Qualifying for a Mortgage When Self Employed

If you’re self employed, it can be a challenge qualifying for a mortgage loan. We’ve compile our 4 favorite resources for helping your prepare for the qualification process!

  1. This article from Forbes covers reviewing tax returns, debt-to-income ratios and more.
  2. Review the new rules for self-employed mortgage borrowers from The Mortgage Reports.
  3. Check out these tips and myths from FHA.com!

One of the most important items for self-employed individuals is the ability to demonstrate a regular income from your business. Be ready to show a profit-loss statement as well and keep solid records for everything related to your business & personal finances.

Located in Palm Beach County and need some more help? Give our team a call for more!

Getting a Mortgage Loan with Bad Credit

Do you have poor credit but want to purchase a home? A low credit score is generally anything worse than 600, but you may still have trouble obtaining a loan with scores under ~700. This is where FHA loans come into play for many.

Lenders are becoming more relaxed again with credit scores and you may be able to make up for a low credit score in other parts of the qualification process.

Here are some ways you can improve your chances of obtaining a loan with bad credit…

  1. Have an explanation for your low score if applicable. For example, if you have a single major event that caused a poor score, you may be able to convince a lender that the score isn’t necessarily representative of your overall credit history.
  2. Be able to show a steady income over a long period of time.
  3. Save for a bigger down payment! If you can put 20% or more down, you’ll dramatically increase your chances.

For more information, check out this resource from BankRate.com –> http://www.bankrate.com/finance/credit/low-credit-score-borrowers-get-mortgage.aspx

Qualifying for a Mortgage Loan – 3 Tips

If you’re interested in buying a home (especially for the first time), chances are you aren’t going to be paying the full price in cash. That means you’ll need a mortgage.

Before you start the home buying process, there are a few things you can and should be doing to maximize the chances you’ll qualify for a mortgage loan.

Here are 3 tips to get you started…

  1. Monitor and improve your credit score. A good credit score is important when it comes to home loans, so be sure you’re monitoring your score, clearing up any issues and staying up on payments for your current loans!
  2. Be able to show a steady income. It’s important to obtain regular and consistent paychecks to qualify for a home loan. This shows lenders that you have a reliable source of income and that there is a high probability that you’ll be able to make the proper payments on schedule.
  3. Improve your Debt to Income ratio. “The borrower writes down all monthly payments that extend beyond 11 months into the future. These can be installment loans, car loans, credit card payments, etc. The resulting number in the first step should be multiplied by .35. Total monthly debt should not exceed the resulting number.” – source: http://www.mortgagecalculator.org/helpful-advice/mortgage-qualifications.php

 

Looking for more info? Visit our website and give us a call if you’re in the South Florida and check out other resources like this one from BankRate for more info on pre-qualification.

Mortgage Rates Down, Applications Up

According to the Mortgage Brokers Association, application rate volume jumped to 9.3% last week. The results were seasonally adjusted, including for the Memorial Day holiday.

It’s likely that this increase was due (in large part) to falling rates along with a natural make-up for a drop off seen the couple weeks prior.

Refinancing applications went down as well (7% seasonally adjusted) as more homeowners look to reap the benefits of the current market rates.

Given the high demand for housing, purchase applications should be higher, but a lack of affordable homes for sale is likely keeping volume low.

You can read more about this story at http://www.cnbc.com/2016/06/08/mortgage-applications-jump-as-rates-fall.html

 

Getting Your Financials “Squared Away” Before Applying for a Mortgage

Maybe apartment life has you yearning for a backyard and breathing room or you are a recent newlywed eager to fill a new home with the pitter pat of little feet or a single woman eager to expand her shoe closet. Whatever your reasons for considering an application for a mortgage, be prepared to dig deep into your financials and have delicate matters squared away before you even approach a lending institution.

Be Aware

Budgets will no longer be for the faint of heart. Decide how much you can reasonable spend on a mortgage. This means you cannot cut so much out of your life that is virtually unlivable in hopes of saving enough to buy or to maintain a mortgage. Cutting out vacations is one thing, but trying to live off soup to afford your dream home is unrealistic and setting yourself up for failure.  Researched your desired location and factor in how much you will actually spend living there as the real you as opposed to a saintly homeowner that will not turn on the air conditioning.

Save

The rule of thumb is that you should have twenty percent of the home’s value ready as a down payment. It is better to start off with equity rather than with debt to begin your new life as a homeowner.  There will be additional costs as well such as insurance, utility bills (especially in the summer months when the entire house must be cooled), and property taxes. Some homes will also have to add costs of homeowner association fees. Make sure that everything is realistically affordable for you. If you are not a saver, then homeownership may not be for you for a few more years.

Find a Reliable Source of Income

Sounds like common sense, but you must have a reliable source of income. This means that if you are in your first three years of a new business then you may want to wait another year or two. If you are freelancing and resisting an office job, then try to at least find part-time work. Lenders check to see that you have a liable source of income and this can make your monthly mortgage payments more desirable. When squaring your financials away, this should be your top priority.

