iowahomeloans

When you’re shopping for a property, the Spring season gives you an opportunity to truly evaluate the exterior of a property in a way that you often can’t in summer, fall and winter. While the property is free of snow, fallen leaves and lush, summer foliage, take the opportunity to evaluate the exterior and decide if it meets your needs – or whether you spot any potentially expensive problems.

 

Check Out the Ground

Is the ground level? Are there signs of runoff or drainage damage? Is there standing water? Drainage and runoff issues can be simple or complicated to solve. In some cases, it’s as easy as cleaning or re-routing drainage pipes from the roof. In other cases, it may require some exterior renovation, which can be quite expensive. Standing water and drainage issues aren’t just a problem because of mosquitos and damage to the property itself; they can also indicate potential problems with the home’s basement or foundation if the property isn’t graded and draining properly.

 

Evaluate the Exterior of the Home

Spring is often the best time of year to get a good look at the exterior of the home. In summer, the exterior may be obscured by lush foliage; and in winter, it may be obscured by snow. Take the opportunity to check areas behind bushes and trees for any deficiency in maintenance. In some cases, it may be as superficial as needing a new coat of paint, but in other cases, foliage can hide rotting or pest-infested siding or foundation.

 

Peruse the Landscaping

Landscaping is a relatively superficial factor in buying a home, as it’s fairly simple to change the landscaping yourself. But if you’re looking at a wide variety of similar homes, something as simple as landscaping can make a difference between the one you want to buy and the homes that you ignore.

 

Check out existing landscaping and decide if it meets your needs. Is it going to require more maintenance than you want to provide, or does it offer the opportunity to mold it into a form you’ll enjoy? Landscaping that requires a lot of time and attention isn’t for everyone; alternately, some people enjoy working in a garden and would be unhappy long-term in a home where the landscaping makes that impossible.

As the document upon which mortgage financing companies base their decisions, your credit report is an invaluable tool in the mortgage financing process. Before you apply for mortgage financing, you need to correct any erroneous entries on your credit report and make sure it reflects the most up-to-date information.

 

Correct erroneous identifying information on your credit report.

 

First and foremost, examine the identifying information on your credit report. Are your name, current address and prior addresses correct? How about your social security number? Incorrect identity information can result in mixing up your credit with someone else’s, and that can have a serious adverse effect on your credit score.

 

Additionally, when a lender goes to underwrite your loan, you may run into trouble if the information you provide doesn’t match the information on your credit report. Correct any erroneous identifying information to avoid trouble.

 

Make sure your credit report shows correct account information.

 

Creditors and credit reporting bureaus sometimes get account information wrong. If your credit report reflects incorrect account information, you may run into a situation where a discrepancy reflects poorly against your actual credit history. Make sure account numbers, balances, opening date and payment information are correct for each and every account on your credit report.

 

Some creditors may not report to all bureaus, so don’t be surprised to see an account show up on one credit report and be missing from another. If an account is on multiple reports, make sure each report reflects the same, correct information.

 

Remove old items that may negatively impact your credit rating.

 

After a certain period of time, old items should automatically drop off of your credit report. However, some companies continue reporting old debts after they’re legally obligated to stop; your vigilance can protect you from this.

 

Different types of items are permitted to remain on your credit report for different periods of time; find out the specifics for your negative items to see whether creditors are erroneously reporting them. If you find a negative item that should be gone from your report, dispute it. Removing one negative item from years ago can make a big difference in your ultimate home financing options.

Some older purchase and sale form contracts include an “as-is” clause, stating that the property is being sold “as-is.” The idea is to reduce seller liability for property issues. Today, most states have laws that protect buyers from “as-is” clauses, requiring sellers to disclose code violations and property defects to buyers. Still, if you see an “as-is” clause in the contract, strike it and require the sellers to list any applicable defects. The protection offered by state laws is a moot point if you get into a blame game with the sellers; it’s better to be clear up front about any issues, and refuse to give sellers a tacit approval to avoid liability.

 

State Laws Protect Buyers from “As-Is” Clauses

 

In today’s home-buying world, most states have laws designed to protect buyers from generic “as-is” clauses and predatory sellers. These laws typically require sellers to disclose code violations and property defects. However, if you see an “as-is” clause in your contract, you may assume that the sellers have something to hide. Ask them to disclose any issues with the neighborhood, property defects, disturbances, etc. Get full disclosures into your agreement to ward off potential problems later.

 

Some Sellers Don’t Know that “As-Is” is Out of Date

 

Some sellers try to work the “as-is” clause into the contract because they don’t realize that it’s out of date. By forcing sellers to disclose issues, you can avoid being drawn into “the blame game.” If you don’t confront sellers regarding the “as-is” clause, you might later find yourself saying to them: “You should have told me.” Only to be answered with “That was your responsibility to investigate. I told you as-is. You can’t blame me now.”

