Loganville, Dacula and Bethlehem Real Estate - The Rains Team

I work with a lot of first-time home buyers, you may be one of them, and I’m asked all the time what is involved with getting pre-qualified for a home loan. To be honest I didn’t have all the answers, so I interviewed the loan officer that I trust the most, Kurt Owen from BB&T’s Covington, Georgia branch. Here’s what he has to say on this topic:

1. What documents do people need to get pre-qualified? For a pre-qualification, it is helpful to have your most recent paystub, bank statements, W-2, and tax returns available. Though no documents are actually collected at this stage, it will help you be more accurate with the lender, which in turn will give them a better idea of what you can qualify for.

2. What are the basic requirements for obtaining a loan? I’ve always heard you must hold the same job for at least two years, is that true? Requirements vary from loan to loan, but 2 years in the same line of work is preferred. It is not a requirement, though, unless they are self employed, commission paid, or paid with a 1099.

3. What kind of questions do you ask people? Normally, to take a pre-qualification, I ask for: Names, birthdates, social security numbers, address history (2 years), contact numbers, work history (2 years) including addresses phone and pay, family information (married/single/divorced, kids, how many), Asset information (checking, savings, retirement, other), and what they are looking for as a payment. Then, based on the answers given, I may ask follow up questions that could range from child support to gift information for the down payment.

4. Once you’re pre-qualified, how long are you approved for? It is important to know that a prequalification is not an approval or even a pre-approval. Pre-qualifications are based on verbal information only, do not set an interest rate, and are not underwritten. However, most major roadblocks can be identified through a prequalification, and they are normally accepted by most agents as an indication that the borrower they are dealing with is, barring an unexpected issue, probably able to obtain financing. For the most part, any lender can issue a prequalification without much of a problem, but it could have many “holes” in it. A true pre-approval means that documents are collected just like an application, and the loan is approved “subject to” an appraisal and identified property.

5. Is there anything else you would like to add to explain how this process works? Most prequalification’s can be taken over the phone or in person in about 30 minutes, but leave more time available so that you can ask questions. You should have a response in 24-48 hours after applying for a prequalification, though you should ask the lender for a time estimate. Always tell the lender how much you are comfortable spending and have your prequalification based on that number.

Here’s a little information about Kurt so you can get to know him better:

My office is cluttered and unorganized, which absolutely drives me crazy. So, last night I decided to start tackling this huge project…not to point fingers here, but it’s mostly my hubby’s mess that I’m trying to sort through. However, I did go through all the files in my desk and found a lot of things I didn’t need.

What does this have to do with saving money you may ask? Well, I found a magazine dated July 2008 that caught my eye–one of the headline stories was “Easy Tips to Save $1,000’s“–I knew I had kept this for a reason! Today I’ll share the tips on saving money through your mortgage, your bank or credit cards.

For previous articles of how to save money, click on the following links:

Simple Tips on How to Slash Your Grocery Bill

“If You Play With Snakes You’re Gonna Get Bit”

MORTGAGE TIPS:

* PAY THE POINTS: With most home loans, the biggest expense is the interest. One of the best ways to lower that expense is through the wise use of discount points–upfront fee paid to the lender. One discount point equals 1 percent of the loan amount. Generally, the more discount points you pay up front, the lower the interest rate. This is also known as “buying down the loan.” A good rule of thumb: If you can recoup the cost of the points within the first 2 years through the lower monthly payments, go for the points.

• Example: You can get a 30-year fixed-rate $200,000 mortgage for 5.75 % plus 2 points (which cost about $4,000), or 6.75 % with no points. If you go with the lower interest rate you save $130 a month. It will take you about 2.5 years to recoup that $4,000 you had to pay up front to get the lower rate. However, over the following 28 years you will save $46,818 due to the lower interest rate and payments.

* PREPAY THE PRINCIPAL: Each month when you make your regular mortgage payment, write a second check for one-twelfth of the regular mortgage payment. Do this every month and at the end of one year you will have made the equivalent of 13 monthly payments. On a 30-year $200,000 mortgage at 6.75 % interest, this tactic pays off your mortgage in 24 years and saves a whopping $62,750 in interest.

* GO SHORT-TERM: Although your monthly payment may be higher, you can save tens of thousands of dollars in interest by shopping for the shortest-term mortgage you can afford. For each $100,000 you borrow at a 7 % annual percentage rate (APR), for example, you will pay over $75,000 less in interest on a 15-year fixed-rate mortgage than you would on a 30-year fixed-rate mortgage.

