We Buy Houses!

If you’ve taken a look at our website, you probably know that we’re a great place to unload a house you’re having trouble affording before buying a fully refurbished one at a very affordable price.  However, we understand that not all of you are homeowners, and that some of you may be planning to purchase your first house.  As you prepare to take this step, it’s important to understand some of the language involved in buying and then making the payments on a new home.  This week, we’re going to discuss the mortgage.

All mortgages are the same, right?

Actually, there are several different kinds.  Here, we’ll mention two of the most common.  The fixed rate mortgage (or FRM) has the same interest rate for the entire term (usually 30 years) of the mortgage.  The nice thing about this option is its consistency; there are no surprises, and you have a set amount of monthly interest to plan around.  With an adjustable rate (or ARM) you generally start off paying less per month with a lower interest rate than you if you had an FRM, but both will go up and down (sometimes more than once a year) along with the rise and fall of the financial index they’re linked to.  Examples of common financial indices are the Cost of Funds Index (or COFI), and Constant Maturity Treasury securities (CMT).

Where do I go to set up my mortgage?

There are several places you can go to get a loan and finance your home, including banks, mortgage companies, and credit unions.  There are even state government lending services out there.  As you choose which of these options is right for you, it helps to shop around and compare the different rates and prices before settling on the one that can provide you with the mortgage that makes the most sense for your situation.  A real estate agent can be a good person to discuss your options with; if you’ve chosen to purchase your home through us, this is a process we would also be happy to assist you with.  It’s important to remember that getting set up doesn’t happen overnight: the loan approval process typically takes 3 to 6 weeks.

Once I’ve chosen a lender and am good to go, what exactly does my mortgage include?

There are usually four parts to every loan.  The principal is the actual amount you borrowed, the interest is what you pay the lender for lending you the money in the first place, part of your monthly costs go toward homeowner’s insurance (in case of theft, a fire, or other damaging circumstances) and of course, property taxes for the city/county you live in.

We understand buying a home and setting up a mortgage can be an intimidating process, but the key to making a good decision is to understand your options.  Please feel free to contact us if you’d like to know more about buying, selling or financing home, we’re happy to help.

They’re here. They’re real. And, as usual, they can be very, very clever.

Scam #1 – The “Helping Hand” Company

We ran across this particular trap about two years ago – it came from the Better Business Bureau and it’s a doosie. These companies look like the “We Buy Wretched Houses” companies that pepper the landscape with flyers and get-out-of-your-mess-quick promises. You sit down with them, and they tell you they will buy your house for a specified period of time. Not only that, they promise you can continue to live in the house while you pay them much reduced rate with a promise that when you catch up on your finances, they will sell you the house back for very reasonable terms. They pick up your late payments and penalties, and you get back to regular payments.

Sounds pretty good.

What you are not aware of is the papers you sign include some non-traditional mortgage terms. The favorite of these helping hands companies is a binding rider that notes “a deed will be executed if you are 10 or more days late on a payment.” Translated, it means the company will take immediate possession of your house and any and all equity if you are 10 days late on any payment during the contracted time period.

Best Course of Action – Use You Head and Call In Professionals

If you need to sell your house fast, our advice is pretty straightforward: avoid doing really dumb things because you are in a state of personal financial panic. Here are the best steps we can suggest:

1. Work with Professionals
   Only deal with companies who have an established history of home buying.
2. Check them Out
   If you have any concerns about the buyer, don’t hesitate to check them out. We always ask our skeptical clients to check out the Better Business Bureau.
3. Always Know What You’re Signing
   Don’t be shy; ask for help! A lawyer or even your mortgage company can help you if you want professional advice from a third party. Never, ever sign a contract that you haven’t read – “oh, that’s just standard contract stuff” – or don’t fully understand.
4. Be Willing to Walk Away
   If you have any doubts about the buyer or the contract — or if it just doesn’t feel right — just walk.

Of Course, Call Us
Many times, people facing foreclosure call us just for advice. We’re glad to help, whether you choose to sell your house to us or not. We buy houses fast, we’re Better Business Bureau accredited. With Express Homebuyers you can sell your house quick, and be secure and comfortable doing it. We’ll introduce scam #2 from this week’s Washington Post next time.