The Ins and Outs of Mortgage Approvals

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Pre-approval should never be skipped and should always be the first step when it comes to purchasing a home. Professionals from Rocket Mortgage suggest following these steps when it comes to the pre-approval process.

Know The Cost

Before obtaining a home loan, you should calculate your mortgage payment using an online mortgage calculator. This will give you a rough estimate of costs and will list all the cost so that you have no surprises along the way.

Get The Ball Rolling

This should be the first thing you even think about before starting the home buying process. Start the pre-approval process immediately so you will have ample time to organize your paperwork, credit and finances. A lender such as Rocket Mortgage can help you through the process of gathering all of the necessary documents.

Gather The Proper Documentation

As mentioned earlier, this is the best way to get everything ready. Make a mortgage pre-approval checklist that lists all of the required documents you need. These will include bank and investment statements, social security cards, income and employment details, pay stubs, tax forms, and lists of assets.

Check Your Credit

Your credit score can have an effect not only on the decision to give you a loan, but also at what rate you will get a loan. Before you apply for a mortgage, run your credit report and get your FICO score. This will help you get a better picture of where you stand and if you need to improve your score before applying for a loan.

Remember following these steps will help the time frame and process of getting pre-approval quicker and easier. If you do not have a lender, talk to your real estate agent who can recommend someone that is right for you.

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Myths About Owning a Home

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Homeownership is one of the biggest events in anyone’s life. There are some myths out there that you need to worry about when it comes to homeownership.

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Home inspectors will find every problem

A home inspection is very important to have when you are purchasing a home. A home inspector cannot examine every little nook and cranny of a home. Do your due diligence and walk through with the home inspector as they are inspecting the property. If you see something that gets your attention, point it out and ask questions.

Even if you already own your home, you can still have a home inspection done. A home inspector might find an issue that you have been living with thinking it was normal.

All home improvements add value

When you think of home improvements, you think of boosting the value of your home. This is not always the case, not every dollar you spend will affect the value of your home. If you spend thousands of dollars on fixing a leaking roof, then this is simply repairing your home. This can also be true with adding something you love but buyers might look at as an imperfection.

You have to do your own yard work and repairs

When you are a homeowner you do have an additional set of responsibilities but this does not mean that you have to tackle them all on your own. If you do not want to have to hire a lawn service, then you might want to consider purchasing a condo that has common space kept up by the association.

You’re always/never better off renting

Owning vs. renting has been a time traditional argument and there is no right or wrong answer. The correct way to go depends on each person’s circumstances. It is true that owning a home is a win in the long-run but this might not be the case if you purchase a home and have to sell it in the next five years.

New homes are maintenance-free

This is not the case because a home is a complicated structure and system. There are many mechanical facetts, structural details and surface details that can need repair no matter if they are old or new. Also, every home needs maintenance, if you do not take care of it, then it will not function properly. Sometimes new homes are built to spec and have a basement or bathroom 80% done but still needs to be completed. This is a time either a great DIYer tackles or you hire someone to complete.

Remodeling is easy and fast

Remodeling a home can be a huge project even if it is just a one room. Reality TV shows have painted a picture that is not true when it comes to remodels. The norm is the budget always needs to have a big cushion and jobs take longer than you plan. On tv a renovation takes 48 hrs but there are always hiccups and in reality it takes longer.

You’ll get to it eventually

If you buy a home with the intention of getting to a project or waiting to fix something that is not necessarily an emergency, more than likely it will not get done. Once you move in, life gets in the way and you keep putting those projects on the back burner. When you first move in, plan out a calendar of all the projects with a start date.

Remember if you are in the market or have a home, a Realtor can be a great source of knowledge and advice. A real estate agent can help you sort through the truths and the myths.

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Ways To Ensure Your Business Is A Success With or Without You

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When you build a business it takes a lot of your time, your money and basically your life. What happens if something happens to you? This is a very important concept to contemplate if you are a small business owner.

“Like all of us, business owners don’t know what they don’t know. Most successful entrepreneurs started out with a great business plan, but they may not have revisited it over time as the business has grown,” point out a rep from First Horizon Advisors.

Hence a succession plan, which according to Securian Financial Group, 72% of business owners have not created one. Even if a business owner has created one, it needs to be revamped as the business grows and changes.