* DROP THE PMI: Private mortgage insurance (PMI) is extra insurance lenders require from most homebuyers who obtain loans that are for more than 80 % of their new home’s value. However, thanks to the Homeowner’s Protection Act (HPA), PMI is now automatically cancelled once your mortgage is paid down to 77 % of the original value of the property. Typically, PMI premiums range from $250 to $1,200 a year.

CREDIT CARD AND BANKING TIPS:

* PAY EARLY: Most credit card companies compute interest charges based on your average daily balance, so making your payment early in the billing cycle (as soon as you receive your statement rather than waiting until the payment is due) will save $5, $10 or even more a month. Why? Because you reduce the daily balance for more days in the cycle.

* JUST ASK: Tired of paying 16 % interest on your credit card balance? Pick up the phone and call customer service (the number on the back of your card). Ask for a lower rate. If you have a good payment history, chacnes are they’ll lower it on the spot. The difference between 18% and 7% on a $5,000 balance is $46 a month, or almost $600 a year.

* FIGHT THE FEES: If your credit card issuer smacks you with a fee, don’t be shy. Nearly all banks will waive at least one late fee ($15-$39) or over-limit fee (up to $39), but you have to ask. If you’re paying an annual fee (anywhere from $50 to $300) just to have the card, ask to have that waived too.

* PAY ONLINE: If you pay 15 bills a month by mail, you’re spending at least $75 a year in postage. Most large banks offer free online bill paying for customers that lets you pay any vendor, or you can also pay the vendor directly online. Go to your bank’s website or the vendor’s website to learn more.

You know, it’s a tough economy we’re in right now and whether you’re on a tight budget, struggling to meet ends each month or you’ve saved up some cash and are more flexible with your money, it doesn’t hurt to make the smartest decisions possible and find ways to save as much money as you can. I hope this tips helped you; as a first-time home owner myself, I learned a lot about mortgages through these tips.

I would love to hear what you’re doing to save money during our current economic times?

If you are in the market to buy or sell your home in the Bethlehem or Dacula area, I would be happy to assist you! My passion is helping people find their dream home and stepping them through this exciting journey. I serve the Walton, Barrow and Gwinnett county areas. Call or text me today!
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Photo Credit: AMagill

Original article was written by Mary Hunt and found in the July 2008 edition of Woman’s Day magazine

On Thursday night, over 6,000 churches hosted Dave Ramsey’s Town Hall for Hope live simulcast and over 1 million Americans heard what he had to say. Not familiar with Dave? He’s a financial expert and a Christian, which I love because what he teaches about your finances are biblically based.

He said a lot of great things last week and he really conveyed that the economy is not as bad as what the media is trying to portray. One of the best quotes of the night was: “Credit cards are snakes. If you play with snakes, you’re going to get bit.” Dave doesn’t even own a credit card because he doesn’t feel that the credit card companies play fair. He only advises using them if you can pay them in full each month! Now, I know that for a lot of Americans credit cards are a way of life, but can you imagine if you never used a credit card again how much money you would save?! Not only would you be keeping all that interest that you would accrue to yourself, but statistics also show that Americans who pay with credit cards typically spend 26% more than Americans who don’t use them. Ponder that for a little bit.

Another important thing he said was that “Failure will run you into excellence. Without fear of failure you cannot be your best.” I think this is also great; we shouldn’t let our fear of failure paralyze us from doing anything but instead use that fear to do our best. And if we should fail that will only make us want to pick up the pieces and try again. A lot of the wealthiest people have been millionaires only to become bankrupt and then they go out and work harder and accomplish even greater wealth than before.

Dave claimed we need to learn two things: 1. SAY NO! and 2. Take personal responsibility that you caused this mess. He says we need to learn how to say no again–we live in a society that says yes to everything and no to nothing, but that must change if we’re going to get in control of our finances. We need to learn to say “yes that was my fault” instead of whining about it.

I’m also very happy to inform you that Dave believes the housing industry is going to lead us out of this recession. He stated that because of interest rates being the lowest they have been in years, it’s a wonderful time to buy a home. If you have extra money he also recommends investing in property as well. And he wants everyone to quit believing the media when they talk about foreclosures running rampant in this nation; did you know that 60% of the foreclosures come from only 5 of our states. And that 50% of foreclosures are in 35 counties. This shows us that foreclosures are highly localized. So, if you can afford it, this is definitely the year to buy a home!

And finally, here’s a three step action plan that we should follow:

1. Get up and TAKE ACTION! Don’t just sit on your couch watching Oprah re-runs wishing you made more money or the country wasn’t in this recession (This is not even the worst recession we’ve ever had, did you know that?) Be proactive and think creatively on ways to earn more money.

