USDA Texas Mortgage Program Benefits

• No Down Payment Required
• 100% Financing
• Seller May Pay Your Closing Costs Up To 6%
• No Reserve Requirements
• Very Low Finance Rate At A Fixed Rate
• No Mortgage Insurance Which Reduces Your Monthly Payment
• No Maximum Purchase Limit
• Reasonable Minimum Credit Score
• NOT Just For First-Time Home Buyers

Texas USDA Rural Development Loan Qualifications:

• The property must be in a designated rural area (Ex. Boerne, Cibolo, New Braunfels)
• The property must be for residential use and you must intend to occupy the home as your primary residence
• The value of the land should not be more than 30% of the total property value
• You must NOT already own adequate housing in the area you wish to purchase in
• You must be a US citizen or be a legal permanent resident to the US
• Reasonably good credit is required, especially the most recent year
• Sufficient dependable income is required for the home you wish to buy; generally the home total payment should be no more than 29% of your gross monthly income
• There is an income limit that depends on the county, it is about 115% of the US average
  You must NOT have liquid assets of 20% or more of the homes selling price

If you’re NOT currently working with a REALTOR® and are ready to take advantage of this Great Program register below to get started today!

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2. Email Address(valid email required)
3. Phone Number(required)
4. Zip Code or Area of Interest(required)
5. Number of Bedrooms 1 2 3 4 5 6+ (required)
6. Number of Bathrooms 1 1.5 2 2.5 3 3.5 4 4.5 5+ (required)
7. Approx Square Footage < 1000 1000-1500 1500-2000 2000-2500 2500-3000 3000 + (required)
8. Price Range 50,000 - 75,000 75,000 - 100,000 100,000 - 125,000 125,000 - 150,000 150,000 - 175,000 175,000 - 200,000 225,000 - 250,000 250,000 - 300,000 300,000 Plus (required)
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According to the National Association of Realtors housing affordability index, homes were more affordable in December than at any other point since the group started the index in 1970. The affordability index is a measure of the relationship between home prices, mortgage interest rates and family income.

Home prices in the San Antonio market have remained pretty much flat at $145,100 compared to February 2008 when the median price was $144,900, according to the San Antonio Board of Realtors.

Good news when many other housing markets home prices have fallen as much as 30% (Las Vegas, Miami) just within the last year.

2. Buyer’s Market – You Have A Large Inventory To Choose From

In many places it is taking months to sell a home, creating loads of inventory — from new homes to existing homes to foreclosures. There was a 7.8-month supply of unsold existing homes in January given that month’s sales pace, according to Texas A&M Real Estate Center.

A large selection gives buyers more choices and drives down prices. And home sellers have gotten the picture. It’s fair to say that some home sellers have become desperate. Sellers that have had for-sale signs in the yard for the past six months are now motivated to accept a lower offer.

Buyers can now take advantage. Another option is having the seller pay a portion if not all of your closing costs. Which could equal an average of 4 percent of the homes purchase price. That’s $6,000 dollars on a $150,000 dollar home.

3. Builders Are Offering Big Discounts

Home builders are getting even more aggressive with their pricing. In fact, you should start looking at completed new homes first because builders are offering such steep discounts. Plus, you’d have a warranty not only on the home itself, but also on the home’s appliances.

Example: D.R. Horton Home located in Alamo Ranch subdivision which is off Culebra Road and Loop 1604. This 2-story home is a 3 Bedroom, 2.5 Bath, 2 Garage and has a total of 1,889 square feet. Originally listed for $181,000, is under contract right now for $159,000. That’s a $22,000 dollar discount!

The Key Is: Walk in with a pre-approval for a mortgage, make an offer, then walk away without making a deal if you have to. Chances are, a builder will call back and reconsider that offer rather than let a potential buyer get away.

4. Mortgage Rates Are Historically Low
It’s not just the price of the home that will affect affordability; mortgage terms will also affect your monthly payments. These days, rates are very attractive for conforming loans, those that can be purchased by mortgage agencies Fannie Mae and Freddie Mac.

Earlier this year, rates on the popular 30-year fixed-rate mortgage hit a level not seen in decades, and rates have stayed relatively near that low for weeks. This week, the 30-year fixed-rate mortgage averaged 5.07%, according to Freddie Mac’s weekly mortgage survey.

