Real Estate Information Archive

With the economic chaos brought about by COVID-19 I have had a number of homeowners tell me their banks will allow them to delay payments for 3 months, with some banks requiring payment in full on the 4th month, and others allowing the seller to pay off the 3 months at the end of the loan or when the home is sold.  While this may be the only recourse to save your home, it does come with some negative "side-effects".

Unfortunately, there is a significant amount of misinformation regarding Payment Forbearance related to the CARES Act and the impact on homeowners. Since the CARES Act prohibits Lenders from reporting Late Payments to the Credit Reporting Agencies many people are operating under the assumption they can just skip making payments without any negative repercussions. What started as Mortgage Payment relief has spread to every type of credit. We are seeing prospective Buyers entering Payment Forbearance plans on every type of credit Car Loans, Installment Loans and Credit Cards. Regardless of what the Government intends you cannot stop making payments on Credit Accounts without it hurting you!

Forbearance basically means you cannot pay on your debt. That is exactly how a lender will see it. And that information will be used when considering your next loan. While a creditor is prohibited from reporting the payment to the credit bureau, they will list it as either "Forbearance", "deference", or "modified", which will make it very difficult for you to obtain a new line of credit.

Regardless of what the Government says, going into a forbearance will hurt you. It is best to consult with a financial advisor to determine if this is the best course of action.  

If you are a real estate investor, or are considering investing, or maybe you want a bit more info before jumping in, the first place to begin your preparation is with your financial portfolio. Since most homes are in need of renovation, available financing for investors is generally limited to cash, or hard money. Using cash to purchase the home will help you to avoid financing fees, but this is not always an option, especially for first time investors. Those with limited cash on hand might choose to research Hard Money Lenders as a viable source. These loans are not regulated by the Federal Reserve, and loan qualifications will vary from lender to lender, as will the fees associated with the loan. Additionally, the investors experience will also dictate some of the fees. Generally, the more you use the same hard money lender, the lower the fees for using the money are reduced.

Here is a list of Hard Money lenders as included in The Scottsman Guide: Residential Edition:

1 STOP HARD MONEY WWW.1STOPHM.COM 949-236-6600

ACCESS FINANCIAL GROUP – JON PARLOT 720-482-0883

AEGIS FUNDING INC WWW.AGISFUNDING.COM 800-290-1954

AGOURA HILLS FINANCIAL WWW.AGOURAHILLSFINANCIAL.COM 818-707-3452

ALLIANCE PORTFOLIO PRIVATE EQUITY FINANCE WWW.ALLIANCEPORTFOLIO.COM 949-382-7300

ARCHWAY FUND WWW.ARCHWAYFUND.COM 310-447-8899

ARIXA CAPITAL WWW.ARIXACAPITAL.COM 310-889-0376

ATHAS CAPITAL GROUP WWW.ATHASCAPITAL.COM 877-877-1477

BRIDGE LOAN FINANCIAL WWW.BRIDGELOANFINACIAL.COM 714-264-4660

BROADMARK REALTY CAPITAL WWW.BROADMARK.COM 206-971-0800

BROOKVIEW FINANCIAL WWW.BROOKVIEWFINANCIAL.COM 877-734-2211

BUILDER FINANCE INC WWW.BUILDERFINANCE.COM 800-752-0401

CALCAP LENDING LLC WWW.CALCAPFINANCIAL.COM 833-816-5580

CALIFORNIA TD FUNDING INC WWW.CATRUSTDEEDS.COM 888-447-8882

CAPITAL FUNDING FINANCIAL WWW.CAPITALFUNDINGFINANCIAL.COM 866-999-2011

CAPITAL THREE SIXTY LLC WWW.CAPITALTHREESIXTY.COM 866-673-2300

CAPSTONE FINACIAL WWW.CAPSTONEFI.COM 480-737-3268

CARLYLE CAPITAL - WWW.CARLYLECAPITALINC.COM - (877) 700-1914

CENTER STREET LANDING – WWW.CENTERSTREETLANDING.COM - (855) 943-0253

CIVIC FINANCIAL SERVICES – WWW.CIVICFS.COM - (424) 336-7584

CONSTRUCTIVE LOANS LLC- WWW.CONSTRUCTIVELOANS.COM - (833) 855-3811

COREVEST FINANCE – WWW.COREVESTFINANCE.COM – (844) 223-2231

CROSSWIND FINANCIAL- WWW.CROSSWINDFINANCIAL.COM – (310) 597-4001

DIRECT LENDING PARTNERS- WWW.DIRECTLANDINGPARTNERS.COM – (484) 218-0141

DRI MORTGAGE LEDNING – WWW.DRIFUND.COM/LOANS - (561) 299-1905

EQUITY CAP FUND ADVISORS- WWW.EQUITYCAPFUNDADVISORS.COM EQUITY MAX- WWW.EQUITYMAX.COM - (954) 267-9103

EQUITY WAVE LANDING - WWW.EQUITYWAVELANDING.COM - (888) 399-8881

FMC LANDING - WWW.FUNDMORTGAGECAPITAL.COM FUNDLOANS – WWW.FUNDLOANS.COM - (970) 300-1900

FUND THAT FLIP – WWW.FUNDTHATFLIP.COM - (646) 895-6090

GENESUS CAPITAL – WWW.GENESISCAPITAL.COM - (213) 634-1002

HERZER FINANCIAL SERVICES INC. – WWW.HERZER.COM - (650) 363-8003

HILTON FINANCIAL CORP. – WWW.HILTONLOANS.COM - (602) 375-8951

INNER CORE CAPITAL INC.- WWW.INNERCORECAPITAL.COM - (619) 890-9825

JB PRIVATE INVESTMENTS – WWW.JBPISCORP.COM – (650) 315-9933

LENDINGHOME FUNDING CORP.- WWW.LENDINGHOME.COM/BROKER - (844) 415-4663

LENDINGONE LLC – WWW.LENDINGHOME.COM/BROKER-PARTNERS (888) 341-9162

LIMA ONE CAPITAL – WWW.LIMAONE.COM - (800) 390-4212

LONE OAK FUND LLC – WWW.LONEOAKFUND.COM - (310) 826-2888

LYNK CAPITAL – WWW.LYNKCAPITAL.COM - (321) 209-6871

M & M PRIVATE LENDING GROUP LLC – WWW.MMPRIVATELENDING.COM (719) 284-9166

PACES FUNDING – WWW.PACESFUNDING.COM (404) 814-1644

PACIFIC PRIVATE MONEY LOANS – WWW.PACIFICPRIVATEMONEY.COM (415) 793-3403

PATCH OF LAND – WWW.PATCHOFLAND.COM – (877) 761-6489

PB FINANCIAL GROUP CORP – WWW.CALHARDMONEY.COM (877) 700-3703

PREMIERE MANAGEMENT INC. – WWW.POLKPROPERTIES.NET (323) 685-6545

PSG CAPITAL PARTNERS INC. – WWW.PSGFUND.COM – (844) 386-3774

RCN CAPITAL – WWW.RCNCAPITAL.COM – (860) 432-5858

RED ROCK CAPITAL – WWW.FUNDWITHREDROCK.COM (719) 900-5400

REDWOOD MORTGAGE – WWW.REDWOODMORTGAGE.COM RODEO LENDING – RODEOLENDING.COM (310) 400-5631

SARATOGA CAPITAL INC. – WWW.SARATOGACAPITAL.NET (408) 418-5032

SETTLE FUNDING GROUP LTD. – WWW.SETTLEFUNDINGGROUP.COM (888) 734-3863

SHARESTATES – WWW.SHARESTATES.COM (212) 201-0750

SOUTH FLORIDA QUALITY MORTGAGE CORP. – WWW.FLORIDAHARDEQUITYLOAN.COM (954) 455-7600

SPROUT MORTGAGE – WWW.SPROUTWHOLESALE.COM/LOAN-PROGRAMS/FIX-FLIP - (800) 642-3354

STRATTON EQUITIES – WWW.STRATTONEQUITIES.COM (800) 962-6613

SUNSET EQUITY FUNDING – WWW.SUNSETEQUITYFUNDING.COM (866) 291-3412

T&M COMMERCIAL FUNDING – WWW.TMFUNDING.COM (207) 358-7527

TAYLOR MADE LENDING LLC – TAYLORMADELENDINGLLC.COM - (954) 614-5109

