Can I Qualify for a Mortgage After Declaring Bankruptcy? Yes — and Here’s How

Can I Qualify for a Mortgage After Declaring Bankruptcy? Yes -- and Here's HowIt may feel like a very daunting task to consider buying a home after you’ve declared bankruptcy, and there’s no doubt that it’s an uphill battle. Fortunately, while you’ll have hard work ahead, there are things you can do in order to make your dream of home ownership a possibility. Whether you’ve just declared bankruptcy or some time has passed, here are some things you should consider before getting into the market.

Wait It Out

It might not be what you want to hear, but it’s, unfortunately, the case that you’ll have to wait at least two years before you purchase a home following bankruptcy. Since lenders will not want to take the risk on someone that has proven to have poor financial habits, they will require a waiting period in order for the credit risk you pose to improve. While this may seem like a long time, take the opportunity to improve your financial habits so you can be amply prepared when the time comes.

Build Up Your Credit

In order to own a home, you’ll need to develop some solid financial habits, and that means getting on top of your finances even in times when it feels like you have no leverage. Ensure you get a copy of your credit report and, if you notice any errors, reach out to the credit bureau for corrections. It’s also a good idea to consider applying for a secured credit card and ensure that you pay all of your bills on time. While it might feel like a lengthy task, developing good habits will have a positive impact on your credit over time.

Prepare For Your Payment

When it comes to a poor credit history, you’ll need to pull out every stop you can to that convince lenders that you’re a solid financial bet. Instead of wasting the time, write up a budget for yourself and save a sizeable sum for your down payment each month. It’s possible that 10 or 15% down will do, but a 20% payment will help you avoid private mortgage insurance (PMI) and will go further in convincing lenders of your reliability.

It’s more than a little disheartening to have to deal with bankruptcy, but by waiting it out and developing good financial habits in the interim, you’ll be well on your way to buying a home. If you’re currently preparing to purchase, contact your trusted mortgage professional for more information.

A Home Loan For an AirBnB Property: What To Know

A Home Loan For an AirBnB Property: What To KnowIf you are looking for a way to diversify your investments, you might be thinking about buying a rental property. One of the most common rental options is AirBnB. Given the number of people who use AirBnB, this could be a great way to generate a steady stream of short-term renters. On the other hand, can you take out a loan to buy an AirBnB property?

There Are No Mortgages Specifically For AirBnB Properties

First, understand that there are no home loans available specifically for AirBnB or VRBO properties. If you go to a lender and ask for an AirBnB loan, they will direct you to a traditional investment property mortgage. Regardless of whether you want to do short-term loans through AirBnB or a long-term loan that you handle on your own (or through a formal property management company), the mortgage you will apply for is the same. What are the options you have available?

Options For An AirBnB Property

If you want to rent out an AirBnB space, you have a few options. First, you could always consider renting out a room in your primary residence. This could be a less expensive way for you to start generating some income through AirBnB.

Or, you can apply for a traditional investment property loan through a mortgage company. This loan uses the value of the investment property as collateral. The process of applying for this new mortgage will be similar to the process of applying for your first mortgage, but the lender may require you to put more money down. 

Finally, you could also move and buy a multi-family property, such as a duplex. Then, you could live in one of the units while renting out the others. This could be a nice middle ground between the other options.

Consider Using AirBnB To Generate Rental Income With Your Own Rental Property

These are a few of the top options available if you want to use AirBnB to generate rental income. It is one of the most popular rental apps, and the process of applying for a loan for an AirBnB property is the same as applying for a loan for any other type of investment property. 

Updating Your Home: The Top Options

Update Your Home Without RenovatingIf you want to improve your quality of life while also increasing the value of your home, you might be interested in updating it. You probably want to live in a home that is well-designed, and a prospective buyer wants the same thing. Unfortunately, performing a major renovation can be time-consuming and expensive, but there are more cost-effective ways to update your home. What are a few of the top ideas?

Paint Your House

One of the first ways you can update your home is to give it a fresh paint job. If you have an older home, a fresh coat of paint can go a long way toward making your home feel younger. Furthermore, there are still homes that have very outdated color schemes, and some of them even use wallpaper. Right now, neutral colors, such as grey, are very popular among homebuyers. In addition, neutral colors are very easy to match with furniture. 

