Even if all your ducks are in a row...

When you apply for your mortgage pre-approval, understand that it's just the beginning of the paperwork and the watching of your ongoing credit.

Once you find a home and write an accepted offer, that's when the mortgage approval process really gets in full swing. During the normal 3 - 4 weeks of having your credit, assets, debts and property appraisal reviewed, there will be times where your mortgage consultant will ask you for additional documentation.

You may be thinking to yourself or saying out loud, "Why didn't they ask for this earlier?" or "Why do they need this document?"

You need to understand that since the mortgage industry has turned 180 degrees on its head, many changes have been implemented and they continue to happen on a daily basis.

What an underwriter didn't need yesterday, they now need today. (An underwriter is the person who reviews your entire loan file and approves or denies it....not your loan officer.)

There are other outside forces like the government, Fannie Mae, Freddie Mac, private mortgage insurance
companies and others, who are causing all of these changes. What paperwork your mortgage consultant may not have needed at the beginning of your mortgage pre-approval, they now are asking for...all because of the changing of the guidelines. They are double-checking and triple-checking credit and everyone is C.Y.A. themselves.

It's outside the control of your mortgage consultant, so please don't give them a hard time. This is just the
way the market is right now and for the foreseeable future.

You could have an 800+ credit score, make a great income and have lots of money in the bank....and you'd still be going through all of the same hoops today, just like everyone else.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class - April 2nd!

Are you ready to find your dream home? Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Home Warranties Can Add Peace of Mind!

When purchasing a property, is it worth getting a 1-year home warranty plan?

I say "Definitely, YES"!

Prior to a few years ago, home warranties were available for purchase, but weren't always selected, because sellers wouldn't always offer them. Now, in the Cincinnati Area Board of Realtors purchase agreements, home warranties are included in the paperwork and negotiated into an offer with the buyer having the option to ask a seller to purchase one on their behalf or the buyer can purchase a policy themselves.

What's often covered in a home warranty plan?

• heating system
• air conditioning system
• plumbing system
• water heater
• electrical system
• kitchen appliances

It's important to read the policy to make sure you know exactly what's covered and what's not covered? Most plans don't cover roofing systems and basement foundations.

When I write up an offer for my clients, we ask the seller to purchase a policy for the buyer to have coverage for one year after the closing. Most of the time the seller will oblige. There are also times when a seller has already activated a home warranty policy on their property when it's first listed and they get seller coverage too.

There are several, national home warranty companies in the market. The cost for a 1-year warranty can range from $375 - $435. There is also a service call fee ranging from $55 - $100 for each time a company-approved contractor handles a claim.

It's important to review the home warranty plan's fine print, because you aren't getting a blank check for anything that breaks to be replaced. There are limitations on all policies - you're looking at repairs and replacements of covered items that break down due to normal wear and tear. The best thing you as a consumer can do is keep the mechanical systems in your property maintained and serviced, so that if a covered part does break down, it should be repaired or replaced.

I believe that for the most part, home warranty plans are effective and worth the investment. They can help protect you from unexpected repair expenses that can be very costly.

It's even becoming more common for homeowners to extend the policy beyond the first year, at the company's option. Some lenders even have partnerships with home warranty companies to offer them to homeowners for an ongoing monthly premium.

So when you make an offer on a property, make sure that a home warranty plan is written into your offer.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class - April 2nd!

Are you ready to find your dream home? Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Be Aware Of Constantly Changing Mortgage Rules!

Once you find a home that you want to call your own, the next important step is to make sure that your mortgage process is moving forward smoothly.

It's just as important for you as well as your mortgage consultant to stay on top of things during the mortgage underwriting process.

In this day of constant changes in the mortgage industry, no home loan is immune from possible delays. FHA, VA, Fannie Mae and Freddie Mac are going through continuous changes in their guidelines and rules that you end up having to abide by.

What does this mean to you?

When you have your initial mortgage consultation, make sure that whatever you haven't brought to the meeting, you get to your lender as soon as possible. There will be times when your mortgage consultant will have to ask you for additional documentation on something...that's just how the industry is right now. Please don't get upset, just know that someone somewhere is trying appease a new regulation that has probably just changed for everyone.

While a couple of years ago, when just about anyone could get a mortgage, now the mortgage industry is going through a 180 degree change. They're having to be extremely rigid in the rules they have to follow. Hopefully, over the time, the restrictions will loosen up a little bit and make the mortgage lending process less stressful and go more smoothly.

In the meantime, just keep asking your mortgage consultant if there's any additional documents they need at this time. I would ask them once a week, so that you don't have to go through any last-minute hoops to get your mortgage approved.

If you know of any impactful changes to your job, credit history or finances, make sure your lender knows right away. While you're going through the mortgage process, don't make any major purchases that require you to use a credit card or pay using lots of cash. Wait until after the closing. You don't want your credit score or money reserves to go down.

It's best to be pro-active in this market and have an open dialogue with your mortgage consultant.

At your service,

Dan

What questions do you have? I'll gladly answer them at: dan@danweis.com.

Tell a friend about my next Free Home & Condo Buyer Class - March 19th!

Are you ready to find your dream home? Contact me for a Free Consultation: (513) 615-1890 or dan@danweis.com

Home Inspection Insight!

I represent a lot of buyers and I believe it's important that the home inspector work in the best interests of his customer - the buyer - and point out all of the shortcomings of the home as well as the positives.

It is important for the inspector share information on the maintenance items found as well as the material defects. There is a difference between the two. A material defect affects habitability of living in the home, like a leaking roof or faulty wiring, etc, while home maintenance items are common issues that happen all of the time and have to be taken care of periodically.

Obviously, sometimes there are gray areas and that'll be up to the buyers and sellers to decide what's to be done, but in most cases, it should be clear-cut as to if it's a maintenance item or material defect.

The inspector should give full disclosure as to the best of their ability at the time of the inspection (with the buyer present), so that the buyer can determine what, if any, issues should be addressed and corrected by the sellers.

The one thing I do think inspectors get a bad rap on is when they get a call from a buyer 3 or 6 months after the buyers move into the home and the buyer tells them that the basement is leaking or some plumbing broke, etc. It's impossible for an inspector to look into the future and know what and when something is going to break. They are only at the property for 2 - 3 hours of its lifetime. They can look for possible signs of potential problems, but don't expect them to have x-ray vision or know exactly when something is going to break or cause a problem. Things do go wrong in homes and sometimes it's days after moving in or can be months or years later. Just understand that when owning a home, items do break or need to be repaired or replaced from time to time.

The role of the home inspector should not be to 'scare' a buyer. If an inspector finds many defective items, that's good. That's the purpose of the buyer paying several hundred dollars - to see if the home is in good condition or if the seller was hiding or didn't know about various defects. The property is what it is and if it's not meant to be the home for the buyer, then it's time to move on to another home.

An agent should also not downplay a bunch of defective items just to have the buyer go ahead and close on the purchase. If the items are serious enough and the seller won't correct them (it's the seller's home and their issues), then the buyer should be able to void the agreement and move on. (The buyer should be aware that they need to understand how a purchase agreement is written to see what their options are for getting out of the agreement. They may need to seek legal advice.)

I hope this sheds a little more light on home inspections.