Posted 10/06/2016

Home loan calculator

USDA Home Loan has become even more affordable as of October 1st. The United States Department of Agriculture lowered upfront and monthly fees for its home loan program.

What is a USDA home loan?

This home loan program is designed to improve the economy and quality of life in rural areas.  It offers low interest rates and no down payments. The program assists approved lenders in providing low- and moderate-income households the opportunity to own adequate, modest, decent, safe and sanitary dwellings as their primary residence in eligible rural areas.

The changes will be in effect until September 30, 2017. The USDA will then re-examine financials at that time to either raise, hold or lower fees.

How will the changes benefit you?

USDA loans with zero down will require two types of mortgage insurance: an upfront fee, typically financed into the mortgage amount, and an annual fee, divided out into each monthly payment. Although both were reduced recently, the most significant change was the upfront fee.

Upfront fee:

Former upfront fee: 2.75%

New upfront fee: 1.00%

Annual fee:

Former annual fee: 0.50%

New annual fee: 0.35%

This will be a pretty large savings and could mean the difference between being turned down and getting approved for some USDA home buyers.

For more information on USDA home loans go to https://muihomeloans.com/blog/2015/04/24/usda-home-loans-no-down-payment-and-low-interest-rates/ or contact one of our Mortgage Experts at 763-416-2600.

Mortgages Unlimited is a local mortgage company serving not only the Twin Cities but also, South Dakota and Wisconsin. We work on the behalf of our clients ensuring they are getting the best possible loan while providing outstanding customer service.

Give one of our Mortgage Consultants a call @ 763-416-2600 if you are looking to purchase a home or refinance your existing home loan. Or you start a secure online application at www.muiapply.com.

Posted 09/22/2016

mortgage-mistkae-ts-1360x860

An Appraiser, is one who sets a value upon property, real or personal.

When financing a home, an appraisal will be required by the lender. Lenders want to know the home’s value before agreeing to approve your home loan so they rely on appraiser for a value of the home.

On a purchase, an appraisal can come in lower than you need to qualify for the home loan. For a refinance, it may mean that there isn’t enough equity to meet mortgage standards.

What do Appraisers look for when evaluating a home?

Most important factors considered in an appraisal: Keep in mind there could be more than what is listed below.

  1. The type of home – one story, two-story, split-level, factory-built.
  2. Features of the home
  3. Improvements to home
  4. Comparables – Similar homes that have sold in the area
  5. Location – The kind of neighborhood is identified. Any zoning areas are will be considered as well as its proximity to other establishments.
  6. Age of Property
  7. Square footage
  8. Lot size
  9. Depreciation
  10. Landscaping features
  11. Topography

After the Appraiser has made his visit to the property, a formal appraisal with very specific details is written up. The lender will weigh all of these considerations to determine if the loan will be approved or not.

What if the appraisal does not support the purchase price? You can appeal the appraisal.

Coming to a value of a home can be more complex if the comparable properties in the neighborhood aren’t cookie-cutter and there are times things can be missed.

If you want to appeal the appraisal, first contact your lender and find out what their steps to appeal are. Most lenders will take the initiative to scrub through the appraisal and look for errors. Remember, they are working on your behalf.

You can also study the appraisal carefully to look for mistakes. Research the comps that were used in the appraisal.  Take note of any advantages the house being appraised has over comps. It could be a much larger yard, a newer roof or the square footage is wrong. Mistakes can happen.

Any one of these can make a difference.  Send these findings to your lender to be forwarded to the Appraiser for reassessment. If they are valid findings, this could be the difference of getting approved for the property.

Mortgages Unlimited is a local mortgage company serving not only the Twin Cities but also, South Dakota and Wisconsin. We work on the behalf of our clients ensuring they are getting the best possible loan while providing outstanding customer service.

Give one of our Mortgage Consultants a call @ 763-416-2600 if you are looking to purchase a home or refinance your existing home loan. Or you start a secure online application at www.muiapply.com.

