Category Archive Loans

ByCurtis Watts

Luxury Real Estate Trends to Watch in 2020 

What will 2020 bring?  These four trends are expected to impact luxury buying and selling in the new year and decade ahead. 

1. Luxury Housing Holds Steady

This year, expect “guarded optimism” to replace last year’s uncertainty over fears about a global economic slowdown, a U.S.-China trade war and a potential U.S. recession, according to Mansion Global. This is encouraging news for luxury real estate, which has traditionally been tied to global economic growth, yet is generally more insulated from market fluctuations. Many U.S. luxury housing meccas are generally stable, while some high-end hotspots like Los Angeles and Miami could be poised to rise or make a comeback in 2020. 

2. The Rise of the Mid-Sized Luxury Market 

When realtor.com released its annual list of the hottest markets last December, surprise cities like Boise, McAllen, Texas and Tucson topped the list. “The cities that we expect to do best in 2020 are not necessarily big, fancy, coastal cities, but secondary markets where the job market is still pretty good but housing is affordable,” said Danielle Hale, chief economist of realtor.com. Affluent buyers from high-cost cities want a good deal as much as anyone — so we expect to see midsized cities with stable and solid economies and more affordable housing as the top performers in 2020. 

3. Less Square Footage

“Less” is becoming “more” — even in the highest price segments. Consistent with NAHB data that found the average new single-family home size has been trending lower since 2015, realtors in some luxury markets are reporting that a growing number of affluent buyers are willing to “trade space for place.” This is especially true in the luxury condo segment, where buyers are increasingly getting flexible on square footage if a building has amenities or hospitality programs attached to it. 

4. Urbanization of the ‘Burbs, Emergence of ‘Hipsturbias’

People are moving back to the cities, it’s true — but as millennials start families another phenomenon has emerged, according to Emerging Trends in Real Estate 2020, a report released by Urban Land Institute and PwC: “hipsturbias.” Hipsturbias are suburban markets with hip or cool live/work/play environments offering walkability and/or transit access. Brooklyn is a prototype, but hipsturbia examples are beginning to crop up across the U.S. — from New Jersey communities such as Hoboken, Maplewood, and Summit, to New York’s Yonkers and New Rochelle, to Evanston, Illinois and further out west — Santa Clara, California, and Tempe, Arizona. 

Which trend do you see impacting your community?

The post Luxury Real Estate Trends to Watch in 2020  first appeared on Century 21®.

Source: century21.com

ByCurtis Watts

Newly Renovated, 1915-Built Townhouse in Park Slope Asks $4.4 Million

A four-bedroom townhouse with park views and tons of charm has recently hit the market, and we’re dying to tell you all about it. The listing, brought to market by Compass’ Michael J. Franco, is right next to Prospect Park, Brooklyn’s second largest park, and has plenty of outdoor space (and a rooftop deck to boot).

The townhouse sits in one of Brooklyn’s trendiest, most desirable neighborhoods — Park Slope — with its leafy streets lined with brick and brownstone townhouses, many of which were built near the turn of the 20th century and have been lovingly updated over the decades by young families migrating from Manhattan. Much like its neighboring properties, the 2,600-square-foot townhome at 15 Prospect Park was originally built more than a century ago in 1915 and retains its old-world charm — but has been carefully updated to meet modern standards of living.

beautiful townhouse in prospect park, Brooklyn
Park Slope townhouse on the market for $4.4 million. Image credit: Compass//Michael J. Franco

With 4 bedrooms, 3.5 baths, a generously sized living room, and a finished basement, the Brooklyn townhouse also comes with a few rare features for a New York home: ample outdoor space and private parking (that includes a private garage and its own driveway).

The layout is split on three levels, with the first floor housing a large living room and open dining room — both with distinctive pre-war features like classic moldings and arches — and a renovated kitchen that opens up to a lovely terrace.

inside a beautiful pre-war townhouse in Park Slope, Brooklyn
Beautiful living space with distinctive pre-war features like arches and moldings. Image credit: Compass//Michael J. Franco
dining room of a pre-war townhouse in park slope, Brooklyn
Beautiful living space with distinctive pre-war features like arches and moldings. Image credit: Compass//Michael J. Franco
renovated kitchen in Brooklyn townhouse
The renovated kitchen. Image credit: Compass//Michael J. Franco
lovely terrace of a pre-war townhouse in Park Slope, Brooklyn
The Park Slope townhouse has a lovely terrace. Image credit: Compass//Michael J. Franco

The second floor is home to 3 bedrooms and a sizeable landing which is perfect for either a library or a home office, while the third floor is dedicated to the primary bedroom suite and its massive walk-in closet, renovated bath with skylights and soaring ceilings, with a separate sitting area/den. The third level also provides access to the townhouse’s own rooftop deck, which adds more outdoor space and looks like a perfect place to entertain guests.

bedroom of a charming brooklyn townhouse in park slope
Bedroom opens up to Prospect Park views. Image credit: Compass//Michael J. Franco
bathroom with skylight in brooklyn townhouse
 Renovated bath with skylights and soaring ceilings. Image credit: Compass//Michael J. Franco
roof deck of a brooklyn townhouse in park slope
Rooftop deck of the $4.4 million townhouse in Park Slope, Brooklyn. Image credit: Compass//Michael J. Franco

The property is listed for $4,400,000 with Compass associate real estate broker Michael J. Franco.

