Gene Mundt - Let's Talk Mortgages & Real Estate!

A Musical Introduction:

"Should I Stay or Should I Go"? ... by the CLASH

double-click -

http://www.last.fm/music/The+Clash/_/Should+I+Stay+or+Should+I+Go

Depending on your financial scenario, you may have more than one option to consider for your home financing ... and that's good.  Being in this situation is actually an envious one.  Before you make this important final decision regarding financing programs and rates, gather all the information and facts you need ... ask questions. 

To help you in your decision I have provided two different scenarios to consider below.  Read the explanations and do the math in each scenario.  Put yourself in the same place as these potential buyers.  See which program option might work for you ...

The Scenario:

A young woman. Unmarried. Buying her first home.  Planning on staying in the starter home 5 years, or less. She qualifies for both a FHA 30 Year-Fixed Mortgage and a 5/1 ARM (Adjustable-Rate Mortgage). 

Here are the numbers:

•  FHA 30 YR Fixed-Rate        4.5 %          $150,000 = $760.03 P&I
•  FHA 5/1 ARM                     3.75%         $150,000 = $694.67 P&I

Net Difference:  $65.36/month

This young woman, could pay down higher-rate credit cards, save the equivalent of her monthly Insurance Escrow payment, or qualify for an additional $13,000 in buying power if she decides to utilize an ARM loan for her financing. 

The Scenario:

Young Man. Now Married. Baby on the way .. wife will be taking a short maternity leave.  Job has changed also.  I've heard bad things about ARM's.  Am I screwed??  And what happens to my payment?

Answer: 

No. Not at all. Remember, your interest rate cannot change during the five year term of the loan. And, your ARM loan is not due and payable at the end of the 5 year term ... it simply "adjusts to market conditions at the time". 

During that 5-year time with an ARM loan, you have saved $65+/month, or $780+/year, or $3,900/5-year term ... over the costs of the 30-Year FHA Fixed Rate Loan talked about above. 

After the initial five year term is up, your worst-case interest rate scenario increase, per year, is typically 2% above your initial rate ... and as of today  (8-30-2010), that means your new rate would be 5.75%. 

At a 3.75% rate, your payment is $760.03.  At 5.75% it rises to $875.36, an increase of $115.33/month.  But look at these comparisons for a period of 1 year:

• $115+ X 12 months = $1,380    (Increase amount per month X 1 yr)
• $3,900 - $1,380 = $2,520   (5-yr Savings minus 1 yr @ Increased Rate)

This Scenario's Outcome:  You have at least two+ full years of increased interest rate that you are still "in the black" and have been saving money by taking out the ARM loan.

Summation:

Let me stress this point, ARMs are not for everyone, nor can every Mortgage Originator adequately explain the pros and cons of Adjustable Rate Mortgages.

While listening to the details regarding ARMS, keep an open mind.  Ask yourself this basic question ... "Where do I think I will be in 5 years"?

If you're not sure, my suggestion is to be cautious.  Pass on the ARM loan.  "Lock-up" that Fixed-Rate loan.  It's still a fantastic rate!

But, if your plan is to move on within five-year's time, either because of a job transfer or changes coming in your life ... don't "overpay" on your mortgage.  Save where you can and secure an ARM loan.

For Extra Information Regarding ARM Loans:

Contact me!   Direct: 815.277.4036    Cell: 708.921.6331 -  or  - write me @: gene@chicagobancorp.com

Or go to the Federal Reserve Board site, http://www.federalreserve.gov/pubs/arms/arms_english.htm, and order your "Consumer Handbook on Adjustable-Rate Mortgage" (CHARM) booklet.

Call or Contact Me For Loan Information Today!

     In today's challenging financing world and real estate market, you must make sure you are working with the right professional and possess the right equation to reach a successful conclusion to your real estate transactions.  Whether it be enhancing your credit scores, refinancing, or buying a new home, these main elements remain the same.

     I can't overemphasize the importance of credit to this equation.  Your credit is the foundation on which everything else is built.  Have a poor foundation of credit, and your transaction ...your finances become fragile or crumble completely. 

     Intelligent credit design is all important, so seeking the assistance and guidance to establish or improve it makes good sense.  Getting your credit run at minimum, once per year (whether seeking financing or not) is wise.  Together, you and I will examine the results found within your report and make sure that it reflects your credit status correctly.  We'll also see that there are no errors contained within your report.  If errors are found, I will help you address them.  If improvements are needed, we will work together to accomplish them.  Good professional direction and advice will prove key to your advancement.

