mortgage

sudoadmin
March 26, 2020

A CLEAN HOME IS A HAPPY (HEALTHIER) HOME

C21 HOMETOWN’S – 7 DAY PLAN TO A HAPPY, HEALTHIER HOME

We’ve all heard the old adage “a clean home is a happy home.” It’s pretty safe to say a clean home is also a healthier one as well and we call use an extra dose of healthy! In the world of real estate, “Spring Cleaning” a house before selling is always key in making sure the house sell faster and even for more money. Since we all find ourselves home a lot more than expected these days, we’ve come up with a 7-day “Spring Cleaning” to keep us productive, healthier and even prepare your house to hit the real estate market if you’re interested. WIN…WIN…WIN!

Cleaning the entire house can feel overwhelming, but if you take a little at a time, one day at a time, your house can be spotless in no time.

DAY 1 – KITCHEN

We’re going to break down Kitchen cleaning into two days.. Take the time to not only clean but declutter as you go.
• Wipe down all the same surfaces as you did for the bathroom. Use that hot water, soap and start scrubbing those surfaces. Great time to work out all that Corona-virus frustration!
• Wipe down the walls, the outside of the cabinets, the handles on the cabinets and disinfect the inside of the sink basin as well.
• Open cabinets and neatly organize anything that looks out-of-place and purge any-thing that no longer is needed.
• Wipe down the floor and call it a day!
Seller’s Tips –
• Now that your Kitchen is sparkly clean, make sure the room is bright with sunlight.
• Also, be sure to repair any leaky faucets and pipes.

DAY 2 – KITCHEN AGAIN

We’re baaaack! Look around, you have to admit it’s looking good and we’re feeling good, right? Today, we finish the Kitchen by tacking those appliances.
• Let’s start with the fridge. Empty the shelves to wipe them down, double-check the expiration dates on the items that remain in your fridge. If they are no longer any good, it’s time to get rid of them! Scrub your fridge ’all those questionable drips and rings are gone then load back up the condiments and food items.
• Now let’s tackle the oven and cleaning the range. Choose a cleaner that is effective but that won’t damage your skin or unhealthy to breathe. Clean the range, then open the oven. If your oven is self-cleaning, hit the button! If not, start wiping down the inside of the oven to make it shine.
• Wipe out the inside and outside of the microwave
• Turn off the kitchen light, your work is done for the day.
Seller’s Tips –
• Make sure all stove, microwave, and refrigerator lights are working.
• Repair all loose handles and knobs. Your dishwasher must be working.
• Go and buy new stove plates or burner covers.

DAY 3 – BATHROOMS

Let’s face it, if we want to be healthier, bathrooms are the perfect place to start!
• Clean the entire parameter of the room from right to left.
• Wipe down door handles, light switches, walls, sink, countertops even base-boards…anything that has a surface, wipe it down with disinfecting products!
• Scrub the toilet, the shower, the tub, the shower head and don’t forget to wipe down the mirrors.
• Once all the surfaces and items in the bathrooms are cleaned, be sure to empty out the trash and wash the floors. DONE!
Seller’s Tips –
• Replace old toilet seats and make sure that every toilet is flushing perfectly. (People often flush the toilets to see if your plumbing is working.)
• Check your grouting and repair or replace any missing tiles.
• Buy new shower curtains and be sure there is no mildew anywhere.
• Put new caulking around toilets and showers.
• Take off any mineral deposit or soap deposit film on your shower doors and walls.
• Organize under the sinks and medicine cabinets (yes, people will open everything). Put away anything personal or dangerous.
• Check ceilings for cracks, stains, and moisture problems.

DAY 4 – LAUNDRY ROOM

Let’s take one of the smallest but busiest rooms in houses with kids, the Laundry.
• Start one of the never-ending loads of laundry.
• Wipe down the tops of the washer and dryer.
• Clean out the lint traps.
• Clean and pick up anything that’s fallen between or behind either unit.
• Organize your detergents so they are all nice, neat and stocked appropriately.
• Sweep the floor.
Seller’s Tips –
• Dust and clean your appliances like washers, dryers, hot water heaters, and furnace.
• Check for any leaks. If your basement has a musty smell (hopefully your friend who did the house tour will have told you) pour bleach down your drains, do not have damp clothing.