More beautiful New York City homes

This Brooklyn Condo Has a Dreamy Backyard that Will Make You Forget You’re in the City
Trophy Apartment Once Owned by Composer Leonard Bernstein Asks $29.5 Million
These 5 Unique Listings Will Remind You of Everything that Makes NYC Real Estate Special
This $16M NYC Penthouse Has Unobstructed Views of Central Park and the Manhattan Skyline

The post Newly Renovated, 1915-Built Townhouse in Park Slope Asks $4.4 Million appeared first on Fancy Pants Homes.

Source: fancypantshomes.com

ByCurtis Watts

These 5 Unique Listings Will Remind You Why NYC Real Estate is Special

These five NYC homes for sale are truly unique, with ties to Cass Gilbert, 1900s architecture, and the city’s best features. Check them out.

Source: fancypantshomes.com

ByCurtis Watts

Trophy Apartment Once Owned by Composer Leonard Bernstein Asks $29.5 Million

An Upper East Side apartment that was once home to one of the most significant American cultural personalities of the 20th century has recently hit the market.

The Art Deco masterpiece at 895 Park Avenue was previously owned by famed composer and cultural icon Leonard Bernstein, whom music critics refer to as “one of the most prodigiously talented and successful musicians in American history”. In fact, this very property is where Bernstein — also a lifelong humanitarian, civil rights advocate, and peace activist — hosted an infamous “radical chic” party with and in support of the Black Panther Party back in 1970.

But its famous past owner is not the building’s only historical trait; built in 1929, it is designed in the classic Art Deco style, evoking New York City’s golden age glamour and sophistication. That, paired with its carefully preserved original architectural details (original wood-burning fireplaces and wide-plank wood floors) and panoramic Manhattan views make this residence a true gem.

perfect manhattan views from luxury apartment
Image credit: Warburg Realty

Clocking in at approximately 6,300 square feet, with an extra 700 square feet of private outdoor space, the 895 Park Avenue unit spans over two floors of the 21-story Upper East Side building. The entrance is through a private elevator landing which opens into a 34-foot grand gallery, further leading into the residence’s elegant formal living room, library, and dining room.

With 6 bedrooms and 6.5 bathrooms, the trophy apartment also comes with an enclosed solarium that’s bathed in sunlight and that, just like the rest of the rooms and outdoor spaces, opens up to picture-perfect views of the city.

beautiful solarium in Manhattan apartment
Image credit: Warburg Realty
Image credit: Warburg Realty
Image credit: Warburg Realty

A grand staircase leads to the lower level, which houses the 6 bedrooms, as well as a home office and laundry room. All but one of the bedrooms enjoys their own en-suite bathroom as well as significant storage space in the form of walk-in closets or dressing rooms.

Image credit: Warburg Realty

The building itself adds an extra note of sophistication and convenience; the full-service white glove co-op has a long list of amenities, including multiple doormen, an elevator attendant, health club, squash court, basketball court, and private storage units. Though location itself may be its biggest asset: 895 Park Avenue is located right in the heart of the Upper East Side, on the southeast corner of 79th street and Park Avenue, providing direct access to world-class dining and shopping.

Priced at $29.5 million, the elegant unit is listed with Bonnie Chajet, Allison Chiaramonte, and Tania Isacoff Friedland of Warburg Realty.

More luxury apartments

This $16M NYC Penthouse Has Unobstructed Views of Central Park and the Manhattan Skyline
Power Couple Loren & JR Ridinger Selling Palatial Unit in Jean Nouvel-Designed Building
These 5 Unique Listings Will Remind You of Everything that Makes NYC Real Estate Special
Former Home and Office of Marilyn Monroe’s Psychiatrist Listed for Sale in Manhattan

The post Trophy Apartment Once Owned by Composer Leonard Bernstein Asks $29.5 Million appeared first on Fancy Pants Homes.