     As you are probably aware, home values can be somewhat elusive right now.  But through my services at Chicago Bancorp, I maintain more control of the appraisal process and "turn times" ... meaning the completed appraisals are delivered in a more timely manner than competitors'.  This can be a very favorable advantage for you, for a transaction, and closing date.

    It is vital to have an experienced mortgage professional on your side.  Rules and regulations are changing quickly and often. Now is not the time to work with an unknown or novice lender.    Trust your financing to someone that has proven that they work hard to represent your best interests and deliver your transaction to a successful conclusion.  I have done that ...

    Do not hesitate any longer.  Contact me so we can check your credit ... make sure it's a true representation of your finance history ... and work towards the highest credit scores possible for you. 

     Do it today ...  gene@chicagobancorp.com  - or - http://www.genemundt.com/Talk-to-Me-.html

Gene

     I liked this post regarding safety tips for school children so much ... and thought it of such great and timely value ... that I'm re-blogging it today.

     Whether you are in Naperville, IL or not ... this post can serve you well ... and serve as inspiration for you to check your own local city website for such info and assistance.

     Thank you to AR member, Linda Kemp of Keller Williams Infinity (608 S. Washington Street, Suite 100, Naperville, IL, 60540) for her stellar post and timely information.  I'm sure it will prove useful to all parents and guardians of school-age children, no matter their location.

     Have a great and safe school year ...

Gene    

      Here's an important message that definitely bears repeating ...

      If you ever hope to enter the home buying market ... there is no better time than NOW to start the buying process!

      And whether you're hoping to buy within 6 months or 6 years down the road, the following statement is true.  The first steps you take towards purchasing your home will be the same.  Those steps will begin with credit.  It's also true, that your processing and preparation for Closing Day will end with credit also. 

      What does that mean?

      It means that ... Your Mortgage Professional will begin your journey to a home purchase by pulling your credit report.  It is now common practice that they will do so once again just prior to your actual Closing date when within the actual buying process. 

      Why? 

      Royal trumpeters please ...

      CREDIT IS KING ...

      This being the case, all future buyers (remember, whether buying now or later) need to seek an up-to-date accounting of their current credit scores and financial standing as soon as possible.  The further out from your buying experience, the better. 

      Simply put, this action affords you more time to rectify or improve your credit scores before you navigate the home buying course, should those actions be needed.  The best and most financial options are available to those that have good credit scores ... and nowdays, the kingdom is awarded to those with good credit only.

       Through Chicago Bancorp's services, I can help you accomplish becoming King of your Castle (or Queen, of course).  Again, that's whether you're hoping to buy right now ... or somewhere down the line. 

      CREDIT IS KING!  

BUT IT'S ALSO KEY TO ROYAL CREDIT STATUS!

• Minimum scores dictate whether qualification is even remotely possible
• Credit is key to many of the underwriting conditions for Approval for a home loan   
• Credit is key to the number of financing program options available to you during a purchase
• Credit is key to the insurance rates you receive for homeowners insurance 
• Credit is key to the interest rate options available to you during your home buying
• Credit is key to whether you have purchasing power for needed items within your home once closed
• Credit is key to etc. etc. etc. ... and etc. ...

      With so many of life's important possibilities, financing options, and cost-savings hinging on your credit score ... can you really afford to bypass the opportunity to work with me on your credit/FICO scores?  

      SUCCESS IS ATTAINABLE  ...

      If you're EVER hoping to buy a home ...  If you're hoping to SAVE yourself money ...  If you desire more CONTROL over your finances and financial future ...

• NOW is the time to act. 
• NOW is the time to write, text, email, stop by my office, or call me for assistance. 
• NOW is better than later. 
• Take action NOW.

      CONTACT ME, Gene Mundt, at Chicago Bancorp: 815.277.4036.  Text/call me on my Cell at: 708.921.6331.  Email me at: gene@chicagobancorp.com.  Reach me through my website: http://genemundt.com.  Stop by my office at: 1555 Naperville/Wheaton Road, Naperville, IL ... or 129 Capista Drive, Shorewood, IL ... or downtown Chicago location, available for the convenience of those residing within the City.

      Become KING (or Queen) of your credit and castle ... not the Court Jester.  Your royal credit status awaits ...

