08
Dec
By First Rate Financial Group
Mortgage

Home Values Are Impacted By School Zones: Is The Move Worth It?

Home Values Are Impacted By School Zones: Is The Move Worth It?If you are looking for a home, then you probably have a budget in mind. You also need to know about the most common factors that influence the price of a home. One factor that always seems to play a role in the price of a home is the quality of the school system. This makes sense. After all, a lot of people who are looking for a home have children (or are planning on having children) and want to make sure they have access to a quality education. At the same time, is it truly worth the price increase to have access to a better school district?

The Quality Of The School District And The Price Of The Home

Numerous surveys have consistently shown that the majority of homeowners are willing to go over their budget price for the perfect and home and the location certainly plays a role. In this manner, the quality of the school system absolutely factors into the right location.

When people think about going over budget, they often think about a higher monthly mortgage payment; however, other costs are going to increase as well. For example, you might need to pay a higher down payment, pay more in home insurance to protect the home, and pay more in property taxes. Therefore, is this truly worth it?

This Is A Subjective Decision

In the end, the answer to this question is always going to be subjective. Therefore, you need to decide what matters most to you and your family and compare this to the premium that is put on the home. For example, the school rankings and test scores are certainly important factors. At the same time, they only tell one small part of the story.

For example, you also want to see how much money the school district spends on each of its students. The more money they spend, the more they care about their students. You also want to think about the diversity of the school district as well, as this is closely correlated to the overall quality of the education each student receives. Compare these factors to your budget to see if it is worth the price of living in that school district.

25
Nov
By First Rate Financial Group
Mortgage

Home Expenses Include Far More Than Just the Down payment

Home Expenses Include Far More Than Just the Down paymentIf you are thinking about purchasing your first home in the near future, then you need to be aware of the costs that you are going to take on. When you are looking at the cost of a home, it is very tempting to focus on the sticker price of the home. Even though the down payment is going to be the largest check you are going to write, this is not the only cost that you are going to pay.

There are numerous other costs for which you need to budget as well. By thinking about all of these costs ahead of time, you can make a smart financial decision for you and your family.

Think About The Real Estate Taxes

Depending on the part of the country in which you live, real estate taxes can be significant. For example, it is not unusual for even a modest home to cost thousands of dollars in real estate taxes per year. Therefore, even though you have budgeted for your monthly mortgage payment, make sure that you have budgeted for real estate taxes as well. Usually, your mortgage lender is going to hold your real estate taxes in escrow for you so you don’t end up having to write a large check at the end of the year.

Homeowners’ Insurance And Utility Costs

In addition, you also need to think about homeowners’ insurance and utility costs. Some of the utilities that you have to pay for include internet, phone, cable, gas, electricity, and water. When this is added to your homeowners’ insurance expenses, this can also add up to several hundred dollars per month. Therefore, make sure that you can afford not only the mortgage payment but these recurring monthly expenses as well.

Budget For Your First Home Accordingly

Some of the other expenses that you might have to incur when it comes to your first home include maintenance and repair bills. Therefore, you should make sure that you sit down with an experienced planner and ensure that you can afford the combined expenses. Otherwise, you might end up being priced out of your first home before you realize it.

 

12
Nov
By First Rate Financial Group
Mortgage

How Are Different Mortgage Lenders Handling Student Loans During the Pandemic?

How Are Different Mortgage Lenders Handling Student Loans During the Pandemic?The coronavirus pandemic has had a massive impact on everyone. This pandemic has led to massive economic issues as well. Given the ongoing crisis as it relates to student loan debt, many students are wondering how the pandemic is going to impact their student loans and how their student loans are going to impact a potential mortgage payment. There are a few points to keep in mind.

Freddie Mac

In general, loans backed by Freddie Mac are going to use the student loan payment that is marked on the credit report. If this amount is $0 or unknown, then the lender is going to use 0.5 percent of the outstanding loan balance. This should also be reported on the credit report. Then, the lender will provide the borrower with information on possible mortgages.

Fannie Mae

When it comes to loans that are backed by Fannie Mae, students might still be on an income-driven repayment plan. In this case, the monthly payment might be zero and the lender may qualify a potential borrower with this $0 payment. On the other hand, if the loans have been deferred or are in forbearance, then the lender may calculate a payment that is equal to approximately 1 percent of the remaining balance on student loans. 

FHA Loans

For individuals going through FHA, the lender is going to run a few calculations. The lender may look at one percent of the remaining balance on the loan, the monthly payment that is reported on the credit report, or the actual documented payment as long as the borrower provides ample evidence. The lender will likely use the greater of these amounts in calculations. 

Why Do These Student Loan Payments Matter?

Credit reports are an essential part of the home-buying process. It is critical for everyone to understand what their student loan payments are and how they might impact their credit report. Furthermore, their student loan payments are also going to have an impact on the monthly mortgage payment they can afford. Therefore, it is important for everyone to make sure the information documented on their credit report is accurate when it comes to their student loans.