Source: fancypantshomes.com

ByCurtis Watts

7 Top Decorating Ideas for Your Bedroom this Fall: Making Your Room More Cozy & Stylish

Fall is one of the most exciting seasons of the year. The trees, the smells, the comfy sweaters and pumpkin spice lattes; it’s a cozy, wonderful time and who wouldn’t want to enjoy that warm vibe all year long? And since this is the season that prompts us all to spend a little more time inside, homeowners and renters alike tend to step up their interior decor game and invite the fall into their homes, adding notes of warmth and pops of color that are typical for the fall season. If you’re one of the many people that love fall

Source: fancypantshomes.com

ByCurtis Watts

Indoor Wellness: How to Recreate the Ultimate Interior Design Trend of 2020

Within the past few years, we’ve seen a growing interest in everything wellness. With a more mindful approach on how we approach our day-to-day lives, the emphasis is now placed on maintaining our mental and emotional health, as we are actively working to ensure that all aspects of our lives remain balanced — our homes included.

This is why the real estate wellness market soared in 2017 to one billion dollars. But what about us regular homeowners, who weren’t lucky enough to buy homes designed in such a fashion? Well, this is where interior design comes in to lend a helping hand.

There are a number of ways you can incorporate wellness design into your home. Let’s go over a few easy ways to get started.

Bringing nature into your home

There is no denying that being around nature – or even just natural materials – can be incredibly soothing. Due to this, bringing the outdoors in is something that many interior designers who follow this trend will try to do, and it’s also the easiest way for you to get started.

Start by incorporating plants and greenery in various spaces in your home. For instance, you can set up hanging plants so there are leaves and flowers dripping from the ceiling, you can encourage climbers to grow across your walls, and accentuate your decor by adding plants in creative pots.

If this seems like too much maintenance, then opt for furniture and furnishings in natural materials instead.

cozy-interiors-plant-and-wicker

Stick to wood and natural fibers as much as possible. Since you will need to add metals to the scheme as well, it is best to opt for more antique-looking pieces.

Selecting calming color palettes

You probably know that the psychology behind the way our mind interprets color plays a big role in interior design. And even if you haven’t yet read it somewhere, you instinctively know that certain shades can impact your mood and frame of mind.

It comes as no surprise to learn that many of the color trends for 2020 are based on this. For instance, there is a fair amount of focus on the color blue – which is known for its calming properties.

So, feel free to invest in navy or peacock blues. In case you prefer something a little brighter, then pinks, yellows, and orange are also great warm tones to consider. These shades too are associated with kindness, warmth, and enthusiasm respectively.

Let the light shine in

Natural light in your home is important for a number of reasons. First and foremost, it can help to brighten up your mood considerably. At the same time, being continuously exposed to light helps to regulate your circadian rhythm, helping you to sleep and wake at appropriate times. 

This is why it is important to ensure that your home is flooded with plenty of light. Windows and skylights naturally play a significant role. However, there is a lot you can do with your interior design to increase how light travels throughout the house. 

For instance, you can position mirrors opposite your windows so that the light bounces off to other parts of a room, or use light and bright window treatments to brighten the space.

You should also try to keep the walls and flooring in a lighter color so that the light is reflected rather than absorbed. Oh, and glossy paint, especially on the ceiling, can go a long way too.

Focus on ergonomics

Naturally, wellness in interior design isn’t just about how your house looks. It also has a great deal to do with how your home environment feels. Thus, the design must include elements of comfort throughout the space. 

For instance, if you live in a warmer part of the country, it is only natural that you will need to set up many cooling units throughout the house. Some of these will need to be standalone devices. Now, rather than eschewing these products completely, find a way to incorporate them into the existing design. 

Let’s imagine that you have embraced a more natural theme for your interiors. Then, perhaps you can design wooden slats to cover the sides and top of the unit so that it isn’t as noticeable. If you decide to opt for this route, make sure that no important outlet is covered up. There should be plenty of airflow in and out of the space as well. 

Or, you could use nature-inspired stickers to help the unit blend in. At the very least, set up some plants around it so that it doesn’t stand out too much. 

As you can see, there are so many different ways to incorporate the wellness theme into your home. So, if you are looking forward to a happier and more balanced year ahead, then these are the tactics you should consider.

Keep reading

6 Smart Home Devices to Keep Your Pets Safe, Well Fed and Entertained While You’re Away
Planning a Redesign? Here are the Most Popular Interior Design Styles You Get to Choose From
Here’s Why a Womb Chair is the Perfect Addition to Your InteriorsHow to Successfully Integrate Smart Home Tech into Your Own Home

The post Indoor Wellness: How to Recreate the Ultimate Interior Design Trend of 2020 appeared first on Fancy Pants Homes.

Source: fancypantshomes.com

ByCurtis Watts

RV Loans: How to Finance an RV

In 2017, wholesale RV shipments reached their highest level ever, topping 500,000, according to the RV Industry Association. Part of the reason for the rise in demand for RVs is due to millennials, who are…

The post RV Loans: How to Finance an RV appeared first on Crediful.

