4 of the Most Common Types of Mortgages

With Toby Stanfield and Brittni Cooke of Highlands Residential Mortgage

Before buying a home, you first have to know how you’re going to pay for it. For many, that may seem like a no-brainer, but a lot of us get excited at the prospect of owning a new home, and want to start house shopping before we even know what we can afford.

When it comes to figuring out financing, most people don’t even know where to begin, which is part of the reason so many jump to calling a Realtor to show them homes. There is nothing wrong with calling a Realtor first, but you should know one of the first questions a good agent will ask you is, “Are you pre-approved for a loan?” No need to get discouraged if you haven’t been pre-approved! A good agent will also be able to refer you to a reputable lender if you don’t already have someone to turn to. But, something else you might be wondering is, what kinds of mortgages are there?

You may be thinking that a loan is a loan, but not all loans are created equal, and for good reason. Below, read on to find out how the four most common types of loans in North Carolina (and most of the United States) work.

Conventional

Conventional loans tend to be the most common type of mortgages people receive when financing a new home. A lender will look at all the usual things to find out if you qualify such as your finances and credit history, however to receive a conventional loan, you have to have a very good credit score to get the best interest rate.

So, what makes a good credit score?

According to Brittni Cooke from Highlands Residential Mortgage, the average “good” credit score that will help you land that conventional loan is around no less than a 700. Additionally, lenders will not only look at your score, but also your history of credit usage to determine if you are indeed eligible. Lenders will also look at your debt-to-income ratio to help you get the best minimum down payment possible and make sure you can actually afford to pay an extra monthly bill.

Conventional loans are also considered less risky when it comes to the home-buying process once it is under contract since it has a faster processing time due to their being less restrictions on the property (more on that later).

FHA

FHA stands for “Federal Housing Administration”, which is the government department created to help low-income individuals and families in the United States obtain loans with lower credit scores and down payments. Technically, the FHA does not actually pay out any money for the loan, but backs the funding, however borrowers must pay for their own mortgage insurance.

This type of loan enables lower-to-middle class families to get the best possible rates with typically a minimum credit score of 640 and down payment of as little as 3.5%, compared to 10- 20% on conventional.

The downside to this type of mortgage is the appraisals are notoriously “picky” and things as minor as chipping paint or rotting wood, to as major as mold or an aging roof, can hold up the entire process. However, according to Toby Stanfield of Highlands Residential Mortgage, people are most commonly qualified for an FHA loan, making it still one of the most popular and favorable loans for buyers to get.

VA

As the name of this loan suggests, it is exclusive for those who serve or have served in the US military. Qualified veterans can obtain financing from the Department of Veterans Affairs for no down payment at all! Often, only a small fee will have to be paid, which can even be rolled into the mortgage if the buyer prefers.

For a veteran, this is an obvious mortgage possibility, especially if they have a low or fixed incomes. Borrowers will still have to pay closing costs and earnest money, and the home they pick will have to meet the VA’s standards like in an FHA situation, but it is definitely worth applying for if you have served for at least 90 days consecutively.

USDA

USDA stands for the “United States Department of Agriculture”, and is designed for low-income families living in rural areas. Backed by the Federal Government, properties must meet the USDA’s minimum requirements to be considered a rural area, and can be obtained with little or no down payment.

These types of loans are similar to FHA and VA in the way that they work, but your debt must not exceed your income by more than 41%. Also, like in an FHA loan, borrowers must purchase their own mortgage insurance. To see if the area you’re interested in purchasing in meets a USDA loan’s guidelines, it must have a population of no more than 25,000, according to Toby Stanfield. Click Here to find out if a property or area qualifies.

These are the 4 main types of loans available for first-time homebuyers, however you do not have to be a first-time homebuyer to qualify for any of these programs. Call or email Brittni Cooke (336) 272-3061 or at bcooke@highlansmortgage.com today to get more information, and learn more about these financing programs as well as other options.

