1. Help for Underwater Homeowners via HARP

    As home values continue to rise in most markets, an estimated 9.3 million homes remain “deeply underwater”, according to RealtyTrac.  These are situations where property values are at least 25% lower than the outstanding mortgage debt on the property.  If your home falls into this category, and you could benefit from refinancing with current interest rates, then you might qualify for the Obama administration’s Home Affordable Refinance Program (HARP).  This program allows homeowners with good payment histories but high loan to value ratios to refinance their homes even with no equity in the property.  As a first step, you must determine if Fannie Mae or Freddie Mac currently own your mortgage.  Even though you are making payments to a different party (for example, one of the large banks) it’s highly probable that Fannie or Freddie own your loan but that it is being serviced by a different entity.  To figure this out, simply go to Fannie’s and/or Freddie’s websites and look for a banner or link to the HARP program.  It’s also important to know that you don’t have to refinance with your current servicer.  You can shop around and get the best deal for a HARP refinance.

    Also, keep your eye on some pending federal legislation, “Responsible Homeowner Refinancing Act of 2013″, broadly known as HARP 3.0.  If this passes, it will lower HARP fees and costs, reduce the need for appraisals even further and ease underwriting standards.  Ask your lender for more information on HARP!


  2. FHA Loans vs. Conventional Mortgages

    The Federal Housing Adminstration (FHA) is the largest insurer of low downpayment home loans and, during the dark days of the mortgage industry meltdown,  experienced a meteoric rise in popularity.  Now that the market has settled back down, how do you know if an FHA loan is the best option for you?  Unfortunately, the mortgage insurance rates charged by FHA on these loans has increased substantially in the past few years and the rules about when the MI “goes away” have changed — making these loans less attractive than in the past.  However, FHA loans are still a great fit for many first time homebuyers, especially people who have limited funds for a down payment.  Additionally, an FHA loan might be the best option for a move-up buyer who has lost equity in their home and, thus, have limited funds to apply to a new down payment.  Here are some specific features of FHA loans that make them attractive:

    • Credit score requirements are much lower than conventional loans
    • Minimum required down payment is only 3.5%
    • A non-occupant can be a co-borrower — for example, a parent can co-sign the loan even if they don’t live in the property
    • Sellers can contribute up to 6% toward closing costs and prepaids.
    • FHA loans can be “assumed” by a subsequent property owner at the same interest — which could a tremendous advantage in selling the home later since current rates are still historically low

    Remember, though, that FHA loans are only for primary residences!


  3. Flood insurance rates in Virginia will rise

    For many years, the government has offered subsidized flood insurance on homes and business constructed before rules existed about building close to the water.  However, premiums collected from homeowners have not been sufficient to cover the losses, leaving the taxpayers holding the bag.  On Friday, President Obama signed legislation that will cause premiums to begin to increase annually. In Virginia this will primarily affect homeowners and businesses in Norfolk and Hampton, two communities in low lying areas with numerous older homes near water.  In Richmond approximately 59 policies are expected to increase by 18% and 48 by 25%.  Almost twice as many homeowners in Chesterfield and Henrico will be affected by the elimination of the rate subsidies, while in Hanover the numbers are minimal.


  4. The Pros And Cons Of Using A Realtor VS For Sale By Owner

    When it comes to selling a piece of property, owners are usually not aware of the pros and cons of using a realtor vs for sale by owner. Below are some of the pros and cons of using a Realtor vs selling a home on their own.

    The Pros
    One of the best things about using a Realtor is that they will take care of all of the marketing for you. You will not have to worry about finding potential buyers by yourself, as a Realtor will do it for you.

    Also, a professional will be able to take care of all the paperwork associated with the selling of the home. This means that you will not have to stress out or worry about whether or not everything is filled out correctly. A professional will make sure that every single piece of paper is filled out properly.

    Another reason why people tend to use a professional is because they will be able to sell their property for the asking price or they may even get more money than what they were asking for it. A professional knows exactly what to do in order to make sure that you get what you are asking for, or even more.

    Perhaps the best thing about using a professional is that you will be able to sell your property much quicker than if you were trying to sell your property on your own. If you want to sell your property fast, then it is a good idea to use a professional.