DAY 5 – LIVING ROOM

Even though the Living Room is one of the largest spaces, it’s generally one of the easiest to clean and freshen up.
• Wipe down all surfaces, baseboards and light switches.
• Dust any shelves, and also the backs and legs of furniture. Be sure to declutter any shelves of unnecessary items.
• Open up your windows and let that fresh air in and while you’re at it, clean the in-side and outside of those windows as well.
• Vacuum if you have carpet, or sweep if not.
Seller’s Tips –
• Be sure to fill holes and patch any other problems.
• Straighten the furniture, and be sure that the cushions are plumped and smoothed.
• Clean the fireplace and do not forget to use glass cleaner on both sides, if you have glass doors. Put a bowl of potpourri in the fireplace (nothing too overpowering).
• Anything on the coffee tables or shelves or mantle should be neatly stacked.

DAY 6 and 7 – BEDROOMS

You are in the homestretch! Just like the Kitchen we are going to tackle the Bedrooms in 2 days (maybe even 3 depending on the number of Bedrooms.)
• Follow the same cleaning protocol as you did in the Living Room: wipe, dust, win-dows, floors.
• Change out the sheets, flip and rotate the mattress.
• Here’s the biggie – organize the closets! Make a donate pile for clothing items that no longer fit or are needed.
Seller’s Tips –
• Patch walls and ceilings if during decluttering, you left a trail of nail holes.
• Clean light fixtures (all over the house), replace bulbs, and be sure to put in soft white bulbs not harsh or glaring bulbs.
• Ceiling fans need to be dusted and cleaned.
• Clean smudgy fingerprints off walls, doors, and light switches. (These bedroom doors often are overlooked).
• Nightstands emptied and organized attractively.

Walk through your house, look around and see if there is anything we missed. Looking good? You tackled it and completed the 7-day “Spring Cleaning” Plan. CONGRATULATIONS!

Whether you are looking to buy or sell, C21 Hometown Realty’s Agents have the most homes listed and the most homes sold! Visit one of the ten local offices throughout the Central Coast or click on c21home.com.

About CENTURY 21 Hometown Realty – Hometown Realty is the leading real estate firm on the Central Coast of California with offices spanning Santa Barbara County and San Luis Obispo county offering expert agents and convenient locations.

Bysudoadmin
OnMarch 26, 2020

sudoadmin
February 27, 2020

PLUNGING INTEREST RATES COULD HELP BUYERS ON THE FENCE

Mortgage rates are falling fast, and they could sink even lower reports Mortgage News Daily. The 30-year fixed-rate mortgage now averages 3.34%, a rate last reached in 2012 and briefly in 2016. That is for borrowers with strong financials and credit scores.

As coronavirus fears hit financial markets, U.S. bond yields are tanking, pushing mortgage rates that loosely follow the 10-year Treasury yield toward an eight-year low. They could sink even lower.

“When rates fall this quickly, it’s not so much that big banks draw the line on mortgage rates, but rather, the underlying mortgage backed securities market refuses to improve as quickly as the Treasury market,” Matthew Graham, chief operating officer at Mortgage News Daily, explained to CNBC. Mortgages become less valuable to investors if they get paid off too quickly.”

And those payoffs, or refinances, are surging right now. Applications to refinance a home loan are up around 165% annually, according to the Mortgage Bankers Association.

Mortgage applications to purchase a home have not been as strong, due to the severe shortage of homes for sale. Builders, however, may be getting a boost, especially those putting up more affordable homes.

GOOD NEWS FOR ENTRY-LEVEL BUYERS

Falling rates help loosen up a tight market. When rates rise, homeowners are more likely to stay put because they don’t want to take on bigger mortgages. But when loan costs fall, buyers on the fence get motivated to trade up. And that frees up entry-level homes for eager first-timers.

People shopping for homes will likely see lower rates in the coming weeks as the 10- year hits new lows, according to Bankrate.com. For existing mortgage borrowers, another drop in rates might clear the path for refinancing.

“The refinancing door has blown open with mortgage rates continuing to fall amid fears of slower global economic growth,” Greg McBride, CFA, Bankrate chief financial analyst says. “This helps those looking to refinance a mortgage as well as would-be homebuyers .”