Why You Should Hire an Agent to Sell Your Home

One thing we can’t help but notice around Davidson County is that people around here tend to be “do-it- yourself”-ers. And by that we mean these are handy, capable people living in these parts! We prefer not to hire someone to chop down a tree, or make a fancy cake, or even change the oil in our cars. We can do all that ourselves! And there is nothing wrong with any of that. However, we also notice a lot of people are trying to sell their homes on their own as well, and trying to sell your home on your own can lead to a lot of problems you may not be ready for, or even be aware of. Problems an experienced real estate agent can help you troubleshoot and understand as they arise. For example, working with an agent helps you to price your home right, first of all. They have access to other current and past listings, so they can easily run a comparative market analysis, or CMA, to make sure you are not pricing your home too high or too low. You may think your house should be priced to sell the same as the 3 bedroom brick colonial down the street, however a lot more factors go into pricing a piece of real estate other than style and location. Another good reason to hire an agent to sell your home is probably stating the obvious: they are just more knowledgeable about it. Do you know what closing costs are? Do you know how to calculate excise tax? What happens if something comes up on the inspection that causes you to have to renegotiate- are you prepared for that? An experienced agent can navigate all those muddy waters for you, and all you have to do is sit back, relax, and nod along as they explain the process and keep you informed. Remember- we’re working for you! Here’s another factor you may not be considering: an agent doesn’t have the same emotions tied into selling your property that you do. Think about it…you may be selling the family home where your kids grew up, or you may have spent your own childhood there as well. Maybe it’s your late mother’s house, and you know she would just be rolling in her grave if you sold it for any less than exactly what she thought it was worth. You’re going to get upset if someone comes along and makes an offer 20K below what you’re asking. An agent can help manage offers coming in and present them to you the best way possible, and negotiate on your behalf. An agent will work hard to get you the best price without getting upset about it and possibly causing a potential buyer to change their mind. Yet another reason to work with an agent is you don’t want to be held responsible if something goes awry that could come back and bite you in the you-know- what. There are so many legal implications involved in selling real estate, and, yeah, you may have a good attorney on your side already, but they can and will only do so much. A realtor will be there every step of the way to make sure your selling sails stay smooth, and will also be keeping you informed through the entire process.

Consider them your personal coach, teammate, and cheerleader all in one! We’re not here just for the paycheck- we genuinely want to make sure you walk away from the deal happy and satisfied. Anymore questions? Call a local Realtor today: (336) 600-1052

New Years Resolutions for Buying a Home

Were you thinking about buying a Lexington or Clemmons, NC home in the last year, but never got around to it? Sometimes it can be hard to get around to doing the things you need to do if you're serious about buying a new home, but the new year is upon us, and with every new year come New Year's resolutions! Here are a few New Year's resolutions you can make to try to get into a new house this coming year. Just don't break these resolutions a month in, okay?

Save Money

In most cases, you're going to need to have a downpayment for your home, so how much have you saved? It's not fun, and it's not always easy, but putting yourself on an austere budget for a while will help you save up the money you need for a downpayment. Think about that next time you're considering a $4 cup of coffee.

Raise Your Credit Score

When is the last time you checked your credit score? There are websites out that like CreditKarma.com that will let you check your score for free, send you updates as your score changes, and give you suggestions for further improving it. In the meantime, just make sure you pay your bills on time. And don't forget to actually use those cards from time to time; $0 balances on unused cards can paradoxically hurt your score.

Check Your Options

Go ahead and start talking to a mortgage broker. Even if you're not ready to buy yet, discussing your situation with a mortgage broker can help you with expectations of how much house you can afford. On top of that, a mortgage broker will let you know what you need to work on, how much to save, and what information to start gathering. They can also help you find government programs such as VA and FHA loans to help with your purchase.

Get Pre-approval

Once you've got your money saved up and everything is in order, go ahead and get a pre-approval. While nothing is in stone at that point, it lets sellers agents know that some financial institution most likely has your back and that you're serious about looking for a house. This can be helpful, especially in markets where homes are going fast.

Know What You Want

Maybe you like new homes in neighborhood developments while your spouse pines for an old farmhouse on a few wooded acres. Maybe one of you loves basements while the other wants everything on one level. Knowing what you want in a house before you start looking will save a lot of headaches and make your Davidson County realtor's job a lot easier.

Get Your House!

The final resolution for getting a Davidson County home is... getting your house! If you've followed all of the above homebuying resolutions, you'll be inviting your family and friends over to your new home for Christmas and New Year's Eve around this time next year!

Q&A with Alyson Hill of Movement Mortgage

The first step to buying a home- before you even start looking –is to know how you’re going to pay for it. Some people are fortunate enough to be able to pay cash right out of their own pocket, but most of us are not. That’s why we have mortgages, and while thinking about applying for such may give many people heart palpitations, it’s not as scary as you might think.