Posted 10/01/2015

 American Flag House

What is a VA loan?

A VA loan is a mortgage loan in the United States guaranteed by the U.S. Department of Veterans Affairs (VA). This loan is a specific loan program to help veterans, active-duty service members and their families purchase a home.

Although the VA Loan is a federal program, the government generally does not make direct loans to veterans. Instead, private lenders finance the loan while the Department of Veterans Affairs offers a guaranty to protect the lender against total loss should the borrower default on payments.

 Benefits of a VA Loan?

  •  Zero to low down payment
  • Fewer restrictions – you’re allowed a higher debt-to-income ratio and have more leniency with your credit score.
  • If you have a service-related disability, you may qualify for waived funding fee, reducing closing costs. (There is an upfront fee of 2.15% of the purchase price of the home. This fee can be rolled into the financing)
  • Borrowers can often refinance to a lower rate within the VA program without re-qualifying for the program.
  • No Private Mortgage Insurance (PMI) – private mortgage insurance (or PMI) normally adds an additional 0.2-0.9% expense to your monthly mortgage payments when you put less than 20% down. With a VA loan, you’re not required to have PMI, saving you even more money on your home loan.

Through its distinct advantages over traditional mortgages, the VA Loan program has helped more than 20 million veterans and their families purchase a home since its inception in 1944. Call a Mortgages Unlimited, Mortgage Consultant to get all your questions answered about VA loans. 763-416-2600.

How much can you qualify for?

In most parts of the country, veterans who qualify for the VA Loan can purchase a home worth up to $417,000 without putting any money down; however, with the 2013 VA Loan Limits, borrowers in high-cost counties may be able to purchase homes far exceeding that amount without a down payment.

Mortgages Unlimited is a local mortgage company serving not only the Twin Cities but also, South Dakota and Wisconsin. We work on the behalf of our clients ensuring they are getting the best possible loan while providing outstanding customer service.

Give one of our Mortgage Consultants a call @763-416-2600 if you are looking to purchase a home or refinance your existing home loan. Or you start a secure online application at www.muiapply.com

 

Posted 08/11/2015

older couple

What is a Reverse Mortgage?

A Reverse Mortgage is a Home Equity loan or Cash-out Refinance for those 62 and older that does not require a monthly payment.  Reverse Mortgages are for primary residences only.  The loan is typically repaid when the home is sold.

How does a Reverse Mortgage work?

If you OR your spouse are over 62 years of age and you have equity in your primary residence you may qualify for a Reverse Mortgage.   Many people get a Reverse Mortgage to pay off a traditional mortgage to eliminate their monthly payments.  After your current mortgage is paid you can choose to receive money at closing, maintain a line of credit, have payments for a fixed amount of time or payments for the rest of your life, or a combination of any of these options.  If you choose a credit line, the credit line will continue to grow each year.  You continue to keep title to your property where it remains a part of your estate. As of October 1st, 2013 you can only take 60% of the money you qualify for in the 1st year of having a Reverse Mortgage.  After that year, the remainder of funds can be withdrawn.  The only exception is if the money required to pay off any existing liens against the home, plus closing costs and required repairs combined exceed the 60%.

What are the benefits of a Reverse Mortgage?

  • You continue to live in your home as long as you OR your spouse desire without making monthly payments.
  • Receive extra money for life or a fixed period of time.
    You can repay the loan at anytime without penalty.
  • No worries about a declining housing market, if you sell your home and it’s not enough to pay the Reverse Mortgage in full that’s okay.  Reverse Mortgages are backed by the federal government.  It’s guaranteed you will never have to repay more than what your home sells for.
  • Payoff your current mortgage and if there is extra money left it’s yours to use as you desire.

This is too good to be true there must be some drawbacks to a Reverse Mortgage?