Source: crediful.com

ByCurtis Watts

How to Get Debt Consolidation Loans When You Have Bad Credit

Debt consolidation is one of the most effective ways to effectively manage debt. It can greatly improve your debt-to-income ratio and help you get back on your feet. You will have more money in your pocket and less debt to worry about, and while your options are a little more limited if you have bad credit, you can still get a consolidation loan.

In this guide, we’ll look at the ways that a debt consolidation loan will impact your credit score, while also showing you the best ways to consolidate credit card payments and find a credit card consolidation plan that suits your needs.

What is a Debt Consolidation Loan and How Does it Work?

A debt consolidation loan can help you to manage credit card debt and other unsecured debts by consolidating them into one, manageable monthly payment. You get a large loan and use this to clear all your current debts, swapping several high-interest debts for one low-interest loan.

You’ll consolidate multiple payments into a single monthly payment, and, in most cases, this will be much less than what you’re paying right now.

The problem is, creditors aren’t in the business of helping you during your time of need. They’re there to make money, and in exchange for your reduced monthly payment, you’ll get a loan that extends your debt by several years. So, while you may pay a few hundred dollars less per month, you could pay several thousand dollars more over the lifetime of the loan.

Why Consider Debt Consolidation for Bad Credit?

You can use a debt consolidation loan to consolidate credit card debt, clear your obligations, reduce the risk of penalties and fees, and ultimately improve your credit score. What’s more, you may still be accepted for a debt consolidation loan even if you have a poor credit score and a credit report with several derogatory marks.

It’s an option that was tailormade for borrowers with lots of unsecured debt, and it stands to reason that anyone with a lot of debt will have a reduced credit score. Of course, it still helps if you have a high credit score as that will increase your chances of getting a low-interest debt consolidation loan, but even with bad credit, you can get a loan that will reduce your monthly payment.

How Does Debt Consolidation Affect Your Credit Score?

A debt consolidation loan can impact your credit score in a number of ways, all of which will depend on what option you choose:

  • A balance transfer can reduce your score temporarily due to the maxed-out credit card and a new account.
  • If you use a consolidation loan to clear credit card balances, you will diversify your credit report, which can benefit up to 10% of your credit score.
  • If you continue to use your credit cards after clearing them, your credit utilization will drop, and your credit score will suffer.
  • A new consolidation loan account will reduce your credit score because it’s a new account and because the average age of your accounts has decreased.
  • Debt management will reduce your credit utilization score by requiring you to cancel credit cards. This accounts for 30% of your total credit score. 

The good news is that all of these are minor, and the short-term reductions should offset in the long-term. After all, you’re clearing multiple debts, and that can only be a good thing. 

A debt consolidation loan will not impact your score in the same way as debt settlement or bankruptcy.

Alternatives to a Debt Consolidation Loan 

A debt consolidation loan isn’t your only option for escaping debt. There are numerous options for bad credit and good credit, all of which work in a similar way to a debt consolidation loan.

These may be preferable to working with a consolidation loan company, especially if you have a lot of unpaid credit card balances or you’re suffering from financial hardship.

How Does a Debt Management Program Work?

Debt management is provided by credit unions and credit counseling agencies and offered to individuals suffering financial hardship and struggling to repay their debts. A debt management plan typically lasts three to five years and works with unsecured debt only, which includes medical debt, private student loans, and credit cards, but not mortgages or car loans.

A debt management plan ties you to a credit counseling agency, which acts as the middleman between you and your creditors. The agency will help to find a monthly payment you can afford and then negotiate with your creditors. You make your monthly payment through the debt management program and they distribute this to your creditors.

Debt management specialists are experts in negotiation and know how to get creditors to bend to their ways. They understand that lenders just want their money and are keen to avoid defaults and collections, so they remind them that failing to negotiate may increase the risk of such outcomes.

Debt management programs are not free. You will be charged a small up-front fee in addition to a monthly fee. However, the amount of time and money they save you is often worth the small charge.

The only real downsides to a debt management plan is that you’ll be required to cancel most of your credit cards, which will impact your credit score, and if you miss a single payment then creditors will revert to previous terms and your progression will be lost.

A Balance Transfer

You don’t need a debt consolidation loan to consolidate your debt. You can also use something known as a balance transfer credit card. 

A balance transfer allows you to consolidate credit card debt onto a single card. These cards offer you 0% interest for up to 18 months and allow you to transfer multiple credit card balances.

As an example, let’s assume that you have the following credit card balances:

  • Card 1 = $5,000
  • Card 2 = $2,000
  • Card 3 = $3,000
  • Card 4 = $5,000

That gives you a total credit card balance of $15,000. If we assume an APR of 20% and a minimum payment of $500, you will repay over $20,000 in 42 months, with close to $6,000 covering interest alone.

