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Do you know what documents to take with you when you apply for a loan?

So you've found a great house and negotiated a fair price.  Now it's time to meet with a loan officer and make your formal mortgage application.  The whole process will run smoother if you've already put together the needed documents.

•        Copies of one or more months of pay stubs from every person signing the loan
• Copies of W-2's and personal tax returns for last 2 to 3 years
• Copies of 2 to 4 months of bank or credit union statements for both checking and savings accounts
• Copies of brokerage account statements for 2 to 4 months, as well as a list of any other major assets of value, e.g., boat, RV, or stocks or bonds not held in a brockerage account
• Copies of your most recent 401K or other retirement account statement
• Documentation to verify additional income, such as child support, pension, overtime, bonus,etc
• Copies of titles to any vehicles which are paid in full
• Account numbers of all your credit cards and the amounts of any outstanding balances
• Lender, loan number and amount owed on other installment loans -- student loans, car loans, etc.
• Addresses where you lived for the last five years, with names of landlords, if appropriate
• If you're self employed, provide profit and loss statements and tax returns for 2 to 3 years
• Copies of alimony or child support payments

Bringing all of these things with you when you make your application will help to speed up the loan approval process.

How Embarrassing!  Our Own Son Didn't Know -- The $8000 Tax Credit is Real Money in Your Pocket!

Last night Steve and I joined our son and his girlfriend for dinner.  I happened to ask him if he had finished preparing his income taxes and taken advantage of the tax deduction being offered for the sales tax he paid on his new car.  He said yes, and mentioned that it was worth a couple of hundred dollars to him. 

One thing led to another and the conversation turned to the First Time Home Buyer Tax Credit.  Being 26, he's interested in the idea of buying -- but not quite ready for home ownership.  We chatted about how we're surprised more buyers aren't taking advantage of the $8000 tax credit -- I mean, people are missing the opportunity to receive $8000 from Uncle Sam.  Our son said -- "you mean they actually get a check for $8000?"  -- "you mean it's not just subtracted from future taxes?"  -- "you mean they don't just get a certain percentage of it -- like a deduction?"  NO!!!!!!! Then, for the icing on the cake -- he actually said "you really need to let people know about this"!

Since January 2009 when the First Time Home Buyer Tax Credit was first announced -- it seems like that's all we've talked about.  I mean, how can anyone not know?   Well, this was a wake up call to us, that yes, there are still First Time Buyers out there who don't understand how this thing works.  So at the risk of sounding like a broken record.....we've got to keep talking about it!  After all, it ends in 84 days!

Visit this blog for details:  New Expanded Tax Credit Helps Indiana Move Up Buyers

Originally posted by Steve & Tonda Hoagland at www.IndyChats.com 

Our sources say rates are going up in 2010!  How much and when?  According to experts in the mortgage industry, rates will start the year just above 5% and will gradually climb into the 6 1/2 range as the year progresses.  Why?  One of the main reasons is the expiration of the Federal Reserves Mortgage Backed Security Purchase Program at the end of March.  This program was instrumental in keeping rates artificially low in 2009.  So as the program winds down, rates will likely edge higher as we get closer to summer. 

For buyers, this means their dollars will buy less house as the rates inch upward.  How much does a rate change really affect a monthly payment?  Here's an example from the e-Book, Only 8 Steps to Home:

For the last twenty years, the mortgage interest rate averaged approximately 8 percent in the United States.  For the same $1000 monthly payment, a buyer can afford $30,000 more house at a 6% rate vs 8%. 

Rates aren't expected to increase quickly, but they will most likely be volitile throughout 2010 with waves of ups and downs and a trend that is clearly up.  So if you're considering purchasing a home, now may be a great time to seriously consider taking the plunge.

Visit our website to download the e-Book "Only 8 Steps to Home" or see how to get your own print copy of "Your First Home, The Proven Path to Home Ownership".  