But low rates don’t mean lenders are handing out mortgages easily. You’ll need good credit, at least a 3.5% down payment and a willingness to document your income in order to qualify for those great rates.

5. You Can Get A Federal Tax Credit
There’s now a federal credit of up to $8,000 for home buyers who haven’t owned a home in at least three years. The credit is available for a limited time (ends December 1, 2009) and does NOT have to be repaid.

That extra cash will come in handy as the average first-time home buyer spends about $6,000 in the first six months of owning a home. We all want new furniture to go with our brand new home.

Waiting for further federal developments, however, might zap a buyer’s negotiating power, as San Antonio home buyers have now shifted into house-hunting mode for the traditional springtime and summer buying season.

If you have reasonably good credit, money for a down payment and can provide documentation of your income for the past 12 months, call me TODAY to take advantage of this great opportunity.

Daniel Gaitan, REALTOR®
Trend Setter Realty
1100 NW Loop 410 Suite # 700
San Antonio, TX 78213
Direct # (210)846-5282

Buying a home is a complex experience, especially if it’s your first time.  We have broken down the process down into four easy-to-understand stages and offers helpful tips and advice for each one.

Stage 1: Evaluate Your Life and Finances

Owning a home is like any major commitment. You need to be mentally and financially ready for it. What stage of life are you in? Are you financially stable? Do you move around a lot?

Before you even look at homes, take a good look at your situation and crunch the numbers to see if this is the right time for you to buy. Just because it’s a buyer’s market doesn’t mean you should buy now. These steps will help you figure out whether you’re ready to own a home.

Step 1: Compare the pros and cons of renting and buying.

Step 2: Create a “Home Wish List.”

Step 3: Calculate a monthly mortgage payment you can afford.

Step 4: Create a budget for monthly homeowner expenses.

Step 5: Check your credit report and improve your credit score.

Step 6: Research the market where you want to buy.

Step 7: Figure out how you will get a down payment and pay closing costs.

Step 8: Start off small. (This is your first home not your dream home.)

Step 9: Know your rights as a homebuyer and borrower.

Stage 2: Shop for a Loan

Once you determine you’re ready for the responsibilities of owning a home, it’s time to find financing. You’ll likely be borrowing thousands of dollars, so shop around for the best interest rates and loan terms to negotiate the best deal. Buying a home involves more than just the sales price. There are fees for every part of the process. Make sure you understand everything you’re paying for.

Step 1: Study your financial picture.

Step 2: Read about the different types of mortgages and check competitive interest rate online. Find out what kind of mortgage is right for you.

Step 3: Now shop for the best mortgage rate and loan terms.

Step 4: Get pre-approved. (You will need a pre-approval letter when your ready to submit an offer.)

Step 5: Look into programs that will save you cash.

Step 6: Research homebuyer assistance programs.

Step 7: Figure out the impact on your taxes.

Step 8: Arrange financing for the home you want to buy and be creative.

Step 9: Protect yourself from falling victim to predatory lenders.

Stage 3: Find a House

Now comes the fun part! You have your home wish list and pre-approval letter, so it’s time to go house hunting. Save the gas money and do some research online first. Read about different neighborhoods and home styles, and browse listings online. Consider getting a buyer’s agent to set up home tours and guide you through the process.

Step 1: Choose a neighborhood.

Step 2: Choose a type of house.

Step 3: See what’s available online.

Step 4: Shop for real estate agent with local knowledge. I would recommend Trend Setter Realty =0)

Step 5: Keep a house-hunting journal.

Step 6: Approach foreclosures with caution.

Step 7: Narrow down your choices and see the houses again.

Step 8: Calculate the home’s market value.

Step 9: Make an offer.

Stage 4: Close the Deal

Unless you made a low-ball offer that offended the seller, expect to negotiate. The key is to find terms you both can agree on. Put them in writing, sign the contract and the closing process begins. During this period, you’ll get an appraisal, title search and exam, home inspection and homeowners insurance. If all goes well, you’ll sign the paperwork and the keys are yours!

Step 1: Finalize the purchase and sale contract.

Step 2: Choose a title company that will research the title and coordinate the closing.

Step 3: Get an appraisal.