TRIUMPH CAPITAL PARTNERS – WWW.TRIUMPH.CAPITAL (877) 353-1099

VAL-CHRIS INVESTMENTS INC.- WWW.VAL-CHRIS.COM (949) 252-1907

VALE CAPITAL INC. – WWW.VALECAP.NET - (650) 600-7250

VELOCITY MORTGAGE CAPITAL – WWW.VELOCITYMORTGAGE.COM (866) 505-3863

VERISTONE CAPITAL – WWW.VERISTONECAPITAL.COM (877) 891-6078

VISIO LENDING – WWW.VISIOLENDING.COM (888) 521-0353

WADOT CAPITAL INC. – WWW.WADOTCAPITAL.COM (206) 362-4444

WESTERN DEVELOPMENT LLC. – WWW.WESTERNDEVELOPMENT.BIZ (703) 988-4666

WOODLAND HILLS MORTGAGE CORP. – WWW.WOODLANDHILLSMTG.COM (818) 999-6600

If you are interested in knowing more about buying or selling a home, or if you are in need of Property Managegment services, please call us at 301-870-1717. DeHanas Real Estate Services serves Southern Maryland, King George County Virginia and Washington DC.

Many real estate deals are dependent on a home inspection, so it’s understandable that there can be a lot of nerves surrounding an inspection, especially for the potential buyer. Many of your clients may not know exactly what a home inspection entails or what to expect. Here are some top myths that may help them adjust their expectations:

6 HOME INSPECTION myths

1.   Having a license ensures a good home inspection. NOT TRUE! Not all states require licenses to be a home inspector and many of the standards vary widely. Make sure to verify other components of an inspector’s credentials, including past clients, years of experience and customer reviews.

2.  You can use a home inspection to identify problems that might be used as a tool to renegotiate the purchase price. NOT TRUE!  This is not the primary objective of a home inspection. The inspector’s professional service is one of unbiased, third-party education. They want to arm buyers and sellers with a good understanding of the physical condition of the home so they can make the best decision for themselves at that time.

3.  A home inspection tells you what your home is worth. NOT TRUE! An appraisal is intended to do this. An inspection also does not make any recommendations about whether or not to buy or sell the home—that is solely up to the client.

4.  All home inspection certifications and professional education are created equal. NOT TRUE! Some programs even offer certification online, without the requirement This article was provided by Pillar To Post home inspectors. For more information, go to pillartopost.com. BY THE NUMBERS It is recommended that a home be inspected every 10years, regardless of whether a sale is taking place. Source: The American Society of Home Inspectors to ever step foot inside a house and produce a real-time inspection. The best certification offers both in-class and hands-on training, as well as examination requirements. When choosing your home inspector, you want your clients to verify the reputation of the certificating organization.

5.  Home inspections are not needed for newly built homes or condos. NOT TRUE! Newly built homes or condos are just as much in need of an inspection as an older home. No home is perfectly built, and it’s best to have an inspector pinpoint potential issues or future repairs. Most inspectors can also give inspections during each construction “phase” of the property at various stages of development.

6.  Home inspections are solely used on the buyer’s side. NOT TRUE! Although most inspections are performed for potential buyers, there are many advantages to a pre-listing inspection for sellers. These include knowing about major issues before the house goes up for sale, increased negotiating power and garnering the best sale price. The American Society of Home Inspectors also recommends that a home be inspected every 10 years, regardless of whether a sale is taking place.

