game if you watch the video below!