Step 4: Get a professional home inspection.

Step 5: Get homeowner’s insurance quotes and pay the premium.

Step 6: Consider home warranty coverage.

Step 7: Do a final walk-through of the house.

Step 8: Review each closing document carefully.

Step 9: Plan your big move!

Disclaimer: This information is provided for general awareness only, and is not intended for the purpose of providing legal, accounting, tax advice or consulting of any kind. Please consult with your tax professional for complete details.

Who is Eligible

• The $7,500 tax credit is available for first-time home buyers only.
• The law defines a first-time home buyer as a buyer who has not owned a home during the past three years.
• All U.S. citizens who file taxes are eligible to participate in the program.

Types of Homes that Qualify for the Tax Credit

• All homes, whether single-family, townhomes or condominiums will qualify.
• However, there are several conditions:

1. The home must be used as a principal residence, and
2. The buyer has not owned a home in the prior three years.

• The Tax Credit includes newly-constructed homes.

Income Limits

• Home buyers who file as single or head-of-household taxpayers can claim the full $7,500 credit if their adjusted gross income (AGI) is less than $75,000.
• For married couples filing a joint return, the income limit doubles to $150,000.
• Single or head-of-household taxpayers who earn between $75,000 and $95,000 are eligible to receive a partial first-time home buyer tax credit.
• Married couples filing jointly who earn between $150,000 and $170,000 are eligible to receive a partial first-time home buyer tax credit.
• The credit is not available for single taxpayers whose AGI is greater than $95,000 and married couples filing jointly with an AGI that exceeds $170,000.

Effective Dates for the Tax Credit

• First-time home buyers would receive a $7,500 tax credit for the purchase of any home on or after April 9, 2008 and before July 1, 2009. To qualify, you must actually close on the sale of the home during this period.

Tax Credit is Refundable

• A refundable credit means that if you pay less than $7,500 in federal income taxes, then the government will write you a check for the difference.

1. For example, if you owe $5,000 in federal income taxes, you would pay nothing to the IRS and receive a $2,500 payment from the government.
2. If you are due to receive a $1,000 tax refund from the government, your refund would grow to $8,500 ($1,000 plus $7,500 from the home buyer tax credit).

• If you purchased the home in 2008, the tax credit is taken on your 2008 tax return. If you buy in 2009, you have the option of taking the credit on your 2008 or 2009 tax returns.

Payback Provisions

• The tax credit is an interest-free loan that must be repaid over 15 years.
• The minimum repayment amount must be 15 equal annual installments. For example, if the credit amount is $7,500, then the home buyer must repay a minimum of $500 each year for 15 years.
• A home buyer must begin repaying the credit two tax years after claiming the credit. For example, if the credit is claimed on the 2008 tax return, repayment of $500 (or less, if the credit amount is less than $7,500) per year begins with the 2010 return.
• If the home owner sells the home for a profit and there is a remaining credit, then the home owner is required to repay the remaining credit during the tax year of the home sale. The amount of the repayment will depend upon the amount of profit from the home sale:

1. If the profit on the sale is more than the remaining credit, then the home owner must repay the entire remaining credit.
2. If the profit on the sale is less than the remaining credit, then the home owner must repay an amount equal to the profit on the home sale. The remaining credit payback will be forgiven.

• If the home owner sells the home but did not make any profit on the home sale, then the remaining credit payback would be forgiven.

Further information regarding the tax credit may be found at www.federalhousingtaxcredit.com or www.irs.gov.

2. Don’t get the price over the phone. Movers can’t see everything through the phone.

3. Don’t take the mover’s word on it. Your estimate should be in writing.

4. Don’t put a deposit down on the move. But do confirm what methods of payment are accepted.

5. Don’t overlook the small print and read all the legal documents called your “Rights and Responsibilities.”

6. Don’t wait to pack. Packing takes the typical homeowner two weeks.

7. Don’t wait to make your moving reservation, especially during the summer.

8. Don’t assume. The American Moving and Storage Association suggests having three surveys performed to give you a good perspective on your move.

9. Don’t try to do it all the last week before you close on your home.

10. Don’t expect exclusive use of a truck. If you’re moving far, you might share a moving truck with another family.

San Antonio Relocating Tips Provided by: Scobey Moving and Storage

1. Pull out the home-inspection report and reread it. Use the report as a handy maintenance checklist.

Most inspections take place during a stressful time when the buyer’s main concern is closing the deal, Davis says.