We have all heard the saying before, “If it sounds too good to be true it usually is”.  Take comfort knowing Reverse Mortgages are backed by the federal government.  Use extreme caution if you are offered a Reverse Mortgage that’s not backed by the federal government.

Once you get a Reverse Mortgage you must continue to:

  • Pay your property taxes
  • Maintain adequate homeowners insurance
  • Keep your residence in reasonable condition

As with any mortgage there are costs involved and a Reverse Mortgage is no different. Appraisals, title examinations, state deed taxes and recording fees must be paid. These fees are paid with the proceeds from the Reverse Mortgage. Since these loans are backed by the federal government there is an up-front fee that’s either .5% or 2.5% of the appraised value (depending on how much money is drawn in the 1st year) that’s paid to the Federal Housing Administration (FHA); thereafter the FHA charges 1.25% of the outstanding balance each year.  This money is for insurance that guarantee’s no matter what happens to the lender, the terms of the Reverse Mortgage will remain in effect.

Again, this fee is paid with the proceeds from the Reverse Mortgage.  (Traditional FHA mortgages have a 2.25% up-front fee along with the 1.25% on-going fee.) Stay clear of lenders that charge monthly service fee’s; these fee’s used to be common in the past but reputable lenders have done away with them.

Why wouldn’t I just get a home equity loan instead of a Reverse Mortgage?

A home equity loan requires a payment each month to the lender where-as a Reverse Mortgage requires no monthly payment.  Home equity loan rates are typically higher than Reverse Mortgage rates.

A home equity loan requires good credit scores and sufficient income. Reverse Mortgages do not look at credit scores as a qualifying factor. Technically, you could have no credit score and still get a Reverse Mortgage. In today’s times, many lenders are freezing lines of credit where Reverse Mortgages are guaranteed by the FHA that this can’t be done.

When do I have to pay off my Reverse Mortgage?

The Reverse Mortgage is usually repaid when you sell your home.  The lender understands it may take some time to sell the home especially in a declining market condition.  This is perfectly acceptable.  Your heirs will just keep in communication with the lender as to the status of the sale.

There are typically a lot of questions when it comes to a Reverse Mortgage. Schedule an appointment with our Reverse Mortgage expert Mike Kraus at 763-355-8540 to discover the benefits of a Reverse Mortgage. If you would like to speak to one of our Mortgage Professionals at Mortgages Unlimited about any of our other loan programs, call us at 763-416-2600 or visit us online at www.muihomeloans.com.

Posted 08/05/2015

diy

Have you ever felt empowered to take on a home improvement project from watching HGTV or DIY Network? Only to get 1/2 way through and realize it was a much bigger undertaking than what you pictured in your head. Many hours and days of filming go into these projects and are edited down to a half hour show. It is hardly as easy as it looks and there are projects that require the help of a professional, more than one person or may be just too dangerous to take on yourself.

Many people are capable of doing projects with all the tutorial videos on the internet to help. Consider this info as a guide to some of the riskier projects that you may want to think twice about.

Electrical Work:

Want to replace a new light fixture or add a dimmer?  Well, that  can be done fairly easy but still, if you’re not familiar with wiring, there’s a risk. Even the smallest mistake in electrical repair jobs could have a devastating effect on not only your property but your life as well.

Electric Shock

Definitely, leave the rewiring and electrical repairs to the pros. In addition to the dangers of attempting to do this yourself, there are codes to be followed.  The risk of electric shock or fire are just not worth saving a few bucks.

Tree Removal/Pruning:

As a do-it-yourself-er, you could  get away with trimming back small branches. Even then, be sure to wear protective goggles. But for trees and larger branches, put some serious thought into this. Chainsaws, utility wires, trees and branches falling in the opposite direction than planned, and falls from ladders and trees. Imagine the things that can go wrong. Chainsaws are very heavy, carry a serious risk for major injuries and would you really want to learn how to use one on a video tutorial for a weekend project? I say “BAD IDEA!”