BUYERS TRADE UP

If you are ready to buy the downturn interest rates can be a big win. One result of falling borrowing costs is that buyers are able to afford bigger mortgages. Those seeking pricier properties are acting now because their choices are increasing, and profits from selling their current home can fund the down payment on the next one.

To take full advantage of lower interest rates, the key is to be prepared. Be sure to choose the right Real Estate Professional to make sure all the details of a transaction are complete. Make sure to have your pay stubs, tax returns, bank statements, and other necessary documents together so there is no delay in processing. Delays could be costly when there is no guarantee how long low interest rates will last.

Bysudoadmin
OnFebruary 27, 2020

sudoadmin
January 16, 2020

WILL 2020 BE A GOOD TIME TO BUY IN CALIFORNIA?

Economists say that 2020 will be positive but not stellar for the housing market in California.

Although last year they expected mortgage rates to rise and they fell keeping real estate markets much stronger than anticipated. Lesson…real estate predictions can be tricky business.

CALIFORNIA STILL SHOWING GROWTH

Despite some predictions from expert economists that the west would face a tough 2019 real estate market, California proved to be one of the better housing markets in the country. In fact, the Central Coast median home prices were up 3.3% year over year according to the California Association of Realtors. Southern California had a 7.5% rise, the Central Valley up 6.3%, while the Bay Area had only a 2.2% rise.

PERSISTENT LACK OF SUPPLY

California’s housing market will continue to be fueled by a persistent lack of supply, keeping pressure on rising home purchasing and rental prices. Sales of homes $500k and $1 million rose by 15.5% on average, yet sales under $300k dropped sharply by 14.2% and homes over $2 million dropped slightly by 3.2%, according to California Association of Realtors.

SELLER OPTIMISM RISING

In CAR’s buyer survey, respondents who thought it was a good time to sell increased 4% to 51%. Only 24% of buyers stated they felt it was a good time to buy, down only 1% from last year, despite lower rates. Prices, down payments, and selection are likely the key factors stopping buyers from buying homes. With higher real estate prices, first time buyers will continue to struggle to come up with a down payment thus keeping the rental market strong.

Whether you are looking to buy or sell, market conditions are looking good for 2020. As the #1 broker on the Central Coast, C21 Hometown Realty’s Agents have the most homes listed and the most homes sold! Visit one of the ten local offices throughout the Central Coast or click on c21home.com.

Bysudoadmin
OnJanuary 16, 2020

sudoadmin
September 25, 2019

FALL IS THE BEST TIME TO MOVE

Central Coast locals often boast that Fall is one of the best times of year to enjoy all our area has to offer. The season brings smaller crowds at the beach, warm sunny days, a plethora of fun Festivals and the long-awaited harvest seasons at the wineries. But did you know it marks a great time for buyers and sellers and is actually the best time of year to move?

REASONS TO SELL IN THE FALL

REASON #1: SERIOUS BUYER POOL While there may not be as many buyers looking as in the spring housing market, serious buyers are looking to move before the holiday season. With fewer houses on the market, serious buyers will be motivated to make offers.

REASON #2: DIFFERENT BUYERS Spring and Summer are when families are likely to make moves, but for Millennials and Empty-Nesters Fall is the perfect time for these savvy shoppers. Not only is it less expensive to travel to new relocation destinations, but they also know they can avoid “high season” real-estate rates and moving costs.

REASON #3: LOWER HOME IMPROVEMENT COSTS Before selling, most homes will need some sprucing up and home repairs. Whether you are a do-it-yourself home repairer or you call in the experts, many times supplies go on-sale and Contractors have less work and may be willing to negotiate rates during the Fall months.

REASONS TO BUY IN THE FALL

REASON #1: LESS COMPETITION You will get much more attention from your ‘not as busy’ real estate agent allowing them to be more attentive to your needs. In addition, lenders, home inspectors, painters and movers can get to your needs much quicker.

REASON #2: TAX ADVANTAGES By closing on a new home before the year’s end you will be eligible for beneficial tax deductions. Deductible items can include closing costs, mortgage interest and property taxes. Even closing in December will allow you to deduct property taxes and interest from your entire year’s earnings.

REASON #3: YEAR-END SALES Whether you are redecorating to help sell your home or designing space in your new home, some of the best savings of the year can be found on appliances, electronics, and furniture. Competing retailers offer large discounts during the holiday season and it’s the perfect time to buy necessary items.