 Other e-Books are also available:

"Your Handbook to Home Ownership"

"The Skinny on First Time Home Buyers"

"$8000 Closer to Home"

Homes for Sale in Center Grove - 507 Green Valley Dr, Greenwood IN

Tired of cookie cutter neighborhoods and tiny yards? Take a look at this 1432 sf brick ranch in Greenwood -- popular Center Grove Schools too!

Gleaming hardwood floors in living room, hall & all 3 bedrooms have been professionally restored to their original beauty. A newer furnace, AC & hot water heater mean less maintenance for the new owner. Nice updates include new vanity & fixtures in the half bath (there is room to add a shower and convert this to a second full bath) and new sink and fixtures in the full bath.

The seller is leaving all of the appliances, including the washer and dryer.  You’ll enjoy the nearly ½ acre property featuring mature trees & fenced backyard. The location is conveniently close to shopping - 5 minutes from the Greenwood Park Mall - restaurants and less than ½ an hour commute to downtown Indianapolis. Greenwood city water & sewer. Property taxes are incredibly low -- only $298 per half - great for the budget!

Search for other Center Grove Properties

Originally Posted by Steve and Tonda Hoagland, Active Rain Blog 11/2/2009

(Information deemed reliable, but not guaranteed)

Home For Sale in Greenwood Indiana - Wakefield - 421 Governors Lane

Enjoy this fabulous 2 story in popular Wakefield featuring spacious great room with gas log fireplace. Open kitchen with large breakfast nook, center island and formal dining room are perfect for entertaining. Main floor den off of the entry foyer -- great place for your home office or family computer room.

Master suite features cathedral ceilings, plant shelf, whirlpool tub, separate shower and double vanity. Bedrooms 2 and 3 are oversized with nice walk in closets. 4th bedroom is enormous 20 X 16 with high ceilings and double closets. Excellent area for rec room, exercise area, etc. Relax or visit with neighbors on the front porch or back patio overlooking the shimmering lake. Home has 3 car carage and 1 year home warranty. Possession at closing too!

Search For Other Great Center Grove Homes

Search for other Center Grove Properties

Originally posted by Steve and Tonda Hoagland on Active Rain Blog with permission of John Breck - listing broker.

Short Sale - Part 2:  How to Buy a Short Sale Property!

If you're not familiar with Short Sales, begin by reading Part 1: What is a Short Sale?  Then come back to this article which takes the next step and explains how to buy a short sale.

So, how are Short Sale Properties Sold?  They are listed with a real estate agent like other properties.  They usually include the words "short sale" or "pre-foreclosure" in the property description section.  Since the current homeowner is in a difficult financial situation, they are usually sold "as is".  It's a good idea to contact a local real estate agent who is familiar with how to buy a short sale and ask them to set you up on a custom search which includes short sale properties.  You can also search for properties on-line, although not all searches allow you to narrow your search to just short sale properties.  Our property search is a good example of one that allows buyers to search for "foreclosed" properties in central Indiana, and the property detail page will state if the property is bank owned or a short sale (pre-foreclosure).

Potential buyers schedule a showing with their real estate agent to view the property.  Unlike bank owned properties, many homeowners continue to live in the home while it's on the market, so if it's occupied, try to allow 24 hours notice to schedule an appointment.  All offers are prepared and submitted to the buyer through a Realtor, in the same manner as a normal property sale.

So far, it seems like other real estate purchase -- right?  So, what's the big deal?  From here until closing.....it's anything but a "normal" transaction! 

• It's contingent on bank approval:  On a short sale, the homeowner still owns the home -- not the bank, but because the bank will be accepting a payoff of less than the mortgage balance, a Purchase Agreement that has been accepted by the homeowner will still be contingent upon Bank Approval.
• Normally the bank will not accept an offer with contingenciesother than financing approval or inspections:  For example, it isn't acceptable to make your offer contingent on the sale of your existing home.  Offers need to be "uncomplicated".  Don't ask for delayed closings, personal property, warranties, etc.  You may be up against other offers -- make yours as "clean" as possible. 
• It usually takes much longer:  Keep in mind that banks are overwhelmed with these right now and it may take as long as several months for the bank to respond back to an offer.  During that time the listing real estate firm will continue to market the property and take other offers.  A short sale buyer must have a lot of patience and the flexibility of having somewhere else to live while waiting on the bank approval.
• The property condition is questionable:  Some are in excellent condition, but because the owner's finances may have been strained for some time prior to a short sale, general maintenance and repairs have often been neglected.  Sometimes they have been abandoned or vandalized. 
  
