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Loan officers and mortgage brokers may have their own criteria, but you can generally expect to provide these papers.

If anything about refinancing your mortgage might be described as “fun,” it would have to be locking in your new lower interest rate. But once that’s done, you’ll have to deal with the decidedly not-fun part of gathering all the documentation you’ll need to support your refinance loan application.

To get started and stay organized, it helps to have a checklist of which documents you’ll need. While each loan officer or mortgage broker might have his own specific checklist, here’s a look at what you can generally expect:

Photo ID: Typically a driver’s license or passport, this document is used to confirm your name, identity and home address.

Pay stubs: You’ll need to produce your pay stubs from at least the past 30 days. If you don’t have your pay stubs, ask your employer’s payroll or personnel department to give you these documents, which must show your name, the name of your employer and your total year-to-date earnings, says Joe Metzler, mortgage specialist at Mortgages Unlimited in St. Paul, Minn.

Asset statements: Gather monthly or quarterly statements from your various asset accounts from the past two to three months. Asset accounts include checking, savings, investment and retirement-plan funds.

If you don’t have your statements handy, you can print them from most financial institutions’ websites, Metzler says. Each statement must include your name, the name of your financial institution and the beginning and ending account balances. A printout of your current transactions “usually does not work” for loan application purposes, Metzler warns. Rather, a true statement is required.

Documentation of deposits: You’ll need documentation that shows the source of any deposit of more than a nominal sum, other than payroll.

This relatively new requirement helps the lender figure out whether you have enough money from allowable sources for closing costs and reserves, says Joe Parsons, senior loan officer at PFS Funding, a mortgage company in Dublin, Calif.

W-2 tax forms for the past two years: If you’re self-employed, earn commission or tip income or own rental property, you’re going to need to produce federal income tax returns for the past two years. Self-employed borrowers might also be required to supply a K-1 tax form, which shows your percentage of ownership of your company. If you’re a substantial owner, you’ll also be asked to supply the company’s tax returns for the past two years.

If you don’t have your tax documents, ask your tax preparer to provide them to you or get copies from the IRS. Be sure to include all the pages and schedules, including the signature page.

A copy of your most recent mortgage statement.

A copy of the original promissory note for your existing mortgage: This relatively new requirement helps lenders ensure that your refinance will offer a legitimate benefit, Parsons says.

“They can look at the mortgage statement, but most lenders want to see the promissory note, too,” he says. “It’s not a big deal, but it adds more time to the process.” If you don’t have these documents, call your loan servicer and request copies of them.

Phone bill: A copy of a recent home or cellphone bill, showing your name and address.

Some lenders have added this requirement to find out whether you occupy your home as your principal residence, says Kirk Chivas, chief operating officer at First Commerce Financial in Wixom, Mich.

Divorce decree: If you got divorced within the past two years or want to use the alimony or child support you receive toward qualifying income, you’ll need to present a copy of your divorce decree.

Proof of attendance: If you’re a first-time homebuyer who has taken advantage of some state or county homebuyer assistance programs, you are required to attend first-time homebuyer education classes. You must show proof of your attendance.

You’ll probably notice that this list is “significantly more comprehensive than it was even a year ago,” Chivas says. Still, the requirements can be met if you keep track of what you need and what you’ve already supplied.

One final tip: Be sure to submit only complete and legible documents. Also, when your lender asks for multiple documents, submit all of them at once. This way, it’s easier to keep track of what you have and haven’t provided your lender.

 

 

Compliments of: Martha Small | Austin Portfolio Real Estate | 512.587.0308

Original Article by: Marcie Geffner of HSH.com

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Open House this SUNDAY, January 20th from 2:00 – 4:00 PM

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The Consumer Financial Protection Bureau has issued new guidelines for home mortgages. The rules require income verification, but don’t specify a minimum down payment.

After months of discussion, the Consumer Financial Protection Bureau has come out with rules it says will help protect consumers from toxic mortgages.

