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Electricity - Savannah Electric /Georgia Power |  888 - 660 - 5890  | www.GeorgiaPower.com/
Electricity - Coastal Electric Cooperative |  912 - 884 - 3311  |
Natural Gas - Atlanta Gas Light Co | 800 - 427 - 5463  | www.atlantagaslight.com
Natural Gas - AmeriGas Inc |  800 - 427 - 4968
Natural Gas - Claxton Oil Co. | 912 - 739 - 1304  
Natural Gas - Pembroke Propane Gas Co.| 912 - 653 - 2393 
Telephone - Bell South/ AT&T | 888 - 757 - 6500 | www.BellSouth.com

The Home Buying Guide

Congratulations! The decision to buy your own home is an exciting one. The experience should be enjoyable as well as get you the perfect home with the least amount of hassle.

 I am devoted  to using our expertise to make your transaction successful!

Purchasing a home is a very important decision. I would like to help you with honest, accurate information so you can make well-informed decisions regarding the purchase of your home. This booklet will give you an idea of what to expect during each phase of your transaction. It also contains reference pages, note pages, deadline information, etc., and is useful as a reference guide even after the transaction is closed.

 Please keep this booklet during all house hunting related activities: meetings, house hunting trips, etc. Use it to take notes and to keep track of deadlines. You can even staple cards to relevant pages to keep related materials together. Making this transaction as easy as possible for you is my job. We are happy to serve all your real estate needs!

- Your Summit Home & Land Team

http:// www.newhomessavannah.com/

The housing market has taken off again.

Home prices are climbing fast and closing in on the record highs we saw just before the housing bubble burst.

Bidding wars for desirable homes are common in many cities, putting incredible pressure on buyers to spend more.

Yet the fundamentals of wise home buying never change.

It's all about figuring out what you can afford — based on how much you can reasonably borrow and the amount you have for a down payment — and then sticking to that budget.

Follow these 5 smart moves, and you'll know exactly what you should spend on a place to live and not wind up house poor with a bad case of buyer's remorse.

Smart move 1. Determine how much you can afford to borrow.

For many years, home buyers seeking a mortgage have been well-served by what's called the 28/36 rule.

It says your total:

• Monthly housing costs, which include mortgage payments, insurance, property taxes and condo or association fees, shouldn't exceed 28% of your monthly gross income.
• Monthly debt payments, including credit card bills and student loans, shouldn't exceed 36% of your gross income.

It's easy to put these guidelines to work.

Just enter your monthly income, bills and projected housing costs into our mortgage calculator, and it determines exactly how much you can afford to borrow and the monthly mortgage payment you can reasonably handle.

A key factor the calculator needs to know is how much your mortgage will cost.

Home loans remain a bargain, historically speaking.

The average cost of a 30-year fixed-rate mortgage — the most popular way to finance a home — is just above 4%. That's still a relative bargain.

And remember, it's the average cost of financing a home. Savvy borrowers with decent credit can almost always pay a quarter to a half point less.

Spend a few minutes searching our extensive database for the best current mortgage rates from dozens of lenders in your area to get a good idea of what you can expect to be charged.

Any online real estate listing for the size and type of home you hope to buy can provide property tax and insurance costs you'll need to get the most accurate estimate of how much you can afford to borrow.

Smart move 2. Add up how much you have for a down payment.

The bigger the down payment, the bigger the house you can afford to buy.

For most buyers, the down payment comes from two sources — savings and the equity they've built up in their current residence. (Equity is the current market value of a home minus the outstanding balance of all mortgages.)

Ideally, you'll be able to make a down payment of at least 20% to avoid paying mortgage insurance.

But borrowers can qualify for conventional mortgages with down payments of 3% and credit scores as low as 640, according to Jim Merrill, founder of Axel Mortgage Inc. in Phoenix.

Different options also are available for paying mortgage insurance premiums, which have come down, and many lenders will now let you use a monetary gift for a down payment. A good mortgage broker can run you through the possibilities.

"I'm getting loans approved today that would not have been approved just a few years ago," Merrill says.

If you’re struggling to qualify for a conventional loan, another option is a government-backed FHA loan, which requires down payments of as little as 3.5%, or a VA loan, which can require no down payment at all.

Smart move 3. Choose wisely if you tap retirement accounts for a down payment.

Taking money out of retirement plans for a down payment is not ideal.

But we know that many families have most, if not all, of their savings tied up in individual retirement accounts (IRAs) or 401(k) accounts where they work.

