The housing marketing in the St. Louis Missouri area is getting more and more difficult for home buyers, the most recent statistic I saw for certain areas of St. Charles and St. Louis County showed homes on the market for only 17 days! We are starting to see Open Houses that have dozens of potential home buyers attending and multiple offers on homes their first day going onto the market. Speed, Agility, and paying very close attention to new homes coming to market is most new home buyers best methods to stay ahead of the game. But, many home buyers have a secret weapon, a weapon that allows them to consider ALL homes on the market creating a better home buying experience.
THE FHA 203K YOUR SECRECT WEAPON
The FHA 203k is a renovation mortgage program that will provide you with the funds to not only purchase your new house but also fix it up to make that house your home. The FHA 203k is becoming the secret weapon of choice for many first time home buyers because it helps them consider every house for sale in the area or location they consider their first choice. No longer do they have to settle for a house, no longer do they have to turn away from a house that needs some repairs or even a lot of repairs, and no longer do they have to scratch off AS IS houses.Imagine finding that near perfect house, it is located in the area you want, the house is what you want, it is close to work, good schools, and play, the it has more rooms than you need, it is everything you want except..... The FHA 203k will fix that except for you and fix it to what you want!Because you are not competing for a house that many others want you have more ability to negotiate the sales price, negotiate closing costs, and get more home for possibly less money. The FHA 203k should be your secret weapon if you are looking for a house in the St. Louis and St. Charles area or even nearby.
The FHA 203k is just one of many renovation home loans, if you would like to learn more about the FHA 203k in St. Louis Missouri, I have a lot of information at my website, https://www.bobrutledge.com/fha-203k-renovation-St.Louis.Another option is the conventional counterpart to the FHA 203k, the Fannie Mae HomeStyle Renovation Mortgage, there are many similarities to the two programs, the biggest differences is that the HomeStyle has a higher loan limit, requires a little more for down payment, and limits the renovation costs. Go to https://www.bobrutledge.com/HomestyleRenovation and learn more. If you are eligible for a VA mortgage, thank you, there is a VA Renovation Home Loan that can help tweak that house you are looking at. The VA Renovation Mortgage will not allow for anything really major and limits you to $35,000 in renovation costs but it can help. If you would like to learn more go to https://www.bobrutledge.com/VA-renovation-mortgageAt my website you can read about the Renovation Equity Plan and how a renovation mortgage is helping new home buyers build instant equity in their new home. There is a Renovation Mortgage FAQ that should help to answer all your questions.If you are having troubles finding that new home or you are about to enter into the St. Louis and St. Charles home market you need the FHA 203k as your secret weapon. I would welcome the opportunity to work for you as your mortgage loan officer, I can get you approved for any mortgage plus any renovation mortgage, go into your home search with more.
My name is Bob Rutledge, I closed my first FHA 203k renovation mortgage in 1998 and I have closed 100s of renovation mortgages in my career. I have been certified as a FHA 203k and Renovation Mortgage Specialist because of my experience and knowledge. New American Funding is a national lender and one of the best renovation lenders in the market, out offices are located throughout St. Louis and St. Charles Missouri. Visit me at https://www.bobrutledge.com/Home
you about to start the home buying process? Are you currently in the process
and you feel overwhelmed with the process of home buying? You’re not alone.
Homebuyer surveys find that more people today want to buy a home, but challenges
such as saving for a down payment and student loans are keeping them sidelined.
We know the vast majority of buyers (92 percent) use online
search at some point in their home buying process. Maybe that’s how you found
me at www.bobrutledge.com!
But, before you start picking out your dream house online, take
a minute to make sure you grasp these 7 key facts about homeownership.
1. Go back to school (for a day). We know you
probably just Goggled “how to buy a home,” but did you know there are homeownership
education courses that can really help you prepare? Homebuyer counseling is occasionally
required when using a down payment assistance program, but any buyer can
benefit. You’ll learn about the home buying process, improving your credit,
mortgage terms, planning a budget and more. Plus, a new study finds that by
simply participating in these in person or online courses, you’ll reduce your
risk of foreclosure by 42 percent.
an agent. If you aren’t yet a homebuyer, there’s no reason not to have a
real estate agent. Your agent’s commission will come from the home you
purchase, not your pocketbook. Everybody wins! Even if you don’t think you’ll
need help with lots of showings, a real estate agent will help you navigate
contracts between you and the seller and set up important things like the home
inspection. As a new buyer, you’ll benefit from the expert help.
the right lender. (PICK ME) Your mortgage lender will help you
secure your home financing—and, there are many types of banks and lenders who
can help. Unfortunately, according to the Consumer Financial Protection Bureau
(CFPB), nearly half of homebuyers don’t shop around for a mortgage lender. Like
you, your finances and home buying goals are unique. So, it makes sense to shop
around and interview your lender for the job. Find a lender that can work
within your parameters and not their own, too many lenders will make YOU
credit score matters. The type of loan you get, including
interest rates and points paid, is primarily determined by your credit score.