Also, consider that  you can damage a tree beyond repair if pruned at the wrong time. For most trees, it is best to trim when dormant,  late fall to early spring.

Replacing Garage Door Springs:

A garage door has springs that are wound tight when installed, and function as you press your garage door opener. Over time they will loosen and break. These springs support the entire weight of a garage door and they are very heavy. it isn’t advisable to try to open it until the parts are repaired. Most homeowners will not attempt to open the garage door based on the weight alone. It is after all, around 300 pounds.

Installing new garage door springs is not only a lengthy and complicated process, but potentially dangerous. Remember, garage door springs are wound and under tension .  Anytime you’re dealing with a tightly wound, heavy springs and aren’t extremely careful, you can be looking at a very dangerous situation.  This job just seems to be best not to  touch with a ten foot pole.

Removing Walls:

Who doesn’t want their home to have an open feel, right? Knocking down some walls looks easy enough.  At least when you watch these home improvement shows where the homeowner jumps right in there with a sledgehammer with the host and starts swinging away at the wall.

Removing a load-bearing wall without knowing it can be disastrous. Not adding the necessary support can result in costly repairs and the floors and roof above can literally come crashing down.

It’s likely that there are electrical wires running up and through the walls. So now you are getting into electrical and hopefully, you got the message about dealing with electrical wiring.  Once you are inside the wall, this means re-routing or dead-ending circuits.

You can always do the frame work and trim but be sure to hire a pro to find out what’s behind the wall before you start demolition.

If you are looking to purchase a new home, refinance or make a home improvement, please contact one of our Mortgage Consultants at Mortgages Unlimited to help you get started. 763-416-2600 or visit us at www.muihomeloans.com.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Posted 07/31/2015

 

Safe House Concept

If you are going to be selling your home or you are buying a home, you may want to consider purchasing a Home Warranty.

What is a Home Warranty and what does it cover?

A Home Warranty is really just an insurance policy. If you are selling your home it will be covered from the day it is listed on the market until one year after the closing date from anything that could break down. If you’re buying a home and the seller has not provided a Home Warranty, it is a good idea to purchase one. The items covered in a policy can include some or all of the following: central air conditioning and heat, duct work, washers, dryers, microwaves, refrigerators, ice makers, ovens, cook tops, exhaust fan, microwave, ceiling fans, garbage disposal, garage door openers, plumbing and electrical systems and various other items.

Home Warranty policies will vary in price. You can expect to pay between $350 to $500. It would be a lot more expensive to have to fix or replace a major household item. It is completely worth the investment.

Some advantages of a home warranty:

• The Home Warranty will repair or replace any covered item
• The cost of a Home Warranty is only a fraction of the cost of replacing a major appliance
• The Home Warranty will relieve any buyers anxiety about buying your home, especially if you have an older home
If you are a seller, it is just one more incentive to offer buyers

The Home Warranty Protection policy is a great way to protect you from unforeseen repairs that can arise.  As with any policy, you should read the terms and conditions of your warranty before determining whether purchasing it is a good investment. It is important to understand what is covered, the limitations of your policy and any fees you will need to pay. Have the representative go over the entire program and its benefits with you.

If you have questions regarding a home warranty, a home loan or refinance, please contact one of our Mortgage Consultants at Mortgages Unlimited at 763-416-2600 or visit us on the web at www.muihomeloans.com.

Posted 07/29/2015

Home loan calculator

If you are going to be purchasing a home and have less than 20% to put down, you will be required to pay private mortgage insurance (PMI). These insurance fees will vary depending the size of the down payment and credit score.

PMI protects lenders in the event the borrower cannot pay back the loan. Even with a Federal Housing Authority (FHA) loan, borrowers without a 20% down payment are required to pay insurance each month. With a FHA loan, the insurance requirement doesn’t go away once there is 20% equity in the home.

