Home loan professional Rob Spinosa of http://www.themortgagedictionary.com explains how to obtain financing to buy an investment property. Many potential investors think about ways to purchase real estate as part of an investment portfolio and earn rental income at the same time, but not all understand how to get a mortgage for a rental home or where to start the process. This video covers the differences between residential and commercial properties, talks about qualifying for a mortgage on a non-owner occupied property and provides explanation and tips on getting a loan approval or pre-approval.

For more information or to begin the pre-approval process, contact Rob Spinosa at rspinosa@rpm-mtg.com or by phone at 877-270-5959. Rob is a mortgage banker at RPM Mortgage in Mill Valley, California, just north of San Francisco. He is able to assist anyone in the state of CA, and can be found on social media platforms as below:

http://www.facebook.com/homefinancefundamentals
http://www.youtube.com/HomeFinanceFund
http://www.linkedin.com/in/robspinosa
http://www.twitter.com/robspinosa

If you are one of the millions of homeowners that have been trying to take advantage of the low interest rates and refinance your home; you know that it isn’t as easy as it used to be. In fact it is close to impossible in some situations; the money is available but the credit restrictions make it impossible for millions to be able to qualify for a loan anymore. You may be able to waltz in, but you are quickly flung out on your bottom if you do not meet every new qualification. Banks, along with the government have made qualifying for a mortgage much harder. But, for those who qualify, refinancing with these low rates has helped millions of Americans free up money and saved many homeowners from losing their homes.

Too Many Refinances, Not Enough Time or Employees

The demand for home refinances with these low interest rate has grown out of control. In the last 4 years, banks have given large numbers of employees the boot and are now in a hiring frenzy to get help dealing with all the demand for refinancing. But, they let the volume grow faster than they hired and the whole refinance pipeline is clogged to slow drip. The four major banks are now reporting the time it will take for them to process these refinances. Wells Fargo, the nation’s largest mortgage lender, as well as the third ranked Citigroup and fourth ranked Bank of America are now advising prospective borrowers to expect at least 90 days to refinance their homes. And that is if everything goes smoothly. Wells Fargo and Citigroup are in most cases allowing people to lock in interest rates for longer periods of time, to protect borrowers from losing out on the lower interest rates. Points for Wells and Citigroup!  Wells Fargo and Citigroup have also added staff to help with the volume and lower the processing time.  J.P Morgan Chase, the second largest mortgage lender is informing borrowers to expect  to close their refinances in about 45 to 60 days and has hired over 1,000 new employees to help with the process.

Waiting Lists

I have heard of waiting lists for many things; but never to refinance your home.  One borrower was told by Bank of America that he would be put on a waiting list for his refinance. He wasn’t too thrilled with this song and dance and took his business elsewhere. He went to a smaller lender and got a much better interest rate and the whole refinancing process took 3 weeks from start to finish. Another borrower calling the Bank of America was told the bank was “swamped” and that he would be put on a call list and someone would get back to him in 60to 90 days. Moral of this story, shop around and look at the smaller lending companies, they usually have more wiggle room, whereas the big banks are regulated to death.

How to know if a Refinance is good for you?

First, you need to know that they big banks have a smaller number of lenders to compete with; which means that they can raise their interest rates and make a bigger profit on you. So, do your homework and check the smaller lenders because they have more lea way to work with. Some will even pay your closing costs. But, you also need to make sure that a refinance will actually save you money. In the first seven years of your loan you are paying about 95% on the interest of the loan and if you refinance; you will start all over with almost all of you payment going to interest instead of principle. You need to do some homework and use the online calculators and work with your lender to make sure a refinance will save you money in the end. Of course, if you are about to lose your home and can still qualify for a refinance; the lower monthly mortgage payment could be your only option. This is your money and your home; take the time to find the best option for you.