“A lot of small problems tend to be overlooked and dismissed,” he says. “But in time they grow to bigger problems that can max out your credit card.”

One of Davis’ real-estate clients watched for three months as a water stain crept across his ceiling. Then one night while the man was eating dinner, the entire ceiling collapsed. The lesson: Be proactive. Take care of issues as soon as or before they arise.

Know your enemy

2. “Water is 90 percent of a homeowner’s problems,” Davis says. A home’s basement, foundation and roof are the most susceptible to costly water damage and corrosion.

Inspect bathrooms, laundry rooms and kitchens regularly for water leaks. The fix can be as simple as tightening a nut. Caulk around doors and windows to prevent water from seeping into the walls. Outside, keep water routed at least 5 feet from the foundation.

Maintaining a home’s gutter system is a major line of defense against water damage. Leaves, dust and dirt from shingles can result in a clog that forces water out and down into the foundation. Use a ladder and a water hose to clean out the gutters regularly, and make sure they drain properly.

Wade Williamson, owner of Axium Inspections in Denver, says many homes he sees have missing downspout extensions. Inspectors suggest checking a new home’s landscaping to make sure the slope of soil and sod doesn’t push water toward the house. Always turn sprinkler heads away from the house.

Remember the roof

3. Roofs should be next on the maintenance checklist. If a roof is more than 12 years old, get it professionally inspected.

A homeowner should avoid climbing on the roof to avoid getting hurt or breaking shingles. Instead, use binoculars to check for broken shingles and spots where the mineral coating has worn off, curled up or is getting brittle. To avoid leaks, make sure that flashings are intact and not getting flaky or deteriorated.

Take charge of circuits

4. Map out the home’s electrical system by determining which outlets serve which circuits and then labeling the breakers. Don’t trust that the previous homeowner labeled the circuits properly.

A tripped circuit is a red flag for an overloaded breaker. Read appliance labels to figure out how many amps (electrical current) each one draws. Many household circuits can have only 15 amps. Update electrical wiring in homes 10 years or older.

Make sure GFCI outlets (ground fault circuit interrupters) are installed near all sinks, in the laundry room and garage, and on exterior outlets. This inexpensive fix — hire an electrician — helps prevent electrocutions and fires.

Tighten screws on outlet covers and replace missing ones. Never use extension cords in place of permanent wiring.

Know your shut-offs

5. The main electrical shut-off should be a switch either at the main breaker panel or outside near a service entrance.

The water shut-off valve will be on a wall of the house facing the street. These areas need to be easily accessible.

Check for leaks

6. Inspect all plumbing and fixtures. Make sure the shut-off valves on toilets and sinks turn easily and are not rusted shut. If they are corroded, replace them.

If the faucet is leaking, then it needs a washer. Take the faucet, washer or stem along to the hardware store to match it.

If a toilet runs all the time, a flapper valve needs replacing. Have slow drains looked at immediately to prevent costly backups.

Consider warranties

7. Sid Davis warns homeowners that warranties can be just as pricey as actually replacing faulty appliances. However, real-estate coach Jason Hanson, author of “How to Build a Real Estate Empire” ($25, Foundations of Wealth), says warranties can provide peace of mind.

When appliances break down, Hanson says, homeowners can use the warranty instead of searching for reputable repair companies.

Buy, update insurance

8. Get “replacement coverage” to cover property damage. Make sure the policy outlines in writing exactly what will be covered in case of a catastrophe. Videotape or photograph all valuables, keep a list of serial numbers and write down the date an item was purchased for possible reimbursement proof.

Also, track all home improvements by saving receipts and records to help avoid capital-gains taxes when you sell the home.

Buy a flood policy

9. Get flood insurance even if your home isn’t near a flood zone. Forty percent of flood claims are made by homeowners in nonflood areas, according to Davis.

A heavy rainstorm, improper drainage and runoff from road or subdivision construction can funnel water into the home.

Do your homework

10. Compare property taxes with similar homes’ taxes in the neighborhood. If all things are equal (i.e. square footage and upgrades) in multiple-listing service documents, protest your rate increase with the assessor’s office.

