Home sales have heated up, according to the National Association of REALTORS®.

More homes are going under contract this summer than went during the winter or spring seasons. Many of these homes are scheduled for late-August/early-September closings. 

If your home is among them, plan ahead. 

Like for the rest of the U.S. workforce, Labor Day is a popular vacation time in the real estate, title and mortgage industries. Closings come together more slowly when the parties involved are on holiday. In addition, when issues arise, they are often slower to resolve because not everyone is “present”. 

Therefore, if you’re under contract to buy or sell your home, or have a refinance in-process with a lender, get proactive with your home and your loan. Finalize your approval as quickly as possible.

Here are some tips to help your loan clear faster:

1. Prepay your first year of homeowners insurance, effective your closing date. Provide proof of payment to your lender.
2. Document and deposit all gifts and retirement withdrawals to be used at your closing as early in the process as possible.
3. Get Power of Attorney forms signed by all parties, and lender-approved, if applicable.
4. When your lender makes a paperwork request, fulfill the request within 24 hours.

There are steps you can take to make your closing go more smoothly, too.

First, if your transaction is purchase, don’t leave your walk-through for the last-minute. Schedule it for as early as reasonable. This way, if there’s an issue, there’s ample time to resolve it. Remember, it’s harder to solve problems when one or more parties to the transaction is away on vacation.

Second, if you have planned time off between now and your closing, make it known, and be reachable in the event of emergency by phone, email or both.

Lastly, if possible, avoid scheduling your closing for the Friday before Labor Day or the Tuesday after. Real estate, title and lender offices are notoriously short-staffed and overworked on these two days. Routine tasks take longer than usual.

You can’t stop people from going on vacation, but you can plan for it. It would be foolish not to.

Filed under: Personal Finance by Julie Woodward
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As home buyers in the North Padre Island area , we tend to research homes a lot. We look at square footage; at upgrades; at landscaping; at community statistics; and, at every other “number” on which we can get our hands.

But those are just statistics. What about the home’s “feel”? 

In this 5-minute piece from NBC’s The Today Show, you’ll learn a dozen complementary home-shopping techniques to help you review and evaluate a home for purchase. Each is focused on findings you won’t see listed on a website.

For example, instead of scheduling your second showing for the same time of day as your first one, revisit a home during an “opposite” time. if you originally saw the home in daylight, go see it at nighttime. If you first saw a home on the weekend, go see it during the work week.

By seeing a home in two distinct settings, you can get a better feel for what the home and neighborhood are really like.

Some of the other tips from the video include:

1. Visit during Rush Hour and on a Saturday night. This will help you gauge sound levels of the street.
2. Go to Google Maps and study the aerial shot of the home. What’s nearby?
3. Talk to neighbors. They’ll share everything about the neighborhood with you — good and bad.

When you buy a home, you committing to more than just the property. You’re committing to the neighborhood, too. Armed with the methods described in this video, you’ll be better prepared to make a good decision.

Filed under: Personal Finance by Julie Woodward
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It’s a fact: It’s more expensive to live in some cities than others. Beyond just the costs of buying a home, different cities also carry a different Cost of Living. For households relocating from TX and  across state lines, the change in “life costs” can be jarring.

Depending on where you live, everyday expenses — from groceries to gasoline — make a different-sized dent in a household budget. And now you can see in numbers by how much your expenses might change.

Visit Bankrate.com’s Cost of Living Comparison Calculator. 

The Cost of Living Comparison calculator is as basic as it is thorough. The calculator asks just 3 questions —  (1) Where do you live now, (2) To what city are you moving, and (3) What is your salary — and uses your answers to produce a detailed, 60-item cost comparison between the two towns.

The city-to-city cost comparisons include:

• Dry Cleaning Costs
• Total Energy Costs
• Beauty Salon Costs
• Movie Costs
• Dentist Visit Costs

The list also features a mortgage rate comparison, and a comparison of local home prices.

The Cost of Living calculator is based on data from the ACCRA. On the ACCRA website, a similar report sells for $5. At Bankrate.com, the information is free.

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More than 50% of supermarket purchases are “impulse buys”. You may not have known that, but the supermarkets do. And they’ve built their stores accordingly. A fool and his grocery cart are soon filled to the brim.

In this 6-minute video from NBC’s The Today Show, you’ll learn how supermarkets use everything from packaging to placement so that customers spend more of their money with each store visit.

Among the supermarkets’ tricks:

• Placing flowers and bakery at the front of the store to “make you salivate”
• Specific “deal wording” (e.g. Buy 5 for $5.00) meant to entice larger purchases
• Placing staples on top and bottom shelves, leaving middle shelves for impulse products

The piece also recommends shopping a supermarket in a clockwise-fashion. It helps you spend less time in the store.

We’re all mindful of our household budgets. Watch this video to save more money on your next trip for groceries.

Filed under: Personal Finance by Julie Woodward
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Credit card debt, left unchecked, can pile up quickly. Especially for debtors making minimum payments.  

According to the Federal Reserve, a credit card balance of $5,000 at 23.99 percent APR won’t pay off for 16,127 years. That’s one reason why it’s important to manage your credit card rates, and renegotiate them whenever possible.

In this 4-minute piece from NBC’s The Today Show, you’ll learn the tested tactics that can cut a credit card rate, and get monthly payments to a more manageable range. And it’s do-it-yourself — no debt management firms required.

Some of the tips in the video include:

• Compare your current rate to the rate offered to new customers. Ask the lender for “new customer rate” if it’s lower.
• If your credit score has improved since application, ask for an interest rate more reflective of your current credit score.
• Be nice to the customer service representative. Kindness helps.