The new “Ability to Repay” rule is designed to make lenders determine that borrowers can actually pay back their mortgages. Lenders whose loans follow the guidelines for what is called a “Qualified Mortgage” are protected against certain lawsuits. While lenders can issue mortgages outside the rules, they won’t have the same legal protections.

The rules don’t include any guidelines about the size of a down payment. There had been much speculation during the two years that the rule was under discussion that a qualified mortgage would include a 20% down payment. That didn’t happen, though the CFPB is planning to issue more rules on mortgages later.

The new rules essentially end the no-doc and low-doc “liar loans,” in which customers did not have to document their income. The rules also limit borrowers’ debt-to-income ratio to 43% in most cases. Interest-only and negative amortization loans don’t qualify, and the qualified mortgages will limit fees.

Whether the rules will do anything to make loans more available is a big question. In general, the standards are similar to those lenders are using on their own now.

The rules will take effect in January 2014. You can read them here and see an analysis by the Center for Responsible Lending here. The Wall Street Journal has a Q&A.

The housing industry and consumer advocates generally praised the new rules.

“The Consumer Financial Protection Bureau’s new rules generally strike a balanced, reasonable approach to mortgage lending and implement important consumer protections,” the Center for Responsible Lending wrote in a news release. “The standard CFPB establishes for a safe, well-underwritten mortgage is appropriately broad enough to include the vast majority of creditworthy homeowners, and  it is clear enough for lenders and borrowers alike to understand. And the rules preserve legal protection for borrowers with the riskiest loans.”

Barry Rutenberg, chairman of the National Association of Home Builders, said in a statement that his organization “is encouraged that regulators heeded concerns from the housing industry to craft a broad standard that includes many of today’s sound mortgage products, including fixed-rate and adjustable-rate mortgages, under the QM standard.”

The new rules were required by the 2010 Dodd‐Frank Wall Street Reform and Consumer Protection Act, which called for restricting mortgages to people who had the ability to pay them back – something that wasn’t a concern during the heady days of the real-estate boom.

“In the run-up to the financial crisis, we had a housing market that was reckless about lending money,” CFPB Director Richard Cordray wrote on the agency’s blog. “Lenders thought they could make money on a loan even if the consumer could not pay back that loan, either by banking on rising housing prices or by offloading the mortgage into the secondary market. This encouraged broad indifference to the ability of many consumers to repay loans, which dramatically increased mortgage delinquencies and rates of foreclosures.”

Compliments of: Martha Small | Austin Portfolio Real Estate | 512.587.0308

Original Article by: Teresa at MSN Real Estate

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Winter gardening makes for a much sweeter spring. Here are the best ways to protect plants from the cold — inside or out.

 

Gardening, in January? Absolutely.

There are still lots of things you can plant, and you can start the new year on the right foot by doing timeless chores that will add to your garden’s health as spring approaches

Everything you accomplish now will make spring that much sweeter.

Trees and shrubs
This month’s tree and shrub tasks are all about planting, pruning and protecting.

  • If you live in a place that has mild winters, you can still plant trees of all kinds: fruit trees, shade trees and flowering trees; and choosing them is fun now, since nurseries tend to add their new selections in January.
  • On a day when temperatures are below freezing, plant new evergreens, rose bushes and deciduous shrubs.
  • While you shouldn’t prune flowering trees until after they’ve bloomed, you can now prune most shrubs and deciduous shade trees.
  • When you notice new buds on deciduous trees, possibly late this month or in early February, give them their third and last shot of dormant spray — follow the label’s instructions and avoid spraying on days that are windy, rainy or below freezing.
  • Keep up with raking; fallen leaves can do heavy damage if left to smother grass.
  • If you have snowfall, knock snow off the branches of evergreens and fine-branched deciduous trees using an upward motion to keep limbs from breaking — don’t risk the benign fluffy stuff turning into ice overnight. If breakage does occur, prune broken branches.

Winterizing
With winter in full force, there are several things you can do to protect challenged plants, trees, shrubs and even birds.