2. Don’t participate in LOSER TALK! Don’t believe everything you hear on the media and if the news is getting you down, just don’t listen to it. Think positively and when others are talking negatively walk away or find something good to say.

3. We need to learn to give again. Americans need to learn how to be generous again with both their time and money. Money really tight? Don’t worry, find ways to give back to your community–maybe help serve in a soup kitchen or volunteer to read to elderly people in a retirement home. Doing things to help others will help get your mind off your problems, put things into perspective (things could be worse) and will be a blessing to you.

Lastly, his parting words were: HOPE comes from you, me, and God–NOT Washington!!

If you would like more information, Dave Ramsey has a whole website devoted to Town Hall for Hope. Also, he’s a wonderful financial advisor and has written a great book: Total Money Makeover that I would highly recommend. He teaches people how to get out of debt and to live a debt-free lifestyle. His motto is “Live like no one else, so one day you can LIVE like no one else.”

Town Hall for Hope Website

Dave Ramsey’s Website

I hope this information has helped you! If you are in the market to buy or sell your home in the Bethlehem or Dacula area, I would be happy to assist you! My passion is helping people find their dream home and stepping them through this exciting journey. I serve the Walton, Barrow and Gwinnett county areas. Call or text me today!

I get asked this question all the time:

SHOULD I PAY OFF MY CAR BEFORE I PURCHASE A HOME?

Well, I must say, I have a pretty specific answer to this…watch my video to find out

If you are in the market to buy or sell your home in the Bethlehem or Dacula area, I would be happy to assist you! My passion is helping people find their dream home and stepping them through this exciting journey. I serve the Walton, Barrow and Gwinnett county areas. Call or text me today!

Photo By: Jack Duval

Previously this government incentive to purchase a home was limited to $7,500 and had to be paid back over the course of 15 years. However, some changes have been made, which I will outline here that will hopefully answer all of your questions.

Photo By: Simon Doggett

1. Who can receive the credit? Only first-time home buyers are eligible and they must close between January 1, 2009 and December 1, 2009. Investors or people purchasing a second home can not receive this credit.
2. What is a first-time home buyer? A buyer who has not owned a principal residence in the 3 previous years before buying a home. If you are married taxpayers, NEITHER you nor your spouse can own a primary residence; in other words if one of you owns a home (a primary residence) you can’t obtain the tax credit if the other spouse purchases a home.
3. How is the amount of the tax credit determined? It is limited to 10% of the sales price of the home, but a maximum of $8,000.
4. What are the income limits on people claiming the tax credit? For single taxpayers the income limit is $75,000 and for married taxpayers filing a joint return it’s $150,000. If you want more specific details on this, please visit http://www.federalhousingtaxcredit.com or ask your CPA or a tax professional.
   How do I claim the tax credit? Simply claim it on your federal income tax return; just fill out IRS Form 5405 to help you know how much to claim and write it on Line 69 of your 1040 income tax return. No other forms are required.

An important difference between this tax credit and the $7,500 credit put into effect July 2008, is that this $8,000 DOES NOT have to be paid back! The only stipulation is that you must live in the home as your principle residence for at least three years, if you don’t you will have to pay back the credit.

Also, because this tax credit is refundable, you could potentially receive a check from the government for part or all of the $8,000. To help you understand this a little better, here’s an example from the Federal Housing Tax Credit’s website:

“For example, if a qualified home buyer expected, notwithstanding the tax credit, federal income tax liability of $5,000 and had tax withholding of $4,000 for the year, then without the tax credit the taxpayer would owe the IRS $1,000 on April 15th. Suppose now that the taxpayer qualified for the $8,000 home buyer tax credit. As a result, the taxpayer would receive a check for $7,000 ($8,000 minus the $1,000 owed).”

Photo By: Visit Hillsborough

So, first-time home buyers, with this excellent tax incentive, coupled with the low interest rates and the extensive amount of homes on the market, why wouldn’t you buy a home this year?

If you still have further questions, please watch the video below provided by the National Association of Home Builders.

There’s no mistaking it, food prices have continued to rise over the past year. According to CNN.com, the cost of food has increased by 6.6% in 2008 alone. BusinessWeek.com reported that most cost increases on individual items, especially dairy products, have risen by double-digit increases. Some statistics include: an increase of about 27% on cheese, 38% on eggs, 10% on milk and 19% on bread. With basic necessities increasing substantially, we need to take advantage of money-saving tips to help us stay within our grocery budgets.