If you are planning on moving; one of the first things you will need to do is to de-clutter your home. You will have to throw out, give away or sale a myriad of items. A good rule of thumb is sale anything that you have not used for the last six months. This is an emotional and physically grueling process. You will need someone close to you to help you go through your home. Make three piles; the throw away pile, the give-away pile and the garage sale pile. If you are trying to sell your home, this is a must.

Planning

You will need about a month to plan the perfect garage sale. You will need to check with HOAs and the city to see if there are restrictions. You will need to decide where you will hold your garage sale; in the actual garage, on your driveway or front lawn. You will also need to enlist the help of friends and family and make a schedule. They may even want to offer up some items of their own for sale. You will need to put up a canopy or tent if the weather is especially warm or wet. Or you may have to move the sale to another area if heavy rain is expected. You will also need to determine how many tables you will need to display your items. You will need to make signs and plan out the best way to place them to make them easy to follow to your sale and to check with the city and HOAs to make sure that you can put up signs. You will need to decide if it will be a one day or weekend sale and the time. Garage sale enthusiasts are very serious about shopping and if you are not ready when you say you will be open, they may just leave. Don’t forget to advertise. Word of mouth is great; but you want to put it in the paper or online as well.

Pricing your Items

While sorting your items you will want to discard any broken items and wash everything else, including clothes. People are more likely to purchase clothing that is washed, ironed and hung on a portable clothing rack. The key to pricing is to price at one half or one third of retail price. Put a price on each item. It is very annoying to have to go and find someone to ask what the price of everything is. Remember not to stick price tags on valuable boxes that could diminish the price of the item. And have each helper go through the items and get acquainted with the items and prices. If you are selling antiques, have a card that states the age, the time when it came into your family and any other information you may have about the item. You can go to www.Valuemystuff.com and get help with pricing things like old electronics, typewriters, dishes, etc. Do your homework.

Setting the Scene

Have you ever walked into garage sales that have things everywhere and you have to be careful where you walk? It is a much better experience to have things on tables and racks so that you can easily see the items and know what section items can be found in. Signs that show where clothing and shoes can be found make it much more organized than just thrown on the ground in a pile. Take some time in setting up your displays and allow room for people to move about easily. Be prepared with newspaper or wrapping paper, boxes and bags to send people home with protected goods. Have one specific place to keep your money in and make sure that it is well protected and watched over. Balloons on your mailbox can help direct people to where your sale is. Enjoy yourself; a smile on your face can be just as important as the things they came to look at. If it is hot; a few paper cups and cold lemonade can go a long way to keep people at your sale a little longer. Or hot chocolate if it is cold is an inexpensive way to make people feel good and maybe even more enticed to buy. Have fun with it and be prepared. And whatever doesn’t sale give to a charity. You will feel good and all that clutter and stuff you have been holding onto for all these years will be gone and you will feel the heaviness of it all float away.

First, it appears that the current economy in our country, and tightening of financial belts with a large portion of the population, is causing people to become their own handyman.   The Times referred to people becoming an army of Bob the Builders.    While this may be a little overstated, many more homeowners and even renters are taking on home improvement or repair projects that previously they would not have considered doable by themselves.

According to a report from Bank of American, many Americans are now taking on home improvement projects they would have normally hired a professional to complete.    The report found the following items:

• In the last year, 70 percent of respondents have taken on tasks like plumbing, painting and home cleaning.
• The most common chores cited were fixing leaky faucets or loose wiring in a light (42 percent), followed by yard work and gardening (36 percent).
• Gen Y-ers (age 18 to 34) are most likely to be found in the DIY crowd.   Among that group, 84 percent said they’d take on home improvement projects, compared with 70 percent of 51 – 64-year-olds.

Frankly, I’m surprised by these statistics.   I am surprised by the apparent normal and easy around the house tasks that, under a more robust economy, people would hire out to others.   Indeed, if things are going financially well hire someone to do the yard work.   If times are good, hire someone to paint the living and dining rooms a more currently stylish color.   Perhaps there is a much deeper message here than is intended.