Source: “What Every Homeowner Should Know” written by Sheba R. Wheeler at The Denver Post.

TIP #2 It Is Very Important To Buy A Home That Will Go Up In Value. Slow, steady home appreciation has been the rule over most of the nation’s history, and many real estate investors became quite wealthy in that environment. They did so by very carefully analyzing the appreciation potential of their investment, and they invested for the long term. You should too. Even if you plan on living in your home just a few years, you will want it to have gone up in value when you put it back on the market.

TIP #3 Use A Buyers Agent. If you’re going to work with a real estate agent, contract using a buyer’s agency, means the agent is working with your best interests (and wallet) in mind. A buyer’s agent will work to negotiate the best price, ensure the property is inspected, and make sure you have the representation you need. Things you tell a buyer’s agent remain confidential. Using a buyer’s agent also means that you will be shown homes that are For Sale By Owner (FSBO). It might seem like using a buyer’s agency means you are going to pay more — but that’s not always the case. Although there are situations where agents charge an hourly fee or a flat fee for the service, in most situations they are simply working for the same commission that is paid by the seller and split it with the seller’s listing agent.

TIP #4 Choose Your Agent Wisely. If you are using a real estate agent look for one with experience in working with buyers, with knowledge of the neighborhood(s) you are considering, and who does not have a reputation for being ‘pushy’. The purchase of a home is a serious long term commitment on your part and a good agent will recognize that buyers need time and patience so they can satisfactorily sort out the many factors involved in a purchase decision.

TIP #5 Current Home Prices Are A Less Important Consideration Than Interest Rates. Try to buy and/or sell when interest rates are low. The amount of mortgage you can afford (and thus the price of the home you will consider) will change as the interest rates rise or fall. A certain asking price may sound expensive to you, but at a lower interest rate you might be able to afford it. You may own several homes over your lifetime, and the factors that will limit or increase the value of the home you will be selling will similarly affect the price of its replacement. Since those factors largely wash each other out, interest rates remain the most important factor.

TIP #6 Always Have A Home Inspection Contingency In Your Offer and always hire a professional home inspector to provide you a written report, along with “ball park” estimates or ranges of repair costs. If the inspection turns up problems that weren’t readily noticeable, you can use it and the ball park estimates for negotiating leverage to get the seller to make the repairs or provide you a commensurate price reduction.

TIP #7 Learn As Much As Possible About The Seller’s Circumstances. There may be mutually beneficial opportunities. For example if you might face difficulty qualifying for a big enough mortgage, and the seller is worried about college costs for his or her sixth grader, then maybe the seller might be interested in accepting a second trust for part of the purchase price if the interest rate is above what they could otherwise earn and the loan is paid off the summer before the child’s freshman college year. From your perspective the rate will likely be less than you could get from a traditional lender.

TIP #8 Research Your Mortgage Options Well Before You Make An Offer. You won’t have enough time in the five days sellers normally allow to get all of your paperwork together, determine the best kind of mortgage, who is offering the best rates etc. Consider getting a contingent letter of approval for a loan, or an actual loan commitment prior to making an offer. The former is not actually a loan commitment, but rather a contingent approval for a loan up to a certain amount. While it has relatively little enforceable value, it nevertheless can impress a seller, who might be more willing to accept a lower offer because of the perceived financial capabilities of the seller. Its also possible to get approved by a lender with a longer term “lock” on the interest rate in order to protect you from subsequent rate increases. While this should substantially increase your negotiating leverage, keep in mind that you pay more directly or indirectly for the longer commitment, either in terms of the rate and/or points.

TIP #9 Learn How To Negotiate Like A Pro. There’s more money involved in this negotiation than just about any other area you’ll encounter. Even if you’re using a buyer’s agent, you’re part of the team, and you’ll have to make the ultimate decisions about how much to offer and how much to compromise on a counter offer.

TIP #10 STUDY! The tips listed here are only the beginning. You’ll need to learn a lot more if you want to get the best possible deal. Read as much as you can on home buying, on negotiating, on neighborhoods in your area that might fit your needs, and on factors that impact long term appreciation like schools, infrastructure, major new business expansions or closing etc. Keep copies of everything you send the lender and everything the lender sends you.