If you consider yourself a savvy shopper and the idea of saving time and money appeal to you, then now’s the time to buy or sell your home. Your C21 Hometown Realty, the hometown experts, can help you find your next dream home or get your home sold quickly. As the #1 broker on the Central Coast, C21 Hometown Realty has the most homes listed and the most homes sold! When you’re ready, visit one of the eleven local offices throughout the Central Coast or click on c21home.com.

Bysudoadmin
OnSeptember 25, 2019

sudoadmin
August 27, 2019

WHEN DOWNSIZING COULD MEAN LIVING THE DREAM

While owning your home is still the American Dream, the idea of living out the golden years in the same home has changed for many Empty Nesters. As you get older, downsizing or settling into a smaller home with a simpler lifestyle could be one definition of “living the dream.”

REVISIT HOUSING SITUATION

At least 37 percent of Baby Boomers said they plan to move at some point in their life and 42 percent of that number said they would prefer to live in a smaller home, according to a 2016 study released by the Demand Institute.

“Revisiting their housing situation is one of the first things new Empty Nesters should do” says Dana Anspach, founder and CEO of Sensible Money, an investment advisory firm.

While parents often have fond memories of their kids’ childhood home, she says, it makes sense to consider a move to less-expensive digs or to a locale or living situation that better fits their needs in the new phase of their lives.

There are, of course, savings to be gained by trading in a big home for a smaller space. Or moving to a less expensive part of the country. Another route: freeing up cash or replenishing your savings by paying off your mortgage before you officially retire from the workplace.

TIPS FOR DOWNSIZING

Declutter Your Home – You can finally tackle some major organizing projects. If you’re looking at the possibility of moving to a smaller home, your first step is to pare down your belongings. According to CityStash, 75 percent of those surveyed said the amount of things they own makes them reluctant to move. Don’t let that scare you off. Take one room, one closet, one square foot at a time.

Give Your Home a Facelift – Your furniture is a little worse for wear after having teenagers lounge on it, spill drinks on it and who knows where those extra spots came from. Also, you weren’t about to paint the walls until your kids were no longer touching them every day. But now’s the time. Refresh your home with new paint, new furniture or convert a kids bedroom to a hobby room.

House Hunt – When your current house has too many bedrooms or you hear an echo within the empty rooms, it may be time to start house hunting.

To ease the process, don’t focus on the memories of the old house but the endless possibilities in a new house. Start searching for a dream home that can give you desired options like a new location, first floor living, natural light, luxury touches, custom options and low maintenance.

If it’s time to start looking for new (smaller) digs, use C21 Hometown Realty, your hometown experts to find a top-selling real estate agent in your area. They’ll help you identify options that can turn downsizing into dream living.

Bysudoadmin
OnAugust 27, 2019

sudoadmin
June 25, 2019

CALIFORNIA DREAMIN’ FOR PROPERTY INVESTORS

The “California Housing Market Report and Predictions” article released by Gord Collins of Manage Casa, explored the key factors that will drive the California market for the years ahead. Below are key excerpts from the article.

CALIFORNIA DREAMIN’

California is a special place to live and rent, and to buy and sell a home. The market diversity is hard to comprehend. And the battle for homeowners hanging onto proposition 13 benefits is very different for young buyers who discover that renting an apartment is better.

It’s this dynamic pull of outrageous wealth and outrageous regulations that makes it hazardous to invest in real estate in this state. Definitely wise to hire a Realtor.

No other economy is as diverse and dynamic. It’s the opportunity that attracts millions of newcomers to live and start businesses here. Most tech startups for instance launch in the Bay Area despite the high cost. Employment and wages have grown and that has put pressure on the California housing market.

WHAT’S HAPPENING AND WHAT MAY HAPPEN

A few pundits believe the California housing market is well past peak. Yet economics, demographics, buyer demand (and last 2 months sales stats) seem to refute that notion. Millions of apartments need to be built in the next decade, a good portion, right here in CA to soothe in insatiable demand (housing crisis).

California’s economy grew 4.7% in the 12 months ended in February compared to the national rate of 2.8%. It could grow at a 2.55% pace in the next six months — faster than the national 1.59 – report from Mercury News.

With interest rates fears gone, and new trade deals with China, any negative economic aspects could disappear. That would mean fast rising prices again for the whole state.

