4 Down Payment Assistance Ideas

 

 

Are you wasting thousands of dollars on rent and dreaming of becoming a homeowner? You can already make a monthly house payment (you’re already paying rent), but the problem is coming up with money for a down payment.  It’s not as difficult as you might think. Here are ways to get a down payment with little out of your own pocket.

1. Look Into Local or Federal Government Programs.  You may qualify for special government programs, such as those for first-time homebuyers and members of the military.  You also may have access to aid from Fannie Mae and Freddie Mac (government-sponsored mortgage programs).  Additional resources are non-profit and community groups and state agencies.  There are too many programs to list here and they expire or change frequently. 

2. Have the Seller Finance You. Some sellers may be willing to help you buy their homes. In a “seller take-back,” the seller holds a second mortgage for you and becomes your lender.  You would make your monthly mortgage payments to the seller.

3. Use A Tax Refund. There are options for you to borrow money for certain investments to a specific level and use those investments to generate a significant tax refund.  Obviously, the timing has to be right to so you can use it as a down payment on a home.

4. Ask A Relative or Friend. Tax law allows gifts of up to $13,000 a year to be given without tax consequences to the giver or recipient. This gift-exclusion amount is adjusted annually to reflect inflation (see IRS publication 950 for the current amount).  You can even get a gift from each of your parents or two friends without them having to pay a gift-tax, which bring it up to $26,000.   

This is a great way to get a down payment for a home. In fact, one out of four first-time homebuyers use a gift to make the down payment.  Even if this isn’t your first home purchase you can still use a gift so you don’t drain your savings.  Usually lenders require you to have some money still left in your bank account after closing so they know you’ll make the mortgage payment each month.

Also, using a gift for a down payment allows you to buy the home you want even if it’s not Federal Housing Administration (FHA)-approved.  Some buyers are able to get FHA mortgages that have down payments as low as 3.5% of the purchase price, but others will have to put more down.  With a gift, you can put the typical 10% to 20% down that most lenders require. For example, if you had to put down 10% on a $150,000 home, that’s $15,000. Or, 20% would be $30,000. A gift from relatives and friends can get you there but some of the rules differ depending on the lender you choose. Contact me at 813-419-7009 for a buyer consultation. Together, we can make your goal of owning your first home a reality.

USDA Still Offers No-Down Payment Mortgages

 

Thanks to funding from federal programs to boost the housing market, the U.S. Department of Agriculture (USDA) still has $11.2 billion in its coffers earmarked for mortgage loans. The USDA’s Rural Development Service’s Section 502 loan is one of the few mortgage programs that requires no down payment.

In earlier years, the program ran out of money by late summer, leaving homebuyers in limbo as they waited for the new budget year to begin. In Florida, most low-income and middle-income buyers qualify if they live in rural areas, smaller towns or some outlying suburbs to larger cities.

The program will change slightly after Oct. 1, when buyers will be required to pay a 0.3 percent premium for mortgage insurance monthly; however, the cost of upfront mortgage insurance will be reduced to 2 percent from its current 3.5 percent.

 

Click here to see which areas of town are USDA eligible.

 

Gloria Walters | REALTOR
Bridging the Gap Between Buyers and Sellers

772-359-7543 (direct)
813-200-8708 (fax)
gwalters83@gmail.com

The Hacienda Restaurant, Bartow, Florida

I recently made a business trip to Bartow. When lunch time came around, I wanted to dine at a new place. I was uninterested in the fast food chains along Broadway Avenue and I have been to Curly Tails to many times before. So I took a short drive down Main Street. I had a coupon for Main Street Wraps, but learned they had gone out of business. Already convinced that I wanted a wrap for lunch, I had to make the disappointing shift to something else. I stumbled upon the Hacienda Restaurant, a quaint Mexican restaurant with a lot of charm. The hostess was very welcoming and answered all of my questions. I ordered the Chicken Quesadilla Ansada, served with rice and black beans. I was surprised the quesadilla was covered in a creamy white sauce. I thought this was truly a different experience. I expected the traditional dry quesadilla pressed to perfection. As different as it was, it tasted even better. I enjoyed my time dining at the Hacienda Restaurant, I look forward to my next trip to try another of their great meals.

I truly love experiencing new places, food and people.

Gloria Walters | REALTOR
Bridging the Gap Between Buyers and Sellers

772-359-7543 (direct)
813-200-8708 (fax)
gwalters83@gmail.com

5 Questions to Ask Your Inspector

 

Most home buyers feel like they are bona fide real estate experts after all the studying up on loans and neighborhoods, online house hunting and open house visiting it takes just to get into contract on a home these days. But for all but the most handy of house hunters, getting into contract and starting the home inspection process only surfaces how little you actually know about the nuts and bolts and brick and mortar of the massive investment you’re about to make: a home!

