The Process of Getting a Loan

Once all the required documentation has been gathered, the loan officer will submit your loan application to underwriting. Underwriting is the process of reviewing all of the information and making a decision as to whether a borrower qualifies for a loan. Underwriters evaluate your ability to repay the loan (income), your repayment history (credit) and the value of the property that you've identified (collateral). The lender will make every effort to help qualified borrowers achieve their home financing goals.

In deciding whether to approve a loan, the underwriter reviews the following information:

Loan application. The information provided on your application helps the lender answer basic questions such as:

• What is the source of your income, and is the source stable?
• Is your income adequate to cover the expense of the new mortgage payment?
• How much long-term debt (debt that will not be paid within the next ten months) do you have?
• Are there enough assets to cover the down payment, closing costs and other expenses?

Credit history. Your credit history helps lenders evaluate your ability to manage debt. It reflects how repayment of your bills has been handled in the past.

Property appraisal. An appraisal provides an estimate of the market value of the home and is based on similar homes sold in the neighborhood. Lenders usually grant up to a certain percentage of the property's value in a mortgage loan. This percentage is called the loan-to-value (LTV) ratio. The rest of the property value is covered by your down payment.

What are sellers in Huntersville getting for there homes?

November 11, 2009

By Terri Latta

Latta Realty, Inc.

Almost every day someone ask me what sellers are getting for their homes.  I love that question because it is important to both buyers and sellers.

Buyers need this information to help them better understand what to offer for the home they want to buy.  Sellers need this same information to help them estimate the net figure they will receive after negotiating an offer.

The answer unfortunately is “it depends”.  It is something you have to keep a close eye on in a shifting market, like the one in which we currently live.

It also depends on supply and demand.  Right now, in most areas, the demand is at a lower price point because there are more buyers in that price range.

Suprisingly, when we compare the market in 2006, MLS reports the average list price for Huntersville (1/1/06 – 11/11/06) at $270,434 with average days on the market at 62.  1187 single family homes sold.

For the same time frame in 2007, MLS reports the average list price at $279,413 with 64 average days on the market.  1073 single family homes sold.

For the same time frame in 2008, MLS reports the average list price at $284,812 with 88 average days on the market.  701 single family homes sold.

For the same time frame in 2009, MLS reports the average list price at $256,867 with 110 days on the market.  529 single family homes sold.

So we see about half the homes have sold this year that sold in 2006, at about 5% less.

Here is the sales data for single family homes in Huntersville year to date:

□                   406 homes below $300,000 . . .. .  96% of asking price . . . . 100 DOM

□                   110 homes $300,000-500,000 . . .  95.5% of asking price . . .128 DOM

□                   5 homes $500,000-700,000 . . . .    92.5% of asking price . . . 237 DOM

□                   6 homes 500,000-1 million . . . . .    92% of asking price . . . .  271

□                   2 homes over 1 million . . . . . . . .    95.4% of asking price . . . 195

I hope this gives you some insight into why there is no easy answer.  If you have any questions, please email me at terrilatta@bellsouth.net.  Also, I encourage you to post a comment on thi

Home Buyer Tax Credit Extended and Expanded

Duplicated from Keller Williams Realty website

Wow!  Have you seen the Home Valuation Code of Conduct?  It essentially regulates the way appraisals are assigned on Fannie Mae and Freddie Mac's conforming loans.  Many believe it was ill conceived and poorly implemented.

It seems not only are consumers suffering, but so are real estate practitioners and appraisers.

We did need revisions, but this one is baffling many of us.

Many lenders are using appraiser management companies.  We are seeing out of area appraisers who are not familiar with "our area" and not giving fair value to homes.  This hurts both buyer and seller.

Some lenders are still using the same appraisers.  They are not allowed to know which particular appraiser will be preforming the appraisal, but at least they know they are familiar with the neighborhood.

Before you commit to a lender, ask your real estate broker to check this out.  The pendulum could swing either way.

Has the market stabilized?

That is the question everyone is asking these days.  Here is the answer for Davidson.