KEY FACTORS IN CALIFORNIA’S HOUSING MARKET GROWTH

1. wages create prices pressure on housing
2. demographics – lots of millennials buying and babyboomers selling
3. interest rates – staying stable
4. migration – slowed to keep prices stable
5. cost of business – extremely high (would you like to see my San Francisco parking fee?)
6. home prices – wickedly high
7. rent vs buy – for most the idea of purchasing is a hopeless dream
8. multifamily new construction – picked up nicely but NIMBY’s still winning
9. taxation and tax savings – much better this year With taxes dropping, interest rates stable, wages rising, prices stable, mortgage requirements reasonable, and rising personal savings, why aren’t people buying? Simple, they’re hoping prices will plummet.

A HEALTHIER CALIFORNIA

There are more homes for sale and more buyers. After a strong lull, the upward march on California homes prices continues.

Zillow gives California an improved 9.6 out of 10 rating and a revised forecast of 7.6% price growth prediction for the next year.

“We’re seeing interest and money shift away from the overheated markets into less expensive secondary markets…Even if we see some markets overheat and demand softens slightly, that doesn’t mean prices will go down” — Javier Vivas, director of economic research at realtor.com.

To read the entire article addressing “California Housing Market Report and Predictions”: https://managecasa.com/articles/california-housing-market-report/

About CENTURY 21 Hometown Realty – Hometown Realty is the leading real estate firm on the central coast of California with offices spanning Santa Barbara County and San Luis Obispo county offering expert agents and convenient locations.

Bysudoadmin
OnJune 25, 2019

sudoadmin
October 17, 2013

Distressed Property in CCRMLS

The Central Coast Regional MLS spans multiple counties. It is mostly San Luis Obispo County and Northern Santa Barbara County. The nearest MLS to our south is Santa Barbara. The nearest MLS to our north is MLS Listings which spans Monterey to San Francisco.

The data below is a current snapshot of all homes in the CCRMLS region. Not just homes for sale, but every property on the tax roles. The data is calculated using something called an Automated Valuation Model or AVM. AVMs have been developed as tools that Mortgage companies (Banks) use to understand the default risk in their portfolio. There is no way that they can have an appraisal done on every home on a regular basis, so they use complex mathematics to create estimates. The AVM is a very important number for both home buyers and home sellers. Frankly, if there is a mortgage involved in the purchase, the AVM is the first tool used to evaluate the potential loan. Secondly, the bank will review the appraisal. This protects the bank from lending too much on a home and the buyer from paying too much. Sellers need to think about this in pricing a home. Even if you do get the highest possible offer from a buyer, the offer price may be too high to qualify for a loan. It happens a lot.

According to a report from Property Radar, in September, nearly one in four, or 1.5 million (22 percent) of California’s 6.8 million homeowners were underwater while more than 420,000 (6 percent) were barely above water (less than 10 percent equity in their homes).

This chart shows that in CCRMLS, the number is more like 2/3 of the properties are underwater, but most are not underwater by very much. 22% of the homes are on the bubble of + or – 10%. Given the accuracy of AVMs being what they are, you can be assured that there are an equal amount in the range of 10% above or below even equity that could go either way.

21% of the property is between -10% and -40%. This is the area of the market that qualifies for something we call a Short Sale. In most cases, the bank recognizes that both the home owner and the bank have a problem. Typically, a Century 21 Hometown REALTOR® can work with those sellers to get the bank to agree to market the property at current market values. 100% of the proceeds of the sale go to the bank and the homeowner walks away without owing any more on the home. There are some tax consequences that our Century 21 Hometown agents can explain.

That last group of properties that are more than 40% underwater is 4% of the market. That is what we usually consider the Foreclosure market. It does not mean that those properties are in Foreclosure, it just means that they probably should be. There are plenty of homeowners who pay back underwater loans.

If you do not know where your property value ranks in comparison to market value, contact any Century 21 Hometown agent. We can provide you with the AVM for your property, or we can do a full analysis by visiting your home. In today’s market, there are more buyers than sellers, so property values are going up. It is a great time to list your home for sale with Century 21 Hometown.