If that's the case, tap a Roth IRA or Roth 401(k) plan first.

Because contributions to Roth plans are fully taxed before they're made, you can withdraw what you've put into those accounts at any time without incurring penalties or additional taxes.

If you've held a Roth IRA for at least five years, you can withdraw an additional $10,000 in earnings to buy or renovate a first home without paying any penalties or taxes.

The next place to turn is a traditional IRA, which will allow you to withdraw up to $10,000 for the purchase of a first home without penalty. (If you have individual accounts, you and your spouse could take a total of $20,000.)

But since contributions to these accounts are tax-deductible, you'll have to pay income tax on withdrawals and a 10% penalty above the $10,000 limit until you reach age 59½.

Your employer's traditional 401(k) plan is the last place you should turn for a down payment. Such "hardship withdrawals" are fully taxed and incur a 10% penalty until age 59½.

The better option is taking out a loan against your 401(k). You can usually borrow up to $50,000 or half of the value of the account, whichever is less. Your employer can give you up to 15 years to repay the loan if it's for a home purchase.

Monthly payments are deducted from your paycheck. The interest you pay, generally a couple of percentage points above the prime rate, goes into your retirement account.

Smart move 4. Calculate an affordable purchase price.

Add how much you have for a down payment (from Smart moves 3 and 4) to the maximum amount you should borrow (from Smart move 1), and that's the amount you can afford to spend on a house.

Don't hesitate to revise this estimate as you shop for houses and mortgages.

Has a fixer-upper popped up on your wish list? If so, you probably need to reduce the size of your down payment to have more cash available for renovations.

Do the homes you're looking at have lower property tax bills, or higher association fees, than you expected? Have you found the perfect lender offering a lower interest rate?

Go back to the mortgage calculator, and revise your borrowing power.

