If you're looking to begin the process of finding and applying for a home loan, chances are you'll already be feeling overwhelmed before even signing any paperwork. By choosing a knowledgeable, high-quality lender who takes service seriously, it's easy to approach the process one step at a time. One key component of the process that often is overlooked, though, is the home appraisal. Whether you're moving into your first home or looking to secure a better rate on an existing home loan, an appraisal is likely in your future. 

Appraisal Basics

A home appraisal is a routine, standardized event that is intended to determine how much a home is worth, and therefore the cost of the mortgage to finance it¹. Real estate appraisals are conducted by professionals who are licensed and certified to perform this service in your area. Appraisers use their knowledge of the local market, combined with information on the home in question, to come to a determination of value. Although appraisers are typically hired by the lender, the applicant or homeowner is usually responsible for their fee, which can cost around $500.

Appraisers generate an objective assessment of a home's value.

To conduct an appraisal, the appraiser will often need to visit the home in person to take a close look at the interior and exterior². He or she will also tap into public records or multiple listing services to find recent sales of similar homes nearby. These past sales, known as comparable properties or "comps," will serve as a benchmark for final value determination. With all the requisite information gathered, the appraiser will create a report on the home's value for the applicant or owner and lender to view.

Preparing for the Appraisal

An appraisal on the horizon isn't cause for panic, but borrowers should still take steps to prepare and ensure it goes as smoothly as possible. While appraisers are required by law to be fair and objective in their analysis of a home's value, there are several things homebuyers or owners can do to make things easier for everyone involved.

In the days leading up to an appraisal viewing, homeowners should be sure they keep the place in good condition. Lawns should be mowed and gardens tended, and interior rooms should be kept tidy. Appraisers won't judge a home on cleanliness alone, but there's still no harm in taking the time to clean.

If homeowners or potential buyers want to go the extra mile, they can help the appraiser out by finding comparable sales³. Take a look through online listings of recent home sales in the area and select properties similar to yours. Location and square footage are the most common factors used to determine similarity between two homes, but take note of building style, age and other features. Presenting the appraiser with three good comparable sales could help you make the case for a favorable appraisal.

When the time comes for the actual inspection, homeowners or buyers can be present but shouldn't intrude too much⁴. Meeting with the appraiser and explaining the comparable sales you've found is perfectly acceptable. However, most appraisers appreciate space as they do their own inspection, so excessive questions or comments at this time are generally frowned upon. 

With the inspection complete, homebuyers or owners may have to wait up to a week before they can view the report. Once the appraisal decision has been finalized, borrowers are well on their way to securing a good loan with an excellent lender. Keep in touch with the lender for any lingering questions about the appraisal process.

Sources:

¹Forbes

²SF Gate Home Guides

³The Washington Post

⁴The Wall Street Journal - See more at: http://www.newamericanfunding.com/blog/post/2016/08/30/How-to-Prepare-for-a-Home-Appraisal.aspx#sthash.8E7K5tjf.dpuf

Author: Rachel

If you're looking to begin the process of finding and applying for a home loan, chances are you'll already be feeling overwhelmed before even signing any paperwork. By choosing a knowledgeable, high-quality lender who takes service seriously, it's easy to approach the process one step at a time. One key component of the process that often is overlooked, though, is the home appraisal. Whether you're moving into your first home or looking to secure a better rate on an existing home loan, an appraisal is likely in your future. 

Appraisal Basics

A home appraisal is a routine, standardized event that is intended to determine how much a home is worth, and therefore the cost of the mortgage to finance it¹. Real estate appraisals are conducted by professionals who are licensed and certified to perform this service in your area. Appraisers use their knowledge of the local market, combined with information on the home in question, to come to a determination of value. Although appraisers are typically hired by the lender, the applicant or homeowner is usually responsible for their fee, which can cost around $500.

Appraisers generate an objective assessment of a home's value.

To conduct an appraisal, the appraiser will often need to visit the home in person to take a close look at the interior and exterior². He or she will also tap into public records or multiple listing services to find recent sales of similar homes nearby. These past sales, known as comparable properties or "comps," will serve as a benchmark for final value determination. With all the requisite information gathered, the appraiser will create a report on the home's value for the applicant or owner and lender to view.