 

While state laws can protect you, it can still take valuable time and resources to enforce these laws and protect yourself from predatory sellers. It’s easier to avoid these issues entirely by addressing them with sellers up front.

Getting a mortgage loan with poor credit has become a lot more difficult than it used to be. In 2007 and 2008, the sub prime lending market took a big hit – more and more homeowners in this segment defaulted, and it caused lenders in this area to pull out of the sub prime market, meaning fewer options for homeowners with poor credit. During this two-year period, hundreds of lenders were either shut down, suspended operations or were sold. This crisis has lingering affects on borrowers with poor credit; most notably the difficulty of getting a mortgage loan with bad credit these days.

 

What’s the Minimum Credit Score to Get a Mortgage Loan?

Credit score minimums vary from lender to lender. Different lenders have different underwriting standards and requirements, and some lenders may have more flexibility than others in working with poor credit scores. That being said, if your credit score is under 600, you’re going to have a difficult time finding a lender to work with you. It doesn’t hurt to shop around, and places such as your local credit union or local mortgage agent may be able to offer you options you wouldn’t get by applying elswhere. But the easiest option if your credit score is below 600 is to work on improving your score.

 

Work on Improving Your Credit Score

The good news is, it doesn’t take years to improve your credit score. With the right strategies, you can make inroads on improving your score in a matter of months. Things like getting late payments taken off your credit report, adding an installment loan or other account where you make regular payments, and paying down existing credit card debt can all improve your credit score. But beware of companies and agencies that promise a quick fix; at best, some of these companies may take your money without providing benefits; at worst, these companies can actually hurt your credit score.  Improving your score does take time, but it can indeed be accomplished with the right program and strategies in place to help you along the way.

Potential disaster sounds dramatic, but it’s an unfortunate fact that some regions are more prone to certain types of natural disasters than others. While a property might look great today, you should know the types of things that might happen tomorrow before you buy. What do natural disasters have to do with buying a new home?

 

Some regions are more prone to natural disasters.

 

Put simply, some regions are more prone to natural disasters than others. A big section of the Midwest is commonly called “Tornado Alley” due to the high proportion of tornadoes that occur there compared to the rest of the country. Southern coastal regions are vulnerable to hurricanes. The southwest, particularly California, experiences a loss of property due to wildfires every year.

 

If you’re buying in these regions, you should know what to expect before you buy. The FEMA website (www.fema.gov) has valuable resources that can help you determine whether your new home is located in an area prone to natural disasters.

 

Insurance policies might not cover ‘acts of god.’

 

Some homeowners insurance policies have a tricky little loophole; the ‘act of god.’ While many policies don’t mention this clause by name, it’s typically there in the fine print somewhere. The ‘act of god’ clause means that if an act could not have been reasonably prevented, the insurance company may not be obligated to pay for the damage. This means that natural disasters such as tornadoes, floods, hurricanes or earthquakes might not be covered under your insurance policy.

 

You may need additional insurance policies or addendums.

 

If you’re buying in an area prone to natural disasters, you’ll want to make sure you’re covered. Talk to your insurance agent about natural disasters. You may be able to buy an addendum to your insurance policy, or a separate policy, to cover disasters such as flooding, tornadoes or hurricanes. This insurance typically comes at a higher cost in areas prone to these disasters, so know what you’re getting into before you buy.

Time is one of the most critical elements of a home deal. As a buyer, you want the sellers to complete their repairs and meet your terms as quickly as possible. At the same time, the sellers want you to clear your contingencies and finalize the deal as soon as possible. The longer a home deal drags out, the more uncertainty there is for both parties, and tempers can flare. You can protect your interests by writing timed deadlines into the contract, but failure to comply with these deadlines can constitute breach of contract and may nullify your home deal, or even subject you to penalties.

 

Adding Time-Sensitive Deadlines

 

Adding time-sensitive deadlines and a “time is of the essence” clause to your contract gives both buyers and sellers an incentive to move forward quickly. Alternately, you may be able to get sellers to agree to contingencies with short deadlines, when they might resist longer contingencies. Time-sensitive deadlines make it easier to plan; you can know when you can end your apartment lease, when to set up the movers and when you’ll move into your new home. They also give the seller the opportunity to do the same thing, and give both parties more confidence in a deal. But when you add time sensitive deadlines and someone runs late, it can have serious consequences.

 

Consequences of Running Late

 

At best, running over a time-sensitive deadline in your purchase contract reduces confidence in the late party, and can make tempers flare. At worst, it can constitute breach of contract, and may subject you or the seller to penalties or kill the deal entirely. If you think you’re going to run late, notify the seller. Try to negotiate a new deadline. Some sellers are understanding and may be willing to negotiate a new date, while others may use this as an excuse to kill a deal.

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