REAL ESTATE DICTIONARY

• Ad Valorem Tax — A tax levied against real property based upon its assessed value.
• Adjustable Rate Mortgage (ARM) — A mortgage loan which allows the lender to adjust periodically the interest rate. Such changes generally come after some initial time period during which the rate is fixed, and are tied to an index such as the Treasury Bill rate or the six-month LIBOR.
• Amortization — Payment of debt in regular, periodic installments of principal and interest, as opposed to interest only payments.
• Amortization Schedule — A schedule showing each payment of a loan to be amortized and breaking down the payment applied to principal and the amount applied to interest.
• Balloon Note — A note calling for periodic payments which are insufficient to fully amortize the face amount of the note prior to maturity, so that a principal sum known as the “balloon” is due at maturity.
• Balloon Payment — The final payment (balance due) of a balloon note.
• Biweekly mortgage — A mortgage in which you make payments every two weeks instead of once a month. The basic result is that instead of making twelve monthly payments during the year, you make thirteen. The extra payment reduces the principal, substantially reducing the time it takes to pay off a thirty year mortgage.
• Board of Equalization — State board charged with the duty to equitable uniformity to the various local property tax assessments. (learn more)
• Cash-out refinance — When a borrower refinances his mortgage at a higher amount than the current loan balance with the intention of pulling out money for personal use, it is referred to as a “cash out refinance”.
• Closing — In real estate sales, the ceremony or final procedure in which documents are executed and/or recorded, and the sale (or loan) is completed. In Georgia, all closings must be supervised by an attorney.
• Closing Statement (aka HUD Statement, Settlement Statement) — The statement that lists the financial settlement between buyer and seller, also the costs each must pay. A separate statement for buyer and seller is sometimes prepared.
• Cloud on title –Any conditions revealed by a title search that adversely affect the title to real estate. Usually clouds on title cannot be removed except by deed, release, or court action.
• Declaration of Restrictions — A set of restrictions filed by a subscriber to cover an entire tract or subdivision.
• Deed — A written document which transfer legal ownership of real estate from one person to another. Actually, any one of many conveyance or financing instruments, but generally a conveyance instrument, given to pass fee title to property upon sale.
• Deed in Lieu of Foreclosure — A deed given by an owner/borrower to a lender to prevent the lender from beginning foreclosure proceedings. The validity of the deed depends to some degree on “fairness” under the circumstances, and adequacy of consideration, which will be considered.
• Deed to Secure Debt or Security Deed — A type of deed used to secure a loan or debt with real property. It is commonly used in Georgia instead of a mortgage. It is a legal document which creates in the lender a right of foreclosure in case of default.
• Due-On-Sale Clause — A provision in a loan allowing the lender to call the balance of the loan due if there is a transfer of ownership of the collateralized property. The Due-On-Sale clause is a standard provision in most mortgages
• Easement — A right created by grant, reservation, agreement, prescription, or necessary implication, which one has in the land of another. It is either for the benefit of land (appurtenant), such as the right to cross parcel A to get to B, or “in gross”, such as public utility easement.
• Encroachment — Generally, construction onto the property of another, as of a wall, fence, building, etc.
• Fee simple estate –An unconditional, unlimited estate of inheritance that represents the greatest estate and most extensive interest in land that can be enjoyed. It is of perpetual duration.
• First Refusal Right — A right, usually given by an owner to a lessee, which gives the lessee a first chance to buy the property if the owner decides to sell. The owner must have a legitimate offer, which the lessee can match or refuse. If the lessee refuses, the property can then be sold to the offeror.
• FNMA (Fannie Mae) — A private corporation dealing in the purchase of first mortgages at a discount.
• Fixed-rate mortgage — A mortgage in which the interest rate does not change during the entire term of the loan.
• Fixture — Personal property that becomes real property when attached in a permanent manner to real estate.
• GNMA (Ginnie Mae) — Government National Mortgage Association. A federal association, working with FHA, which offers special assistance in obtaining mortgages and purchases mortgages in a secondary capacity.
• Grantee — One to whom a grant is made, generally the buyer.
• Grantor — One who grants property or property rights.
• Home inspection — A thorough inspection by a professional that evaluates the structural and mechanical condition of a property. A satisfactory home inspection is often included as a contingency by the purchaser.
• Homeowners’ association — A nonprofit association that manages the common areas of a planned unit development (PUD) or condominium project. In a condominium project, it has no ownership interest in the common elements. In a PUD project, it holds title to the common elements.
• Homeowner’s insurance — An insurance policy that combines personal liability insurance and hazard insurance coverage for a dwelling and its contents.
• Homeowner’s warranty — A type of insurance often purchased by homebuyers that will cover repairs to certain items, such as heating or air conditioning, should they break down within the coverage period. The buyer often requests the seller to pay for this coverage as a condition of the sale, but either party can pay.
• Homestead — The dwelling (house and contiguous land) of the head of a family. Some states grant statutory exemptions, protecting homestead property (usually to set a maximum amount) against the rights of creditors. Property tax exemptions (usually to set a maximum amount) are also available in some states. Statutory requirements to establish a homestead may include a formal declaration to be recorded. (learn more)
• Homestead Exemption — an exemption on real property taxes for residents who own and occupy the property (read more)
• Impound Account — Account held by a lender for payment of taxes, insurance, or other periodic debts against real property. The mortgagor or beneficiary pays a portion of, for example, the yearly taxes, with each monthly payment. The lender pays the tax bill from the accumulated funds.
• Installment Contract — A method of purchasing by installment (usually monthly) payments. When referring to real property, it is usually called a land contract.
• Intangible Tax — A tax the state of Georgia imposes on loans with terms of three years or longer which are secured by real property. The amount of the intangibles tax is $1.50 for each $500.00 of the loan amount.
• Intestate — Without leaving a will, or leaving an invalid will, so that the property of the estate passes by the laws of succession rather than the direction of the deceased.
• Joint Tenants with Rights of Survivorship — Co-ownership of real property by two or more persons where each owner holds an equal interest in the property; and upon the death of one owner, their interest automatically passes to the survivors without probate.
• Lease — A written agreement between the property owner and a tenant that stipulates the payment and conditions under which the tenant may possess the real estate for a specified period of time.
• Leasehold estate — A way of holding title to a property wherein the mortgagor does not actually own the property but rather has a recorded long-term lease on it.
• Lease option — An alternative financing option that allows home buyers to lease a home with an option to buy. Each month’s rent payment may consist of not only the rent, but an additional amount which can be applied toward the down payment on an already specified price.
• Lien — A legal claim against a property that must be paid off when the property is sold. A mortgage or first trust deed is considered a lien.