The better your credit score, the more affordable loan you can get, often with
more options for a low down payment. For low down payment loans, your MIDDLE
credit score needs to be a minimum of 620. Review your credit report, make
adjustments and get prepared so you can enjoy the lowest interest rate possible
and save cash over the life of your loan.
don’t need 20 percent down. You may have heard or read that you
need 20 percent down. It’s not necessarily a bad thing, but that’s just not the
case. And, if using a low down payment can get you in a home now (instead of 3
years from now), you’ll enjoy low rates and get out of a rising rent situation.
Low down payment options have been around for a long time. In fact, data shows
that low down payment loans with sound underwriting (loan is fully documented,
income verified) are just as successful as loan with large down payments.
payment programs offer savings. Did you know the average
down payment assistance benefit is more than $8,000? Many homebuyers don’t know
about homeownership programs that can help them get in a home much more quickly
and provide a valuable cash cushion for other home buying expenses. You could
save on save on your down payment and closing costs, or even get ongoing tax
credits. If you would like to see how a low down payment mortgage and down
payment programs can help to get you into a new home with zero out of pocket
expense follow this link to my ZERO PROGRAM.
forget to budget closing costs. Most buyers focus on saving
for a down payment, but your closing costs can run you another 3 to 5 percent
of the sales price. It’s important to factor in those costs so you are prepared
for the closing table. Ask your agent about negotiating those costs with the
seller. In addition, some homeownership programs can help you cover your
(1) Shopping for a
house before a mortgage
It is so much more
fun to look at homes than it is to talk about your finances with a lender. So
that’s what a lot of first-time home buyers do: They visit properties before
finding out how much they are able to borrow. Then, they are disappointed when
they discover they were looking in the wrong price range (either too high or
too low) or when they find that right home they scramble to get financing, and
the mortgage is not something you want to rush or put too little of time in to.
In today’s housing market you want to show home sellers you are a serious buyer
and able to make a serious offer when you find that right home.
How to avoid this mistake: Talk to a mortgage
professional about getting pre-qualified or even preapproved for a home loan
before you start to seriously shop for a place. The pre-qualification or
preapproval process involves a review of your credit, income and expenses. Having
a per-qualification/pre-approval letter in hand will make your offer more
competitive, and most offers today must have this letter.
(2) Not looking for first-time home buyer
As a first-time
home buyer, you probably don’t have a ton of money saved up for the down
payment and closing costs. But don’t make the error of assuming that you have
to delay homeownership while saving for a huge down payment. There are plenty
of low-down-payment loan programs out there.
Besides low down
payment mortgage programs there is a lot of down payment assistance programs available
to first time home buyers. Many times the funds that are available to you from
DPA (down payment assistance) Programs will cover your entire down payment.
Even if you have saved enough for a low down payment mortgage program keeping
your savings in your pocket will allow you to pay with cash for the items you
need for your new home. I see too many home buyers use credit to purchase new
home items, increasing your monthly credit obligations just after purchasing a
Visit my website
at http://www.bobrutledge.com/MODPA to learn more about what is available in the State of Missouri!
How to avoid this mistake: Ask a mortgage lender about
your options. You might qualify for a Veterans Administration or U.S.
Department of Agriculture loan that doesn’t require a down payment. Federal
Housing Administration loans have a minimum down payment of 3.5%, and some
conventional loan programs allow down payments as low as 3%. Ask about down
payment assistance programs as well. Do your own homework too, search for DPA
programs in your area.
(3) Not hiring a buyer’s agent
Too many home buyers
make this mistake! Do not make the mistake of working directly with the
seller’s real estate agent, who was first hired and obligated to secure the
best price and terms for the seller. Do not be persuaded that a Real Estate
Agent can negotiate in all fairness to both sides, it is impossible. As a
novice home buyer, you could be overmatched when negotiating with an
experienced agent who’s working on the seller’s behalf.
How to avoid this mistake: Work with an exclusive
buyer’s agent, who has a duty to work in your best interests. If you do not know
a real estate agent, seek out referrals from your friends and family. But, if
you are working with a Mortgage Lender they will know many qualified real
estate agents in the area and especially an agent who will fit your needs.