For additional information on obtaining a home inspection, call our office at 301-870-1717.

There could be some legitimate reasons for not buying a home but indecision is not one of them. Indecision is rooted in not having enough information to move forward to own a home or continue renting.

If you keep renting, at the end of the year, you have had a place to live and a pile of receipts that helped the landlord pay for his house. Deciding to buy a home will give you a place to live that is yours and all the things that come with that.

When you consider principal reduction, appreciation and tax savings, your monthly cost of housing could be much less than the rent you’re paying. The principal reduction included in each payment is like a forced savings account that increases as your mortgage balance decreases.

Your equity in the property will also grow due to appreciation as the home goes up in value. The equity is part of your net worth and an investment in your family’s future. The income tax savings can be an additional financial consideration if the combined interest and property taxes are greater than the allowable standard deduction. Trends are showing that both tenants and homeowners are staying in their homes longer. It’s been said that whether you rent or own, you’re paying for the home.

Do you really want to buy the home for your landlord? Check out your numbers on a Rent vs. Own and then, call us at 301-870-1717 to help make it happen.

DeHanas Real Estate Services specializes in residential resales, Bank-owned home sales, Property Management, short sales, and new constrcution. DeHanas Real Estate Services is family owned and operated with an office convenitnly located in Waldorf, MD.

Regardless of what a lender quotes on mortgage rates, the actual rate a borrower pays is based on a number of variables. Lenders determine whether to loan money and at what rate based on the risk involved with the transaction.

Factors that increase the risk that the loan will be repaid will proportionately increase the interest rate charged to the borrower. If the risk becomes too high, the loan will not be approved. • Loan amounts – conventional mortgages above conforming limits as set by Fannie Mae and Freddie Mac are considered jumbo loans and generally have a higher interest rate.

• FICO score – the lowest interest rate is reserved for the highest score; the lower the score, the higher the rate the borrower will pay.

• Occupancy – borrowers occupying a home as their principal residence are considered a better loan risk than second homes and investment properties.

• Loan purpose – purchase transactions generally have the lowest interest rate with refinancing for better rates and terms being priced slightly higher. An even higher rate might be charged for refinancing and taking cash out of the property.

• Debt-to-Income Ratio – a borrower’s monthly liabilities divided by their gross monthly income develops a ratio that helps lenders to assess the borrower’s ability to repay the mortgage.

• Property Type – some types of property are considered higher risk than others which could adversely affect the rate.

• Loan-to-value – the lower the percentage of the loan to the appraised value of the property will generally lower the interest rate.

Any combination of these factors could limit a borrower’s ability to secure a mortgage at the rate initially quoted. Pre-approval by a trusted mortgage professional can be the best way to know what rate you can expect to pay. Please call for a recommendation of a trusted mortgage professional.

For a more detailed analysis of your current financial situation, please call DeHanas Real Estate Services at 301-870-1717 or visit one of our lender partners.

Buyer’s mortgage pre-approval is good for everyone in the transaction. It saves time, money and removes the uncertainty of knowing whether the buyer will be qualified after negotiating a contract.

The direct benefits include:

• Looking at “Right” homes - price, size, amenities, location

• Find the best loan - rate, term, type

• Uncover credit issues early - time to cure possible problems

• Negotiating power - price, terms, & timing

• Close quicker - verifications have been made

There is a significant difference in having a trusted mortgage professional take a loan application and run all the necessary verifications compared to going through calculators on a lender’s website. Beside the peace of mind, the cost of being pre-approved is a bargain and generally, limited to the cost of the credit report. Even if a person has been pre-approved, a second opinion from a different lender may be a good option. It can verify there is a good deal or you’ll discover that you can improve it. Either way, it works to your advantage. Contact me if you’d like a recommendation of a trusted mortgage officer.

The grass tends to look greener on the other side of the fence. Maybe that’s why some people invest in things they don’t understand. It has been said that the grass is just as hard to mow on the other side of the fence so stay with what your most familiar.