The PMI payment is usually paid monthly as part of the overall mortgage payment to the lender. Once your loan balance reaches 80% of the homes current value, you can contact your lender and ask that the PMI payment be removed. Many borrowers forget to cancel the insurance and continue to pay. Your lender will automatically remove the insurance when the loan-to-value (LTV) ratio drops to 78% of the original value.

If you feel your home has increased in value, you can get an appraisal performed. You will want to contact your lender to find out the proper way to go about this. Keep in mind most lenders will require you to pay PMI for two years regardless of if your home has increased in value and reached 80% LTV. So you may want to hold off on having an appraisal done too soon and save yourself $400.00.

If you have any questions regarding PMI, please contact one of our Mortgage Professionals @ 763-416-2600 or visit us online at www.muihomeloans.com.

Posted 07/21/2015

pig and house

Home ownership can be expensive and at times you can feel like it’s sucking money right out of your bank account. If you don’t pay attention to the small things, you might wind up paying much more to replace items that could have been given a little TLC.

Below are some tips you’ll be glad you knew about.

Maintain and service your appliances

All the hype on energy saving appliances can be just that. If you service your appliances regularly and take care of problems as soon as you notice them, your appliances can last a very long time.

Some of these new appliances can be pretty expensive and the savings over the lifetime of the appliance is minimal compared the money shelled out to purchase them. For instance, if you clean your lint tray regularly and vacuum under the area of the lint tray periodically, your dryer will heat quicker and more efficient allowing for a shorter time to dry clothes. So why spend nearly $500 to buy a new dryer?

Add Insulation

If your attic isn’t insulated, now might be the time to do it. The Department of Energy estimates that a properly insulated attic can shave 10 to 50 percent off your heating bill. And it works the opposite way for warm climates; in summer, it helps stabilize your house’s indoor temps to keep cooling needs in check.

If you are handy, this can be a weekend DIY project. This is definitely worth the investment and you will see savings immediately.

Purchase a programmable thermostat

thermostat

When there’s no one around during the day, there’s no need to have the heat or air on as you would when you’re home. A 10-15 degree difference can mean a significant savings on your bill.

You can pick up a programmable thermostat for as low as $25.00 from your local hardware store and installation is easy.

Use less water

Are you aware of how much water you use? Do you let the shower run too long before getting in? Run your dishwasher when half full or run the water while brushing your teeth? When you start paying attention to this, you will see how much water you’re wasting and you might as well just take your hard earned cash and flush it down the toilet.

The difference between washing in hot water/warm rinse vs. cold wash/cold rinse is hot water can cost you 60 cents per load, whereas cold water will only cost 4 cents per load. Save water and money by washing clothes and dishes when you have a full load to wash.

Fix leaky faucets and shower heads

This is another way that water and money are wasted. Several drips per minute can turn into a couple gallons at the end of the day. Also, fixing any appliance early on, will save you from having to replace it sooner than you have to.

Do it yourself

So many projects can be done by you. Or maybe you have a friend that is handy and willing to help. You can save big bucks this way. Many big box home improvement stores have classes on home projects. Also, have you ever looked up instructions on Youtube? It is one of the best places to find step-by-step instructions for almost anything. And you can stop and start the video as you go along.

If you are in need of getting approved for a mortgage or want to look at saving money on your current mortgage, give a Mortgages Unlimited Mortgage Professional a call today at 763-416-2600 or visit us at www.muihomeloans.com

Posted 07/20/2015

splitting house

Refinancing your home is typically a choice you make to reduce your monthly payment by taking advantage of a lower rate from what you currently have. There is a time when refinancing isn’t a choice but a necessity.

If you’re going through a divorce and both names are on the mortgage, refinancing is your only option to get a spouse’s name off of the mortgage.

There are several things to consider when going through this trying time.

Determine who is going to stay in the house.

Every situation is different. Some will feel it’s best to sell the property, split the profit and move forward. If you have children, the spouse with primary custody may choose to live in the house and keep the kid’s life as normal as possible. This can work, but you’ll have to refinance the mortgage loan since this is the only way to remove a co-borrower’s name from the loan.