• The Bank takes back-up offers:  Because the bank may take a long time to accept an offer, the listing agent will continue to take "back-up" offers.  Is it a wast of time to make a "back-up" offer if there are other offers ahead of yours?  Not necessarily.  Often buyers get frustrated waiting on the bank and decide to move on to other properties.  If you're willing and able to wait, they may get to your offer, then again, they might accept the initial offer and you've wasted a lot of time when you could have moved on to another home yourself.
• Inspections:  The buyer can have the property inspected, but be prepared that the homeowner is usually not in a financial position to make any repairs and neither will the bank.  So why have it inspected?  You want to know what you're buying.  In Indiana, the purchase agreement contract still allows the buyer to walk away from a deal without losing their earnest money if the inspection discovers something substantial which will effect the value of the property.
• The Banks like to close quickly:  Although the banks often take their time approving an offer, once they do, they will want to close quickly, so the buyer must have their financing in order.

As you can see, it may take significantly longer to buy a short sale, the condition of the property may be questionable and there are definitely added frustrations working through the bank's red tape.  You could wait months just to have the bank turn down the offer, accept someone else's offer, or see the property continue on to foreclosure and Sheriff's sale.  So the real questions is.....Is it worth it?  Can you get a good deal?  Come back for Part 3!

Part 3 - Are Short Sales Good Deals?
Part 4 - Can You Sell Your Property as a Short Sale?

Search for Short Sale Properties

What is a short sale? - Part 1

A short sale(or pre-foreclosure) takes place when the sales price of a home is less than the outstanding mortgage balance on the property and the lender agrees to absorb the difference. 

Short sales happen at all price points - from under $100,000 to homes in the millions.  Each short sale represents a family in financial distress for a variety of reasons such as divorce, job loss, health expenses, or poor financial decisions.

We meet with many people in Central Indiana looking to sell their homes and unfortunately we hear this scenario way too often:

"I'm having difficulty making my mortgage payments.  I'm afraid they are going to foreclose on me.  I would love to sell, but I still owe $200,000 on my mortgage.  According to the market analysis, my home will most likely sell for only $175,000.  I don't have $25,000 (the "short" part) to make up the difference."

In the example above - will the bank let the home be sold for $175,000 and absorb the $25,000 shortfall - ie...a "short" sale?

• It depends.  It's up to each bank to decide if they will accept less than the total due.  Every bank handles short sales differently and each homeowner's situation is unique.  One of the most important and least understood elements of short sales is that the homeowner must be approved for a short sale.  In other words, they have to provide proof to the lender that they can no longer afford their home.  This is called a hardship letter. 

Why do banks approve a short sale?

• Foreclosure proceedings are very expensive for banks.  It may be less expensive for them to accept a short sale if the homeowner is no longer able to afford their payments.  In that case it is a prudent business decision. Banks don't agree to short sales because they "feel sorry" for the owner or "understand" their circumstances. 

This artile is part of a series.  Check back or subscribe to read:

Part 2 - How Do You Buy a Short Sale?
Part 3 - Are Short Sales Good Deals?
Part 4 - Can You Sell Your Property as a Short Sale?

This article originally published for The Hoagland Team Blog - IndyChats.com

Price Reduced on Home For Sale in Indianapolis - Hill Valley Estates

42 E Hill Valley Drive, Indianapolis, IN  46227

Price reduced from $124,900 to $119,900 on this lovely 3 bedroom home for Sale in Indianapolis in popular Hill Valley Estates.  This mature neighborhood has much to offer.  It's conveniently located on the south side of Indianapolis, near shopping (5 minutes from the Greenwood Park Mall) and a quick 10 minute commute to downtown. 