If you use a balance transfer credit card, you will be charged an initial balance transfer rate of between 3% and 5%, after which you will not be required to pay any interest for up to 18 months. Continue making those same monthly payments, and you’ll repay $9,000 before that introductory period ends, which means your debt will be reduced to just $6,000 and can be cleared in 14 months with less than $800 in total interest.

This is a fantastic option if you have a strong credit score, otherwise, you may struggle to find a credit limit high enough to cover your debts. However, it’s worth noting that:

  • Your credit score may take an initial hit due to the new account and maxed-out credit card.
  • The interest rate may be higher, so it’s important to clear as much of the balance as you can before the introductory period ends.
  • You may be charged high penalty fees for late payments.
  • You can’t move credit card debt from cards owned by the same provider.

What About Debt Settlement?

Debt settlement works in a similar way to debt management, in that other companies work on your behalf to negotiate with your creditors. However, this is pretty much where the similarities end.

A debt settlement specialist will request several things from you:

  • You pay a fee (charged upon settlement).
  • You move money to a secure third-party account.
  • You stop meeting your monthly payments.

They ask you to stop making payments for two reasons. Firstly, it will ensure you have more money to move to the third-party account, which is what they use to negotiate with creditors. They will offer those creditors a lump sum payment in exchange for discharging the debt, potentially saving as much as 90%, on top of which they will charge their fee. 

Secondly, the more payments you miss, the more unlikely it is that your account will be settled in full, at which point the lender will be more inclined to accept a sizable settlement.

Debt settlement is not without its issues. It can reduce your credit score, increase the risk of litigation and take several years to complete. However, it’s the cheapest way to clear your debts without resorting to bankruptcy.

You can do debt settlement yourself by contacting your creditors and negotiating reduced sums, but you will need to have a large sum of cash prepared to pay these settlements and you’ll also need a lot of patience and persistence. There are also companies like National Debt Relief that can help, as well a huge number of lesser-known but equally reputable options. 

Who is Eligible for a Personal Loan for Debt Consolidation?

In theory, you can use a personal loan as a debt consolidation loan. In other words, instead of working with a debt consolidation company and allowing them to set the rates and find suitable terms, you just apply for a personal loan, use it to pay off your debts, and then focus your attention on repaying that loan.

This can work very well if you’re using it to repay credit card debt. The average credit card APR in the US is 16% to 20%, while the average personal loan rate is closer to 6%. A personal loan acquired for this purpose will give you more control over the total interest and repayment term. 

However, while you may pay less over the term, it’s unlikely that you’ll reduce your monthly payments. A debt consolidation loan is designed to provide an extended-term so that the monthly payment will be reduced, and unless you choose a loan with a long term, you won’t get the same benefits.

The biggest issue, however, is that you need a very good credit score to get a loan that is big enough to cover your debts and has interest that is low enough to make it a viable option. This is easier said than done, and if you’re drowning in debt there’s a good chance your credit score will not be high enough to make this feasible. 

Is it Time for Bankruptcy?

If you have mounting credit card debt, personal loan debt, and private student loans, and you’re struggling to make the repayments or clear more than the minimum amount, you may want to consider bankruptcy.

It should always be seen as the last resort, as it can have a seriously negative impact on your credit score and make it difficult to get a home loan, car loan, or low-interest credit card for many years. However, if you’re not confident that debt settlement will work for you and believe you’re too far gone for debt management and consolidation, speak with a credit counselor and discuss whether bankruptcy is the right option.

You can learn more about this process in our guides to Filing for Bankruptcy and Rebuilding your Credit After Bankruptcy.

Debt Consolidation for Bad Credit Homeowners

If you own your home, you have a few more options for debt consolidation. When you use your home as collateral against a loan it’s known as a secured debt. It means the lender can repossess your home if you fail to meet the repayments. This also eliminates some of the risks associated with lending, which means they offer more favorable interest rates and terms.

Home Equity Loan and HELOC

An equity loan is a large personal loan secured against the value tied-up in your home. You can acquire an equity loan when you own a large share of your property, in which case you’re using that share as collateral.

Interest rates are very favorable, and you can receive a consolidation loan that clears all your debts and leaves only a small monthly payment and easily manageable debt in their place.

A home equity line of credit (HELOC), works in much the same way, only this time you’re given a line of credit similar to what you’d get with a credit card. You can use this credit to repay your debts, after which you just need to focus on repaying the HELOC.

An equity loan and a HELOC provide the lowest possible interest rates of any debt consolidation loan. However, failure to meet your monthly payments will damage your credit score and place your home at risk.

Cash-Out Refinancing for Consolidation

Cash-Out refinancing replaces your current mortgage with a new, larger mortgage. The difference between these two home loans is then released to you as a cash sum, allowing you to clear your debts in one fell swoop. 