Don’t haul that Christmas tree out to the curb just yet: Its branches can be used to protect tender plants and even root vegetables and perennials or to form a wind or sun shield for shrubs such as azaleas, rhododendrons, holly and boxwood. Or the full tree can be staked near a feeder to shield birds from cold. (Place far enough away to avoid accidents with cats.)

If you live in an area that has heavy winters and you haven’t yet wrapped newly planted trees or thin-barked trees such as maple, ash, mountain ash and linden, do so now. Wrap from the base upward to repel moisture.

Keep protecting tender plants against freezes by covering them with burlap or other cloth supported by a perimeter of stakes; just don’t let the cloth touch the leafy parts.

Houseplants
Winter houseplant care is more about attentive restraint than high maintenance.

  • When you water, which should be minimal during the winter, do it just enough so that water saturates the soil and comes through the drainage holes; at this time of year, plants left in standing water can suffer root damage.
  • Turn plants every two weeks for balanced foliage as they seek sunlight.
  • Check for pests in the greenhouse and on houseplants; treat with organic products so kids and pets aren’t endangered.
  • Hold off on transplanting those plants whose roots are potbound.
  • On nights that are extremely cold, be sure to draw the curtains or blinds of plant windows.

Wouldn’t it be nice if birds ate slugs for a living? If you’re a feeder of birds, don’t stop now — during this month they’ll need all the help they can get, and it needn’t be fancy. Birds will likely find any station above snow level, from old logs to carpet scraps.

Every slug you catch before it reproduces can spare you from facing several more generations. (And you thought rabbits were prolific.)

Maintenance
Take this chance to get sleek for spring. No, not to buff up for your getaway swimwear — you know, the fun stuff. Machines. Tools.

  • Any machine repair you have done now will spare you spring headaches — or at least a long wait in the queue that begins to form in February. Consider mowers, chain saws and other power tools.
  • Clean, sharpen and oil hand tools, from clippers to shovels.

Perennials
Even after the holidays, the catalog season continues.

  • Start planning your spring garden now by making a map of your garden, including what you’d like to plant where, with seed and bulb catalogs by your side for inspiration.
  • Clear away mulch from winter-blooming bulbs.
  • Dig up and divide winter-blooming bulbs after they’ve flowered.
  • In mild climates, you may still be able to plant hyacinths, tulips, daffodils and crocuses.
  • If an unexpected warm streak fools bulbs into thinking it’s springtime, help protect them with an extra light layer of mulch.

Weeding
It’s a nasty job, but unless your garden is buried under snow, somebody has to do it. Too bad weeds don’t take winter vacations.

  • Many weeds are still merrily going through their flowering and seeding cycle even in January. Uproot them before seeds spread to spare yourself weeding future generations.

Compliments of: Martha Small | Austin Portfolio Real Estate | 512.587.0308

Original Article by: Sally Anderson of MSN Real Estate

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While the price of food and other essentials continues to climb, some costs are bucking the trend.

 

As the economy recovers, rising prices can seem inevitable. But they’re not universal.

Experts say some items and expenses are bucking the trend, and may actually be cheaper in the new year. In some cases, the drop is due to evolving technology and increased competition. In others, shoppers are making choices that may result in lower bills — without leaving them feeling deprived.

In particular, the cost of these four essentials may seem less daunting in 2013:

Automobiles

Used-car values have been on an upswing in recent years, with lower supply from fewer leases and inventory cleared out by 2009’s federal Cash for Clunkers program.

But after peaking in 2011, used-car prices have begun to ebb again. “Consumers shopping for a used car will find that pricing will be more affordable in 2013 than in 2012,” says Alec Gutierrez, senior market analyst for Kelley Blue Book.

He expects prices to be 1% to 2% lower by the first quarter, and 3% to 4% lower by the end of 2013. Many cars in the new used-car supply will be recent off-lease returns.