• Marketable Title — Title that can be readily marketed (sold) to a reasonably prudent purchaser aware of the facts and their legal meaning concerning liens and encumbrances.
• Mechanic’s Lien — A lien created by statute for the purpose of securing priority of payment for the price or value of work performed and materials furnished in construction or repair of improvements to land, and which attaches to the land as well as the improvements.
• Mortgage insurance (MIP) — Insurance that covers the lender against some of the losses incurred as a result of a default on a home loan. Often mistakenly referred to as PMI, which is actually the name of one of the larger mortgage insurers. Mortgage insurance is usually required in one form or another on all loans that have a loan-to-value higher than eighty percent.
• Mortgage insurance premium (MIP) — The amount paid by a mortgagor for mortgage insurance, either to a government agency such as the Federal Housing Administration (FHA) or to a private mortgage insurance (MI) company.
• Mortgage life and disability insurance — A type of term life insurance often bought by borrowers. The amount of coverage decreases as the principal balance declines. Some policies also cover the borrower in the event of disability. In the event that the borrower dies while the policy is in force, the debt is automatically satisfied by insurance proceeds. In the case of disability insurance, the insurance will make the mortgage payment for a specified amount of time during the disability.
• Non Judicial Foreclosure Sale — Sale by a trustee under a deed of trust, or mortgage under a power of sale of a mortgage. There is no court (judicial) proceeding.
• Owner’s Title Insurance (Owner’s Policy) — A policy of title insurance issued to the owner of the property. Owner’s title insurance ensures that the purchaser is the vested owner of the property free and clear from any covered defect, lien, or encumbrance to the title. An owner’s policy protects the property owner from any financial loss from claims to the title which cannot be discovered through a title examination. Title insurance will defend the insured’s title in court, if necessary, and bear any and all costs in settling that claim. The title insurance premium is a one-time charge, typically collected for and paid at closing.
• PITI (Principal, Interest, Taxes and Insurance) — Used to indicate what is included in a monthly payment on real property. Principal, interest, taxes and insurance are the four major portions of a usual monthly payment.
• Planned (Unit) Development — A subdivision of five or more individually owned lots with one or more other parcels owned in common or with reciprocal rights in one or more other parcels. The lots are generally small, being the exact size of the improvements, or slightly larger.
• Power of Attorney — An authority by which one person (principal) enables another (attorney in fact) to act for him. (1) General power — Authorizes sale, mortgaging, etc. of all property of the principal. Invalid in some jurisdictions. (2) Special Power — Specifies property, buyers, price and terms. How specific it must be varies in each state.
• Prepayment — Any amount paid to reduce the principal balance of a loan before the due date. Payment in full on a mortgage that may result from a sale of the property, the owner’s decision to pay off the loan in full, or a foreclosure. In each case, prepayment means payment occurs before the loan has been fully amortized.
• Prepayment penalty — A fee that may be charged to a borrower who pays off a loan before it is due.
• Principal, interest, taxes, and insurance (PITI) — The four components of a monthly mortgage payment on impounded loans. Principal refers to the part of the monthly payment that reduces the remaining balance of the mortgage. Interest is the fee charged for borrowing money. Taxes and insurance refer to the amounts that are paid into an escrow account each month for property taxes and mortgage and hazard insurance.
• Private Mortgage Insurance — Insurance against a loss by a lender in the event of default by a borrower (mortgagor). The insurance is similar to insurance by a governmental agency such as FHA, except that a private insurance company issues it. The premium is paid by the borrower and is included in the mortgage payment.
• Quitclaim Deed — A deed operating as a release; intended to pass any title, interest, or claim, which the grantor may have in the property, but not containing any warranty of a valid interest or title in the grantor.
• Real Estate
  1. Land and anything permanently affixed to the land, such as buildings, fences and those things attached to the buildings, such as light fixtures, plumbing and heating fixtures, or other such items that would be personal property if not attached. The term is generally synonymous with real property, although in some states a distinction may be made.
  2. May refer to rights in real property as well as the property itself.
• Real Estate Owned (REO) — Most commonly refers to property owned by a lender from foreclosure of mortgages or trust deeds. The property is usually for sale.
• Reverse Annuity Mortgage — A reverse annuity mortgage is a type of mortgage that retirees on fixed incomes can use to generate income out of the equity in their homes while they continue to live in the home.
• Right of first refusal — A provision in an agreement that requires the owner of a property to give another party the first opportunity to purchase or lease the property before he or she offers it for sale or lease to others.
• Right of Survivorship — The right of a survivor of a deceased person to the property of said deceased. A distinguishing characteristic of a joint tenancy relationship.
• Stephens-Day Bill — A homestead exemption that is equal to the difference between the current year fair market value and the adjusted base year value (property’s value in the year prior to the homestead application plus any improvements since the year of the application). This exemption does not apply to improvements added to the property after January 1 of the base year. (read more)
• Subordination Agreement — An agreement by which an encumbrance is made subject (junior) to a junior encumbrance. For example: A loan on vacant land is made subject to a subsequent construction loan.
• Survivorship Deed — A deed that conveys ownership to two or more person establishing Joint Tenants with the right of Survivorship. (see Joint Tenants with Rights of Survivorship)
• Tax Deed
  1. Deed from tax collector to government body after a period of non-payment of taxes according to statute.
  2. Deed to a purchaser at a public sale of land taken for delinquent taxes. The purchaser receives only such title as the former owners had, and strict procedures must be followed to prevent attachment of prior liens.
• Tax Lien
  1. A lien for nonpayment of property taxes. Attaches only to the property upon which the taxes are unpaid.
  2. A federal income tax lien. May attach to all property of the one owing the taxes.
• Tenancy in common — As opposed to joint tenancy, when there are two or more individuals on title to a piece of property, this type of ownership does not pass ownership to the others in the event of death.
• Testate — Having written a last will and testament.
• Title Company — An agency issuing the policy of a title insurance company.
• Title Insurance — Insurance against loss resulting from defects of title to a specifically described parcel of real property. Defects may run to the fee (chain of title) or to encumbrance. (learn more)
• Title Search — A review of all recorded documents affecting a specific piece of property to determine the present condition of the title.
• Transfer Tax — State tax on the transfer of real property. Based on purchase price or money changing hands. Check statues for each state. Also called the documentary transfer tax.
• Truth-in-Lending — A federal law that requires lenders to fully disclose, in writing, the terms and conditions of a mortgage, including the annual percentage rate (APR) and other charges.
• Warranty Deed — A deed used in many states to convey fee title to real property. Until the widespread use of title insurance, the warranties by the grantor were very important to the grantee. When title insurance is purchased, the warranties become less important as practical means of recovery by the grantee for defective title.