Cash-Out refinancing is often used to fund a child’s college education or a new business, but it’s becoming increasingly common as a form of debt consolidation, helping American homeowners to clear credit card debt and other unsecured debts.

Reverse Mortgages

Reverse mortgages work in a similar way to home equity loans, but with a few key differences. Firstly, they are only offered to homeowners aged 62 or older. Secondly, there is no monthly payment and no other recurring obligations.

A reverse mortgage is only repaid when you sell the home or die. There are also some obligations with regards to maintaining the home and living in it full time, but you don’t need to pay any fees and can use the money gained from this mortgage to clear your debts.

Summary: Consider Your Options

A debt consolidation loan is a great option if you’re struggling with debt. You can try a debt management plan if you have bad credit, a balance transfer if you have great credit, and debt consolidation companies if you’re somewhere in the middle.

But as discussed already, these are not the only options. The debt relief industry is vast and caters for every type and size of debt. Do your research, take your time, and make sure you understand the pros and cons of each option before you decide.

How to Get Debt Consolidation Loans When You Have Bad Credit is a post from Pocket Your Dollars.

Source: pocketyourdollars.com

ByCurtis Watts

FHA Loan Requirements – Guideline & Limits

FHA loan requirements are simple; they’re different than conventional loan requirements. For a conventional loan, for example, you will need a good credit score. However a FHA loan credit score is only 580.

If you’re a first time home buyer and need a first time home buyer loan to purchase your dream home, then keep reading to find out how an FHA loan is right for you.

Click here to compare the rates if you’re thinking of applying for an FHA loan. It’s totally FREE.

In this article, we will cover several topics around the FHA loan requirements. As a first time home buyer, you will need to be aware of these requirements so that your home-buying process can go as smoothly as possible.

Here’s what we will cover: FHA loan limits, FHA loan rates, FHA loan credit score, FHA lenders, and so many others. In addition, we will address the difference between conventional loan requirements versus FHA loan requirements.

Click here to apply for a FHA loan.

FHA Loan Requirements – Guideline & Limits:

Buying a house through an FHA loan, while exciting, can be daunting, especially as a first time home buyer. Taking a few moments to familiarize yourself with the FHA loan requirements can save you from costly mistakes during the home buying process. Below is an overview of FHA loan process

FHA loan definition

What is an FHA loan? Simply stated, an FHA loan is a loan that is insured by the Federal Housing Administration. These type of loan are popular among first time home buyers because they allow them to put as low as 3.5% down payment and require a very low credit score.

So if you’re a first time home buyer with a bad credit, then an FHA loan makes more sense.


Feeling Overwhelmed With Your Finances?, You have options and there are steps you can take yourself. But if you feel you need a bit more guidance, simply speak with a financial advisorSmartAsset’s free tool matches you with fiduciary advisors in your area in 5 minutes. If you are ready to meet your goals, get started with Smart Asset today.


FHA loan limits

FHA loan limits refers to the maximum amount of loan the FHA will give you. For 2019, for example, in low cost areas, FHA loan requirements have been set in place allowing the maximum amount for a single family home to be $314, 827. Whereas for a four-plex, the maximum amount is $605,525.

FHA loan limits – low cost areas
Single Duplex Triplex Fourplex
$314,827 $403,125 $487,250 $605,525

 

For high cost areas, the FHA loan limits for a single family home is $726, 525 and for a duplex, the FHA limit is $930, 300. Those limits, of course vary depending on your states and they are update annually. So visit your state to determine what the FHA mortgage lending limits are.

FHA loan limits – high cost areas
Single Duplex Triplex Fourplex
$726,525 $930,300 $1,124,475 $1,397,400

Click here to compare current FHA loan mortgage rates

FHA loan vs conventional

When it comes to get a home loan for presumably the biggest purchase you’ll ever make in your life, you certainly have to know the key differences between an FHA loan and a conventional loan. While it’s easier to get approved for an FHA loan, it’s important so that you can make the best decisions.

FHA loan requirements

fha loan requirements
FHA credit score loan requirement

The FHA loan requirements are fairly simple and straightforward. Here’s what they require: 1) You must have a credit score of at least 580.

2) A 3.5% down payment is required. (*note, if your FICO score is between 500 and 579, then you will have to put 10% down payment). 3) You will have to pay Private Mortgage Insurance (PMI);

4) Your debt to income ratio must be < 43%. Your debt to income ratio is the percentage of your income that you spend on debt, including mortgage, car loan, student debt, etc..

5) The home you intend to purchase must be your primary residence. You must also occupy the property within 60 days of closing.

