There has been a lot of mention in various media of the impact of the baby boom generation on the economy. Bob Waun, of Vacation Finance, has written an article that outlines the demographic facts about the boomers and how they will impact the second home market in years to come.

If you enjoyed this post, make sure you subscribe to our RSS feed!

Filed under: Finance, Mortgages, Vacation Homes | No Comments »

Once you’ve found the perfect second home, had your appraisal and inspection done and have your financing in place, you’re in the clear, right?

Not necessarily.

There are plenty of things you can do at that point that could seriously jeopardize your financing. Here are some of them (and, if in doubt, ask your lender):

1. Don’t change jobs. Even if you have another job in place before you leave, don’t leave your current job until you’ve closed on your mortgage.
2. Don’t move your money or long-term investments around. Keep things the way they are until after the closing. Moving money from your savings to checking or vice versa could, at the very least, slow things down if you end up needing to re-submit paperwork with your lender.
3. Don’t co-sign for anyone else on a loan. This shows up as a new loan or line of credit on your credit history.
4. Don’t let anyone run your credit report again. Too many inquiries on your credit report could signal to a bank that you’re over-extending yourself, or at least trying to. Don’t let any other lenders run your credit report until after your closing.
5. Don’t forget to lock in your interest rate. Request written confirmation of your rate prior to your closing date, so that you don’t have any surprises. Just because your financing is in place, doesn’t mean that your interest rate is locked in unless you have a guarantee - in hand, in writing.
6. Don’t finance any other big purchases. Anything that changes the amount of debt you have or have available to you (including new credit cards) can impact whether or not you still qualify for your mortgage. Even if you don’t lose your mortgage, it could impact the rate you pay.

These tips are meant as a guide, and there are surely other things that you should be aware of when taking out a mortgage to purchase your second home. For more information, talk to your mortgage broker or loan officer.

If you enjoyed this post, make sure you subscribe to our RSS feed!

Filed under: Buying, Finance, Mortgages, Vacation Homes | No Comments »

With the huge surge in baby boomers nearing or in retirement, the U.S. banking industry is gearing up new vehicles to tap more revenue out of what has been called ‘the richest generation in history’.

Reverse mortgages, a means of tapping the asset resource in primary residences is now being expanded into the vacation home market.

Rapidly appreciating and long-held second homes have become surprisingly valuable, providing another possibility for older homeowners to draw funds to supplement their income for monthly expenses, health care, family reunions and investments. There are no restrictions on how reverse mortgage funds are used.

Via HeraldNet.

If you enjoyed this post, make sure you subscribe to our RSS feed!

Filed under: Buying, Finance, Investment Homes, Mortgages, Tools, Vacation Homes | No Comments »

With a reverse mortgage, you might say that after a lifetime of making payments, that turnabout is fair play.

Would you like to keep your current home after you retire but think you can’t afford it? If you are 62 or older, there is a choice you might like to explore. It’s called a reverse mortgage. This type of mortgage is growing in popularity as members of the baby boom generation near retirement. It allows you to tap the inert equity in your primary residence as a source of income. How you spend that money is up to you.

AARP has an article with some basics about this mortgage option.

If you enjoyed this post, make sure you subscribe to our RSS feed!

Filed under: Finance, Investment Homes, Mortgages, Vacation Homes | No Comments »

Part 3: How much can a ‘Short Sale’ save me?

Given the complexities that can be encountered when negotiating a short sale contract, why on earth would you do it? Because, depending on how cooperative your lender is and how good your negotiating team is, a good short sale agreement can save you tens of thousands of dollars.

Let’s take our ‘f’rinstance form the fist posting. If your lender agrees to settle for $250,000, when your outstanding mortgage is $350,000, right off the bat you have saved 100K. And as if that alone isn’t sufficient incentive to explore working out a short sale with your lender, It is possible to negotiate the lender being responsible for some or all of the closing costs.

In some cases, a short sale contract can include some or all of the sales commission due to your real estate agent. This sort of general forgiveness of debt and closing expenses is more likely to happen connected to larger mortgages, with greater lender exposure than our $350,000 example, However, it’s not impossible to realize significant savings on some or all of these fees at closing.

Remember, even if your home is worth near or slightly more than the amount you owe you could still be upside down when other factors are considered such as agent commissions, property taxes, homeowner dues and other standard closing costs. Under these circumstances a short sale could offer a workable solution for all parties involved.

Short sales are not for everybody. But if the downturn in the real estate market has left you in an exposed position, it is an option that merits some consideration.

If you enjoyed this post, make sure you subscribe to our RSS feed!

Filed under: Finance, Investment Homes, Market, Mortgages, Selling, Vacation Homes | No Comments »