April Genter
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By April
Genter
Special
to Pasco
Naturally
Understanding
the
“mortgage
market
meltdown”
and the
critical
importance
of
learning
about
the
current
mortgage
loan
products
offered
in our
market
will
help
buyers,
sellers,
and real
estate
agents
make a
smooth
transition
in
bringing
contracts
to a
successful
close.
Recent
products
like the
No Doc
Loans
with 100
percent
financing,
Stated
Income
Loans,
Alt A
loans,
are hard
to
obtain.
Many
loan
officers
are
finding
it hard
to find
lenders
who even
offer
these
loan
packages
any
more.
With the
onslaught
of the
mortgage
market
meltdown,
stricter
guidelines
and much
more
documentation
is
needed
to get
loans.
Many
people
who
could
have
qualified
for a 90
percent
loan are
now only
qualifying
for an
80
percent
loan-to-
value.
It is
smart
for both
buyers
and
sellers
to get
pre-approved
before
spending
time
shopping
for real
estate.
It may
be more
obvious
why
buyers
should
get
pre-approved.
But why
did I
mention
sellers
get
pre-approved?
In
today’s
market,
it is
wise for
sellers
to
establish
a
relationship
with a
loan
officer
and
provide
documentation
for
getting
a loan
for
their
future
purchase.
Why?
Certain
loan
packages
that
were
easy to
get
months
ago are
not
readily
available
in the
market
at this
time.
When
sellers
are
budgeting
what
they
need to
net from
proceeds
of an
existing
property
they
also
need to
understand
fully
the
costs
and
programs
available
to them
for
their
future
purchase
to be
certain
that the
loan
products
and
funds
are
obtainable.
Sellers
need to
be aware
of what
their
property
will
appraiser
for in
today’s
market.
I
believe
it
prudent
to get
an
appraisal
on the
home
before
listing
the
property.
While
Realtors
can
provide
a
comparative
market
analysis
on homes
for a
seller,
I think
it best
to get a
certified
appraisal
before
listing
a home.
When
buyers
apply
for a
loan,
the
lender
will
require
an
appraisal.
If the
bank’s
appraisal
comes in
far
lower
than the
agreed
upon
sales
price,
the
buyer’s
down
payment
will
obviously
increase.
If the
buyer
doesn’t
have the
extra
5/10/20
percent
needed,
then the
contract
will
probably
end up
dead. Or
the
seller
and
buyer
will
find
themselves
having
to
renegotiate
the
sales
price.
This
scenario
is being
played
out
daily
with the
recent
drop in
property
values
in Pasco
County
and the
stricter
loan
packages
and
guidelines
thrust
upon us.
For
buyers
it is
imperative
to get
pre-approved
before
they
begin
shopping
for a
home.
Understanding
the
total
amount
it will
cost for
purchasing
a home –
and a
realistic
view of
your
monthly
payments
– is
crucial.
Often
lenders
wrap the
monthly
insurance
payment
and
taxes
into the
mortgage
payment
and
possibly
community
CDD
fees.
Knowing
the
amount
you can
qualify
for and
how much
you will
be
expected
to put
down on
a home
should
be
determined
before
you
begin
shopping.
You
don’t
want to
be
caught
spending
hours
and
hours
shopping
for a
home,
writing
up the
contract,
paying
for
inspections,
a survey
and an
appraisal
–only to
find out
that you
can’t
qualify
for the
loan.
Many
sellers
are now
asking
for a
pre-approval
letter
when a
buyer
presents
an offer
on a
home.
Negotiating
a price
with a
seller
isn’t
going to
be easy
if you
don’t
have a
pre-approval
letter.
Many
sellers
do not
want to
take the
risk of
tying up
their
properties
for 30
to 60
days
while
waiting
for a
buyer to
get
approved.
Being
pre-approved
or
having a
commitment
letter
can give
a
prospective
buyer
some
leverage
in
negotiating
a
contract
with a
seller.
Because
there is
a high
inventory
in our
local
market,
buyers
are
under
the
impression
that
sellers
are more
desperate
to sell.
This may
not
necessarily
be so.
In fact,
I find
that
sellers
are
requiring
larger
deposits
and
requiring
stipulations
that all
or part
of the
deposits
are not
refundable
if the
buyers
present
offers
without
pre-qualification
letters
and get
denied
funding.
The
risks
that
sellers
take can
be
costly
when
tying up
a parcel
of real
estate.
Taking
time to
tap into
the
resources
and
services
offered
by
qualified
appraisers,
loan
officers,
and real
estate
brokers
is
critical
in the
segue
for
buying
and
selling
homes in
our
current
market.
April
Genter
is a
Florida
Licensed
Realtor
with
Charles
Rutenberg
Realty
Inc.
Phone:
(813)
943-1071.