Homebuyer Do’s and Don’ts When Getting a Loan

  • DO continue to make payments on time for current mortgages, cars, credit cards, etc..
  • DO paper trail, document, and explain any large or unusual deposits or withdrawals into accounts such as checking, savings, stock, etc.
  • DO keep pay stubs, bank statements, tax forms, etc., in case the lender needs to update the documentation prior to closing.
  • DO ask questions if something is unclear about the loan program, fees, and/or loan conditions.
  • DO let the loan officer or mortgage broker know if anything changes, for example, your employment, income, assets, credit history, etc.
  • DO document that the earnest money deposit has cleared your account; obtain a copy of the cancelled check and/or statement that reflects the funds have cleared.
  • DO lock-in the interest rate.  These are ordinarily thirty to sixty days and definitely worth it if rates are trending upward.
  • DO have homeowner’s insurance agent information available and provide updated documentation (pay stubs, bank statements, etc.) in a timely manner so as not to delay the closing.
  • DO NOT increase credit card balances and/or loan balances.
  • DO NOT apply for additional or new credit or put balances on a paid credit card.
  • DO NOT ignore late payment and/or collection notices that are received during the loan process.
  • DO NOT purchase anything that is “same as cash”, as it will show on the credit report as a new debt.
  • DO NOT buy furniture, a new car or appliances on credit until after closing.  This is the most common “don’t” action that has occurred during my sales.
  • DO NOT lend money to family members or friends if the money is needed for closing.
  • DO NOT store money at home; place it in a bank account so it can be documented as savings throughout the loan process and can qualify as assets on hand.
  • DO NOT have overdrafts on a checking account.
  • DO NOT quit or change jobs during the loan process.



Tips for Buying a Condo/Townhouse

March 7, 2011

If you are a first-time homebuyer or an empty nester, a condominium can be a good choice. Some units are marketed as condos but are not legally condos, such as stock co-ops and own-your-own apartments. Condos are the easiest to finance, so be sure to check. A townhouse is a style of condominium that has its own entrance,  is often two-stories, and usually there is no unit above or below.

Before you start looking, decide which neighborhood in which you would like to live. Also, do you want to live in a smaller complex with few, if any, common amenities or would you prefer a larger development with tennis courts, swimming pool, club house…?

There are some characteristics of the unit and the development that are sometimes overlooked by a buyer who falls in love with a condo’s appearance inside. One of the things that a buyer should look closely at is the overall appearance of the development. Are the grounds clean? Does the building need new paint? Do the gates operate correctly? Is the landscaping well kept? When you buy a condo, you are buying the interior of the unit, “paint to paint,” and an equal, undivided interest of the real estate. The appearance of the entire development will affect the value of each individual unit.

Be sure to obtain a copy of the Homeowners Association bylaws and CCR’s(covenants, conditions and restrictions) a current budget, as well as minutes of at least the last 12 months homeowners’ meetings. Are there any assessments on the horizon? Be sure to look at parking restrictions and pet restrictions in the CCR’s. Are there any age restrictions? If the units have a swimming pool, what are the guest policies? Who is responsible for maintenance of any decks, roofs, etc.? Is it the Homeowners Association or the individual owner? If the unit is on an upper floor, what are the rules for the type of flooring an owner can install? What is covered by the Homeowner’s fee? Check to see how many of the units are rented out, as lenders may not provide the loan if there is over a certain percentage of non-owner occupied units in the development (check with your lender to find out what that percentage is).

It’s probably a good idea to visit the complex during the day and also at night or on the weekend, to be able to see how quiet it is and possibly talk to some of the other owners.

If you are downsizing from a larger home, be sure to check the drawer, cabinet and closet spaces. If the parking is subterranean, is there additional storage in the garage? Be sure to read the Preliminary Title Report to be sure that legally assigned parking spaces are included with the unit. Is it secure? Is it well maintained? Is there a common laundry room? Is it clean? How much does it cost to wash and dry your clothes?

What is the cost for a new owner moving in? What are the rules for moving in?

Be sure to have the unit inspected for termites and other infestations. If the unit is attached to others, it may share a common attic with others and if there are termites in the attic it might require that the entire building be tented to remove them. Tenting of the building would be an expense that the homeowners association cannot or is not willing to afford. Sellers will often write in the contract that they will have the condo inspected “inside only.” It is up to you to decide if you still want to purchase such a property.

Another thing to check is, are there any pending lawsuits against the development that might affect the amount of the homeowners association dues?

All in all, a condo can be a very good choice for many homeowners. A couple of reasons are: It is easier to go out of town because the complexes are often gated and there are other owners around. Condos can make nice rental properties, as they do not require maintenance of the exterior. Some complexes have rules regarding how long an owner must own a condo before it can be rented out, so be sure find out. Call me; I can help you find just the right place here in PV or throughout the South Bay.