Saturday Reporter-Herald July 3, 2010 E1
Real Estate Matters
www.homeandrealtyguide.com • Saturday, July 3, 2010 • Reporter-Herald
BMUYER ’ S ARKET
Lender may not allow name change ILYCE GLINK TRIBUNE MEDIA SERVICES
Market conditions present a unique buying opportunity
Q
uestion: Please help. A few years ago I signed for a mortgage on my daughter’s house. How do I get this changed into her name or taken off my credit report and put onto hers? I now have a retirement property I want to buy. With her mortgage on my credit report, it appears that I am overextended financially. What do I do? Answer: Sadly, your story is a perfect example of how the best of intentions can torpedo future financial decisions. When you cosign a mortgage, future creditors will look at your signature as a guarantee that you will pay the entire loan back, should the other party to the contract not make his or her payments. In this case, it’s unclear from your e-mail whether you cosigned the mortgage (and your daughter’s name is also on the loan), or you simply bought the property and added your daughter’s name to the title. Either way, lenders now look at you as having to support a single mortgage on your income, which probably doesn’t leave much room for a second loan. There is nothing you can do unless your daughter has good enough credit to refinance the property in her own name alone, or you can find someone else who can cosign the mortgage for your new retirement home. In past years, lenders were willing to look at a person like you and have your daughter prove that she is making all of the payments on the mortgage. If your daughter made the payments and you could prove she had, the lender would still consider the other loan in determining whether to grant you a new loan, but it would discount that loan substantially, enabling you to get additional financing. Given the current state of the mortgage and real estate markets, many lenders aren’t willing to do that. Please talk to a real estate attorney for more details. Question: We closed on a mortgage with a big box lender for a condo that required flood insurance. We purchased a policy in the amount of the mortgage, which is what was required. Now the lender has contacted us to say it is requiring us to buy a policy for 100 percent replacement value that comes to almost three times the amount of the mortgage they carry. The lender actually lied on the phone and told me it is because the National Flood Insurance Program (NFIP) requires it. I called NFIP and they told me
RH PAID ADVERTORIAL
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uying a home in today’s market? Are you crazy? It’s actually not as crazy as it may seem. Although the tax credit may have passed you by, there are still a lot of great reasons why now is the time to invest in a home. Historically, home prices and interest rates are still at unprecedented low levels, making the investment in a home a smart decision. Instead of writing rent checks month after month, think about the longterm potential you could gain by becoming a home-owner instead. While the real estate market will always have its ups and downs, the overall trend over time has been positive for home-owners. David Powell, managing broker for the RE/MAX Alliance office in Loveland, said that no matter what the current conditions are, the market eventually ends up in the winning column. “Home ownership is the key to wealth,” Powell said. “Even though we have seen some very trying times in the past three years, the longterm trend is that the market is always going up.” When you think about a home as a long-term investment, the overall appreciation may surprise you. Before the recession hit, the average annual appreciation rate on a typical residential home was 3.9 percent. However, when you consider a 20- or 30-year investment in your home, you still end up with a large amount of appreciated value if you gain roughly 4 percent over a majority of that time span. Powell added, “It’s not about the timing in the market — it’s about the time in the market. That is what creates wealth.”
CALL RE/MAX ALLIANCE TODAY, 970-669-1234
Find several incentives for going green in your home RH PAID ADVERTORIAL Missed the tax credit deadline? No problem. Now’s the time to go green in your home.
There is a wide array of tax incentives for homeowners — that don’t have a deadline. Right now, there are various tax deductions and other credits
available to homeowners who make energy-efficient improvements on their homes — at the local, state and federal levels. For good resources of informa-
tion on how to apply and receive these savings, visit the Database of State Incentives for Renewables & Efficiency’s website at www.dsireusa.org.
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Inside this week’s Home & Real Estate Realtor of the Week Jeannine Diguglielmo of RE/MAX Alliance in Loveland
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Beetle Kill Wood
Director y Page E5
Fallen trees being used in home industry
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Mortgage rate update This week Last week Trend
30-year fixed
4.69%
4.72%
15-year fixed
4.09%
5/1 ARM
3.69%
4.10% 3.74%