Photo by: Steven Fernandez

However, there are ways to combat these rising prices if you learn some simple shopping strategies and begin shopping smart. After doing some research, here are my top 10 ways to slash your grocery bill:

1. Use the featured sales ad from your grocery store to plan weekly meals:

• Before you shop, get your grocery stores’ ad and look at the deals, plan your meals around what’s on sale-write your shopping list using the brands and items that are on sale.
• Make a detailed grocery list so you only have to make one trip to the store.
• Plan ahead so you don’t impulsively buy items while at the store.
• You can also save time by planning ahead and dividing the list between family members once you’re in the store-everyone works together to get the shopping done faster.

2. Choose cheaper meats:

• Buying less expensive cuts of meat and marinating them allows you to save money without forfeiting your favorite dinners.

3. Shop at stores that have savings programs and know how they work:

• Find out if the store offers “buy one get one free” deals or if there is a savings card you can get or if they double coupons, etc.
• You can maximize your savings once you know the rules because you’ll find ways to combine discounts to get items at an even greater reduced price.

4. Start clipping those coupons:

• Buy 2 or 3 copies of the Sunday paper to drastically increase your savings.
• Go on the grocery stores’ website-often they will offer their best deals in coupons you can print from the Internet.

5. Plan a potluck:

• A couple of times a month get together with friends or neighbors for dinner potluck style-have everyone bring something.
• Enjoy the time socializing (which can help reduce stress) and save money all in one night!

Photo by: Darwin Bell

6. Buy extra items when they are at their lowest price:

• Figure out when your grocery store offers things at their lowest price-for example, if boneless chicken is on sale every other week, get enough to last for two weeks and freeze it.
• Don’t buy a whole year’s worth at one time, just the amount needed to last until the next sale.

7. Don’t be stuck on specific brands or stores:

• Learn to buy the brand that is on sale the most (even if it’s not name brand).
• Also, be flexible about which grocery store you go to-look at all the sale papers and shop where the items are the cheapest for that week.

8. Maximize your little indulgences:

• Find ways to make your more expensive, special items last longer.
• For example, if you can’t let go of your favorite pricey brand of coffee, try mixing it with a less expensive brand to make it last twice as long-the flavor will still be there, but it will cost you half the price.

9. Organize a coupon group:

• Find some friends or neighbors who are interested in cutting coupons and assign a designated person to each member of the group.
• Every week after you’re finished clipping your coupons, mail or give your unused coupons to your person. In return you’ll also receive a set of coupons from your designated person as well.
• This will give you a much wider range of coupons on various products.

10. Don’t be wasteful, measure it:

• If you find yourself throwing out unused food, especially pet food leftover in bowls, start measuring it. Use the back of the package as a guideline for how much food your pet needs-your pet will be healthier as they are not being overfed and their food will last a lot longer.

Photo by: Micky

I hope these tips will be helpful in cutting your grocery bill each week. If have other tips for keeping your food costs down, please share them with all of us in the comment section below. We can help each get through this tight economy…and if you currently don’t even use a grocery budget, maybe now is the time to start. Figure out a number your family can comfortably spend each week on food and stick to it–this includes dining out as well!

If you are in the market to buy or sell your home in the Bethlehem or Dacula area, I would be happy to assist you! My passion is helping people find their dream home and stepping them through this exciting journey. I serve the Walton, Barrow and Gwinnett county areas. Call or text me today!

As we all know, it is increasingly harder to obtain a loan on a home these days due to the amount of foreclosures that have occurred. Banks and mortgage companies are tightening their requirements and are hesitant to lend money–especially to first-time home buyers. This is especially difficult because many first-time home buyers don’t have much money saved up yet or have perfect credit–the average age of a first-time home buyer is only about 26 years old. However, I have found a loan program that helps first-time home buyers, it is BB and T’s Community Homeownership Incentive Program or CHIP. It is a loan program specially designed for first-time home buyers. Some of the benefits are: 1.) up to 97 per cent of financing available on various different property types including singled family homes, townhomes, condos and doublewide manufactured homes on permanent foundations and 2.) the private mortgage insurance is waived–over the long run that saves you a lot of money!!

If you don’t have much money for a downpayment, have a lack of credit history and don’t have an income that exceeds 80 per cent of your county median income, then this program may be right for you.

Please contact me if you are interested in learning more about this program and I will connect you with the loan officer that I work with at       BB &T. Don’t be discouraged if you are a first-time home buyer–there are still good programs available to you and I want to help you find them and your dream house!