The listing price has remained fairly stable.  For the past six months the average list price has been $510,382 with an average of 3000 square feet.

The sale price in Davidson for January was $523,177.  Average square footage was 3290 and the average days on market was 117.  5 sales.

The sale price in Davidson for February was $375,192. Average square footage was 2909 and the average days on market was 68.  6 sales.

The sale price in Davidson for March was $419,638.  Average square footage was 3093 and the average days on market was 89.  12 sales.

The sale price in Davidson for April was $543,928.  Average square footage was 3110 and average days on market was 100.  7 sales.

The sale price in Davidson for May was $514,003.  Average square footage was 3175 and average days on market was 211.  11 sales.

The sale price in Davidson for June was $578,000.  Average square footage was 3573 and average days on market was 144.  8 sales.

The sale price in Davidson for July was $479,272.  Average square footage was 2917 and average days on market was 138.  11 sales.

The sale price in Davidson for August was $365,391.  Average square footage was 2804 and average days on market was 152.  12 sales

I did not include homes that were in the Davidson Housing Coalition.  They are restricted sales and not true comparables.

Here’s the good news for Davidson:   There are currently 14 homes  under contract.  The average list price is $444,138.  We will not have the sales price until they close.

The average list to sale differential for the past six months has held at 95%.

Thought you might like a quick update from the National Association of Realtors.

The smallest drops in price since the plateau in real estate prices have been in Charlotte, North Carolina, and Omaha, Nebraska, which dropped only about 3%, while Phoenix has almost halved in value since 2007. It is worth noting that those cities whose values have dropped very little were not victims of the original run-up in prices. Cities where values have dropped precipitously also saw double housing inflation between 2003 and 2007.

Nonetheless, the million dollar homes in virtually every city in the nation are selling at large discounts and are remaining on the market for far longer than they did 2 years ago. An overwhelming reason for this drop in purchases is that jumbo mortgages (in amounts of more than $417,000) have become more expensive to carry and harder to fund. Also, many former millionaires have been affected by the economic crisis and have determined to purchase homes that serve as shelters, rather than as showcases.

Thank you,

Terri Latta

www.LakeNormansBestHomes.com

Everybody is very cautious now when it comes to buying a home.  Especially the first home.  You should be cautious and have your agent give you lots of statistics.  But, beware of paralysis by analysis.

Your real estate broker can help you interpret the data.  I love for the buyers I represent to have a firm grasp on the market.

Keep in mind that interest rates now are similar to the 1950's - low.  I haven't been helping buyers quite that long - lol.  But, during the past 20 years this is the best I have seen.

If it is your first home, take advantage of the $8,000 tax credit (you actually do get it back - ask your accountant just exactly how it will benefit you).

Think about it this way. If you buy while the interest rates are below 5% instead of waiting until they reach 7.5% (which we thought was great in the 90's), prices would have to go down by another twenty percent to make up for the difference in your monthly payment.  Many analysist believe the real estate market is now beginning to stabalize - which would mean we are no longer declining and that great deal is now!

Email me if you have questions.  terrilatta@bellsouth.net

• 12 homes below $300,000. . . . . . .  96% of asking price. . . .  121 days on market
• 6 homes $300,000-500,000 . . . . .   94% of asking price . . . . 167 days on market
• 6 homes $500,000-700,000 . . . . . .100% of asking price . . . .235 days on market
• 6 homes $700,000- 1,000,000 . . . 109% of asking price . . . .294 days on market
• 1 home Over $1,000,000 . . . . . . .   85% of asking price . . . . 360 days on Market

• 12 homes below $300,000. . . . . . .  94% of asking price. . . .  103 days on market
• 6 homes $300,000-500,000 . . . . . 95% of asking price . . . . 150 days on market
• 6 homes $500,000-700,000 . . . . . .98% of asking price . . . . .141 days on market
• 6 homes $700,000- 1,000,000 . . . 100% of asking price . . . .  51 days on market
• 1 home Over $1,000,000 . . . . . . .   93% of asking price . . . . 276 days on Market