        No matter your location ... no matter when you intend to buy ... GET  STARTED  NOW!  

You've Heard it Before .. The Only Thing You Have to Fear, is Fear Itself.                                                         It's True With Mortgages Too!

     Right now, you can't escape the headlines and deluge of information regarding mortgage interest rates.  The rates themselves are big news ... let alone all the information and controversy swirling about the state of home buying, home buyers, home owners, home lenders, and home builders.

     The other day, I read an article online that related the opinion that the extremely low rates that we are currently experiencing are going to waste.  The jist of the article was that because of fear, the fallen prices of homes, unemployment, and other various components ... Americans are just not capable or willing to take advantage of these current low rates.

     That is a terrible shame ... as being able to take advantage of these rates could turn lives around.

     I can understand the fear being felt ... as a substantial portion of we Americans are all in the same boat.  Our country's finances have touched ours.  And I can understand that fear even more, if you personally have taken a financial hit by losing a job, benefits, financial loss, housing loss, or more.   Those are cold hard facts ... and unfortunately, there ARE many that cannot be helped because of a variety of reasons.  To say otherwise as a mortgage lender, would be a lie.

     But for those lucky enough to NOT have suffered these losses -  or  -  for those that have not sought advice or guidance, I ask ... what exactly is it that prevents you from doing so?

     It is a fact ... mortgage lenders cannot charge you for simply asking them questions or seeking their advice.  So, why not do so? 

     Whether you think you are currently capable -  or  -  whether you are currently contemplating buying or not  should NOT be the deciding factor in seeking a mortgage lender's advice or guidance right now.  Especially with mortgage lending being as challenging as it currently is, the process of buying or refinancing should be started way ahead of time.  This is definitely so for those that have never purchased a home before or borrowed money.  The process of knowing, or pro-actively improving your credit should be taken right away.  

     Also, the knowledge and protection of your credit should be accomplished at least once per year.  A reputable mortgage lending professional can do that for you.  The establishment of good credit, whether it be for the first time or correcting past actions, takes time.  Delaying this step until the time when actually entering into a purchase or refinance can be very stressful and costly in time and money. 

     Contacting an experienced mortgage professional with credit expertise and background way in advance of any actual lending application makes good sense ... and good cents.  Again, taking this path to good strong credit and preparing for a future purchase or loan is free.   (Keep in mind, the actual credit report may not be free.)  And also important, you are establishing a healthy working relationship that will benefit you down the road when you DO want to take action towards a purchase or refinance.

     If you are in need of advice, counsel, assistance, guidance, and hard information ... contact me now.  Do not wait.  Do not hesitate or be fearful.  I want you to contact me with your needs and questions.  It is the wise action for you to take.

     Together we can explore your financial realities, organize the most beneficial course for your credit and finances, establish a plan to meet your financial needs and goals, monitor your progress, and keep you steadily improving and moving towards your successful end objective.   As your mortgage lender I will work with and support you every step of the way.

     Credit and lending decisions and their resulting actions need not be hard or scarey.   Working with a professional mortgage lender that offers the best in advice and expertise ... and can deliver you to a successful financial and lending outcome, is extremely important.  Contact me today and let's get started ...

     Click here to go to my website .... or contact me for the assistance and information you need now.

     Building Your Potential Home Purchase ... Starting From its Infrastructure Up!

     Are you considering a move into a different town, different subdivision, county, or state?  There are many facets of a purchase that are important.  Location.  The condition and cost of the property being considered.  Finding the right professionals to represent you.  Mortgage financing concerns.   Finances themself.

     But, here's something additional to consider very seriously.  What is the condition of the infrastructure in that area?  What services are included in that property's infrastructure?

     First, the definition of infrastructure:  The basic physical systems of a business, nation, or government entity.  Transportation, communication, sewage, water, electric systems, schools, are all a part of infrastructure. These systems tend to be high cost investments ... however, they are needed for a country to be efficient and productive.  (Merriam-Webster dictionary)

     The infrastructure impacting your home may determine the quality of life you enjoy in that property in the most basic form.  Questions you should ask regarding a specific property's infrastructure could be the following ...