Click here to shop for FHA mortgage rates in your area

It can’t be an investment property. However, you can buy a duplex or triplex, live in one unit and rent the other units. As long as you reside in the property, you will satisfy that requirement. Also, the house must meet FHA loan limits (see above).

6) Finally, and of course, you must have a steady income and proof of employment. I will discuss later whether a FHA loan is better than a conventional loan. For more information about FHA loan requirements in general, visit the FHA website.

Conventional loan requirements

The requirements for a conventional loan, however, are much stricter. By the way a conventional loan or traditional loan is not insured by the Federal Housing Administration. But instead it is guaranteed by a private lender such as a bank, credit union, mortgage companies, etc…

Of course whether you will qualify for a conventional loan vary from lenders to lenders, but the following are required:

1) A credit score of at least 680 (of course the higher the score is, the more likely you will get qualified, and the lower your interest rate on the loan will be.

2) A down payment of at least 20% of the house purchase price. If you have less than 20%, you still can get the loan. But the problem is, you will have to take out private mortgage insurance, pay its premiums until you achieve at least 20% equity in the house.

3) Your debt to income ratio needs to be around 36% and no more than 43%.

Should you apply for an FHA loan or conventional loan?

As you can see above, the FHA loan requirements are less strict than the conventional loan requirements. However, which one you choose to apply to depends on your personal circumstances.

But if you are a first time home buyer, there are a lot of good reasons why an FHA loan would seem more appealing to you. For one, the down payment is only 3.5% (compare that with a 20% down payment a conventional loan requires). A down payment is the upfront money you need to to make when buying a home.

As a first time home buyer, saving for a 20% down payment on a house can be a big burden. Homes are expensive. For example, saving for $450,000 home can take you years to accomplish, especially if you have other debt like student debt, credit card debt, car loan, etc… So a 3.5% down payment makes it easier for you to buy your own home.

Second, the FHA loan credit score is only 580. Although, you should always take steps to raise your credit score, sometimes certain changes in your life may leave you with a low credit score. Perhaps, you had to file for bankruptcy which resulted in a low credit score.

Or maybe you never had a credit card, which means that you don’t have an established credit history. Or maybe you’re a victim of identity theft which lowered your credit score. So there are several reasons why you could have a low credit score.

However, that shouldn’t mean you can’t buy a house. That’s why the FHA loan requirements make it easier for folks who otherwise would not have been qualified for a conventional loan.

Related Articles:

5 Signs You’re Not Ready To Buy A House

The Biggest Mistakes Millennials Make When Buying a House

How Much House Can I afford

Buy a home with the Right Financial Advisor

You can talk to a financial advisor who can review your finances and help you reach your goals. Find one who meets your needs with SmartAsset’s free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.

The post FHA Loan Requirements – Guideline & Limits appeared first on GrowthRapidly.

Source: growthrapidly.com

ByCurtis Watts

What to Know Before Taking Out a Subsidized Loan

Attending college or university is a dream for a ton of people. Yet higher education can be expensive, seemingly putting that dream out of reach for many students and families.

Tuition at American schools has steadily increased for decades, so it can be hard for your average student to afford it. But it’s not only tuition costs that you need to consider: fees, room and board, off-campus living, meal plans, textbooks, living essentials and other supplies all cost money.

Fortunately, there are many different types of financial aid available to help you meet the total costs of attending school.

Grants, scholarships and government programs can all be used to aid your pursuit of higher education. Student loans, including private and federal loans, are also commonly used to fund college. But taking on debt requires more financial planning than other types of aid.

If you’re ready to find the right loan for you and your unique financial situation, we’ve got you covered. We’ll go over everything and anything we think you need to know about subsidized student loans—the basics, how they’re different from unsubsidized loans and much more. 

Student Loans and Rising Education Costs

Having a plan for how you’ll pay for college is pretty important. That’s mostly because the tuition continues rise: 

  • According to The College Board, tuition and fees for a public four-year institution in the academic year of 1989–90 were $3,510, in 2019 dollars. 
  • For the academic year 2019–2020, those costs exceeded $10,000. In the same time span, tuition and fees for a private four-year institution rose from $17,860 to nearly $37,000. 
  • In the last 10 years alone, tuition and fees for four-year public schools have increased $2,020, while costs for four-year private schools have grown $6,210. 

But as we mentioned, total costs include a lot more than tuition, and these other cost items have shown the same upward trend:

  • Data from the U.S. Bureau of Labor Statistics (BLS) shows college textbooks costs increased 88% from 2006 to 2016.
  • Average dorm costs at all postsecondary institutions were $6,106 in 2017, per data from the National Center for Education Statistics (NCES). Boarding costs, including meal plans, were $4,765. A decade earlier those costs, respectively, were $4,777 and $4,009.
  • Costs rose 24% for students living off-campus at public four-year universities between 2000 and 2017, according to The Hechinger Report.