Reduce Debt

Your personal credit score will play an enormous factor in acquiring a loan. Lenders will not be pleased to see enormous piles of debt or multiple unpaid credit cards. Pay off as many credit cards as possible. Lenders want proof that you are financially responsible. They will also take into consideration student loans and business loans as well. Do not take on any new debt ideally a year before applying for a mortgage. This is inevitably become a concern for both you and the bank. Keep in mind that your credit score does not have to be perfect, just in decent shape.

It may be a daunting task to delve into your financials, but with a reward such as a new house awaiting you, it is worth every minute spent in front of a calculator.

 

4th of July, 2015 Celebrations in Palm Beach

The 4th of July is the greatest American holiday. Traditionally there are barbeques, fireworks, and family time. Palm Beach has a vast array of options to celebrate the nation’s birthday. You can enjoy a cruise, visit large events, or stay closer to home with day time events.

On the Water

A real treat is to watch the fireworks on the water. You will not have to fight the crowds and can lay back for the full experience of the firework displays after dropping anchor. Do a bit of research and make your reservation for a catamaran or larger vessel. A popular fireworks cruise leaves from Singer Island. The price for adults is fifty dollars per person and twenty-five dollars for minor under the age of twelve. Space is limited so call 561-881-9757.

Enjoy Flagler

The best event in Pam Beach is free! Largely considered one of the biggest events in South Florida is also family friendly. Palm Beach’s waterfront becomes the best seat in the state to watch the fireworks. There are two stages of live entertainment and a display of Harley motorcycles. Call 561-822-1515 for further information.

Star Spangled Spectacular

If you are seeking an alternative to the celebrations on Flagler, then the Village of Royal Palm Beach may be for you. They offer tribute bands paying homage to Bon Jovi and Bruce Springsteen to put you in the festive mood with all your favorite songs. Kids will love the fun zone and find something to entertain them for hours. Adults have the option of picking up some new wares at the arts and crafts fair featuring local artists and many masterpieces waiting to be discovered. Indulge your competitive side with a kayak race, golf tournament, volleyball and cornhole tournaments in addition to a fishing tournament. A food truck invasion of over twenty mobile restaurants and festival food vendors will indulge your food cravings with all their delights. To make any inquiries, call 561-790-5140,

Wellington Aquatics Complex

From noon until 9:30 celebrate the 4th of July at the Wellington Aquatics Complex with two shifts of activities. The first shift is noon until five in the evening. This is a more child-friendly event for a nominal cost. It is only three dollars for children seventeen and under. Adults will be charged five dollars. Enjoy the day before all the fireworks begin with fun activities in the pool. The second shift of activities will begin at six and end until 9:30 (plenty of time to beat traffic). The location will be moved to Village Park, 11700 Pierson Road. For no charge, you will enjoy music, games and, of course, fireworks. Request more information by calling (561) 791-4770.

Reminders

As this is a holiday weekend, keep in mind that streets will be packed and traffic will most likely be bottle neck when entering popular locations. Avoid any issues by starting off early and consider leaving your chosen venue before elven at night. Most venues encourage bringing chairs and blankets, but not personal grills or personal coolers. Check ahead of time to see if shuttles are available and to make necessary reservations.

 

Updates on Mortgage Rates and Projected Trends in Florida

Understanding Mortgage Rates

Just like in New York City, Floridians love to analyze real estate. All things real estate are discussed from beaches to boats and everywhere in between. Before discussing the unique position Florida has not only as a desired location, but its place in the real estate market it might be wise just to have a bit more background on the matter. A mortgage rate is the rate of interest on a set mortgage. Lenders determine the rate, which can be either fixed or variable. A fixed rate remains steadfast for the term of the mortgage. In contrast, adjustable or variable rates are based on a benchmark interest rate. Mortgage rates and interest rates ride the same financial wave, which either can positively or negatively affect the homebuyers’ market. Your personal  credit score influences the rate on a mortgage, which ultimately determines the overall mortgage cost and the monthly billing. It goes without saying that you should seek the lowest rate possible.

The Uniqueness of Florida Real Estate

The reason why interest rates exist in the first place is because mortgage companies or lenders make money by collecting interest rates on your loan. Longer loans mean more profit. In Florida, it is more expensive to refinance than in any other states. Therefore, mortgage rates are lower in the Sunshine State. Floridians pay higher state taxes and higher title insurance rates. Our mortgages last longer than in other states, which come into play with interest rates. Florida is unique in that it has extra closing costs. These costs can put off potential residents; however, mortgage companies can still make money even with lower interest rates. It takes Floridians significantly longer to pay off their mortgages.

Projected Trends

Now that the ins and outs of mortgage rates have been laid out, the most applicable knowledge will be what this means for current and future homeowners. According to HSH.com, there is good news. As a trusted source in mortgages, they have been studying Florida’s market for over thirty years and have projected into May 2015. The good news is that there have not been any wild fluctuations, which marred 2008. That horrid year saw the markets crash and homeowners desperate to unload their homes. On the bright side, rates have seen very little fluctuation between May 2014 and May 2015. In fact, it has decreased slightly which is expected to drop a bit more over the continuation of the summer when most relocations occur and some residents simply move into their summer homes in Florida. While Florida has higher closing costs, it is still one of the most desired states to reside in as a whole. If you are seeking a renew residence or to refinance, now and the upcoming summer months would be the most ideal time to delve into the real estate market.