Is There a Deeper Message Here?

When I was young, my parents showed me by example that if something was wrong around the house, you simply got some tools from the shed and fixed it.    If you couldn’t fix it, you would call a friend who happened to be more handy than you to come over and lend you some help.   If the pipe in the bathroom feeding the shower was broken and you couldn’t fix it right away, everyone took bathes until it got fixed.    In today’s society, and I guess when people are making adequate money to support themselves plus a little bit more, you would call a plumber to fix the broken pipe, or call the local landscaping company to come by and mow the lawn.

This is hard for me to understand.   Let’s just consider the yard work portion of this situation.   My dad would die before he would hire someone to mow the lawn.   Hiring someone to do something so basic to home ownership just wouldn’t come to his mind.   Spending money to do something so easily done by yourself would go against his very nature.    My mother was no different.

An Opportunity to Learn to Work

At the same time, there were four sons born to my parents and each of us was taught to mow the lawn before we turned twelve years old.   From that point forward, the chore of mowing the lawn was delegated by my Dad to one of us to do each Saturday.   Mowing the lawn was not just a chore to be done around the house, it was an opportunity to learn to work and take on some kind of responsibility.

The knee jerk reaction to hire someone to care of household chores just because there is money available to do it, is one of the reasons our country is learning to take and expect government to provide for their needs, rather than supporting the self-reliant society taught to us all by our parents and grandparents.

Basic Finance 101 is truly basic. It consists of three areas of concern. Millions of us just don’t get it or more realistically don’t want to. Did you ever watch “Willie Wonka and the Chocolate Factory”? Do you remember the little English girl named Veruca Salt? Her lines mostly consisted of “and I want it NOW”. Well, there are millions of us who have the same thought going through our minds when we see something we just have to have. If we don’t have the money, we pull out the plastic and “get it NOW.” This is why we have Basic Finance 101. We need to push that character trait right out of our reality. That particular trait will only get us into big financial trouble.

First   We have to know exactly what we have to work with; our salaries, child support, alimony, monthly annuities, social security, etc.  We need to add up all the monies that come in every month. Those that come in once in a while, leave out.  You need to determine to the penny how much you have to work with each month.

Second    You will next have to sit down with all your monthly and quarterly bills. Pay yourself first; this may take a little trial and error, but if you put a certain percentage into a savings account each payday; you will be surprised how much you can save. Have it directly deposited so you don’t even see it or touch it. Start with what needs to be taken care of monthly and add up how much of your income it will take. Then try and work in the quarterly bills by saving money out of what is left over after paying your monthly bills. This can actually be a very good experience when you see how much money is left over. Or it can be very depressing in which you may have to go out and buy a new outfit. NO, I was just kidding, don’t do that; we’re not done yet.

Third    Determine how much is left after covering all of your monthly expenses. Then divide that figure by the number of days in the month to reach your daily spending goal. I know, you’re thinking; she’s crazy and why should I do that, right?  You need to keep track of everything that you spend money on. Get a tiny notebook and pencil and keep it with you. Write down every coffee or snack as well as the big things. This will help you think before you buy. And hide the credit cards, where they are hard to get at. Blowing your budget by even $5 a day will leave you $2,000 in debt in a year.

 Things to Think About

Set goals, if there is something that you need or want; set yourself a savings goal. Tell someone close to you that you can trust about your goal. It’s like dieting, it makes you accountable. And take a look at every monthly expense and see if you can lower it. If you have credit card debt; take the card with the highest interest payment and start paying as much as you can afford over the minimum payment. When that card is paid off, start with the next highest interest rate card and pay the same amount of money on that card and so on; until you completely rid yourself of credit card debt.  Tip-don’t close your credit card accounts once they are paid for; it will lower your credit rating. Just set the card back in its hiding place and don’t use it. If you must use credit cards; only keep a balance of 20% of your credit limit. Never max out a card. It will hurt your credit score.