The growth in college costs has occurred rapidly, outpacing wagegrowth. This has made a degree unaffordable for many. That’s where student loans come in.

The biggest source of these loans is the federal government. According to Sallie Mae, more than 90% of student loan debt today is tied to federal student loans. While the government offers several loan types, often based on financial need, private lenders such as banks and credit unions also make student loans available.

Find the right student loan for you today!

What is a Subsidized Loan?

To better understand your loan options, let’s explore the specifics of one of the government’s most popular offers: the subsidized student loan.

Officially, a subsidized loan is a type of federal loan offered through the U.S. Department of Education’s Direct Loan Program and referred to as a Direct Subsidized Loan. They are made exclusively to undergraduate students who demonstrate financial need and can be used to pay for college, university or a career school.

Subsidized loans work like most other student loans. They allow college goers to borrow money as they learn, paying the principal and interest back later. Most loans don’t require repayment while you attend school, and provide a grace period of six months after graduation for you to find a job. 

The most notable feature of subsidized loans is that the government pays the interest while you attend school at least part time. This is a quality that’s pretty much unique to federal subsidized loans. 

The government will also pay the interest during the grace period and during periods of loan deferment. You eventually assume responsibility for paying the interest, and principal, once you enter the repayment plan. 

The bottom line for subsidized loans is they carry a lower lifetime cost, because the government pays interest while you’re at school.

Who’s Eligible to Take Out a Subsidized Loan?

Subsidized loans aren’t available to everyone, however. In addition to meeting basic requirements for getting a loan from the federal Direct Loan Program, applicants for subsidized loans must:

  • Demonstrate financial need.
  • Be an undergraduate student.
  • Be enrolled at least half time.

Anyone considering a subsidized loan must fill out and submit the Free Application for Federal Student Aid (FAFSA) form. This is how the government will establish whether you demonstrate financial need that is sufficient for taking out a subsidized loan.

What Else Should You Know?

There are two other main points to discuss about subsidized loans—loan limits and time limits. Ultimately, your school will decide how much you can borrow. But there are annual limits to what you can borrow through subsidized loans, as well as a maximum for the entirety of your college career.

  • In your first undergrad year you can borrow up to $5,500 through federal loan, no more than $3,500 of that amount can be through subsidized loans.
  • In your second year you can borrow up to $6,500, no more than $4,500 through subsidized loans.
  • In your third year you can borrow up to $7,500, no more than $5,500 through subsidized loans.
  • The limits for your third year apply to your fourth year, and any year after that for which you are eligible to borrow through federal subsidized loans.

Factors influencing what you can borrow include what year you are in school and whether you are a dependent or independent student. 

Importantly, you can only receive subsidized loans for 150% of the published time of your degree program. That means if you attend a four-year bachelor’s program, you can only receive a subsidized loan for six years.

What’s the Difference Between Subsidized and Unsubsidized Loans?

Unsubsidized loans are the other type of loan the government offers. While unsubsidized loans and subsidized have some similarities, unsubsidized loans have some major differences.  

Interest rates for both subsidized and unsubsidized loans are controlled and set by Congress. This makes the interest rates for government student loans among the lowest you will be able to find.

While the federal government pays interest on subsidized loans, you’ll be solely responsible for paying interest on unsubsidized loans. You’ll have to pay interest while you’re in school and during the grace/deferment period.  Here are some other key differences:

  • Unsubsidized loans are available to undergraduate students, as well as graduate and professional students.
  • Students don’t need to demonstrate financial need to apply for an unsubsidized loan.
  • There is no maximum time limit for how long you can receive unsubsidized loans (compared to the 150% rule for subsidized loans).
  • Annual and aggregate loan limits are generally higher for unsubsidized loans.

Private Loans vs. Federal Student Loans

Interested in how private loans stack up to government loans? In a nutshell:

  • Private loans can have variable interest rates, which may make them lower in some cases than even fixed interest rates on government loans.
  • Annual loan limits don’t apply to private loans, as you and your lender will work out a package that is best for you.
  • Being approved for a private loan means submitting to a credit check, or having a parent as a consigner.
  • Often, private loans require payment while you attend school, and may not have the allowance for forbearance and forgiveness as government loans do.

Taking the Next Steps Toward Taking Out a Student Loan

If you or your child is nearing college age, it’s time to start thinking about how you’ll pay for higher education. It’s a good idea to look into a few options, including student loans, scholarships, grants and other sources. 

If you want to get started on applying for a subsidized loan, get started on your FAFSA form. And if you’re taking a closer look at private student loans, you can find help here.

Infographic outlining what to know about subsidized loans, including their structure, requirements, and qualifications.

The post What to Know Before Taking Out a Subsidized Loan appeared first on Credit.com.

Source: credit.com