Obviously, potential mortgage lenders look at your income for the last two years and your credit score when determining if you are “mortgage-worthy.” However, income can now be “stated,” and bad credit does not mean you will be unworthy in getting a loan. Bad Credit is just as attractive to many lenders as good credit since it means a lender can charge you a higher interest rate and get you to pay more points and fees to get a better rate. In fact, since there are so many “secret” factors that go into lending you money, by simply making a few tweaks before applying, you can get approved for the best of the best loans. Here are some other factors Potential Mortgage Lenders look at when deciding if they should lend to you or not.

• Are your credit accounts current? If your accounts are not current now, then you are not making enough money to make your mortgage. Get those balances current before applying for a credit card.
  
• Have all of your balances been paid on time within the last 12 months? Paying on time for 12 straight months will make you an “A-Paper” borrower, something lenders consider just as important as your score. If you are an “A-Paper” borrower, you will get bumped up to the better end of loans you credit score will qualify you for. Therefore, go 12 months with timely payments to give you that extra boost regardless of your score.
• Do you have a lot of negatives on your credit report? Negatives are usually late payments, balances over their limits, and items charged off for collections. You can “dispute” these items on your credit report and have them removed, which will make you look more attractive in the application process and raise your score at the same time. (Plus it only takes 30 days to do.)
• How many times have you applied for credit in the last three to six months? Too many credit inquiries lowers your score and says you are trying to get yourself into a heap of debt. Try to make it through three to six months without applying for new credit before applying for a home loan.
• How much money do you have to pay towards other credit on a monthly basis? A creditor will figure your mortgage at approximately 50% of what you make. This number varies depending on the lender. Your credit report totals all of your payments right up front. If you are paying more then 50% towards credit cards and other loans, then you will most likely be rejected for a mortgage. Ask your creditors to lower your interest rates so that the total monthly payments on your credit report will go down. Also, try to pay down as much of your credit balances as possible so that you can get a higher pre-approved mortgage amount.
• How much longer will you be paying your car loan? If you have a car loan, and you only have one year’s worth of payments left, mortgage lenders will usually not take that debt into account when calculating your potential mortgage amount. Therefore, if you have more then one year of payments left, pay it down to one year in order to get a higher mortgage.

Remember, knowledge is power. A pre-approval letter is knowledge and it gives you bargaining power. By cleaning your credit before applying for a mortgage, you can bargain for the best loans and make the toughest home offers. Do these things before applying for a loan, and soon you will own the home of your dreams.

If you’re ready; click on “Get Started” below and you can start completing a DHI Mortgage on-line pre-qualification form. Once you’ve finished and submitted the application, it is automatically transmitted to DHI Mortgage. Senior Loan Officer Tanya Ramos from DHI Mortgage will evaluate your information and will contact you as soon as possible to help you get things moving on your loan.

P.S. Please tell Tanya that Daniel Gaitan from Trend Setter Realty sent you, thanks! 

Get Started!

TYPICAL TITLE PROBLEMS

To close on a house, the buyer usually must have title insurance guaranteeing that he or she will be the sole owner.
Insurance companies refuse to provide that insurance in some cases. Here are common examples of why title insurance would be denied:
•Grandparents die without leaving wills, and one child keeps the home without proper legal documents. It’s not found until two generations later.
•The property description differs from the sales contract.
•The previous owner forged mortgage documents to show that he or she had paid off a previous mortgage. But the former mortgage company still owns the property.
Source: Alamo Title Co.

WHAT DOES TITLE INSURANCE COST?

The Texas Department of Insurance sets the same on-time premium rates for all properties, regardless of type of home, its age or where the house is located. The insurance policy must cover at least the sales price of the property.
The minimum premium is $229 for the first $10,000 in sales price. Premium rates are broken down into six tiers and get smaller as the purchase price increases to $25 million.
For instance, buyers pay the minimum rate plus an average of $3.41 for each additional $500 of the price, up to $100,000.
A home priced at $100,000 would have an $843 premium.
The premium for a $200,000 house includes the $843 from the first $100,000, plus $2.67 per $500 of additional value, or $1,377.
Source: Texas Department of Insurance

Read “Title insurance protects buyers” Written by Aïssatou Sidimé Express-News Business Writer

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