    The Cons
    There are not many cons, but one of the cons is that sometimes you will need to pay a Realtor a certain percentage of the selling price. This is why it is important to know how much a professional charges for their services before you actually hire them.

    Another con of using a Realtor is that they take care of the marketing for you. However, this is also considered a pro in many owners’ eyes, but some owners want to have full control over how their property is marketing. When they work with a Realtor, then the chances are they will have little control over how their property is marketed.

    As you can see there are many pros and some cons of using a professional when it comes to selling your property. The pros outweigh the cons, and if you want to sell your property, then you should hire a Realtor.


  5. Should I Refinance My Mortgage If I Plan On Selling?

    If you have made the decision to sell your home, you know how hard it can be. Saying goodbye to a home full of memories and closing that chapter of your life can emotionally taxing and extremely difficult. Once you have come to the decision to sell, the process is only just beginning. Finding a great listing agent who can help you sell your home, deciding how much your sale price should be and determining what repairs, remodels and home improvements you need to do before listing can seem all consuming. In addition to these things, there are other important aspects to consider when deciding to sell your house and you may end up asking should I refinance my mortgage if I plan on selling? While the answer to this question will differ in every case, one thing remains a constant: you need help from a reputable mortgage broker to determine what course of action is best for you.

    In some cases, refinancing your mortgage before selling your home makes sense. If you know you are not going to list and sell your home for a couple of years, it can save you thousands of dollars in interest costs to refinance. Some people decide to refinance their mortgage a couple of years before they retire and sell their home and use the money they save on their mortgage payments to pad their retirement fund or pay off other debts.

    Other home owners find that the closing costs on their refinance cancel out the savings they would see on a lower interest rate and decide to forgo the refinancing process. Some home owners find that a refinancing option will end up saving them money and the closing costs will pay for themselves in the short time they hold the loan. For these borrowers, it makes sense to refinance before selling their home. For borrowers who would end up breaking even after considering closing costs or those who would have to pay an additional private mortgage interest because the loan amount exceeds 80% of their home’s value, refinancing does not make sense and could end up costing the home owner money.

    Of course, the best way to determine which option is right for you is with help from a knowledgeable mortgage broker. If you are thinking about refinancing and selling your home, let CapCenter.com put together a potential loan for you so you can make an informed decision. There is no obligation and you may be able to save thousands of dollars, so get your loan proposal today.


  6. Home Remodeling Projects With Best Return On Investment

    You have a lovely home and you make sure that it is maintained well all through the year. In fact, you undertake regular renovations to make your home weather-resistant, to patch repairs and generally, to make it a comfortable and beautiful place to live in. Realtors have approached you with interested buyers and they’ve even quoted attractive rates. In fact, some realtors have suggested home renovations projects that will increase the value of your property even more. Is that possible?

    Yes it is: home remodeling projects with best return on investment

    In the last two years, remodeling costs have dropped by 10% to about 20%. Material costs have increased by 17% but this still means that you can renovate your home comfortably and recover the costs while selling your home. However, this is possible only if you invest in sensible projects that increase the attractiveness of your home for a buyer. Spending on maintenance, essential replacements and enhancing curb appeal of a home are more likely to result in higher purchase prices right in the beginning. The most common projects recommended by realtors and industry professionals in all three categories are as follows –

    Siding – High quality fiber cement siding recovers more than 88% of the initial investment. This high quality material can easily withstand any kind of weather and it is pest-resistant and fire-resistant as well. The material is also available in a range of colors, textures and finishes and it can easily enhance the curbside appeal of a home at first glance.

    A good front door with a wood deck – A strong steel and glass door is an inexpensive upgrade but it reinforces security and provides visual appeal as well. Combining this with an outdoor wood or combination deck provides a seamless transition from inside the house to outside.

    Updating kitchens and bathrooms- Kitchens and bathrooms undergo a huge amount of wear and tear but it is just as easy to make out whether work has been done in these rooms. However, individual preferences may vary considerably and it’s a far better idea to stock to mid-range appliances, cabinets and natural wood or stone counters and flooring.

    In conclusion, remember that the value of your home depends on the neighborhood, the housing market and the quality of renovation you are doing. Buyer appreciated a well-maintained and renovated home but they will not pay 2-4 times above the market average. Do not invest in expensive renovations in a low-end or middle-end community as you may not get what you have spent. Any changes you make in your home should improve its value when you sell but only if you can get that sale price.