Recent updates include refurbished original hardwood floors, new carpet and vinyl flooring in tasteful neutral colors and fresh paint throughout.  New kitchen counter tops, new range, updated light fixtures, new tub surround.  This home is not a "flip".  It has been updated with love by the owners.

More Details on this Great Home For Sale in Indianapolis.

Open House in Hill Valley Estates on Sunday, September 20, 2009

 

Hill Valley Estates, Indianapolis  -  You're invited to visit Steve at Sunday's open house at 42 E Hill Valley Dr on September 20 from 1:00 PM to 2:00 PM.

If you're in the area, be sure to stop in and say "Hi"!

Property information

Posted: Wednesday, September 16, 2009 10:05 AM by Tonda & Steve Hoagland

January, a new year, another new goal.  Or is it the same one as last year and the year before that?  Isn't it interesting how we set new goals for ourselves in January.  It's like we need a fresh start to the calendar in order to make a plan -- to get things done that we know need doing.

What are your 2009 goals?  Lose weight? (Yes, that's one of mine!) Land a new job?  Get a promotion?  Spend more time with family?  Go back to school?, Buy a new house?......

Whatever your goal -- do you have a plan to get there?  Goals are seldom achieved unless you think through the things that need to happen before they become accomplishments.  For example, I want to lose weight this year.  Great.  I know in my head that I can watch what I eat, exercise more, maybe even skip a meal or two.  Will I do it?  Where will I be by March 1st?  Yes, you guessed it -- probably waiting on January 1, 2010 to restart my goal to lose weight!

So what should I do?  How do I really make it happen?

Here is a formula that has worked for me in the past.  It's not easy, and I can't say I always follow my own advice, but when I do, I have a lot better chance of achieving my goals.  Maybe it will work for you too.

 Step One:  Choose your goal - and write it down.  (This is the easy part!)

Example:  I want to lose weight.

Step Two:  Set a measurable objective. (Answer the questions, "how much" and "by when".)

Example: My objective is to lose 20 pounds by May 1st.

Step Three: Determine your strategy for achieving your objectives

• I will stop eating fast food
• I will exercise 5 days per week for at least 30 minutes
• I will monitor my progress on a weekly basis and reward myself (not with food) when I meet the milestones I've set

Step Four:  Determine what you need to execute upon your strategy

• I need to organize my day so that I am not tempted to hurry through lunch or go to the drive through
• I need to schedule time on my calendar to exercise -- an appointment with me!
• I need to monitor my activities and progress on a chart
• I need to stick to the plan!  "Just Do It" as Nike would say
• I need to share my goals with my wife and ask her to help me stay the course

There are many more things I can add to the list, but you get the idea!  I find if I follow this plan of goals, objectives, strategies, and needs then I stand a very good chance of losing those 20 pounds by May 1st.  If you're anything like me, you feel a real sense of accomplishment when you actually get 'er done!

As a real estate professional, I meet a lot of people who would like to buy a home, but just like losing weight, they're not sure how to make it happen.  Is purchasing a new home one of your goals in 2009?  Perhaps your objective is something like "moving to a great Greenwood neighborhood before school starts in the fall".  Now, how do you determine your strategies and needs?  This where a Real Estate Professional can make all of the difference.  It's like hiring a personal trainer.  They'll guide you through the process from beginning to end, ensuring you're on track with your strategies and providing the resources to assist you with your needs. But unlike a personal trainer, hiring a buyer agent isn't expensive!  Their fees are paid by the seller.   So what are you waiting for?  Put a plan in place to make this New Year's Resolution a reality!.....Oh, and you might want to save some time on your calendar the last week in July for the big move into your new place!  As for me, hopefully I'll be celebrating shedding those extra 20 pounds!

by Steve Hoagland of The Hoagland Team