Trick or Treat…Lets plan for nothing but Treats.

As the temperatures drop and it begins to get dark earlier, it can mean just one thing…Halloween is just around the corner.  As goblins, witches, football players and cheerleaders, your little ones are likely getting excited for Trick or Treating. Here at Lawyer’s Realty we’re feeling the Halloween spirits and wanted to offer a few quick tips for a safe and fun time for all.

No matter how old your kids are, there are certain “rules” that should always be followed. Make sure your child chooses a safe costume. Reflective materials or blinking lights on their costume is easier to spot for drivers in passing vehicles. 

Masks sometimes make a more exciting costume, but make sure the mask doesn’t impair your child’s vision. Blocked vision can lead to tripping or other injuries. If the costume requires a prop, you want to make sure that the prop has flexible edges and obvious markings to ensure that it’s not mistaken for a real weapon.

It may be hard for them to avoid the temptation to start indulging in the great amount of chocolate treats, but you want to make sure your children know to wait until they get home to eat any of their treats. Once home, inspect the treats for tampering.  If it looks suspicious, throw it out. I’m sure they’ve gotten enough candy from their trip that they won’t notice a few pieces missing. Better safe than sorry.

If your child is older and trick or treating with a parent is just not cool, ensure that you know their planned route and they have a cell phone with them.  Remind them about not cutting through alleys or fields and to  only use the sidewalks that are often well lit and are much safer. Many developments are also patrolled by the police throughout the designated trick or treat times.

They don’t want to hear this, but it makes you feel better to remind them about not getting into a stranger’s car or going into any house other than their own. It may seem redundant, but a simple reminder never hurt anyone.

Finally, ensure your group, or your child’s group, if they are going out without a parent, has several flash lights. It not only helps to brighten any dark area, but also works much the same as headlights on a vehicle. It increases your visibility to passing cars and will help to keep everyone safe.

From the Lawyer’s Realty family we wish you and your family a safe and fun Halloween!

Found a Home, but it is in Need of Work? There’s an App…err, Program for That!

You have been looking and looking for a new home within your price range, but what you are finding are houses that are best described as  “fixer-upper”, “needs TLC”, “has great bones” and houses that are stuck in the 1970’s (lime green?).  What has been your reaction to these houses?  “No way, too much work!” “We won’t have any money left over to bring it to 2011!”  “How did a family survive with one bathroom, we need at least 2!” Sound familiar? 

Well, did you know that the Federal Housing Administration (FHA) has a program for that? The FHA 203k Program allows for the cost of renovations to be included in your mortgage. By considering this program, many more houses may open up to you as possible choices. 

  

There are a few options in the 203k program. For smaller renovations there is the 203k Streamline. Cosmetic work and minor repairs would usually fall under this program. In order to qualify, the renovations must be between $5,000 & $32,000 and can even include the cost of appliances. This program allows up to 110% loan to value of the improved property. Depending on the work needed, this option can convert into the 203k full renovation option.

The 203k Full Renovation option allows for additions, garages and other structural/foundation work needed, but it does not allow luxury items such as an in-ground pool or a spa. While the streamline program has an upper limit of $32,000 this option covers renovations that total over that mark. A HUD consultant is required for the 203k full renovation.

The final option is the 203k Conventional. This option allows for luxury items to be added to the house, and is only limited by the conforming limits. Those limits are 95% loan to value for the improved property if the owner occupies the unit, and 75% LTV if it is a non-owner occupied unit.

For all of these programs, a validated contractor will be required to provide estimates on the renovations as well as complete the work. Home Depot & Lowe’s are both validated contractors.  

The FHA 203k Program is a great option to help improve a potential home, but the process may be slow so be prepared to be patient.  By working with a REALTOR®, you will be guided throughout the process including finding the right mortgage professional who knows the in and out’s of the FHA 203k Program.

I Don’t Have to Have 20% Down Money to Get a Mortgage?

Traditionally, a 20% down payment is ideal for many mortgages to avoid paying private mortgage insurance, aka PMI.  Also, by having more money saved that you initially put into your home rather than borrowing will help to reduce your monthly payments, and provide you instant equity in your new home.  However, thanks to the Federal Housing Administration (FHA), you need much less down money, or with some programs, zero money down.  We’ll briefly discuss several of the programs available.

First, let’s take a look at FHA 203(b). This program allows a qualifying buyer to put down as little as 3.5% of the total purchase price. There are loan limits in this program, but they vary by area so be sure to check with your REALTOR® about your area. Also in this program, the PMI is wrapped into the loan. You can use this loan to purchase one to four unit structures. There are some income and other limits with this and many other FHA programs so be sure to check with your REALTOR® about those as well. Some other FHA programs can be found here.

Another popular program is the 100% USDA Rural Development Program. This is a 100% loan that requires no down payment as well as no PMI. A minimum credit score of 640 is required and the loan can be up to 103.5% of the appraised value of the structure. With no limit to the seller’s contribution toward closing costs this loan is very beneficial to the buyer and may require little to no money at all for closing.

However, there is one “catch” to the USDA program. The property must be in designated rural areas. You can check out http://eligibility.sc.egov.usda.gov to see what areas are approved. Also, there are income eligibility requirements to be met as well. They vary based on county for instance a 1-4 person household can make no more than $81,650 in Dauphin or Cumberland counties but in Lancaster county the limit is $77,500 (as of June 2, 2010 – subject to change).

Are you a veteran?  Don’t forget that as a veteran you are entitled to a VA Loan which is also a 100% loan that requires no money down.  As with all of these programs, your REALTOR® can help you to get in touch with a mortgage broker that will work with you to understand which program will best meet your needs.

Next week, we’ll go into more detail about another FHA program that allows you to include money for improvements to the dwelling in the purchase price. Be sure to stay tuned for a great FHA program that is often overlooked.