Regardless of your profession, if you enjoy working for yourself and want to achieve the American dream of homeownership, use the following tips to when applying for a mortgage:Clean up your Finances
Banks that offer mortgages to self employed consumers will highly scrutinize business financials. This means that your personal and business accounts must be separate and that you’ll need to minimize the amount of deductions you take over the course of 12 months prior to your application.
Make sure you’ve kept good financial records that are ready to be presented to the mortgage broker.
Apply for an Alternative Loan
Standard mortgages are often hard to come by for the self employed millennial, which is why some banks are offering alternative financing.
Similar to the “no doc” loans of a decade ago, alternative loans use different income verification methods for the self employed. This process involves examining 12 months worth of bank statements against the profit and loss statements for the same time period. A cash flow analysis is created to determine suitability for obtaining a mortgage.
The Basics that You’ll Need
Like any other buyer, self employed individuals will need to provide specific requirements to the bank during the mortgage approval process. Those can include:
- Bank statements - Both personal and business, bank statements will show that you have the necessary funds to pay the down payment and initial monthly payment.
- Profit and Loss statement - A profit and loss statement is essential to creating an analysis for mortgage approval.
- Proof of business formation - If your business is formed as an LLC or corporation, you’ll need to provide proof as well.
- Solid credit history - In most cases, self employed consumers will need a credit score of at least 680 to qualify for a mortgage.
- Sizable down payment - Banks often consider self employed people more of a risk for mortgage lending and they’ll require a down payment of around 20 percent.
While obtaining a mortgage as a self employed millennial is difficult, it isn’t impossible. The right amount of research combined with careful planning and record keeping will help make the process much easier.
In the last year or so, Seattle has become a tight seller’s market with a low inventory and a common occurrence of multiple offers per house for sale. Many buyers have described it as an all-out war trying to buy the house they want. Owners who waited out the housing recession are more than willing to engage in a bidding war in an attempt to get the highest offer.
The following are some good real estate tips for both buyers and sellers in the Seattle market. These real estate tips can also be applied to many of the surrounding real estate markets like Tukwila, Renton, Sea-Tac, Burien and more.
1.Decide what you can compromise on. Of the three big factors: condition, location and size, which one isn’t as important as the other two? In most cases, you’ll need to compromise on one of them.
2.Understand what you can actually afford in this market. Because the real estate market is so tough in these areas, agents and sellers look at every detail of competing offers, and larger down payments often win out as many houses are unlikely to appraise at the price being offered.
3.Be patient and don’t give up too soon. Losing the house you thought was perfect can be a crushing disappointment at the time, but it’s important to keep looking. During the time you’re looking, you can also save extra cash for a bigger down payment.
4.Find out what the seller wants. Knowing what constitutes the perfect offer to a seller can be half the battle. In a seller’s market, the buyer cannot make too many demands on an offer and expect to win the house if there are multiples. In some cases, it’s simply the highest, in others, the most cash, and sometimes they just want a quick closing.
1.Price your house competitively. Most properties in this market are getting multiple offers, but if you price your house too high to start, you may not get the right bites.
2. Be clear about what you want and where you won’t compromise. If you need a quick closing or the ability to rent the house for two months from the buyer, make sure to have this communicated so you can get an offer that meets your conditions.
Listings dropped by 10 percent in Seattle’s market in 2016, but demand remained high and is expected to increase in 2017.
When you’re a homeowner, you want to increase the value of your property as much as possible. Although you may not be moving in the near future, the value can be slowly improved over the years. Take a close look at how you can increase your home’s real estate value by mixing in both low-cost and investment options.
Swapping Out Fixtures
Unique real estate tips often involve clever ways to update a space without a large investment. Swapping out fixtures, such as lamps and electrical switches, are quick ways to increase the home’s value. This same concept applies to the kitchen too. Add new handles to cabinet doors and change the sink faucet. Although every other item in the area may be vintage, prospective buyers will only focus on the bright and new additions.
Refine the Landscape
The front yard is the first property space that’s seen by buyers. Trim the grass, plant a tree or start a flower garden. There are countless accents that you can add to a landscape as long as they remain neat. In addition, maintain a native look by choosing plants that only belong in the region. Trying out a desert landscape in a snowy region will only fail as the seasons change.