Preparing for the Appraisal

An appraisal on the horizon isn't cause for panic, but borrowers should still take steps to prepare and ensure it goes as smoothly as possible. While appraisers are required by law to be fair and objective in their analysis of a home's value, there are several things homebuyers or owners can do to make things easier for everyone involved.

In the days leading up to an appraisal viewing, homeowners should be sure they keep the place in good condition. Lawns should be mowed and gardens tended, and interior rooms should be kept tidy. Appraisers won't judge a home on cleanliness alone, but there's still no harm in taking the time to clean.

If homeowners or potential buyers want to go the extra mile, they can help the appraiser out by finding comparable sales³. Take a look through online listings of recent home sales in the area and select properties similar to yours. Location and square footage are the most common factors used to determine similarity between two homes, but take note of building style, age and other features. Presenting the appraiser with three good comparable sales could help you make the case for a favorable appraisal.

When the time comes for the actual inspection, homeowners or buyers can be present but shouldn't intrude too much⁴. Meeting with the appraiser and explaining the comparable sales you've found is perfectly acceptable. However, most appraisers appreciate space as they do their own inspection, so excessive questions or comments at this time are generally frowned upon. 

With the inspection complete, homebuyers or owners may have to wait up to a week before they can view the report. Once the appraisal decision has been finalized, borrowers are well on their way to securing a good loan with an excellent lender. Keep in touch with the lender for any lingering questions about the appraisal process.

Sources:

¹Forbes

²SF Gate Home Guides

³The Washington Post

⁴The Wall Street Journal - See more at: http://www.newamericanfunding.com/blog/post/2016/08/30/How-to-Prepare-for-a-Home-Appraisal.aspx#sthash.8E7K5tjf.dpuf

Buying a home is a goal of many Americans and veterans and military members especially value home ownership. According to Did You Serve, a certification program for real estate agents who wish to work with military personnel, three-quarters of military service members said buying a home was one of their biggest goals after returning from service.

These men and women may have different homebuying needs than the average civilian. This is why it's crucial their real estate agent be in tune with the nuances that go into finding the perfect house for a military person or family.

Veterans and service members are eligible for a VA loan. These loans offer low rates, flexible credit standards and other great benefits that don't go along with the typical mortgage. However, Did You Serve explained one 10 percent of qualified homebuyers don't take advantage of the VA loan - mainly because of lack of education.

Service members need knowledgeable agents

Real estate agents are important to the homebuying process for many, but an agent experienced in working with service members and their families are important for veteran homebuyers. This is because many of them may not know how to look for house that meets their needs or about how to take advantage of the VA loan program. According to the Consumer Finance Protectin Bureau, service members also have access to free financial education and counseling through the Personal Financial Management Program at their local installation. It's important that real estate agents working with service members know all of their rights and benefits in the homebuying process, as some of them may not know everything they are qualified for.

When a service member looks for the right real estate agent, they look for someone who can help them navigate the complex process of buying a home. The VA loan offers unique benefits, but also has unique requirements for properties purchased through it, according to the U.S. Department of Housing and Urban Development. For instance, any mechanical systems must be checked to ensure they are safe to use and they have a reasonable lifespan. Or, homes that are heated with a wood-burning stove must also have a secondary, conventional heating system for any areas in the home that has plumbing. Knowing these requirements in advance will benefit agents who plan on working with military service members find a home.

What agents should know

Aside from available benefits and property requirements, agents hoping to help military service members find homes should also educate themselves on the rules of working with military members. For instance, Inmann explained asking a veteran if he or she is disabled could be perceived as rude and in some states, could even be illegal. Further, certain states regard military service members as a protected class, which means it is even against the law to ask if they've served. Knowing if this applies to a state in which you are selling will help to better serve your clients and can protect you from the law.

If a person in one of these states willingly discloses his or her military affiliation, you can begin helping them claim all the benefits they are entitled to. Also, if they do, a way to determine if they are eligible for the grants available to disabled veterans, agents can ask whether they receive monthly checks from the VA. This could be an indication they are disabled and may qualify for a grant for specially adapted housing.

A real estate agent working with a military service member may have to dig a little deeper to learn what the client needs from a house. Realtor.com explained some active-duty service members may only have a short period of time to find a home. This is because when they receive a permanent change of station order, they have 10 days to find a home in the new area. If a real estate agent knows this ahead of time, he or she will be able to prioritize this client better in the home search.

