Qualifying for a mortgage loan requires a good credit history. Banks want a proven record of responsible financial behavior and lines of credit answer this requirement. It’s not enough to use a mortgage loan calculator to figure your mortgage payment amount, you need to demonstrate that you can handle credit successfully.
What is a line of credit? A line of credit (aka credit line) is when a bank grants an unsecured loan amount. Unlike a regular loan, interest is only charged on how much of the credit line you use. For example, a department store credit card has a limit of $500. That’s your line of credit. You spend $50 which leaves $450 left on your line of credit to use. When the bill comes, if you pay it off in full, there’s no interest charged. If you don’t pay it in full, the amount you owe incurs a credit charge.
Harry Vanezis, Vice President and Senior Loan Officer at Bank of America, said that for mortgage loans, banks consider a car loan/lease and rent/mortgage payments as lines of credit too. Harry advises that you get a bank and department store card. “Charge your gas every other month on the bank card and use the other for gift purchases but pay off the bill in full when it arrives so you don’t incur interest expenses” said Harry. “If you do this and pay your other bills in full and on time, you’ll have an excellent credit history.” While 4 lines of credit are best, 3 will work if your other credentials are strong.
Amazing as it is, paying cash for everything makes getting a mortgage difficult because you have no verifiable record of good financial behavior. Prudent and regular use of lines of credit creates an excellent credit history.
June began a new requirement from Fannie Mae. Mortgage applicants must now have their credit checked 3 days before closing. If there are any significant changes, the terms may be adjusted or the mortgage may actually be cancelled. While this may sound harsh, it also makes sense.
When you apply for a mortgage, your credit, debt and assets are checked. The bank wants to verify that your credit history shows that you are a responsible person and your income, debt and assets are enough to allow you to comfortably carry the expenses.
Once you get your mortgage commitment, nothing should change. You should be just as credit worthy on the day you close as you were when you first applied for your mortgage. Fannie Mae is just checking to make sure.
Before the sub prime mortgage market existed, this was a normal part of the process. Fannie Mae found that a good number of people abused the system by being irresponsible or committing outright fraud. By requiring this verification just before closing, Fannie Mae is hoping to avoid such trouble.
In the past, some people actually took out other loans just before closing because they knew they’d never qualify once the mortgage closed and was on their credit record. So, they got a car on a loan, bought an appliance on credit etc. and sometimes even quit a job just before closing on a house. This sort of irresponsible behavior often ended up in foreclosure.
I agree with this. Fannie Mae is taking the right approach because this goes a long way to ensure the integrity of the mortgage system. It also protects buyers from over burdening themselves with debt. It does no one good when a home ends up in foreclosure. So is Fannie Mae making life impossible for buyers? Not at all.
The NJ Senior Citizen Property Tax Freeze is a wonderful solution for many seniors. It can make the difference between staying in your home or having to move out.
Property taxes are a major reason why senior citizens sell their Bergen County homes. The cost of ownership for people who are on a retirement income often becomes a burden they cannot handle. When they bought their family home many years ago, they had a working income. Things change when they retire and no longer have that income. Their home becomes too expensive even when the mortgage is paid off.
Property taxes are a big part of the problem. New Jersey has high property taxes. To make matters worse, those taxes go up every year for nearly all owners. This makes it increasingly difficult for senior homeowners to afford their home. To help out, the State of New Jersey has a property tax freeze program for those seniors who qualify, Known as the Senior Freeze the deadline to apply has been extended until August 2nd.
You go to the State of New Jersey’s Property Tax Reimbursement website where you’ll find all the information. This program, known as the Senior Freeze, stops property tax increases for those who qualify. This is difficult for many seniors who are not computer savvy. A good place to turn to is your local library. Research librarians will help you out. I’ll be glad to help too so just call me up at 201-741-8490.
As in all things relating to your finances and taxes, I suggest that you contact your accountant for guidance. You can also call your attorney for a legal perspective. I believe you should consult both so you understand it completely. But one thing’s for sure – if you’re a senior citizen, you want to check this out before the August deadline. The Senior Citizen Property Tax Freeze might be something you qualify for and if so, it’s a blessing.
One of the wonderful things about owning a Bergen County home is how close you are to so many things. Every season has it’s sports and activities. Bergen County is always within an easy 1-2 hour drive which makes for lots of fun family trips. This is particularly true when we get to beach weather.
When people come here to buy a home in Bergen County they often ask “How easy is it to get to the city?” They are concerned with transportation to New York City. Once they live in a Bergen County home, however, they soon ask about other things. When beach weather arrives they’ll ask “How long does it take to get to the beach?”