Update Your Lighting

You can also update your home by improving the lighting system. If your lights are not that strong, certain rooms might feel small and cramped. On the other hand, a room that has plenty of natural light feels much more open and welcoming. Even something as simple as swapping out your light bulbs for LED bulbs can go a long way toward making your home feel more inviting. New light bulbs might also use less electricity, which can help you save money.

Swap Out The Handles And Cabinet Pulls

The kitchen is the heart of the home, so you should consider updating this room as well. You do not need to swap out all of the appliances and cabinets. Even something as simple as updating the handles and cabinet pulls can make your house look young and fresh. For example, stainless steel, aged copper, and brushed nickel are a few of the most popular materials for cabinet and drawer pulls. 

Get A Landscaper 

Finally, you can also update your home by hiring a landscaper. You may want to start by mowing your lawn, but you can also make your home look younger and more welcoming by planting a few flowers and bushes. This is also a great way to make your home more sustainable without breaking the bank.

 

Get Your Mortgage Paid Down Faster With These 5 Simple Money Saving Strategies

Get Your Mortgage Paid Down Faster With These 5 Simple Money Saving StrategiesThe monthly mortgage payment can be burdensome for many, but it’s possible you’ve thought of trying to pay it down more quickly. Without getting a new job or working overtime, here are some tips you can use on a daily basis to save additional funds and pay off your mortgage at a swifter rate.

Make Your Lunch

The five or ten dollars spent on lunch might not seem like a lot, but over time this amount adds up to a lot of savings. Instead of hitting the cafe, pick one or two nights each week to prepare a lunch for yourself so you can skip the daily expense.

Take A Coffee To Go

Like lunch, coffee is another thing that can end up costing a lot of money. However, instead of going for the two-dollar cup, make a pot before you leave for the day or opt for the office coffee instead. If you prefer yours on the go, you can always make it a once-a-week treat.

Avoid The Impulse

This might seem like a hard one to stick with, but instead of buying something because you want it, sit on it for a day or two and see if it still appeals to you. In all likelihood, the desire to purchase will pass and you’ll manage to keep more money in the bank.

Read The Flyers

Items like groceries may be a necessity, but that doesn’t mean that you have to buy the first thing you see. From fruits and vegetables to packaged goods, there are plenty of food items that go on sale all the time. By the time the month is out, you’ll be surprised how much you can save just by shopping around.

Skip The Cell Phone Plan

For most people, having a cell phone is a necessity these days; however, there are ways that you can get around the high costs that are often associated with smart phones. Instead of going for the expensive plan you have, settle for a little bit less service and talk to your provider about deals they can offer you.

It may seem like paying a higher monthly amount on your mortgage is impossible, but there are little ways to save each day that can help you pay it down faster. If you’re planning on looking for a new home in the near future, contact one of our mortgage professionals for more information.

What Are The Advantages Of Owning A Multifamily Property?

What Are The Advantages Of Owning A Multifamily Property?It is important for everyone to diversify their investments. One of the ways to do so is to invest in real estate. There are numerous types of properties, and one of the most attractive options is a multifamily property. Even though it might seem like a challenge to manage such a large property, there are several benefits of multifamily properties everyone should keep in mind. 

Hiring A Property Manager

One of the first advantages of purchasing a multifamily property is the potential to hire a property manager. With more families living in the building, it might be worth it to pay a property manager to handle a lot of the day-to-day tasks. Residents might have questions, and property maintenance is critical. The right property manager can handle a lot of these responsibilities. 

Generating Passive Income

By hiring a property manager, it is possible for real estate investors to generate passive income. With the property manager handling just about everything, real estate investors will be free to work another job, identify other properties, or focus on their retirement. This passive income can be used to cover mortgage payments, real estate taxes, and homeowners’ insurance. A smart investor might even use the income generated from this property to purchase another one, starting the cycle again. 

Taking Advantage Of Tax Write-Offs

It is true that there are a lot of expenses that come with owning a multi-family property. Examples include maintenance expenses, repair bills, insurance premiums, real estate taxes, and marketing costs. Fortunately, a lot of these expenses could be tax-deductible. This could save property owners a significant amount of money. Of course, anyone who is interested in exploring the tax advantages that come with owning a multi-family property should reach out to an experienced tax professional for assistance. 

Consider Owning A Multifamily Property

These are just a few of the many advantages that come with owning a multifamily property. Even though there might be a larger upfront expense, there are numerous advantages that a multifamily property might provide. There are potential tax advantages, an opportunity to delegate responsibility, and a consistent flow of passive income. Those interested in real estate investing should explore the opportunities afforded by multifamily housing.