  7. Top 10 Things To Look Out For When Buying A House

    Buying a house is not as simple as it sounds. Things have really changed over the past decade or so, and people are really watching their dollars a lot closer. Banks have tightened up on their lending rules. However, on the other side of the coin, when the market is down, that means inventory is up. Don’t let the economy keep you from purchasing a new home.

    There are some things to consider if you are in the market for a new home today. Here are the top 10 things to look out for when buying a house -

    (1). One thing you want to look out for is going into a home purchase not armed with the basics. It takes a bit of research to arm yourself with the proper knowledge that will lead you down the right path to a great deal. Talk with realtors, lawyers, or HUD counselors. Professionals who are ‘in the biz’, are treasure troves of great insight into what to look out for when buying your home.

    (2). Watch out for misleading information. One thing about looking at new homes, is that you see them mostly during the day. It’s well worth taking a trip to see that same home at night. That neighborhood could be calm as a Disney movie during the day, and loud as a CSI episode at night. Things can be quite different in many areas at various times of the day. Talking to neighbors is a great way to get a feel for how things really are.

    (3). Along the lines of misinformation above, you should also ask key questions of the sellers. This is mining for information that isn’t necessarily obvious, but it is their responsibility to divulge. Ask if they’ve had any problems with the house in the last few years. Did they fix those problems? Does the yard ever flood or the roof leak? Has the basement ever flooded? Things like this are what you need to know before making a buying decision. Flood damage can be very expensive to repair.

    (5). Watch out for lopsided views. This is when the street the house is on looks very good. However, if you drive around the block you might find out that there are empty abandoned homes and teardown all over the place. Make sure your entire neighborhood is someplace you would like to live. Never assume anything about an area without thoroughly investigating things personally.

    (6). Watch out for sky-high utility bills. You should ask the sellers to show you the past 6 months of utility bills. This will give you an idea of what it takes to run this house as far as gas, water, and electricity bills go.

    (7). Watch out for unexpected taxes. Ask the sellers to show you several of their past tax bills. There are times when houses get pre-appraised at higher tax rates. The seemingly good deal you think you are getting, might not be so great if the property taxes shoot to the moon year after year.

    (8). Watch out for sellers who are not trustworthy. Make it your responsibility to go downtown to city hall and check out he zoning and regulations that are attached to that home. Check for any liens or potential easements, as well as any other types of restrictions that may apply to that property.

    (9). Protect yourself against things you cannot see. Literally any house you are moving into is going to have some type of defects. Some are obvious, some are not. Some can be fixed, some cannot. This is information you must know before deciding to make an offer.

    (10). Watch out for misinformation regarding repairs. It the sellers tell you they painted the house at such and such a date, ask for receipts for proof. If they say the roof has been re-shingled, ask to see the paperwork on that. See if they used good materials or tried to get by as cheaply as possible. All this information regarding the top 10 things to look out for when buying a house, can help to keep you from making a huge buying mistake.


  8. Living in a Neighborhood with an HOA

    Home owners associations (HOA) are groups of people living in the same neighborhood who govern the community by setting rules and guidelines for the people living in the neighborhood. There are many benefits and downsides to living in a neighborhood with an HOA.

    Neighborhoods with HOAs are usually more well-kept than neighborhoods without them. This is because the HOA creates rules for how they want the community to look. For example, if a house has overgrown plants in the yard and the community believes this makes the community look unkempt, the HOA can send a letter to the owner of the house with overgrown plants and tell him to better maintain his yard. HOAs generally serve to make the community more appealing and friendlier to live in. They can do this by limiting the amount of construction that can be done on a house, setting a no-noise period after a certain time, and build speed bumps in the neighborhood to slow down cars. A well-maintained community attracts more buyers to the neighborhood, which means more members to collect money from in the community. The HOA fees usually go towards community-wide projects, such as yard sales and block parties that bring the neighbors together.