Drivers in the market for a new car may also see some savings, although that opportunity is more about the ability to downsize than falling prices. Compacts and subcompacts in the $25,000-and-under category are getting more features typically found in full-size and luxury cars, Gutierrez says.

“That’s part of what’s been driving additional sales in the smaller-car segments,” he says. The category also includes a few hybrids, such as the popular $20,000 Toyota Prius C.

Cable television

The cable bill itself isn’t getting any cheaper. Prices for expanded basic service rose 5.4% in 2011 from the year before, according to the Federal Communications Commission. But there may be less need to pony up for a subscription.

Talk of cord-cutting — ditching paid television subscriptions in favor of a combination of free and inexpensive streaming options — has been on the rise in recent quarters, as providers like Netflix and Amazon.com gain more partnerships to stream movies and television shows. During the third quarter of 2012, providers lost an estimated 127,000 subscribers, according to reports from research firm Sanford C. Bernstein, after losing 400,000 in the second quarter.

But experts say the trend isn’t yet an option for everyone. Live sports aren’t always available for streaming, nor are many TV shows — especially those on premium channels.

Flat-screen TVs

It has become cheaper and easier for manufacturers to make large flat-screens, which has steadily pushed set prices down.

Average prices for 32-inch sets have dropped nearly 50% since 2010, from $600 to just below the $300 mark, says Mike Fridgen, the chief executive of price-comparison site Decide.com.

Fewer consumers are in the market for a new TV, and the competition among manufacturers and retailers is likely to fuel further drops, he says. Global demand for new TV sets fell 4% this year and is expected to stay flat for 2013, according to DisplaySearch, a division of research firm NPD Group.

But surprisingly, falling prices may spur consumers to spend more — on a bigger set. The $600 budget that in 2010 might have bought you a 32-inch set would today be enough to get one measuring 40 to 55 inches, depending on the brand.

Digital media

Prices for electronic editions already often edge out their print counterparts. Barnes & Noble, for one, sells the novel “Gone Girl” in hardcover for $14.34 and as an e-book for $12.99. The gap could widen in 2013.

In recent months, four publishers reached settlements with the Justice Department in a lawsuit alleging that they and Apple had conspired to raise e-book prices. (Apple and the fifth publisher named in the suit, Macmillan, will continue to litigate, according to the DOJ.)

The settlements give retailers more pricing flexibility. Deeper discounts are likely to pop up on current best-sellers and trendy topics, says Peter Hildick-Smith, president of consulting firm Codex Group.

As more people opt to buy tablets instead of e-readers, though, consumers may not buy as many e-books. “What we find is when someone has a tablet only, they’re spending a lot less time reading books on it,” says Hildick-Smith.

E-reader owners spend five hours a week reading on the device, according to Codex Group. But iPad owners spend two hours per week reading books and 72 minutes reading newspaper and magazine tablet editions.

Compliments of: Martha Small | Austin Portfolio Real Estate | 512.587.0308

Original Article by: MSN Money partner

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The most important job this month is to prevent water damage from bursting pipes and leaks in your home.

 

The dead of winter is the time for the greatest vigilance in your home-maintenance routine. The most important job this month is to head off damage to your home from water and dampness from a number of sources:

Groundwater and rain seeping into your home.

Leaky pipes inside the walls.

Pipes bursting from freezing and thawing.

Take a tour
After a winter storm, get outside as soon as you can. Walk around the house, checking for damage from wind and broken tree limbs. User binoculars if you can’t see your entire roof. Scan for loose or missing shingles.

Give special attention to vulnerable pipes — indoors and out — that are exposed to the cold, including hose bibs, pipes in outside walls, garden sprinkler lines, swimming pool pipes and pipes in unheated attics, basements and garages. A frozen pipe needs only a one-eighth-inch crack to leak as much as 250 gallons a day, according to this State Farm Insurance video, which demonstrates how to shut off your water and insulate pipes.