Managing debt is an important part of household budgeting so if you’re finding your credit card payments and/or rates too high for your liking, try following the instructions as described in the video. And, above all else, be persistent. The credit card companies won’t likely approve your first request. 

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Despite tougher mortgage guidelines and better loan disclosures for consumers, mortgage fraud is on the rise, according to the FBI.

Fraud has many varieties and it’s estimated cost to the nation is between $4-6 billion annually.  Today, common mortgage fraud scams target homeowners behind in their mortgage payments and/or facing foreclosure. And, despite the hordes of legitimate organizations that dedicate themselves to helping consumers, mortgage fraudsters proliferate.

In this 3-minute piece from NBC’s The Today Show, you’ll learn to spot common frauds, and to avoid them.

Some of the frauds highlighted include:

1. The Rent-to-Buy arrangement
2. The Bait-and-Switch
3. The “Phantom fees”

With respect to mortgage paperwork, it’s always wise to read what you’re signing, and to take time to understand what it means. If you’re uncomfortable reading mortgage documents, ask for an attorney’s help. And don’t worry if you don’t have the budget — many states offer free or discounted help via advocacy groups.

Filed under: Personal Finance by Julie Woodward
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Is it better to rent a North Padre Island home, or to buy one? The answer may not be as clear-cut as you think. In this balanced, 3-minute joint interview from NBC’s The Today Show, you’ll hear the case for both sides.

From the pro-renting part of the talk, there’s valid points about the economic impact of low credit scores and/or no cash for downpayment, and the ongoing, annual cost of home maintenance — estimated at 2% of a home’s value.  Plus, renters have the ability to “follow a job” to a new town or region whereas a homeowner may be restricted, somewhat.

From the pro-purchase part, however, there’s excellent points that were made, too:

• Mortgage rates are low and each 1% drop to rates equates to a 9% drop to home price
• Buyers can zero in on a particular area with particular schools or walkability, for example, better than renters
• A home can a piggybank over the long-term; a place for “forced savings” for families that want it

The segment then closes with 5 of the best cities in which to rent, and 5 of the best cities in which to buy.

Whether buying or renting, don’t try to go at it alone. There’s lot of resources online, and an email to a local real estate or mortgage pro can set you in the right direction.

Filed under: Personal Finance by Julie Woodward
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How much does a mortgage cost? The answer depends on where you live. But no matter which your locale, chances are strong that you’ll pay more for a mortgage in 2010 as compared to 2009.

According to Bankrate.com and its annual Closing Cost Survey, a typical $200,000, purchase mortgage now carries an average $3,741 in closing costs — up nearly 37 percent from last year.

As defined by Bankrate.com, “closing costs” is defined as the sum of two numbers.  The first group is labeled “origination charges”, a category that includes such items as underwriting fees, application fees and processing fees.  These fees are paid directly to the loan originator’s company at the time of closing.

The second grouping of costs is labeled “third-party fees”.  Third-party fees include appraisals, credit reports, settlement fees and title searches — items paid in connection with the loan, but not paid to the lending bank or broker.

It’s unclear why closing costs appear to have escalated into 2010, but Bankrate.com suggest that recently-enacted federal lending laws are a culprit:

1. The new law requires loan officers to be accountable to a Good Faith Estimate’s accuracy. Bankrate.com’s prior-year surveys may have been “understated”, therefore, because of a lack of accountability.
2. The cost of federal compliance is high, and banks may be passing on compliance costs to consumers

To see the complete list of closing costs by state, including where TX ranks, visit the Bankrate.com website.

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The fiscal responsibility of a homeowner — in Corpus Christi and everywhere else — extends beyond the mortgage’s basic principal and interest repayments. Homeowners are also responsible for the real estate taxes on the home and its insurance premiums, too.

Failure to pay taxes can lead to foreclosure, and failure to insure is breach of your mortgage contract.

As a homeowner, you have a choice about how you manage your real estate tax and insurance bills.  You can choose to pay them from your own bank account when the bills come due, or you can choose to pay 1/12 of the annual bill to your mortgage servicer each month, and then let your servicer pay the bills on your behalf when they come due.

Not surprisingly, servicers prefer the latter method — it reduces two major lender risks:

1. That the home’s real estate taxes go delinquent and are sold to a third-party
2. That the home endures catastrophic damage during a lapse of insurance coverage

In theory, when the servicer is paying the bills, the home’s taxes are always current and the home’s insurance is always paid. This method of managing taxes and insurance is commonly called “escrowing”.

To calculate a home’s monthly escrow payment is simple. Just take the sum of the annual real estate tax bills and insurance bill, then divide it by 12 months in the year.

As a example, a $4,000 annual tax bill with a $800 insurance policy = $4,800 annually = $400 paid into escrow monthly. These monies are collected as part of the regular mortgage payment along with the mortgage’s scheduled principal + interest payment.

Homeowners choosing to escrow tend to get the lowest rate, lowest fee loans. This is because lenders often charge a premium to “waive escrow” (i.e. pay their own taxes and insurance). Escrow waiver fees vary between banks, but can range up to half-percent of the amount borrowed. The larger the loan, the stiffer the penalty in dollar terms. 

Choosing to waive escrow can also raise your mortgage rate by up to 0.250 percent.

If you’re unsure whether escrowing is right for you, talk to your loan officer and/or financial planner. There’s good reason to go either route depending on your profile.

Filed under: Personal Finance by Julie Woodward
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