Electric Loan Officer

Category - Getting Prequalified

6 Reasons Life Is Better As a Homeowner

homeowners are happier than renters

Image used above Courtesy of https://www.flickr.com/photos/xvire

When it comes to owning vs renting a home, the never-ending debate between homeowners and renters never seems to have any clear winner. The former talk about the pride of owning your own place, while the latter focus on the flexibility of not being tied down to one location.

As with most hot topics, both parties may very well have their arguments, but, I can pretty much tell you that buying a home is like most things in life…

You really have to make the change in order to truly appreciate its benefits.

With that in mind, here’s a list of things that simply make life better when you’re a homeowner:

1. You wake up in the morning and you know it’s yours

It may sound cheesy, but homeownership has been a staple of the American Dream for as long as that concept has been around, and with good reason.

There’s just something about waking up inside a place that is definitely, irrevocably yours.

Feel like installing a trampoline in the living room? You got it.

Want to dress up your walls in purple fur? Sure, why not.

When you own the place you can pretty much do anything you can imagine.

2. You don’t have to worry about increasing monthly payments

No matter how nice your landlord is, chances are that sooner or later he’ll want to maximize the return on his property.

This means that as a renter you’re just going to have to deal with occasional price hikes if you want to stay in the same place for longer periods of time. These tend to cancel out whatever savings you may accrue as a result of not paying for maintenance or repair works.

Using a mortgage to buy a home, on the other hand, often comes with the added benefit of having a fixed monthly payment that won’t change regardless of property values. This translates to less headaches and more financial predictability down the line.

3. You get plenty of tax breaks

Buying a house can require some money out of pocket up front, but it all tends to payoff pretty soon even if the value of your property stays the same.

Now, I’m not a tax person so verify this information with your preferred tax consultant, but my guy says there are numerous tax advantages to owning a home. For one, you can deduct your mortgage interest from your tax obligations. You’ll also be able to claim your origination fees the first year you buy a home. They usually hover around 1% of the total price, which can lead to considerable savings. Last but not least, the property taxes you pay for your primary residence are fully deductible for income tax purposes.

These are all measures promoted by the government to incentivize renters to take that that final leap of faith towards becoming homeowners.

4. It’s better than a savings account

When you rent a house or apartment, you’re basically paying another person for the courtesy of allowing you to borrow their space.

The process of owning a home changes that. When you pay monthly installments on your house, you’re paying yourself to live in your home by putting more and more money into your equity and saving it for a later date.

Moreover, while there’s no absolute guarantee that housing values will always keep rising, research shows that housing tends to beat inflation by a couple of percentage points per year over the long term. This means that your house could continue to appreciate in value at a rate higher than the national inflation, making you slightly wealthier year after year.

5. You get to take advantage of an economy in flux

The economic downturn of 2007 – 2010 took a hit on homeownership, but now that the economy is recovering, the numbers are on the rise again. What’s remarkable is that interest rates and mortgage fees haven’t gone up with them.

That’s because, despite a steadily improving economy, the Federal Reserve has yet to take steps towards implementing higher rates. This means that right now you can still get the best of both worlds: the homebuyer advantages brought on by the economic crisis, along with the benefit of a higher purchasing power due to growth in the private sector.

This kind of situation won’t last forever, and it’s likely that 2015 may be the last hurrah for some time.

Be smart now and you’ll thank yourself later. (Get Pre-Approved for an Arizona Home Loan)

6. Flexibility is still on the table, if you want it

This is a big one, since many people use the “F” word (that’s “F” for “flexibility”, folks) to explain why they prefer renting to buying. Personally, it’s what also kept me from seriously considering homeownership for a very long time. But thinking about it in terms of flexibility is a fallacy. If anything, owning your home offers you more flexibility.

That’s because, whenever you do decide to move on, you could have the benefit of a starting out with considerable initial capital from selling the house. You can also put your home up for rent even before you’ve finished paying off the mortgage, and have renters pay you each month while you go on to the next place. The possibilities are endless.

Overall, homeownership shouldn’t be seen as an untouchable pipe dream reserved only for the few and fortunate. There are very real solutions available for normal people like you and I and anybody who truly wants to have a place they can call their own. With the right mindset and a dedicated professional at your side, you’ll be able secure a little slice of heaven and see that life is better as a homeowner.

Do you want to know how much home you could qualify for? Visit http://TheJustinHainesTeam.com for a 100% free, no obligation mortgage pre-approval. This will give you the confidence to work with a Realtor and begin your search for the perfect home.


FHA Loans with 580 credit scores | Lending is getting agressive

FHA loan with 580 fico

It is crazy to see that mortgage lending here in Phoenix is starting to get much more agressive, we are seeing loan programs to qualify borrowers a day after their foreclosures and short sales and now the credit score overlays for FHA loans have completely disappeared.

The thing is, FHA loans always required a minimum credit score of a 580, it has been this way for a while however many lenders/investors who were buying a funding these loans slapped on an overlay of 620 or 640. The investors we are working with now have removed that overlay completely and are doing FHA loans with 580 credit scores or better.

I can’t tell you how many people we have had to decline due to their credit score not meeting the minimum requirements, we have free in house credit services but sometimes they just couldn’t get the scores to where they needed to be to qualify at 620 and 640. It is a great thing that we have kept a pretty good database as it sounds like I have my work cutoff for me in regards to calling everyone who previously applied and we couldn’t get financed.

So what else is on the horizon as far as potentially “niche” type products? We have seen a couple investors out there offering stated income loans in which we thought that we would never see again although you will not find and 100% financing type products for stated income as they now require the borrowers to have a lot more skin in the game… By that I mean investing a much larger down payment, I guess they got smart and decided this is the only way to get the client from walking away from the house if they are in financing distress.

My bet is that with the market flattening out and home prices stabilizing, the investors that are buying these mortgages have made a decision that it is safe to come out and test the waters with innovative new programs. As long as they have all learned their last time from the last housing bubble and don’t come out with any of these ridiculous products like the negative am option arms I think we will maintain some consistency within the market place and it will continue to be a safe bet for homeowners.

But back to FHA loans with 580 credit scores, because Phoenix, Az was one of the places that got hit pretty hard with the housing collapse I think this is a great product to be able to offer as there are many qualified candidates who have great job history, a down payment and can afford a housing payment but are unable to meet the current credit score guidelines of 620. As far as overlays the only two things I can think of here is that we will have to follow FHA’s manual debt to income ratio max of 31/43 (contact me and I will calculate yours for you) and we do not allow any of the down payment assistance products.

As long as you meet the FHA 36months from foreclosure or delinquent short sale and 24 months from a bankruptcy seasoning periods you should be good to go to pursue a pre-approval with us, reach out now and let’s get you rolling!


Looking to get qualified for an FHA loan?

Fill out the form below and we will get in touch