Single-family homes used for rental property give a person a chance to invest in something they understand: a home. They also have distinct advantages over other types of investments. An investor can borrow up to 80% of the value at fixed interest rates 30 years.

The financing creates leverage so that the investor can benefit from the increase in value of the home not just the down payment. It is reasonable to expect that the home will appreciate while providing tax advantages and practical control that are not available with many other investments. Low housing inventory in many markets has caused rents to increase and low new home growth will make it difficult to keep up with demand.

Consider a $150,000 home purchased for cash that would rent for $1,500 per month. With $18,000 income and allowing for property taxes, insurance and maintenance, it is still reasonable to expect $10,000 net income. There would be an 8% return on investment without considering tax savings or future appreciation compared with 5-year CDs paying less than 2.35% and a 10-year Treasury yield at 2.13%. An added bonus is the amortization that occurs on the loan as the principal is reduced with each payment. It becomes a forced savings account that increases the equity and isn’t taxable until the property is sold.

The reasonable control has a lot of appeal to many investors who find the volatility of the stock market unacceptable and don’t want the risk associated with alternative investments. Please contact me if you’d like to know more about available opportunities. If you or someone you know is looking to invest in real estate, The DeHanas Team can help! Call 301-870-1717.

Whether you’re refinancing your current home or buying a new one, something worth considering is a 15-year loan rather than a 30-year term. The payments will be a little higher but you’ll get a lower interest rate and you’ll build equity much faster. Let’s look at an example of a $300,000 mortgage with the choice of a 30-year term with a 3.92% rate compared to a 15-year term with a 3.2% rate. The payments would be $682.28 higher on the shorter term but the equity would be considerably higher even after you adjust for the higher payments.

Another benefit is that the shorter-term loan creates a forced savings situation where the savings on longer term loan might end up being spent rather than being saved and invested.  A conscious decision to pay more in payments could pay big dividends in the future.

For more information and financing options, call the DeHanas Team at 301-870-1717.

What your home is worth depends on why you ask the question. It could be one value based on a purchase or sale and an entirely different value for insurance purposes. Fair market value is the price a buyer and seller can agree upon assuming both are knowledgeable, willing and unpressured by extraordinary events.

This value is generally indicated by a comparable market analysis done by real estate professionals. Insured value is determined for insurance coverage. Homeowner policies typically have replacement clauses in them and the cost of demolition, new construction and the added complexities of matching existing construction could exceed the cost of new construction. Investment value is based on the income it can generate during its useful life.

This value is dependent on what kind of yield an investor requires to capitalize the value over time. The formula for this is to divide net operating income by the capitalization rate required by the investor. The assessed value of a home is used to determine the property taxes the owner must pay.

This value is determined by the responsible state government agency. Homeowners are generally more familiar with their home’s market value. Since it can be lower than the replacement cost, owners should review the insured value with their property insurance agent periodically.

There can be a surprising difference in each of these separate values. It is important to know the purpose that it is going to be used for the value.

For more information on determining your homes' value for the sales market, call the DeHanas Team at 301-870-1717.

“More has been lost due to indecision than was ever lost to making the wrong decision.” Interest rates have as much effect on housing costs as price and when they are both trending upward,

it can be very expensive to wait. There can be some legitimate reasons for postponing a purchase such as needing to save the down payment, improve your credit or waiting to find out about a possible transfer. The problem is that prices and interest rates could, and very likely will, go up in the future.

If the price of $250,000 home went up 5% and the interest rate went from 4.5% to 5.25%, the payments would increase by $176.42. The additional cost over a seven-year period would be close to $15,000. The questions that indecisive buyers need to ask themselves is “how am I going to feel knowing that if I had not waited, I could have been living in the home for less money?” and “What would I have spent the money on if I didn’t have to make the larger payment?”

Use the Cost of Waiting to Buy calculator to find out how much indecision may be costing you. For a FREE, no hassel consutation with a prefessional, please call 301-870-1717 today.