So, you hire a home inspector, but it seems like they’re speaking an entirely different language - riddled with terms like “serviceable condition” and “conducive to deterioration” - about your dream home! Here are 5 questions you can use to decode your home inspector’s findings into knowledge you can use to make smart decisions as a homebuyer - and homeowner.

1. How bad is it - really? The best home inspectors are pretty even keeled, emotionally speaking. They’re not alarmists that blow little things up into big ones, nor do they try to play down the importance of things. They’re all about the facts. But sometimes, that straightforwardness makes it hard for you, the home’s buyer, to understand what’s a big deal and what isn’t so much - the information you need to know whether to move forward with the deal, whether to renegotiate and what to plan ahead for.

I’ve seen things categorized in home inspection reports under “Health and Safety Hazards” that cost less than $100 to fix, like replacing a faucet that has hot and cold reversed. And I’ve seen one-liners in inspection reports, like “extensive earth-to-wood contact” result, after further inspection, in foundation repair bids pricier than the whole cost of the home! In many states, home inspectors are not legally able to provide you with a repair bid, but if you attend the inspection and simply ask them whether or not something they say needs fixing is a big deal, nine times out of ten they will verbally give you the information you need to understand the degree to which the issue is a serious problem (or not).

2. Who should I have fix that? I always ask this question of home inspectors, with dual motives. First, very often, the inspector’s response is - “What do you mean? You don’t need to pay someone to fix that. Go down to Home Depot, pick up a ___fill in the blank__, and here’s how you pop it in. Should cost you $15 - tops.” And that’s useful information to know - it eliminates the horror of a laundry list of repairs and maintenance items at the end of an inspection report to know that a number of them are really DIY-type maintenance items. Even buyers who are really uncomfortable doing these things themselves then feel empowered to either (a) watch a few YouTube vids that show them how it’s done, or (b) hire a handyperson to do these small fixes, knowing they shouldn’t be too terribly costly.

And even on the larger repairs, your home inspector might be able to give you a few referrals to the plumbers, electricians or roofers you’ll need to get bids from during your contingency period, which you may be able to use to negotiate with your home’s seller, and to get the work done after you own the place. Dropping the inspector’s name might get you an appointment booked with the urgency you need it in order to get your repair bids and estimates in hand before your contingency or objection period expires.

And same goes for any further inspections they recommend - if neither you nor your agent knows a specialist, as the general home inspector for a few referrals.

3. If this was your house, what would you fix, and when? Your home inspector’s job is to point out everything, within the scope of the inspection, that might need repair, replacement, maintenance or further inspection - or seems like it might be on it’s last leg. But they also tend to be experienced enough with homes to know that no home is perfect. Many times, I’ve asked this question about an item the inspector described as “at the end of its serviceable lifetime” and had them say, “I wouldn’t do a thing to it. Just know that it could break in the next 5 months, or in the next 5 years. And keep your home warranty in effect, because that should cover it when it does break.”

This question positions your home inspector to help you:

• understand what does and doesn’t need to be repaired,
• prioritize the work you plan to do to your home (and budget or negotiate with the seller accordingly),
• get used to the constant maintenance that is part and parcel of homeownership, and
• understand the importance of having a home warranty plan.

4. Can you point that out to me? Often, when you attend the home inspection, you’ll be multi-tasking, taking pictures of the interior, measuring for drapes or furniture, even meeting the neighbors, or fielding several inspectors at a time. Worst case scenario is to get home, open up the inspector’s report and have no clue whatsoever what he or she was referring to when they called out the wax ring that needs replacement or the temperature-pressure release valve that is improperly installed.

Your best bet is to, at the end of the inspection, while you’re all still in the property, just ask the inspector to take 10 or 15 minutes and walk you through the place, pointing out all the items they’ve noted need repair, maintenance or further inspection. When you get the report, then, you’ll know what and where the various items belong. (One more best practice is to choose an inspector who takes digital pictures and inserts them into their reports!)

5. Can you show me how to work that? Many home inspectors are delighted to show you how to operate various mechanical or other systems in your home, and will walk you through the steps of operating everything from your thermostat, to your water heater, to your stove and dishwasher - and especially the emergency shutoffs for your gas, water and electrical utilities. This one single item is such a time and stress saver it alone is worth the lost income of missing a day of work to attend your inspections.

(Source: Trulia | Tara-Nicholle Nelson)