Remember, total your income, subtract your monthly payments; save and budget the rest to pass Basic Finance 101. Reach for that A+ in the class.

Good News for Texas Housing Market

This is very good news for the Texas housing market which seems to be experiencing some of the positive attitudes toward housing that the rest of the country wishes it could capture.   The Texas market has not suffered the devastating value declines of many of other states and parts of the country, so it’s not surprising that Texas buyers would start to see the housing market in a more positive light.    Confidence in the state housing market is driving local buyers into the purchasing process.

Home Sales Up in 2012 over  2011 by 2.7%

For January through March 2012, the volume of single-family home sales in Texas was 45,502, 12 percent more than the same quarter in 2011. The median price for Texas homes during the quarter was $147,100, up 2.7 percent more than a year ago.

Months inventory was at six months. Experts say a 6.5-month inventory represents a balanced market.

Several Factors Driving Performance

Real Estate Center Research Economist Dr. Jim Gaines said he believes several factors are driving the strong performance of the first quarter, including continued job growth in Texas and some increased access to credit for homebuyers.   Job growth in Texas has been positive for some time as state regulations and attitudes toward corporate expansion and job growth remain company friendly.   In the past year, states like California have sent delegations of officials to Texas to try and understand how job growth has remained positive, and perhaps how their state might duplicate at least a portion of the Texas success.

Increased access to credit seems to be coming from lenders who are more willing to lend even in the current national housing market crisis, and even lend with some underwriting flexibility.   Several lending institutions have expanded some key lending guidelines to allow more buyers to qualify.   The expansion of guidelines still positions lenders in a much more guarded and conservative position as compared to pre 2007 guidelines, nevertheless, some softening of requirements is adding buyers to the list of those who can get approved for a residential mortgage loan.

Consumer Confidence is the Key to Growth

Regardless of what lenders or Realtors may do to try and stimulate the housing market, the best stimulus occurs when the attitudes of buyers in the state shift toward the positive.    If buyers believe the market is improving and housing values may be steady or even experiencing a slight overall increase, more transactions will occur and momentum in housing sales will improve.   As the Texas housing market improves, it is also hoped that it will be a strong and positive signal to other states and areas of the country that buying a home is no longer a risky proposition.    Historically low interest rates also continue to support any positive movements in the market, as buyers are able to finance at rates not seen in decades.

Overall, Texas home buyers are seeing the housing market in the state as less ‘risky’ than at any time in the past few years.

Find out how banks judge your credit score in this free video on insider banking and finance advice.

Expert: Levi Culbertson
Bio: Levi Culbertson is a 2000 appointee of the United States Air Force Academy. Following the appointment, he moved to Marshall, MN where he was employed in property management by Robert L. Carr.
Filmmaker: Nili Nathan

Tips for home buyers! Find how to get financing to buy a home in this free video on insider banking and finance advice.

Expert: Levi Culbertson
Bio: Levi Culbertson is a 2000 appointee of the United States Air Force Academy. Following the appointment, he moved to Marshall, MN where he was employed in property management by Robert L. Carr.
Filmmaker: Nili Nathan

Banking secrets! Learn how banks make money from loans and how banks work in this free video on insider banking and finance advice.

Expert: Levi Culbertson
Bio: Levi Culbertson is a 2000 appointee of the United States Air Force Academy. Following the appointment, he moved to Marshall, MN where he was employed in property management by Robert L. Carr.
Filmmaker: Nili Nathan

Discover how a mortgage works and find tips for making the most of your mortgage in this free video on insider banking advice.

Expert: Levi Culbertson
Bio: Levi Culbertson is a 2000 appointee of the United States Air Force Academy. Following the appointment, he moved to Marshall, MN where he was employed in property management by Robert L. Carr.
Filmmaker: Nili Nathan