Also, because active-duty service members might be asked to relocate several times throughout their careers, it is especially important that the chosen home have a good resale value. The person or family may only live in the home for a few years before receiving relocation orders again. This means there is little time to increase the resale value. So, finding a home with a great value right away will prove to be beneficial to the service member in the long run.

When working with veterans and military service members, it is crucial that agents know what benefits they are eligible for, what requirements the property must adhere to, as well as all the needs the person has for the home. By educating oneself about working with this group of people beforehand, real estate agents are sure to be successful in working with this nation's service men and women.

As summer came to an end, the months of high home sales began to decrease. While the first half of 2015 saw a strong housing market, it began to decline in August, according to a press release from the National Association of Realtors.

The Pending Home Sales Index went down from 110.9 in July to 109.4 in August. However, the PHSI still represents an improvement from August 2014, when it was 103.1. This is a good sign for the housing market.

Lawrence Yun, NAR's chief economist, explained that rising home prices and low supply of available homes greatly contribute to the decline. He also foresees the implementation of the TILA-RESPA Integrated Disclosure, a restructuring of the mortgage process, to have an effect on upcoming months' PHSI. TRID went into effect on October 3.

Though the drop in home sales wasn't what many real estate professional expected, some economists don't think it will last long, according to the Wall Street Journal.

"While the report is a negative development, mortgage applications are on an upward trend while supply is tighter—both suggest the drop in pending home sales will be short-lived," Bricklin Dwyer, a senior economist with BNP Paribas, told his clients.

Home Building Is Up

Although low housing inventory has contributed to the decline in signed contracts, construction has picked up, which will bring the inventory up in the upcoming months. July experienced the most housing starts since the end of 2007 with 1.21 million homes, according to the New York Times.

In August, the National Association of Home Builders reported the highest homebuilder confidence level since November of 2005. These facts show promise for the housing supply in the upcoming months, though Tom Woods, NAHB chairman explained that there are still obstacles to overcome.

"The fact the builder confidence has been in the low 60s for three straight months shows that single-family housing is making slow but steady progress," Woods said in the release. "However, we continue to hear that builders face difficulties accessing land and labor."

The new construction is being noticed by homebuyers. According to the U.S. Census Bureau, new home sales rose to 552,000 in August, up 30,000 from July. Compared to last August's total of 454,000, this is a big improvement.

According to the Wall Street Journal, new home sales make up one-tenth of the market. Homebuilders see the increase of new home sales as a good sign the housing market is on the right track. Many have seen increases in orders in the past few months. Stuart Miller, CEO of Lennar Corp, a homebuilder in 17 states, reported a 10 percent increase in home orders in its third fiscal quarter.

"Our results reflect the slow but steady growth in the overall home-building market," Miller explained to his investors on a conference call. "This year's summer season, and the spring selling season before it, confirm that the market is continuing to improve at a fairly consistent pace."

The Mortgage Bankers Association released its weekly survey on July 8. The results showed mortgage applications increased for the week ending July 3.

Applications for Home Loans Jump

The number of individuals who decided to apply for a home loan rose 4.6 percent when compared on a week-over-week basis. This increase was also adjusted for the July 4 holiday.

On an unadjusted basis, applications increased 6 percent from the previous week.

When compared to the same time one year ago, the total number of applications jumped 32 percent. While applications saw an increase, refinancing activity decreased to 48 percent of all mortgage applications. This is the lowest level seen since June 2009 when it comes to refinance activity.

The rise in total applications likely occurred due to more favorable economic conditions in the U.S. as well as lower interest rates for home loans.

Greece Pushes Mortgage Rates Lower

According to Zillow, an online real estate company, the average 30-year fixed-rate mortgages decreased 5 basis points on a week-over-week basis. just prior to the decrease rates rose to match the stronger economic conditions in the u.s.

"Mortgage rates jumped last Wednesday after Greece defaulted on its international debts, then fell early this week due to continued Greek instability, turmoil in Chinese stock markets, and unexpectedly strong global oil supplies," noted Erin Lantz, vice president of mortgages at Zillow. "Uncertainty over Greece's future will continue to dominate headlines this week, but economic news elsewhere suggests interest rates will remain lower for longer."

The foreign economic condition's impact on mortgage rates stimulated a higher number of individuals to apply for home loans. In doing so, these prospective buyers will help continue to strengthen the U.S. housing market and help bolster the current conditions.