Hurricane Irma wrecks havoc on my Disney Trip & my mindset

Anyone who has met me, even for just a few minutes, knows that I tend to Iive life with my emotions on my sleeve. I can be high strung and I keep a lot of things “on my plate." This can be extremely difficult for everyone around me, and even myself. So, even now, while I am on a family vacation at Disney World,. I have been dealing with a lot of things that have stopped me from fully seeing the joy in my loved one's faces on this trip. I have been stuck in a room eating my weight in Cheetoes ( sorry, Elliott), waiting for the cleaning up of the destruction left behind by the now infamous Hurricane Irma. It wasn't too terrible around here when we arrived in Orlando, so I assumed that by Tuesday we could really start our vacation. I was right about that in the fact that the parks were open, but my head wasn't. This was because of crap going on at home. For those of you who don't know, our office was broken into a few months ago. Then, someone stole my car a few weeks ago (I did get it back, but missing a lot from the inside).

So the night Irma came through I decided to participate in my Crossfit gym's no arm burpee challenge in the middle of the hurricane. If you would like some comic relief it's right here. The only problem is the following day we were about to start off my real vacation at the most magical place on earth, I got some crappy news. Irma decided she did not care for my videos making fun of her here in Florida, so she decided to drop a tree on TWO cars at the house. And, yes, if I had full coverage over those bad boys we would be doing the happy dance, but we all know I am too cheap for full cover. So, womp womp-, and, no, homeowners insurance doesn't cover the car, just the removal of the tree. Then, while I was spending an arm and a leg for a soda here in Disney, I was getting kicked in the junk at home too: I had two contracts terminate yesterday. Just an FYI: real estate is a fickle business. Some deals go so smooth, and others, well, you see what happens to them; they lay there lifeless while you try your hardest to resuscitate them. I was pretty grumpy the rest of the day;. I just took it as if I was in character of one of the 7 dwarfs.... At the end of the day I was tired, my feet were numb, and I had 2 boys who didn’t want to do anything but ride the Nemo & Friends 15 times. I was frustrated with my ungrateful Bash Brothers, and their side kick, sister, The Siren. She, who was screaming most of the evening..... So Then, by happenstance, when I was really feeling at my lowest level of patience, it just so happened that during the 15 rides of Nemo, we received an unexpected gift.… There was a little Stellybelly dress on Keekly's (The Siren’s) stroller. It had a card on it that said: “In memory of my daughter Eleanor Josephine Please accept this random act of kindness on this 9.11.2017 her second birthday”. Now me being me, even though I had had a really crappy day with business and with my cars, I still felt like this could be something someone else could use more. After doing a little bit of Googling, I found the family where this gift came from: Natalie Morgan and her family. I read her story and broke down while riding those clam shell seats for the 16th time. I try to give my kids the world, but, at the same time, I let the drawbacks of life blind me from the valuable times spent with my kids.

I found her story with Today.

But the short of it is “There will be times your child will scream and cry any time you try to put him or her down. Or they'll cry even as they're in your arms and you've done everything you can possibly think of to get them to stop. There will be sleepless nights, multiple diaper changes in a matter of minutes, spit up in your hair, pee on your shirt, and poop in your hands, and again — so much screaming from the baby, and probably from you as well. Every time that happens, every time you feel frustrated and want to run away, please remember my story,” I am just writing this to share my thanks to this family and to share. Hold your babies tight and enjoy the time you have with them.

2017-09-12 17.35.19.jpg
2017-09-12 17.35.18.jpg
2017-09-14 08.26.50.jpg

Welcome, NC Homes

Welcome home to your Welcome, NC home! 

If you're looking for a home near Winston-Salem or High Point, but away from the hustle and bustle, you need to make sure Welcome, NC is on your list. It's a 20-minute drive to Winston-Salem and it's just under a half hour commute to High Point. Greensboro's a little bit further with a 45-minute drive, but it's still doable and very worthwhile if you just want to get out of the city.

Are You Ready to Sell?

So, you may have been thinking about it. You’re thinking, maybe it’s time to take the plunge. It’s time to stop worrying over it, it’s time to stop making excuses, and just sell your house already!

Whether you have a growing family or a shrinking one, or it just feels like the right time to upgrade or simplify things, the decision to list your home for sale is never a simple task. But, with the right help and guidance, the load can be lightened.