 

The Majority Of Millennials Plan On Buying A House In The Next Few Years

The Majority Of Millennials Plan On Buying A House In The Next Few YearsDuring the past year, the housing market has been on fire. There are not a lot of houses for sale, many people are interested in moving, and there is a rising demand from the people who put off moving during the coronavirus pandemic. Furthermore, Millennial demand is picking up, which will only make the housing market even hotter. Recently, a survey found that approximately two-thirds of people who qualify for Generation Y are thinking about buying a home in the near future. Many of them have improving financial circumstances, and they are looking for a way to build wealth and settle down. 

A Majority Of Millennials Are Now Homeowners

Millennials make up approximately 43 percent of all new home purchases so far this year, which is up from 37 percent in 2021. In addition, Millennials represent approximately 20 percent of the United States population, and they represent the fastest-growing segment of homebuyers in the country. Furthermore, approximately 53 percent of all Millennials now own their own home. Many Millennials have become homeowners by purchasing homes that require updating. As a result, many Millennials are spending money renovating and upgrading their homes.

Has The Housing Market Hit Its Peak?

Even though a lot of Millennials have become homeowners, there are many who are still struggling to afford the cost of a house. With rising mortgage interest rates and home prices, it will only become more difficult for them to do so in the future. Some people are wondering if the housing market has peaked. If a price correction takes place, it could make it easier for Millennials who have not yet purchased a house to do so. Even though it is impossible to predict the future, some financial experts believe that the housing market is headed for a correction.

More Homes Are Needed

One of the reasons why housing prices are so high is that there are not a lot of new houses being built. A shortage of labor and materials has made it difficult for construction companies to keep up with demand. If construction companies are able to start building more houses, it could increase the supply of homes on the market, reducing prices overall.

 

Should You Use A Home Equity Loan To Buy A Vacation Home?

Should You Use A Home Equity Loan To Buy A Vacation Home?If you are looking for a way to diversify your investments while also making it easier to go on vacation, you may have thought about purchasing a vacation home. Saving up enough money for one house was already hard enough, so how are you going to save up money for a second house? If you have owned your primary residence for a while, you might be able to take out a home equity loan. Then, you could use this to purchase a vacation house.

How Does A Home Equity Loan Work?

A home equity loan allows you to borrow against the equity you have already accrued in your house. A home equity loan typically has a lower interest rate when compared to a personal loan because you use your house as collateral. If you have at least 20 percent equity built up in your home, you may be able to tap into this equity to use it as a down payment for a vacation home.

The process of applying for a home equity loan is similar to the process of applying for a mortgage. Then, you can pay back the home equity loan on your own schedule. You are only required to pay the interest every month, and you can work with the lender to figure out when you would like to repay the rest of the loan.

Consider Added Expenses With A Vacation Home

If you purchase a vacation house, some of your expenses might be higher. For example, your home insurance premium will probably be higher on your vacation house because there is a greater risk of something going wrong. You aren’t in the house all the time, so there is a greater risk of something going unnoticed. Furthermore, real estate taxes are typically higher on a vacation house than they are on a primary residence. You should have enough money put aside.

Consider Using A Home Equity Loan To Buy A Vacation House

A vacation house can be a great investment and a home equity loan can provide you with the flexibility you need to purchase one; however, you should consider all of the expenses that go along with a vacation home before deciding if you can afford one. 

 

Make Modifications To Age In Place With A Home Equity Loan

Make Modifications to Age In PlaceThere are a lot of people who would like to remain in their homes for as long as possible. Unfortunately, a traditional home may have a few features that can make it difficult for people to stay in their homes as they get older. There are some modifications that can be done relatively easily to reduce the risk of falls. This includes adding handrails, improving the lighting, and even adding seats in the shower. Unfortunately, some modifications, such as making a home wheelchair accessible, can cost thousands of dollars. A home equity loan can make this process much more affordable.

How Does A Home Equity Loan Work?

If you have been in your house for a long time, you probably have a significant amount of equity built up in your home. There is a chance that your house may have been paid off entirely. A home equity loan allows you to borrow against the equity you already have in your home to receive a lump-sum payment. Then, you can use this money to make more expensive upgrades to your house, allowing you to age in place. 

You can pay back the loan on your own schedule, and you only have to make the interest payment every month. The only rule is that you need to pay back your equity loan before you sell the house. If you sell the house and the home equity loan has not been repaid, part of the proceeds from the sale of the house will be used to pay off the home equity loan.