With the summer season just beginning, it’s time to think of going to the Jersey Shore. Actually, you never say you’re going TO the shore. Here in Bergen County we say we’re going DOWN the shore. That’s because Bergen County homes are north of the shore so our famous beaches are south of where we live.
Point Pleasant NJ is a very popular destination and it’s close. It’s only a short 90 minutes from your front door whether you live in Tenafly, Paramus or Ridgewood or anywhere else in our county. Just hop on the Garden State Parkway or the New Jersey Turnpike. You’ll find that sooner than you’d think you’ll be on the beautiful sandy beaches of the New Jersey Shore.
Every year New Jersey Monthly Magazine publishes it’s annual shore guide. This is one issue you do not want to miss. From Atlantic City to Sea Girt and beyond you’ll find everything you need to know about what’s happening down the New Jersey shore this season. Once you read it, you can plan your next trip down the shore from your Bergen County home!
Make That Red Brick Fireplace Beautiful
Does this look familiar?
If it does, then you”re like many people who’ve bought an older, charming colonial home in Bergen County. Along with the home you got a red brick fireplace in the living room that you figured you’d fix in the future. This is often seen in towns with large inventories of charming colonial homes like Tenafly or Teaneck or Ridgewood. An article I read in Lowes “Creative Ideas” magazine recently showed how you can transform that old red brick quickly and affordably.
Lowes has a special program for real estate agents. I’ve found it to be a great help for my clients and it’s taught me a lot. Recently there was an article in “Creative Ideas” that solved this problem. This was done by resurfacing the existing red brick with a combination of tile and slate. This created an amazing, beautiful effect immediately. As a result, the entire room’s ambiance changed from dated to fresh and modern.
This fireplace was an old, stained, red brick unit and then the Lowes team went to work with a combination of tile and slate. You can, of course, use other tile and stone materials but the change is certainly remarkable. No structural renovations were needed to make this fireplace a modern showpiece.
If you’d like to get “Creative Ideas” you can go to http://www.Lowes.com Or you can get in touch with me for the full real estate agent benefits program. Lowes has many simple and affordable solutions to design problems for homeowners. You’ll also find a lot of good tips from commercial painters for a wide range of things from gardening to indoor insulation.
The bottom line is that you can refinish that old red brick fireplace into a modern showplace. It will be a lot easier and more affordable than you’d expect too. So go to Lowes and make that red brick fireplace beautiful.
You don’t have to own a home in Tenafly to know what’s happening there. Go to the town website. That’s all you have to do. The Borough of Tenafly website is where you’ll discover that Tenafly is doing a revaluation right now.
Let’s say you’re thinking of buying a home in Englewood. You see that many of the homes there are from the early 20th century so you’d like to know about the city’s history. Go to the City of Englewood website where you’ll find the Historic Englewood page This page will take you from Englewood’s earliest days to the present. The information there is incredibly fascinating.
The River Vale website is the place to go for local events. It’s always on their home page. Park Ridge and Westwood do this too along with many other local communities. You may find important changes on a town’s home page. Because of this it’s important to check your town website from time to time. Westwood began registering it’s various Recreation Department activities online this year. This new change is announced on it’s home page.
Town websites help tremendously when you need a form because they allow a download. This saves you a trip to the Borough Hall.
Here’s a perfect example for you. You want to put up a fence on your property and you live in Cresskill. To do this you must send a permit to the Building Department. You find the fence permit form on the Cresskill Boro website and download it. What could be easier? Some towns like Tenafly actually have a step by step guide for you when it comes to getting a permit Tenafly makes the entire process understandable as a result.
Many community sites have portions of their building codes right on their websites. Old Tappan has their entire borough code online.
You may be amazed at how much information can be found on a town website. If you’re thinking of buying a home or if you’re a Bergen County resident now, check out the borough website.
Don’t forget about the County’s website too. There is an overwhelming amount of information on the Bergen County Website
Mortgage terms are easing for luxury homes which will significantly help this market recover.
While the real estate market in Bergen County has been recovering nicely since late last year, the luxury market has not. Sales of high end homes has been one of the less robust parts of the market because of financing. Financing for upper tier homes all but disappeared in 2008. This was a large part of the problem. When banks began to loan on luxury homes the terms were often highly objectionable. As a result, the luxury home market has been having a hard time.
There is a segment of that market which is immune to the economy. Premier luxury homes at the highest level are in a class by themselves. Typically cash purchases, homes at this level are bought and sold by people of such vast wealth that they rise about what’s happening in the world economy. In our area this would be purchases at or above $5 million.