(4) Using up all of your savings
If you buy a
previously owned home, it almost inevitably will need an unexpected repair not
long after. Maybe you’ll need to replace a water heater, repair a crack in the
chimney or get rid of hidden mold.
Having money in
your account after you close is one of the best situations for any home buyer.
Besides the home repairs that will come, what about the small items that will
be needed for your new home the moment you move in.
Using your own funds
and not your credit cards will keep you from increasing your debt loan. You
have a new house payment, normally at or higher than your previous rent, try
not to add to your monthly debt with additional credit card purchases if you
don’t have to.
Read about my ZERO
PROGRAM at http://www.bobrutledge.com/zero-down-payment-closing-costs and how easy it is for new home buyers keep their savings in their
to avoid this mistake: Save enough money to make a down payment, pay for closing costs
and moving expenses, and take care of unexpected expenses. This is easier said
than done. But you can buy a home with a down payment of much less than 20%,
allowing you to conserve your savings.
(5) Ignoring a home’s flaws and drawbacks
A lot of
first-time home buyers fall in love with one of the first properties they look
at. They ignore the negatives of the house and its neighborhood.
But you can’t disregard
the downsides forever. For example, you might think you’ll be OK with a
long commute, but after a few months of spending too many hours stuck in
traffic, you’ll wish you had bought a house closer to work.
How to avoid this mistake: Do two things. First,
resolve to visit many of houses before
making an offer, you’ll be less likely to fall in love with the first or second
or third home you look at.
Second, write a list of the
attractive and the unattractive qualities of each house, and pay attention to
each home’s downsides.
(6) Being indecisive
The flip side of
choosing a place too quickly is acting too slowly when you find the right home.
In a market with more buyers than sellers, you have to move fast.
I see this a lot when I first
pre-approve a home buyer, they needed some time to think about it and made an
offer two or three days after viewing a house, only to discover that another
buyer had swooped in and made a successful offer. This will only happen to you
after the first couple times, but by then you will know what you want in a
home. If this happens to you know that it is normal and simply a part of the
learning process of being a first time home buyer…..all things happen for a
How to avoid this mistake: Once you look at multiple
houses, and you get a feel of the market and you know what the market is like
and where the prices are at, and you see something you like, don’t hesitate to
make an offer, because you and 10 other people will be interested in that same
property, this is today’s housing market.
(7) Overpaying for a house
home buyers tend to pay more than experienced buyers would pay for the same
house, according to research conducted by two economists with the Federal
Housing Finance Agency. In their analysis of appraisal data from more than 1.7
million home sales, FHFA economists Jessica Shui and Shriya Murthy concluded
that first-timers overpay by an average of 0.79%, which was nearly $2,200 per
house, according to the data set they examined.
and Murthy pointed to the inexperience of first-time home buyers. Real
estate agents say newbie buyers let their emotions take over, too. First Time
Home Buyers tend to overlook potential negatives and only look at the positives
of a particular house. I tell me home buyers to act with their heads and not
with their heart, but I know I am asking for the impossible so just use as much
of one as the other.
How to avoid this mistake: Ask your agent for
a competitive market analysis, a report that looks at the prices of comparable
nearby homes that have been sold recently. And it helps to fully understand the
real estate process, so seek out as much information as possible. If you
have friend that recently went through the process or are currently seek out
(8) Skipping the home inspection
markets, a lot of buyers compete for a small number of properties for sale. In
these strong seller’s markets, buyers are tempted to waive a home inspection.
It gives them a competitive edge over smarter buyers who wouldn’t dream of
forgoing an inspection before plunking down hundreds of thousands of dollars
for a home.
It’s a HUGE
mistake to buy a previously owned home without an inspection because there
could be expensive, hidden damage that you wouldn’t spot but an inspector
How to avoid this mistake: Simple: NEVER EVER ALLOW
THIS TO HAPPEN. Hire a licensed home inspector. Your real estate agent will
gladly make a recommendation, but it’s better to hire an inspector of your own
choosing who doesn’t depend on your agent for referrals. Plus, require that a
home inspection contingency is included in your sales contract, your BUYER AGENT
who represent you will help you get this negotiated in the sale contract.
(9) Underestimating the costs of ownership
After you buy a
home, the monthly bills keep stacking up. This can come as a surprise if you’re
Keep in mind it’s not just
your mortgage payment, you’re going to have the utilities bills that you did
not or may not have been paying when you rented.
Renters may have been paying
these kinds of bills, too. But the new home could very possibly have
higher costs simply because your new home is bigger. Your house may come with
entirely new bills, such as homeowner association fees.