Can you afford your home?

Lenders will look at your income to determine if you can afford the new mortgage on your own. The mortgage payment cannot be more than 28 percent to 30 percent of your gross income, and your total monthly debt payments cannot exceed 43 percent of your gross income. Your child support and alimony will be factored in as well.

Is your credit strong enough?

You will need to meet the lenders credit score requirements. You need to have a credit score of at least 620 to qualify but that score is on the low end and you will likely be at a higher interest rate with a higher payment than if you had a higher credit score. With a good credit score, over 700, you will be looking at a significantly lower monthly payment.

If your credit score is poor and you aren’t yet able to refinance, you can work out a deal with your ex to allow you to keep making the payments until your credit is repaired. This could take anywhere from six months to a year depending on what is on your credit report. You can then re-apply for to refinance.

There are many credit repair companies out there. Be sure to do your due diligence when seeking a credit repair company. The average price for this type of service is around $600.

Lastly, the quit claim deed.

If you’re able to refinance and remove your spouse’s name from the mortgage loan, he or she also needs to sign a quit claim deed, which transfers ownership of the property to you. Refinancing takes a name off the mortgage loan, but not the title.

If you have any questions regarding your home when getting a divorce, please give one of our Mortgage Professionals a call at 763-416-2600.

Posted 04/24/2015
young family

What exactly is a USDA Home loan?The USDA Home Loan is the U.S. Department of Agriculture’s Rural Development Single Family Housing Loan Guarantee Program.

Rural development home loans aren’t just for farms. You may be surprised to find out that eligible Rural areas can include subdivisions and properties in town nationwide.
If you  purchase a  home in a qualified USDA area and  meet the income eligibility requirements, you’ll be able to take advantage of the low to no down payment and lower mortgage rates.  If you are not sure you are in a USDA qualified area, visit http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?pageAction=sfp or give us a call at 763-416-2600 to speak to one of our exerts on USDA home loans.
Benefits of USDA Home Loan

No Down Payment Required – For those who qualify for a USDA home loan, you have the availability to finance 100% of the purchase price of the home. These loans are becoming popular, as buyers discover an easier way to buy a home with zero down payment.

Lower mortgage interest rate  – In most cases, interest rates are lower than a conventional 30 year fixed rate mortgage. USDA loans are fixed rate loans only. Additionally, you can refinance your current USDA home loan if interest rates drop 1% or more than your current rate.

Flexible Credit Guidelines – With flexible credit guidelines, potential homeowners with challenged credit can still possibly qualify for a home loan. USDA loans could be approved with scores of 640.

No maximum purchase price limit – However, a lender will still determine the maximum amount of loan each applicant is eligible for based on ability to repay.

Affordable monthly mortgage insurance – USDA mortgage insurance is made up of two parts. The upfront Mortgage Insurance Premium which is 1% of the loan amount, a reduction made effective October 1, 2016 from 2.75%, and a monthly Mortgage Insurance Premium (MIP).  The monthly mortgage insurance premium has also been reduced from 0.50% to 0.35% of your loan amount.

Streamline USDA refinance –  A home owner with a USDA home loan can refinance into a new USDA home loan . The streamlined process will shorten the time necessary to close on your loan and will require you to provide less paperwork and fill out fewer forms.  USDA Streamline loans also require no appraisal,  which will save you, on average, $400-$500.

Qualifying for a USDA Home Loan

There are two main requirements to meet to qualify for a USDA home loan.
First, the buyer must buy a home in a USDA-eligible area. USDA property eligibility is governed by census tract density. An area that was eligible at one point may not be eligible now. Or an area that is USDA eligible today may not be eligible next year.
Second, is USDA income eligibility requirement. Income limits will vary by area so it is important to talk to one of our USDA loan specialist.

For more information on USDA Rural Home Loans, contact Mortgages Unlimited at 763-416-2600.

 

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