Install a Cool Roof
An investment that really impacts the home’s market value is a new roof. A typical rooftop lasts about 20 or 30 years. If your home is nearing that time frame, add a cool roof to the structure. Along with improving the home’s aesthetics, a cool roof also offers better energy efficiency. Your real estate investment will stay cooler in the summer while retaining warmth in the winter.
Extend the Living-Room Space
Smart, real estate tips include the perception of size. You want the home to look large, but the square footage may be lacking. Add an exterior deck just outside of the living room’s sliding glass door. With the curtains or blinds wide open, the living room seems to expand as you move between the interior and exterior.
In the past, homeowners often added a room onto the structure in hopes of increasing market value exponentially. This renovation idea doesn’t always offer the best return for your dollar. Remodeling an attic or basement will usually give you a better value for the investment. Pick and choose projects through the years that please you, and prospective buyers will be thrilled to benefit from them in the future.
With the entire process of buying and selling a new home can be quite stressful in general, today’s fast-moving real estate market only adds an additional layer of pressure to both you and your family. Regardless of the state, county, or town you are looking into, there are useful ways to avoid pressure that may cause emotional or mental stress.
Millions of families across the country who are buying or selling their homes are experiencing the same sentiments and frustrations as you are. Below are some methods to alleviate stress and maximize efficiency during this huge life stage.
If you are a buyer in this market, you need to move fast after the home is sold and the new homeowner moves in. Working with a realtor will not only help you figure out what you want, but also how you can access information on a regular basis. Real estate agents are also great with regard to filtering through info related to property history, tax records, and other resources you may not of previously.
In the seller position, you need to have everything prepared before you actually move to your new home. Removing all unnecessary items, decluttering, and consolidating all your possessions in different areas. If you’re family lives in neighboring towns, it may be a good idea to stay with them if there is a time gap between moving out of your home and settling in the new one.
A challenging aspect of navigating the residential real estate market is undergoing inspections, the resolution process, and most of all, competing in offer situations across the board. Sellers should understand that hiring a realtor can help manage the buyer’s expectations, while also saving you money, time and energy during a process that can be fairly complicated without the right professional by your side.
Preparing in all the best ways possible will both ease your mind and wallet as you move from different stages of the homebuying process. It is also important to be completely upfront with your real estate agent through every stage so they can most effectively manage your price expectations, concerns, or other specificities you are looking for.
While exciting, it can no doubt be overwhelming when individuals, families or couples are on the market looking for a new home. Amidst all the meetings with real estate agents and open houses, there comes a time when it is necessary to sit down, gather your thoughts, and set a solid plan to move forward in this process.
Speaking with a professional
The first tip is to remember that you are not alone through this process. Keeping in contact and working with a real estate agent will help you organize your thoughts during this journey. Using the professional resources around you will help you gear your search towards long-term success.
Clear your mind
As you see homes you may a long list of features you would like to have in your new home. However, if you like to live in an area that is generally family friendly with a great school system, it may be really difficult to find your dream house with everything you want. Opening your mind to become more flexible when looking for a new home is essential instead of becoming disappointed if certain features are not incorporated.
One way to get a great idea to see how much you can afford to put towards a home is to evaluate how comfortable you are spending outside your budget. Just to better understand the situation, be sure to start small and purchase a small home. This way, if your partner happens to lose his or her job, you can avoid spending money beyond your means.
Take your time
Try to focus on the task at hand and avoid letting the excitement overtake you during the process. Take the time to weigh out all the advantages, disadvantages and areas of improvement in every home you look at. Basically, organize your thoughts you have about each house so you can consider all your options.
Preparing for the long hall
Figuring out how you will pay your expenses (either upfront or within your loan) will reduce any nervousness or anxiety you may have. Having some extra money on the side that factors in extra expenses such as moving costs, additional future you may need, and other micro-investments that could arise are ideal ways to prepare for anything unexpected.
Using these tips to the best of your ability will ease this strenuous process both at the day to day and higher levels.