Bysudoadmin
OnOctober 17, 2013

sudoadmin
July 20, 2012

San Luis Obispo Tribune honors Hometown Realty

Century 21 Hometown Realty is a humble company by nature. Like all people and companies we enjoy accolades, and we appreciate the opportunity to express our gratitude to the customers, managers, staff, and our sales associates that all contribute to our business success. As every homeowner knows all too well, the past three years have been brutal to housing. Families have lost homes. Real Estate brokerages have failed. Lenders have faced government intervention. Everyone has felt economic woe in some way and it is heart wrenching.

When the housing market crashed, our company recognized that to stay vibrant, we needed to accomplish two key strategic goals. The first goal was expansion. We recognized that we needed to diversify our market service areas. Through acquisition and new offices, we now offer 13 locations along the central coast and in Bakersfield. Our agent count expanded from 100 to 300. The second goal was to focus on delivering a wider range of home services to our customers. Hometown Realty is more than a residential real estate company today. We offer our customers access to world class services in commercial real estate, relocation, property management, and have established joint ventures to mortgage and housing related financial services. We are blessed to have so much support from our community in reaching these goals.

Hometown Realty is a Century 21 franchise. Century 21 is largest real estate franchise in the world and is operated by REALOGY, a company that operates franchises for Coldwell Banker, Century 21, Sotheby’s, Better Homes and Gardens Real Estate, and ERA. This year, Century 21 recognized our company as the fastest growing real estate company in the world out of 7500 brokerages. In the past 3 years, the company has become one of the 500 largest brokerages in America across all franchise and independent brands.

We sincerely appreciate the San Luis Obsipo Tribunes’ article about our company which follows below.

A local Century 21 franchise has grown to 13 offices from two in less than three years, earning an award from its parent company for being the fastest growing franchise in the firm’s nationwide system.

Because Century 21 Hometown Realty was a break-even company in 2008, said CEO and Grover Beach resident Jack Hardy, “what we needed to do to survive was attack the market.”

So Hometown Realty, which at the time had offices in Arroyo Grande and Pismo Beach, approached other distressed real estate companies with offers to buy them, pare down the operations and take advantage of economies of scale, Hardy said.

In the process, Hometown Realty acquired Re/Max Ocean West with offices in Pismo Beach and Santa Maria, and South County Realty with two offices in Arroyo Grande.

It also bought other Century 21 franchises, including San Luis Properties in San Luis Obispo and Los Osos; Advantage with an office in Lompoc and two in Santa Maria; and Your Professional Choice in Atascadero.

In 2011, it opened an office in Paso Robles.

Hometown Realty has grown revenue 100 percent and earnings by 200 percent since beginning acquisitions, and is looking at buying realty companies in Ventura and Bakersfield.

Hometown Realty is owned by five partners on the Central Coast and Bakersfield, and has 300 real estate agents.

Century 21 is an international company with more than 7,500 independently owned and operated franchised brokerages in 71 countries and territories.

Bysudoadmin
OnJuly 20, 2012

sudoadmin
June 7, 2012

Credit Scores for Home Loans

If you are planning to finance or refinance your home, you need to understand a thing or two about what is happening in the mortgage universe. As you may already know, the mortgage industry had very low standards for consumer credit ratings and home loan downpayments a few years ago. The story on the street was that if you had a pulse, you could get a home loan with no money down. This was not totally true, but suffice it to say that lending standards were pretty low. Mortgage companies would write a loan with a consumer, then bundle that loan together with other loans and sell them to investors. Clearly, that policy did not work. Consumers began to default on their loans at an alarming rate and the financial mortgage industry collapsed around those defaults.

To help, the Bush Administration and the Obama Administration bailed out the banks. Many of the home loans in America are backed by the Federal Housing Administration, a division of the Department of . FHA insures the loans. Since the passing of the Frank-Dodd legislation, standards for home mortgages have increased as mandated by law. Among those standards are requirements for FHA backed loans and standards for Government Sponsored Entities like Fannie Mae and Freddy Mac.

The first new standard is that consumers should anticipate putting 20% down. You can put less down, but that puts you into a higher risk type of mortgage and you will likely pay a higher rate.

The second new standard is that consumers should Only

Base loan limits must be below $417,000

Max Seller Contribution 3%

No lates on housing payment in the last 12 months

No Property Flips

You may not understand all of these terms and conditions. Century 21 Hometown Agents can explain them to you, and/or set up a call or meeting with PrimeLending. PrimeLending representatives are in Century 21 Hometown office every day.