     "How often will the property experience electrical service problems ... will electricity go out often?  When tap water is run in the kitchen ... will it smell of sulfur or be speckled with iron?  What is the EPA quality of that water?  Does the property have technological services ... what cable or wireless computer capabilities are there?  When laundry is done ... will the water flush out into well-functioning sewer pipes?  If problems exist, will those problems shut-down other area services, such as commuter trains, cell towers and service, subways, highways, and more?  What is the age of the infrastructure systems that supply services to that home?"

     Knowing the age and condition of the town's, subdivision's, county's, or state's internal infrastucture should appear on your Top 5 List of "Things to Find Out" before you buy.  It's that important.  Stop ... think about all the ramifications to you and your quality of life that are possible.  What would be your "trickle down affect"? 

     And, do not think that just because you are considering a move into a newly constructed home located in a new subdivision, that you are exempt from infrastructure issues or problems.  That is NOT the case.  Know whether water treatment plants are large enough .. or have been added ... to service the growing number of homes in your area.  Find out if monies have been withheld by the government entities ... or arrangements have been made ... to address the abuse of the area's or subdivision's streets AFTER construction has been completely built-out.  Think about what your left to contend with if these elements are NOT in place. 

     Things as simple as the level of postal service to the area, police, fire, and libraries should be considered. The school system serving the children living in your area is of extreme importance.  Schools are a huge deciding factor not only in the quality of life you live, but in maintaining the value of your property.  This is true whether you have your own children participating in the school system or not.  Discounting this fact could prove extremely damaging to your finances when and if the time comes to sell your home.

      Cover the most basic of services and question their current status and repair when in search for a new home.  Take the time to do the research needed to find the answers and information you need to make a qualified and intelligent choice regarding your future home.  Find the performance records for the services provided to your property.  Learn what is planned in the future for those services, the costs of the improvements or repairs, and how they will be paid for.  Inquire as to what increases in those services (and their corresponding costs) you can expect to be held accountable for in one way or another, should you buy.  

     Only after making all these efforts will you be fully prepared and ready to make a final decision regarding the purchase of the property you are considering.  You will also know that you have taken every possible precaution in protecting your quality of life in that property ... and your personal finances while there. 

     Start with knowing the infrastructure of your potential home ... and build upon that ...

It happens to the best of us ... we get a little older, and signs of age start to creep up slowly but surely.

A wrinkle here, a worn out part there, blotchy colors, and suddenly you're tired and feeling your age .... sigh .... it happens.

Don't worry ~ with a little "cosmetic surgery" you'll be as good as new.  And it won't cost a fortune, I promise! If you're about to put your home on the market, all you need is a little cosmetic help from your professional home stager -- Think of us as your House Doctor.  Here's what we can do for your tired and dated home:

• We'll walk through your home with you (your agent is welcome to join us) and give you sound and cost-effective advice on how to best prepare your home for selling.  This process usually takes two hours (sometimes longer).

• Painting fresh, neutral colors is an instant "face lift" for a home ... buyers LOVE to find a home that's move-in ready. We can tell you all the best colors to use for today's buyers (hint: it's not white!)
  

• Is your home suffering from dated window coverings that have seen better times?  No problem, we'll suggest that they be removed (along with the old hardware too). We want buyers to see a light, bright space so they can imagine themselves living here. Today the best window coverings are simple ones that let in a lot of light. We can tell you what to buy for a reasonable cost, and where to find them.
  

• We see a lot of dated, worn out light fixtures in homes on the market.  Buyers don't want to bother changing them out -- and they might just say, "let's go to the next house on our list" so let's take care of that right now.  Fixtures in brushed nickel and oil-rubbed bronze are classic favorites.  Use whatever finish works best with the other elements in your home.  Especially important are the entry, dining room, living or family room, master bedroom, and bathroom light fixtures.  Let's change those first!

•  Is your flooring old, creaky, cracked, or faded?  If so, let's freshen it up with something new! If you have hardwoods hiding under old carpet, surgically remove it and reveal the beautiful asset underneath.  Replace carpeting that's worn and past its prime.  Consider new tile, vinyl, bamboo or Marmoleum flooring ... buyers will be relieved it's one more thing they don't have to tackle.

• Check your kitchen appliances.  If they're old and  look like rejects from the scratch & dent place, it's time to consider replacing them.  There's no need to buy top-of-the-line unless your home is in the upper price ranges.  Decent quality that's new or near-new is a smart option.  

• Sometimes your house needs just a "tweak" or two to bring it up to par -- and your furniture may need to be thinned out and some of it put into storage so that buyers can see how spacious the house really is.