You want to make sure that your business could operate without you. “We’ve seen companies go out of business when an owner passes away or becomes disabled without a good succession plan in place,” comments Jennifer Schuchart, President of First Horizon Bank Market. You do this by seeing who would make a great successor and let them shadow you. You want to build your successors skills and knowledge.

If you have parents in a business, you need to think about what would happen if you or your partner had to leave the business. This can be due to sudden death, a divorce, or tons of other circumstances. A good way to help alleviate this problem before it occurs is to come up with a buy/sell agreement.

“Plan for an unexpected buyout using life insurance. To fund a buy/sell agreement, the company can hold life insurance on all partners, ensuring that if one passes away, the company itself can purchase their stake,” says Paul Lankau of First Horizon Advisors,Inc.

Retirement can look different to someone who is in business for themselves. A lot of business owners count on their business to help fund their retirement. “They may know where they are now in their business, and where they want to be when they transition out, but have zero idea of how to get from here to there,” Schuchart says.

If you are a business owner and do not have a succession plan, talk to a financial advisor. A good start would be with First Horizon Bank who will put you with a team who can help you with a succession plan.

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Tips From Professionals on Real Estate Planning

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Estate planning is a very important part of your retirement plans. This can be an emotional and stressful decision. Professionals in the industry such as a fiduciary financial advisor have several tips to follow when you are making those tough decisions.

1. Define your objectives

This is not fun to think about but will help your loved ones in the long run. Estate planning encompasses elements of money, taxes, family dynamics and emotions. You want to be clear with your intentions, if you want your money to go to your favorite charity, then you need to be clear on this.

2. Inventory your belongings

Take inventory of everything so that you do not leave anything out that you own; You want to include both tangible and intangible things. These can include homes, land, real estate, cars, boats, collectibles, antiques, sentimental family heirlooms, clothing, books, tools, bank accounts, investments and life insurance policies.

3. Consider your values

What do you want to leave behind is a great question to ask yourself. This can be a legacy, memory or an impact on a person or a whole community. This can be money left behind for a college degree because you were the first generation to graduate, or something you value in life.

4. Brainstorm your beneficiaries

If there is not a will, most states will give the next-of-kin estate beneficiary rights. If you do not want your crazy nephew to get all your money, then you have to put in writing what goes to who. A good way to do this is to make a list of your close friends and family.

Remember these are just several tips that can help you along the way with estate planning. The best advice is to hire a professional. A financial advisor can help you with each step along the way and they will have your best interest in mind.

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Buying Home During an Uncertain Market

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Buying a home can be a very exciting yet stressful time in one’s life. This can be very stressful when you are buying during an uncertain market. The Financial Mobility Survey reports, most consumers are still planning on making big-ticket purchases this year, with two-thirds (66%) intending to make at least one large purchase in the next year. KeyBank, who released the survey, gives these tips to those who are looking to buy a home in our current uncertain market.

1. Assess finances

Before you start searching for a home, you need to review your budget to see how much home you can afford. When looking at your budget for home expenses, you need to include the down payment, monthly mortgage payment, interest, taxes, homeowners’ insurance, moving costs, renovation fees and other expenses. A good tool to use to make sure you understand the costs associated is an online mortgage calculator.

2. Save for a down payment and additional expenses

A down payment can be a big expense that you need up front. For a mortgage, the typical down payment can cost you anywhere from 5% to 20% of the loan amount. Closing costs will also need to be considered along with moving costs or renovation costs. Talk to a local mortgage lender or banker who can help explain the different down payment programs.

3. Find the right mortgage loan officer

Finding a loan officer is just as important as finding the right Realtor. You want to find someone that clicks with you and understands your wants and needs. A loan officer can offer you tons of advice and additional insights and considerations while you are making your decision. Choose a lender that is familiar with your market and has a history of closing on time.

4. Consider all financing options

Last, you want to make sure to look at all of your options from adjustable-rate mortgages to fixed-rate mortgages. Different loan programs such as FHA, VA and USDA loans have different options to fit different needs. You will want to understand the differences to make sure you choose the right one for your financial obligation.

Remember owning your own home has tons of rewards but you need to work with both a Realtor and a mortgage lender who knows your current market. Remember, real estate is a long-term investment and homeownership can help provide a tangible asset in an uncertain market.

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