Bysudoadmin
OnJune 7, 2012

sudoadmin
May 1, 2012

Your Fair Credit Rights

We’ve all heard that many things in life are not fair. But the process of qualifying for a mortgage shouldn’t be one of them. That doesn’t mean you necessarily get the loan you apply for. It does mean that you have the right to be judged on your financial stability and credit history rather than on biases. Two federal laws, theEqual Credit Opportunity Act and the Fair Housing Act, prohibit lenders from considering irrelevant information, such as race or gender. And, these laws provide recourse if you suspect lenders have run afoul of the law in rejecting your application. If the Department of Justice suspects housing discrimination, an investigation may be filed under either or both of these laws. The Equal Credit Opportunity Act (ECOA) was originally signed into law in 1974. It prohibits discrimination in any credit transaction, including mortgages, based on:

race or color
religion
national origin
sex
marital status
age (provided the applicant is legally able to form a contract)
income from public assistance programs
the applicant’s good faith exercise of any right granted under the Consumer Credit Protection Act, which is the umbrella statute that includes the ECOA.

The Fair Housing Act (FHA) was initially passed in 1968. It is also called Title VIII of the Civil Rights Act, and makes it unlawful to discriminate in residential real estate transactions, including buying, selling, improving, or renting a housing unit. This law prohibits discrimination on bases similar to the ECOA. When the FHA was first signed into law it was specifically to prevent unfair practices based on race or skin color. Although the law also covers other bases for discrimination, nearly four decades after its passage, the majority of FHA violations reported to the Department of Fair Housing still involve race and color.

Municipalities have also been charged with violating the FHA by rejecting building permits or by passing zoning regulations, which result in physical separation of residents by race, color. The FHA also bars direct discrimination based on religion, as well as indirect discrimination such as zoning ordinances designed to prevent the use of private homes as places of worship. In today’s housing market, a rising number of single women are homeowners. Not too many years ago, it was hard for women to get mortgages alone because lenders saw them as financially risky. But the Fair Housing Act makes it unlawful to base a decision not to sell housing because of an applicant’s gender.

Discrimination based on an individual’s country of birth, or the country of birth of his ancestors, is also prohibited by the FHA. The Justice Department has taken action against some municipalities which have set up more stringent standards for certain groups to buy or build houses, as a covert way to limit the growth of those populations.

Having children under the age of 18 is not a lawful premise for refusing to approve a mortgage, according to the FHA. However, certain housing facilities may be designated as restricted to those ages 55 and over, under the Housing for Older Persons Act, an amendment to the FHA.

Discrimination based on disability is illegal in all types of housing transactions. This includes physical and mental disabilities, as well as a growing list of specific conditions. For example, according to the U.S. Department of Justice, disability may include conditions such as blindness, hearing impairment, mobility impairment, HIV infection, mental retardation, alcoholism, drug addiction, chronic fatigue, learning disability, head injury, and mental illness. However, the Justice Department adds that “current users of illegal controlled substances, persons convicted for illegal manufacture or distribution of a controlled substance, sex offenders, and juvenile offenders are not considered disabled under the Fair Housing Act, by virtue of that status.” The FHA prevents the use of zoning laws to hinder the residential choices of the disabled. It also demands that new multi-family construction meet the accessibility requirements within the law.

If your income includes public Social Security, pensions, annuities, child support, payments under a separate maintenance agreement, reliable alimony, or public assistance, a lender cannot refuse to include those items in your income calculations. In the case of alimony, lenders do have the right to ask you to prove that the payments are consistent. Lenders can’t require that a co-signor be your spouse. They also cannot require a co-signor if you otherwise meet the standards.

Lenders cannot discourage you from applying for a mortgage or reject your application on any of the bases prohibited by the Equal Credit Opportunity Act. They can however, determine your immigration status and your right to remain in the country long enough to repay the debt.

Lenders also cannot refuse a mortgage because of the racial makeup of the neighborhood an applicant wishes to live in. It is unlawful to ask about plans to have children or expand a family. However, lenders do have the right to ask about expenses relating to current dependents.

Your Century 21 Hometown Realty agent can answer any questions that you may have about your fair rights in applying for a mortgage. Additionally, loan officers at Prime Lending are available to help you with your application.

Bysudoadmin
OnMay 1, 2012