How To Get Approved For A Home Equity Loan

To get approved for a home equity loan, you will need to have all of the things that accompany a standard mortgage. You should have a low debt to income ratio, a history of steady income (or a nice portfolio with assets), a solid credit score, and enough equity in your home. In general, lenders will require you to have 15 percent or more built up in home equity.

You need to know how big of a home equity loan you need, so be sure to get multiple estimates for your modifications before you get started.

The Top Home Renovations You Should Go All Out On

The Top Home Renovations You Should Go All Out OnWith many people spending more time at home, lots of homeowners are taking advantage of the opportunity to improve their houses. If you are thinking about making an upgrade to your house, you probably have a budget you would like to stick to. On the other hand, there are several home renovations you should splurge on if you want to maximize the return on your investment.

Renovate The Kitchen

Many people say that the kitchen is the center of the house. This is where you will spend a lot of your time, and a lot of your guests will congregate in the kitchen as well. Because of how important the kitchen is to not only yourself but a prospective homebuyer, this is where you can maximize the return on your renovation investment. It is not unusual for you to recoup most of the money you spend improving your kitchen when you go to sell your home. 

Replace Your Floors

Even though you may not think about the surface on which you walk, upgrading your floors is a great way for you to improve the value of your home. Your floors take a beating between heavy equipment, your feet, and your pets, so if you can replace your floors and give them an upgrade, you can increase the value of your home. There might even be new flooring options available, such as luxury vinyl plank, that were not available when you first purchased it. Consider upgrading your flooring to increase the value of your home. 

Finish Your Attic Or Basement

One of the most direct ways to increase the value of your home is to increase your square footage. You do not necessarily need to complete an addition if you can finish your attic or your basement. You may want to work with a professional contractor who can help you turn your attic or basement into an extra room. You can use the extra space as a home theater, a gym, or a recreational space.

Invest In Your Home Through Renovations

These are a few of the top renovations on which you should consider going all out. Even though it might be expensive, these renovations can increase the value of your home. 

 

Is It Best To Put Down A Large Down Payment, Or Be Agile With Your Savings?

Is It Best to Put Down a Large Down Payment, or Be Agile With Your Savings?Putting down the largest sum of money at your disposal might seem like the best way to go when it comes to your mortgage down payment. There is a certain amount of truth to this, but the reality is bigger is not always better.

Ideally, the amount of money you settle on for your mortgage down payment will take into account your monthly budgeting requirements.

The Big Advantages Of A Large Down Payment

Fewer Mortgage Payments: The larger the down payment, the higher the likelihood that you will be able to afford a shorter mortgage. Unlike some of the other benefits of large down payments, ensuring this perk is available to you is solely dependent on whether or not your post-down payment budget will be able to support the necessary payments.

Lower Payment Totals: If you choose to stick to a longer payment plan, each month’s payment will be significantly less than it would have been had you chosen to put less money down up front. Of course, if you choose a shorter mortgage you will be required to pay more.

No Need For Mortgage Insurance: When the down payment is a lower percentage of the purchase amount, lenders will often require clients to apply for mortgage insurance as way to protect themselves in the case that a client defaults on the loan. However, if the buyer is able to make a larger down payment, mortgage insurance can be completely avoided.

Lower Interest Rates: The interest rate on your mortgage is dependent on how much you need to borrow. The more you pay out of pocket, the less money you will have to borrow from a lender. This means the interest rate on the loan will be lower and you will lose less money on the loan overall.

Coping Smartly With A Small Down Payment

Making a larger down payment may not be an option for you in your current financial state. Opting to make a smaller down payment will still allow you to purchase your new home, with a few extra conditions. Higher interest rates and having to take out mortgage insurance are the two primary conditions you are likely to come across.

Once the down payment is made, your main concern becomes making the most of your monthly mortgage payments.

A great coping strategy is to get into the habit of paying off more than the amount due on as many scheduled payment days as possible. Another good strategy is to arrange for an accelerated payment schedule. These small adjustments could help you pay off your mortgage faster, and save you more money as a result.

When settling on a down payment amount, the most important issue to factor into your decision is whether or not you are capable of remaining financially secure after the payment is made.

If a larger down payment is going to dramatically impact your emergency funds, you may want to reconsider. Contact your local mortgage professional to learn more about choosing the most suitable mortgage for your budget.