The first thing you need to ask yourself is: Once I sell my home, do I know where I’m going after that? If you’ve already made plans to move into a smaller or larger home that you already know you can afford, regardless if your current home sells or not, then that is the first step in the right direction. Maybe you are choosing to rent a small apartment instead, or move in with family. In those cases, making sure you have enough in your savings and have paid off most of, if not all of, you non-mortgage debt, are less of a concern. However, if you’re planning to buy a new home that is worth more than your current, making sure you have a solid financial plan in place is key, and something many people don’t think of before they list their house. Not being financially secure before you list your home can lead to many more headaches you won’t be expecting, making the process all the more stressful. You’ll need extra funds on hand not only for the move itself, but also maintenances of the property that may come up if a potential buyer requests them.

Sitting down with an experienced financial advisor is a good idea if you’re not sure where you stand money-wise. If you don’t know where to find one and don’t have anyone who can refer you, this would be a good time to contact your bank or a real estate agent, both of which tend to have a roster of reliable sources for these matters.

However, sometimes you need to sell because you simply can’t afford to live where you’re living anymore, and you may want to just sell your home “as-is”. This is a viable option as well, but it may take longer to sell your home if it needs some upgrading, and it may not sell at full market value. A knowledgeable real estate agent can best advise you on how to price a home in need of some TLC.

And, speaking of real estate agents…once you feel that you are as ready to move as you are to sell, now it’s time to find a good agent to help get your house sold! You’ll want to work with someone with your best interests in mind, but who also isn’t afraid to be honest with you and not just be a “Yes-Man”. The agent you choose should make you feel at ease with their breadth of knowledge and experience, and they should be prepared with advice on how to get your house market ready, be familiar with the area you live in, show evidence that they have the tools to sell, and be able to make recommendations for you when it comes to attorneys, home inspectors, and property surveyors, just to name a few.

Referrals are an agent’s bestfriend, so talk to people you know- friends, family, co-workers, neighbors –and ask them if they can recommend a good agent for you. If you can’t find a recommendation, stop in a few local real estate offices or do some research on the internet to see who others in your area are using successfully.

Okay, now you’re financially ready and you’ve found your agent- what’s next? It’s time to get your home ready for showing to potential buyers! Most agents can advise you on this part, and may even have a handy checklist for you to use. Some things to consider are:

  • Keep the yard neat and well-maintained, meaning mow that lawn, trim those branches and shrubs, and keep overall yard clear of debris, such as toys and tools

  • Take down and put away any unnecessary clutter and pictures that wouldn’t have meaning to anyone but you. For example, you may have a thing for clown art, but those viewing your home may get creeped out by it! It’s time to make those walls and shelves look like they’re makeover-ready! The easier it is for a buyer to imagine living in your home, the better

  • Paint! Find spots that need touching up and make those walls look fresh! If you have any “radically” painted rooms that may look garish to others, it might be time to consider something more neutral

  • Do any repairs that may not seem like a big deal to you, but could stand out to someone looking at a home with new eyes. For example, fix gutters, polish hardwood floors, fill in cracks on walls, keep doors and windows clean and neat. Fresh paint on the front door is a simple thing you can do that does wonders for first impressions!

Once you’ve made all the necessary adjustments to get your house showing-ready, now you’ll just want to stay on top of keeping things neat and clean as much as possible. Keep toys put away, keep pet areas neat, keep floors vacuumed, furniture dusted, etc. Little touches like fresh flowers in the entry way or on the kitchen table can really help buyers walk away with a good feeling about your home as well!

If you’ve done all these things, now your agent takes over and handles all showing appointments and negotiations with offers that will start to come in. Whomever you choose to assist you in selling your home, they should be able to have a conversation with you at least once a week to keep you up-to-date on how things are going, and advise you if anything needs to change, such as the way the home is being marketed, or reviewed by buyers. Just remember, these things can take time, so don’t expect your home to sell right away. It can take weeks or months before you get a solid offer, so be prepared to hang in there and keep that in mind in regards to your projected moving date.

Have more questions? We would love to hear from you! Call our office today at (336) 600-1052, and speak to one of our friendly and knowledgeable agents today!

Why You Should Consider Buying a Home in Lexington, NC

Why You Should Consider Buying a Home in Lexington, NC

Lexington is experiencing an exciting rejuvenation! New independent restaurants, wine bars and microbreweries are opening up – many in restored furniture factories. Lexington has long been known for its famous barbecue – and that's still here too – but new culinary experiences are available all through the uptown area.