Jumbo loans and super jumbo loans were not only hard to get but their down payment requirements went through the roof. If you wanted to purchase a $2 million house you had to come up with as much as a 50% down payment. Requirements of 40-45% were standard for up to $2 million purchases. As a result it’s easy to see why these terms were objectionable. This has changed because mortgage terms are easing for luxury homes now.
Today I can report to you that only a 20% down payment is required for $1-2 million homes and just a 25% down payment for a $2-3 million purchase. Of course this assumes the buyer is qualified as to credit, assets, etc.
This change bodes well for affluent buyers and the luxury home market. With more liberal jumbo loan financing the market for high end luxury homes is now becoming more active. According to the New Jersey MLS data, we have an 18% increase in the number of homes sold at $2 million or above for the first 4 months of this year. Better mortgage loan terms for luxury home buyers is indeed positive for the Bergen County real estate market.
A major source of stress for people who are selling their home is the home inspection. No matter how well you’ve maintained your house, there can be unpleasant surprises. It’s smart to pre-empt a buyer by doing a pre listing inspection before the home is listed for sale.
Buying a home is often the biggest purchase buyers make in their lifetime. Home inspections are additionally stressful for buyers because most are ill equipped for even minor home repairs. This is because of a sociological shift.
Most homeowners are older than their buyers. These are 2 different generations. The majority of sellers had parents who came through the Depression. Their parents didn’t call the plumber because they fixed things themselves. What sellers heard growing up was “We’ll make do with what we have.”
Their younger generation buyers grew up in a very different world. They never or hardly ever saw parents with a screwdriver trying to fix something. This generation did not see Dad putting together a tricycle for them with 1,000 small parts because he didn’t have to. They drove plastic Big Wheels or Dad paid a small fee to have a more conventional tricycle assembled. As a result this generation is often not comfortable with any work required on a home because it’s not within their experience.
We have 2 different worlds combining on a home purchase. Sellers do not understand why something they see as a minor fix is upsetting to their buyer. I think this explains why things get out of perspective so quickly.
It hurts a seller more to have a failed contract than it does a buyer. The seller must put his house back on the market and statistically the next offer that comes along is at least 2-3% lower. This cost is much higher than a buyer’s home inspection. As a result the seller loses much more.
By getting the house inspected by a professional home inspector, issues likely to come up are uncovered. Homeowners can repair them or get estimates from contractors. Either way, they’ll be prepared and that puts a homeowner in a good position.
Two towns in the Pascack Valley have come together as a team to offer their residents all options for summer day camp. If you have a Hillsdale home or a River Vale home, you now have the choice of full or half day summer camp for your children. Each town will accept the other’s children on an equal footing with their own residents which serves to share both town’s resources and fully answer’s homeowner needs.
River Vale has a half day summer program and Hillsdale has a full day summer camp. This is truly innovative because most homeowners are stuck with only one choice – whatever their town has to offer. By sharing their resources, both Hillsdale and River Vale have given their families with children an unbeatable situation. This is just another example of why our suburban lifestyle keeps Bergen County homes in high demand.
If you have a school aged child and need a summer camp placement, go to the Hillsdale website for full day and the River Vale website for half day placements. Whether you’re looking at Hillsdale homes or River Vale homes you know you’ve got summer camp covered!
If you own a Bergen County home or anywhere else in the New York City area, the past few months were a challenge indeed. Winter weather in Bergen County was very unusual this year. We had multiple storms that wreaked havoc throughout the NYC area and Bergen County was right in the middle of things.
One snow storm after another for weeks on end with even a full blown blizzard gave us over 30 inches of snow. Once that melted then we had a series of rain storms culminating in a vicious nor’easter that came with winds at hurricane force toppling tree limbs and entire trees knocking out power with such drenching rain that many local towns resembled lakes or raging rivers. We had 7 inches of rain within 24 hours. It was so bad that Bergen County and 11 other counties in New Jersey were declared Federal Disaster Areas.
Bergen County homes suffered with days of power outages, flooded basements, cars smashed by trees, 100 year old trees strewn across lawns like toothpicks or thrown across a roof ripping it to shreds and impassable streets everywhere. Because of this mess, the IRS has delayed tax day to May 11th from the traditional April 15th date. So if you own a Bergen County home, you’re getting additional time to file your taxes from both the IRS and the State of New Jersey. Of course you should consult with your tax preparer to make sure of things but tax day for Bergen County homes this year is May 11th.