Take these steps to safeguard against damage from frozen and bursting pipes:

  1. If practical, insulate any pipes exposed to the cold. Ask hardware-store personnel for the best materials for the job.
  2. Seal any leaks that are letting cold air in, especially around dryer vents and pipes and where electrical wiring enters the house.
  3. Search for uninsulated water supply lines in the attic, garage, basement and crawl spaces and in bathroom and kitchen cabinets adjacent to outside walls. During a cold spell, open cupboard doors in the kitchen and bathroom so the home’s heat can reach them. (Reminder: Put harmful household cleaners out of the reach of children.) Keep doors shut tight in the garage and outside closets and cupboards during freezing weather.
  4. When temperatures drop below zero, open both hot and cold faucets a trickle to relieve pressure in the pipes.
  5. Locate your home’s water shut-off valve; learn how to turn off the water quickly in case a pipe bursts.
  6. If you’ll be gone in freezing weather, even overnight, ask a friend or neighbor to check on your house for broken or leaking pipes. Show him or her how to shut off the water.
  7. Keep temperatures inside the house at 55 degrees Fahrenheit or above, night and day, even when you’re gone.
  8. Promise yourself that when the weather improves you will add to the installation in the basement or crawl space and attic.

Leak prevention

  • Install small, battery-powered individual leak alarms, also called flood alarms, under the refrigerator, kitchen and bathroom drain pipes, dishwasher and laundry appliances and behind toilets. Cost: around $10-$15 each.
  • Check to make sure your sump pump is operating properly. If it has a battery backup, unplug the pump from the wall and test it.

Look for pests seeking shelter
Cold weather drives mice and insects into the walls of your home. Even unheated parts of the house invite these pests. Insects need only a crack to enter, and mice can get in through a dime-sized hole. Houseflies, particularly, pose a health risk because they can transmit disease.

  • Seal any cracks where pests enter.
  • Empty compost and garbage frequently.
  • Keep food covered and put away; keep counters clean.
  • Fix leaky pipes quickly.
  • Pour boiling water down bathroom and kitchen drains monthly, preventing the buildup of bacteria-laden sludge; scrub removable drain covers weekly.
  • Check basement, attic, crawl spaces and the back of cupboards and cabinets for mice droppings or holes. If you find evidence, install traps immediately or call a pest-control service.
  • Pick up and dispose of outdoor pet waste promptly; turn compost piles frequently.

Make an inventory
While you are putting away holiday gifts, seize the opportunity to make a quick home inventory.

An inventory is a record of your home’s features, conditions, furnishings and valuable possessions. If your home is damaged or destroyed by fire, flood, mudslide or other disaster, you can use the inventory to substantiate your insurance claim to get the maximum replacement value for what was lost.

Your inventory doesn’t have to be fancy. You can get started and add to it later. Supplement your record with photos or video. The Insurance Information Institute has free software for making a room-by-room home inventory. Download it here and watch an instructional video here.

Tips:

  • Save receipts for valuable home purchases and for work you have done to upgrade the interior or exterior of your home.
  • Keep a copy of your inventory in a bank safe-deposit box or on a hosted server online, so you can get it even if your computer is destroyed.

Also …
Here are a few more winter tasks:

  1. Check the labels on the switches in your electrical circuit-breaker panel and make new labels if necessary.
  2. Check your furnace filter monthly in the winter to see if it needs replacing.
  3. Use a vacuum-cleaner tool or a long-handled brush to clean under and behind the refrigerator, including the coils.
  4. Clean lint from under laundry appliances, especially the dryer, carefully work the cleaning tool down into the lint filter; outdoors, clean the dryer vent outlet, reaching as far as possible into the pipe.
  5. Gather product documents and warranties into a folder. Go through the contents and discard outdated materials.
  6. Walk around inside the house with a screwdriver, pencil and paper. Tighten any loose knobs and attachments and list repairs to tackle later.
  7. Examine the ducts of your forced-air furnace and seal any leaks with duct tape.

Compliments of: Martha Small | Austin Portfolio Real Estate | 512.587.0308

Original Article by: Marilyn Lewis of MSN Real Estate

Click here to view original article

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