   Belmont Glen Preferred Lenders

0 % Down!!

                           USDA GUARANTEED

                     RURAL HOUSING PROGRAM

• 100 % FINANCING with no PMI

• 2% Guarantee Fee can be financed into the loan 

• Household Income Limitations: $73,600 for 1-4 person household, $97,150 for 5-8 person household

• Unlimited Seller contributions (may change in future)
• Not limited to "lower of" contract or appraisal - Closing Costs can be financed into the loan. Including guarantee fee, LTV can go up to 102% of the appraised value

• Property must be in a rural area as designated by USDA - See USDA website 

         Click Here to Check Eligibility

• Cities where properties may qualify 
•  Gift Funds are allowed
• Not limited to first time home buyers (buyers cannot currently own another home)

• Qualified Ratios: 29/41 on existing homes and 31/43 on Energy Code Compliant Houses
• Flexible credit for your purchaser
• Credit scores of 620 is "free pass" on credit. Scores under 620 considered on a case-by-case basis.

• Competitive market based fixed interest rates with 30 year term
• Lot value must be less than 30% of the property value.
• Government's approvals issued within 1-2 days after First Bank underwrites the loan.

Have questions? Give us a call 912 858 2858

Conventional Loans and Government Loans

Mortgages can be classified as either “conventional loans” or “government loans.” Conventional loans can be conforming or jumbo, but are not insured or guaranteed by the government.

Then there are government loans, such as the widely popular FHA loan. This type of mortgage is backed by the Federal Housing Administration (FHA). Another common government loan is the VA loan, backed by the Department of Veteran Affairs. The max loan amount for these types of loans varies by county. Other option is the USDA loan which offers $0 down loan options as long as property is located in an eligible rural area. Click here to check the USDA eligibility map and see if your dream home qualifies. 

For more information on loan or lender options give us a call: 816 858 2858

Home inspector vs Home Appraiser

When you are considering buying a home, it is smart to check it out carefully to see if it is in good condition. The person who does this for you is called a home inspector. The inspector works for you and should tell you whether the home you want to buy is in good condition and whether you are buying a “money pit” of expensive repairs. Get your inspection before you are finally committed to buy the home.

A home inspector is different from a home appraiser. The appraiser is an independent professional whose job is to give the lender an estimate of the home’s market value. You are entitled to a copy of the appraisal prior to your closing. This allows you to see how the price you agreed to pay compares to similar and recent property sales in your area.

For more information on obtaining a local home inspector give us call: 912 858 2858