• Remember that with all cosmetic procedures, it's important to be sure your home is *sparkling* clean, top to bottom ... especially windows, kitchens, bathrooms, doors (every surface has to shine).

• Last but not least, we'll talk about curb appeal and how important it is for buyers.  They'll decide right away if they even want to see the inside.  Some of your landscaping may need radical surgery ... some of it just a little pruning.  Is the grass lush and green, or is it pale and thinning?  Either way, we can tell you  how to fix it FAST.

Don't be afraid to take the first step -- contact your local professional home stager for a consultation.  We promise, you won't even need pain medication -- it's a completely pain-free process.   For a very reasonable fee, you'll save time and money making sure your home stands up well when compared to others in your market area.  Looking good can lead to a faster sale!

                                    ***                    ***                    ***

If you're located in the Portland metro area, we'd love to help your home look its best.  For less than $200 we provide a Home Staging Verbal Consultation. Our clients love our home staging statistics and our dedicated customer service. Contact us @ 503-246-1800 to schedule your appointment!

     This post has so many great points and suggestions contained within it!

     Just think ... you have a virtual "army" of salespersons acting on your behalf, if you follow the advice found here.

     My thanks to Russel for his post and amazing power tips.  My hope is that  everyone is lucky enough to find, cultivate, and reciprocate in relationships of this strength and huge benefit.

     Russel is absolutely correct ... it's a win-win-win for all involved!

Gene

     When asked by a customer about debt relief counseling or services, I always take the time to thoroughly examine and determine exactly what the nature of the person's debt is ... and how severe.  Many lenders will do the same, and proceed in assisting those customers that they feel equipped to counsel and assist at no cost to the customer. 

     I do this to help straighten out debt and benefit credit scores for present customers, and those considering buying in the future or refinancing present loans.  I consider it just another way I can benefit my customers and also see it as extension of my personal lending services.  When I feel the debt or circumstances are beyond me, I say so and help in finding someone that is best equipped to handle the more critical stages of debt.  I will point out, that there are some companies that are more reputable and better capable of offering that assistance.  Obtaining THOSE contacts are key to the success of debt elimination. 

     Big changes came to those companies found within the debt settlement industry yesterday.  The Federal Trade Commission placed new restrictions on companies that promise to help consumers pay-down or eliminate their credit card balances and late fees.

     These new changes will apply to all debt relief companies selling their services over the phone ... not to those that make first contact in-person or conduct business entirely online.  These rulings are much more wide-spread than it would initially appear, as the large percentage of debt settlement companies utilize radio and television marketing to promote their toll-free numbers. That means they are included under these new restrictions.

     It's been reported by the Better Business Bureau that over 3,500 complaints have been received regarding these debt settlement companies since the recent recession began.  Complaints contained out-and-out fraudulent activities and stories of debt actually accumulating higher as a result of working with these companies.  While utilizing these companies services, many customers quit making their payments, which resulted in further debt, additional interest charges, and late fees being assessed.  This only exacerbated their credit problems.

     Perhaps the best change contained within these new rulings by the Federal Trade Commission, will be that these companies can no longer charge their customers an "up-front" fee for services.

     Starting on October 27th, 2010, debt settlement companies will only be able to charge their fees AFTER a customer's debt has already been settled, renegotiated ... or at minimum, seen a reduction.  Many companies were charging a percentage of the outstanding balance as their company's service fee.  For their fee, they were promising to negotiate for reduction or elimination of debts with the customer's creditors.

     Some debt settlement companies also demanded that monies be placed aside in accounts.  Of course, the settlement company had control over the accounts.  This has been ruled out as a result of the new restrictions.  From now on, any accounts maintained must be through independent financial institutions and in the customer's name(s).  The customer will retain the ability to withdraw the monies at any time ... and free of penalty. 

     Strict penalties ($16,000 per violation) will apply to for-profit companies that do not abide by these newer, more restrictive rules.  Non-profit agencies or companies do not fall under these penalty rulings.

     I suggest strongly that you contact me or your own lender, should you wish a credit/debt evaluation ... or recommendation for a debt settlement company.  Take the time to thoroughly know and understand what you are facing.  Educate yourself to your options and how best to proceed.  With the new restrictions going into place on October 27th, you will be better protected and better served if your decision then ultimately includes the services of a debt settlement company.