    Although there are pros to having an HOA, there are also cons. Many HOAs are very strict and will send notices and demand fines for the most minute things. For example, a dog barking a couple of times during the day is a reason to fine a homeowner. Some people on the HOA board also do not assess the situation accurately and fine the wrong people. For example, if a tree branch is hanging over into the next person’s yard, it could be mistaken for that owner’s tree rather than their neighbors, causing the wrong person to be fined. Some HOAs also have board members who are impossible to compromise with or talk to and are unwilling to consider changes to their rules. Some members also use their power to spy on their neighbors and write them up for the smallest offenses. However, just because some HOAs are strict and have impossible members, this does not mean all are like this.

    Neighborhoods with HOAs have many benefits and downsides. HOAs can keep a neighborhood clean and appealing, but can also be very strict and have nosy members. When looking for a new house, an HOA or lack of in the neighborhood can be a reasonable factor to consider.


  9. The Different Types Of Home Loans

    Homeowners may be curious to know more about the types of home loans available to them. Read on for more information about your options.

    The fixed-interest mortgage is the first kind of loan. This fixed-rate loan means that your interest rate stays the same for its duration. In other words, amortization takes place other the lifespan of the loan. Remember that interest payments for fixed-interest loans are front-loaded, which means that during the first few years of the loan only a small part of your monthly payment actually goes to the loan’s principal. Most commonly taken for a thirty-year time span, this kind of mortgage can be shorter and, on occasion, longer. The thirty-year is the most popular because it makes your payment the least expensive. Some have reported that at the height of the real estate bubble brokers were offering fixed-rate loans on even longer terms, but those may be urban myths rather than reports from reality. Having such a long mortgage term offers these and other benefits to consumers, although the price for such low rates is a decades-long loan.

    Another kind of mortgage option is the adjustable-rate mortgage. As opposed to a fixed-rate loan, which has a static interest rate over the lifetime of the loan, an adjustable-rate loan (also known as an adjustable-rate mortgage or ARM) changes every year. This type of loan comes in a variety of permutations; indeed, it features aspects of both the adjustable- and fixed-rate mortgage. These hybrids can last anywhere from three years, to five years, to seven or even ten. In point of fact, the loan is amortized over the balance of the duration of the loan with a rate that is adjusted on an annual basis. Conversely, a one-year adjustable-rate mortgage has no fixed-rate period. While available, they are not widely on offer. It is difficult for most experts to imagine anyone taking a one-year loan, although it is of course within the realm of possibility.

    Another type of loan is the interest-only loan, interest-only loan. This is best for buyers who need a super low payment for several years at a stretch. An interest-only product allows them to pay only the interest for the first few years, although if they can pay the principal, that is also an option. Structured like an adjustable-rate mortgage, interest-only loans are commonly set up so that payment and interest are fixed for the first five years, and then open to adjustment after that.


  10. Buy Smart With First Time Home Buyer Programs

    Owning your own home gives you a sense of accomplishment and pride. Home ownership has long been a hallmark of the American Dream and achieving that status is something you can be proud of. Not only does it give you pride and accomplishment, home ownership provides you with an extremely valuable commodity you can use to build your net worth. Owning a home can help you earn valuable tax breaks that can also help your financial situation and make it possible for you to accrue wealth.

    While owning a home has numerous benefits, the home buying process can be daunting and even intimidating. If you are a first time home buyer, the process can be even more frightening since you have no experience or expertise in buying a home. Purchasing a home is likely the biggest investment you will ever make, so it is incumbent on you to find the best mortgage possible. Finding the right mortgage takes industry know how and experience, so it is best to rely on a mortgage expert to help guide you in the right direction. In fact, there are many first time home buyer programs available to help buying your new home possible. First time home buyer programs are great options for home buyers who have limited down payments or are in a lower tax bracket.

    Working with a knowledgeable mortgage broker is the best way to make sure you can take advantage of every program available to you. Without the help of a mortgage broker, you could end up leaving thousands of dollars on the table simply because you did not know the program existed or how to take advantage of it and make it work for you. When you work with CapCenter, you can be sure you will understand the home mortgage process and get every dollar available to you through first time home buyer programs. Our knowledgeable mortgage experts can help you get the best mortgage for your needs and make the home buying process as stress free and easy as possible.

    When you are ready to buy your first home, let CapCenter help you. With our experience and expertise, we can help make sure you get the best rates and terms available. With the right mortgage, you can rest easy knowing you have made a sound investment that will give you years of enjoyment, security and a great return on your investment.