How to avoid this mistake: Work with a real estate
agent who can tell you how much the neighborhood’s property taxes and insurance
typically cost. Ask to see the seller’s utility bills for the last 12 months
the home was occupied so you have an idea how much they will cost after you
move in. Ask for a seller disclosure for every house you are interested
in, many times this will help you.
(10) Miscalculating repair and renovation
First-time home buyers are frequently surprised by high repair
and renovation costs. Buyers can make two mistakes: First, they get a repair
estimate from just one contractor, and the estimate is unrealistically low.
Second, their perspective is distorted by reality TV shows that make
renovations look faster, cheaper and easier than they are in the real world.
How to avoid this mistake: Assume that all repair
estimates are low.
Seek more than one estimate
for expensive repairs, such as roof replacements. A good real estate agent
should be able to give you referrals to contractors who can give you estimates.
But also seek independent referrals from friends, family and co-workers so you
can compare those estimates against ones you receive from contractors your
purchasing a home in need of repairs with a renovation mortgage program that
will allow you to use your mortgage to purchase your home as well as fund the
repair/renovation costs all in one new home loan. Want to learn more about
renovation mortgages visit my website to Learn More About Renovation Mortgages at http://www.bobrutledge.com/HomeStyle-Renovation-Mortgage
With significant changes to the tax code taking effect this
year, homeowners and prospective buyers are revising their plans to take
advantage of its sweeping changes. Here’s an analysis based on information from
the National Association of Realtors and NerdWalllet.
Tax Rate Reductions. Joint filers with incomes of $77,400 to
$400,000, which will include most first-time buyers, will see their tax rates
decline from two to four percent when they file their 2018 taxes next year.
Mortgage Interest Rate. Changes in the mortgage interest
rate—lowering the cap to mortgages worth o $750,000 from 1 million and
excluding interest paid on home equity loans— would affect only the wealthiest
first-time buyers directly. The changes will make second homes and equity loans
more expensive for first-time buyers in the future.
State and Local Taxes. The new law limits the amount of
property taxes and other state and local taxes to $10,000 a year. First-time
owners, as well as current owners, will lose the ability to deduct thousands of
dollars that they can deduct in 2018, increasing the cost of homeownership,
especially in high tax states like New York and California. In the State of
Missouri most First Time Home Buyers homes will not have an annual property tax
anyway near $10,000.
Student Loan Interest Deduction. Potential first-time buyers
and their parents who have been burdened with student loan debt will lose the
ability to deduct the interest they pay on their loans. As a result, it will
cost them more to pay off their debts to reach a DTI that would qualify them
for a mortgage.
Personal Exemptions. Personal exemptions for filers and
their dependents, worth $4,150 each in 2017, was eliminated in the new tax law.
Moving Expenses. Taxpayers have been able to deduct some
moving expenses related to their employment, but this deduction is eliminated
in the new act.
Standard Deduction. Taxpayers must decide whether to take
the standard deduction or itemize their deductions. In the past, most
homeowners have itemized to take advantage of the mortgage interest deduction
and the deduction for state taxes, including property taxes. The new law
doubles the size of the standard deduction from $6,000 to $12,000, or $24,000
on a joint return. According to Zillow’s Alexander Casey, under the current
setup, roughly 44 percent of U.S. homes are worth enough for it to make sense
for a homeowner to itemize their deductions and take advantage of the mortgage
interest deduction. Under the new law, that proportion of homes drops to 14.4
Impact on First-time Buyers: NAR’s research department
modeled examples of homeowners as different income levels, mortgage sizes, and
A single first-time buyer who purchases a home costing
$205,000 and takes out a 30-year fixed rate mortgage at 4% interest. She puts
down 3.5 percent. Assuming she buys early in 2018, her first-year mortgage
interest would total $7,856, and she would pay real property taxes of $2,050.
Under the old law, her taxes for 2018 would fall by $2,098; Under the new law,
her taxes would rise by $30. Moreover, the difference between renting and
owning was $2,098 under the prior law but shrinks to $637 ($6,060 - $5,423), or
$53 per month.
A family of five with an income of $120,000 that buys a
$425,000 home with a 10 percent down payment on a 30-year fixed mortgage at a 4
percent. Under the old law, they would save $3,219 by buying. Under the new law
their taxes would decline only $100, but if they had remained renters, they
would receive a tax cut of almost $2,400. Under the prior law, the tax benefit
of buying a home was $3,219. Under the new law, they will get a tax cut $948
($8,999 - $8,051), a much weaker incentive to buy.