Kathy Foran - REALTY EXECUTIVES Boston West



Posted by Kathy Foran on 9/25/2016

Who wouldn't like to pay off the mortgage early? Getting rid of mortgage debt will allow you the security and the psychological benefit of owning your home free and clear. There are lots of ways to accomplish these goals. Here are some suggestions on ways to get rid of your mortgage debt. Compare the options and do what works best for you. 1. Add more money to your monthly payment. This will help pay down the principal balance shortening the length of your loan. When you pay more on your principal is gets lower, and the lower your principal gets, the more every payment from then on is applied to principal, as less goes to cover interest expense. 2. Refinance. Refinance your mortgage to 10, 15 or 20 years. Your payments will be higher on a 15-year loan, but often the rate is lower and the loan is paid off much quicker. If you are afraid to take out a 15- year loan take out a 30-year loan, but make payments as if you had a 15-year loan. 3. Make biweekly payments. Most banks have a biweekly payment plan. Since there are 52 weeks in the year if you pay half your regular mortgage payment every other week, you'll have made 26 half-payments, or 13 payments. There are options when it comes to owning your home free and clear. Just decide which one works for you and be on your way to being mortgage free.





Posted by Kathy Foran on 9/18/2016

Do you know the difference between adjustable-rate and fixed-rate mortgages? An adjustable-rate mortgage (ARM) includes an interest rate that will change periodically based on market conditions. In many cases, homebuyers prefer fixed-rate mortgages (FRMs), as these mortgages enable homebuyers to pay the same monthly mortgage payment for the life of their loan. Conversely, an ARM may start with lower monthly payments but could rise over an extended period of time. This means that an ARM is likely to result in mortgage payments that vary over the years. Although an ARM may seem like an inferior option to its fixed-rate counterpart, there are several scenarios in which a homebuyer may prefer an ARM, including: 1. A Homebuyer Is Purchasing a Residence for the First Time. A first-time homebuyer may enter the real estate market with lofty expectations. But upon realizing there are few housing options that meet his or her needs, this buyer may settle for a house that represents a short-term residence. In this scenario, a homebuyer may be better off selecting an ARM. With an ARM, a first-time homebuyer may be able to make lower monthly payments in the first few years of homeownership. And then, when a better homeownership opportunity becomes available, this buyer may be able to work toward upgrading from his or her starter residence. 2. A Homebuyer Expects His or Her Income to Rise. The economy may fluctuate at times, but those who are assured of a higher income over the next few years may be better equipped to handle an ARM. For example, a student who is enrolled in a medical residency program may be a few years away from becoming a doctor. At the same time, this student wants a nice place that he or she can call home and may consider an ARM because it offers lower monthly payments initially. After this student completes the residency program, he or she likely will see a jump in his or her annual income as well. Thus, this homebuyer may be best served with an ARM. 3. A Homebuyer Is Facing an Empty Nest. Will your children soon be moving out of the home in the next few years? If so, now may be a great time to consider an ARM if you'd like to move into a new residence. Parents who are facing an empty nest in the next few years may be better off living in a larger residence for now, then downsizing after their children leave the nest. Therefore, with an ARM, parents may be able to buy a nicer home with lower monthly payments. And after their kids move out, these parents always can look into downsizing accordingly. Deciding which type of mortgage is right for you can be challenging for even an experienced homebuyer. Fortunately, lenders are available to answer any concerns or questions you may have, and your real estate agent may be able to offer guidance and tips as well. Explore all of the mortgage options at your disposal before you purchase a new residence. By doing so, you'll be equipped with the necessary information to make an informed decision that will serve you well both now and in the future.





Posted by Kathy Foran on 10/18/2015

You might have seen the ads on TV about reverse mortgages, but what is a reverse mortgage? It is a loan for older homeowners that uses a portion of the home’s equity as collateral. Instead of the homeowner paying the lender, it is the lender that pays the homeowner based on the equity in the home. How much can be borrowed? The amount that can be borrowed in a reverse mortgage is determined by an Federal Housing Authority (FHA formula).  The formula considers age, the current interest rate, and the appraised value of the home. What are the requirements for a reverse mortgage? You must be at least age 62 The home must be owned free and clear or all existing liens. Any mortgage balance must be paid off with the proceeds of the reverse mortgage loan at the closing. There are usually no income or credit score requirements. How is the loan repaid? The loan cannot become due as long as at least one homeowner lives in the home as their primary residence and maintains the home in accordance with FHA requirements (keeping taxes and insurance current). The must be repaid when the last surviving homeowner permanently moves out of the property or passes away. The estate will have approximately 6 months to repay the balance of the reverse mortgage or sell the home to pay off the balance.  





Posted by Kathy Foran on 7/13/2014

If you are looking to buy a home you may be wondering how you will be able to come up with the down payment. One way that many buyers come up with down payment money is from gifts.  If you are planning on using gift money to help buy a home there are some guidelines you will need to follow. Here are some simple rules: 1. Get a Gift Letter If you are getting gift money to help you buy a house you will need a gift letter. The letter has a few requirements:

  • Have the letter hand-signed by you and the gift-giver
  • State the relationship between the buyer and the gift-giver.
  • State the amount of the gift.
  • State the address of the home being purchased.
  • A statement that the money is a gift and not a loan that must be paid back.
  • A statement that says: “Will wire the gift directly to escrow at time of closing.”
2. Document a paper trail Mortgage underwriters want proof of where the money came from and where it went. Get copies of transactions showing the withdrawals and deposits. You will also need to make sure that the transaction is for the exact amount of the gift. Following these simple guidelines will get you to the closing table hassle free.    





Posted by Kathy Foran on 11/10/2013

Buying your first home can be confusing. Securing a mortgage is one of the most important parts of the home buying process. Making sure that you have the right loan and have chosen the right loan officer are among the things a first time buyer has to do to start the process. Here are some more tips on how to ensure a successful purchase: 1. Make sure your deposit is in order. Talk to your loan officer about what amount of a deposit is required for the purchase and type of loan. You will also want to make sure the funds are accounted for and readily available. You can expect deposits to run anywhere between 3 and 20 percent of the purchase price. 2. Plan to have a cash reserve in addition to your deposit. You may want to have a reserve of at least two months mortgage payments. 3. Ask your lender to go over all the fees that apply to the purchase. It is better to be prepared and know how much the actual purchase will cost. These costs are typically added into your loan but there may be some out of pocket expenses too. 4. Consider how much you can comfortably afford not how much you have been approved for. These numbers may vary considerably. Your mortgage costs should not be more than 30% of your household income. 5. The lowest rate is not always the best deal. You will want to look at not only the rate but also the terms and fees associated with the loan.