Your kids have moved out, and it’s probably time for you to think about downsizing your home. You might want to consider staying in a house with fewer rooms and accessible facilities. Furthermore, the extra space in your house determines the equity that can potentially be converted into cash. Additionally, make sure you ask these 4 questions while selling your house for retirement.
#1 What Is The Reason To Sell Your House?
Selling your house to a cash buyer in NY may seem like the best option. Although, you may still want to consider looking at financial numbers while seeing other options. Selling your house is not only about making money but also making your life easier post-retirement. If take a look at the statistics, according to a study it was shown around 64% of seniors chose downsizing to lower their monthly expenditure on housing costs. Whereas, around 44% stated owning a huge house is too much work and maintenance.
When you decide to sell a house you are inclined to buy a house of your choice as you have definite advantages over young buyers, how? Starting with you likely have more cash to offer, school districts are not an obstacle, and living near your workplace is not required anymore. All of this is a bonus while you hunt for a property of your choice.
#2 What Is Better While Retirement, Buying Or Renting?
Buying a house may sound like the safest option while planning your retirement. Although, there are some touchdown points you may want to consider. In some cases, renting is the most feasible option. To begin with, renting a house makes sense if you want to save the constant repair costs. Furthermore, renting promises a predictable monthly expense flow making your life much easier. It enables you to even change your mind and change the current house or just look for more space, fewer amenities, etc. Also, if you plan to move out of the city or even the country you have the liberty to do so when renting.
#3 Is Piling Up Extra Cash For Retirement On Your Mind?
Most of the retirees who downsize soon discover expenses they never knew about. Moving altogether can be a lifestyle change as you might live in new weather, clothing, furniture, etc. Although, downsizing from a huge bungalow to a condo can result in a significant amount of savings.
#4 Do You Have Enough Funds To Fix Up Your Old House?
Let’s get it straight, the longer you live in a house the more difficult it gets to sell it later. Furthermore, selling the property can be an expensive undertaking as it will definitely require improvements. If you don’t have enough funds handy to renovate your house or take up any new improvement project, it is best to sell it as-is for cash. Selling a tenant-occupied property for cash will save you from the extra costs and troubles of selling your house the traditional way.
If you want to avoid the hassles of falling into the straining home-selling process, you may consider selling your property to a cash-buying company. At Elite Properties, we buy and sell properties online and provide a no-obligation offer to our customers. Selling your home to a cash-buying company will give you hard cash in return. Sell your house as-is and save that extra money from drowning in real estate agents and home improvements. Call us today at 718-977-5462 and our experts will offer you the best solutions.
After a lot of house hunting, you’ve finally found the home of your dreams. A house with the right amount of rooms and a beautiful front yard so, what do you do next? How do you turn yourself into a homeowner from being a potential buyer? It’s simple, you apply for a mortgage to finance the purchase of your new home. As simple as it sounds there’s a lot that goes into applying for a mortgage and one of them is the mortgage underwriting process. If you’re a potential buyer, here’s a Step By Step Detail On Mortgage Underwriting Process.
What Is Exactly Mortgage Underwriting?
An underwriting process merely determines whether a buyer is able to pay back the loan to the lender. It is a process due to the lender, assessing the risk of lending money. The lender here will assess and verify your income, debts, assets, etc. towards the decisive approval for your loan.
What Goes Into Mortgage Underwriting
A mortgage underwriter’s responsibility is to assess the overall risk of the potential buyer, and whether he/she would be able to repay the mortgage. The underwriter evaluates the factors which help the lender comprehend a buyer’s financial condition that including –
- Buyer’s credit score
- Buyer’s credit report
- Property intended to be bought by the buyer
Additionally, the underwriter also aids the lender in determining if the buyer may or may not see a forthcoming loan approval. The motive of this process is to ensure the buyer doesn’t end up closing a mortgage that they can’t afford. An underwriter further will investigate the buyer’s credit history, order an appraisal, verify the income and employment, analyze the Debt-To-Income Ratio, and lastly, verify your payments and savings.
What Is Automated Underwriting Vs Manual Underwriting
A mortgage underwriter has two options to assess the loan application. The first is to do it manually and the other through software, which is known as automated underwriting. An automated underwriting process is much easier and faster than the manual one as a computer evaluates it. Although, it has some limitations that are non-negotiable like inconsistent income, poor credit score, etc. That may be a deal-breaker for borrowers. Hence, in such circumstances, manual underwriting is an easy option. Furthermore, in some situations, lenders combine automated and manual underwriting to avoid the complications of the loan application.
The Underwriting Process
As explained above in brief, an underwriter evaluates your finances and forwards them to the lender. Although, there are more aspects that need to be analyzed while proceeding with the underwriting process. Some of the aspects are given below.
While assessing a buyer’s income the underwriter requires a set of documents as proof to determine if he/she can cover the monthly mortgage payments. As a buyer, you’ll need to submit documents like –
- W-2 (of last 2 years)
- Bank Statements (2 most recent ones)
- Pay stubs (2 most recent ones)
Furthermore, if the buyer is self-employed or has a share in a business there are some additional documents that need to be submitted, such as –
- Profit And Loss Sheets
- Balance Sheets
- Personal And Business Tax Returns
Adding to the above, the underwriter will verify if the buyer’s income is as mentioned in the payslips (or any other format where the income details are provided). Also, the underwriter will verify your employment status with the employer as well.
Your assets help you qualify for a mortgage as they can be sold for hard cash if you fail to satisfy the outstanding loan amount. An underwriter will go through your savings accounts, stocks, and property if any. As the closing amount ranges from anywhere from 3%-6% lenders use assets to make sure the buyer makes monthly payments post-paying closing costs.
It is one of the most important aspects of mortgage approval, is assessing your credit score. An underwriter will evaluate your credit score to understand how well you have managed to repay your past loans. Assessing your credit score helps the underwriter to predict your capacity to repay the loan.
The underwriter needs to understand the worth of the house you’re interested in buying. The motive for seeing the collateral risk is to avoid putting the buyer’s money in a house that is not worth it. Hence, as a part of the closing process, the lender will order an appraisal.
Potential Underwriting Consequences
There can be only three possible consequences of the underwriter’s evaluation as given below.
Conditional / Contingent Approval
This means you are entitled to submit more documents to satisfy the underwriter’s questions. Although, you’ll be clear to close while the documents go through the assessment. One of the most common requests includes verification/proving large amounts of deposit in the buyer’s bank. In such situations, a gift /donation letter from the donor is vital (if the amount is gifted or given as a donation) to prove it’s not a loan.
This means there are significant questions in your file for which a loan officer will work with you closely to resolve the underwriter’s questions.
This means even if the buyers got the loan pre-approved and had a thorough review of their finances, their loan will still be ultimately declined.
How Long Does Underwriting Take To Complete?
The underwriting process takes up to 5-8 days. Although, there are dependencies like your financial condition, loan type, missing paperwork, etc. that may prolong the whole process. Additionally, a point to remember, underwriting is a mere part of the process. A complete closing can take up to 40-50 days in total.
A pro tip to speed up the process is to keep the documents in place, maintain a good credit score and always put a larger down payment. This way it’ll make the mortgage underwriting process a smooth sail. Furthermore, if you are in a hurry to move out and don’t have time for a traditional home-selling process then sell your house to Elite Properties. We buy houses as-is which means no hassles of legal documentation. We close a deal in less than 7 days and offer you hard cash. Call us today at 718-977-5462 and sell your house fast for cash.