Sep 25, 2023 | Home Buyer Tips, Home Mortgage Tips, Real Estate
Recent reports from various title companies and other leaders in the real estate industry show that across the United States, systematic fraudulent schemes involving sophisticated seller impersonation efforts are targeting existing owners and prospective purchasers of vacant, unencumbered land. These schemes target both residential and commercial properties in rural and metropolitan areas alike.
The scammers orchestrating these schemes typically begin by searching various real property records to identify real estate that is free of any mortgage or other liens (often vacant lots or rental properties) and the identity of the property owner. Next, scammers will contact a real estate broker posing as the owner to list the property for sale (often at a below market value to generate immediate interest). Once a prospective buyer is identified, the closing process will begin. Although scammers typically will communicate only by email through this process, more sophisticated operations recruit individuals to participate in all transactional phases, including diligence phone conversations and even personal appearances at signings. When facilitating due diligence and closing efforts, scammers will forge notary stamps, signatures and even identification documents such as driver’s licenses. These falsified documents are provided to the title company or closing attorney at closing, the fraudulent deed is recorded and the buyer’s funds are wired to the scammer (often to an overseas account).
Red flags include:
- No outstanding mortgages – free and clear property
- Vacant land
- Seller in a rush to close
- Owner is a non-US citizen
- Sales amount is usually under $50,000
- County’s Property Appraiser records show the owner’s address to be outside of the U.S.
- Real estate agent never meets with principals and is hired by e-mail
- Sale documents are e-mailed to seller(no in-person closing or use of RON)
- Typographical errors and non-matching signatures
- Passport/ID appears suspect –cut and pasted photos, for example
- Notary acknowledgments are suspect and may claim to be f rom U.S. Embassy or an attorney/notary in South Africa or other foreign country
- Purported owner is not currently located at the owner’s address listed in the county’s tax records
- Wiring instructions use banks not located in the owner’s country of residence, as shown in county’s tax records, and/or list third-party payee/account owner
- Multiple foreign countries involved for one party(seller in one place, documents notarized in another, wire going to another country, for example)
- Documents sent to title company already executed without prior inquiry to title company about how they need to be completed and acknowledged.
Resources:
Mar 3, 2023 | Home Mortgage Tips
Are you in the market for a new home? If you are considering a mortgage, you may be curious about mortgage insurance, commonly referred to as PMI or MI. Let’s explore the topic of mortgage insurance, including how it works to reduce risk and how it benefits you as the mortgage borrower.
Mortgage Insurance = Risk Reduction
You might not know this, but the toughest part of the home buying process for many individuals and families is coming up with the required down payment. For example, if you were to buy a $200,000 home, you may want to invest $40,000 or $60,000 or more in the down payment. The remainder would be borrowed in your mortgage, which you would then pay off each month.
Most mortgage lenders require a minimum of 20 percent as a down payment. In the example above, this means having $40,000 cash on hand before you buy the home. If you can’t come up with this much, your lender may require mortgage insurance be purchased to protect them in case you default on the loan.
Mortgage Insurance Can Help You Qualify
Since mortgage insurance reduces the lender’s exposure to risk, it can help you in a number of ways during the qualification process. First, you can put less in your down payment than you had initially intended, which can increase your buying power and the size of home you can afford. Mortgages backed with a private insurance policy tend to be approved a bit faster than those that aren’t. Also, if you decide that you don’t need it later, many mortgage insurance policies can be canceled, which saves you a bit of money.
Look For Supplemental Benefits
Finally, don’t forget to ask your mortgage lender about any supplemental benefits offered with your mortgage insurance policy. Some policies protect you in the event that you lose your job or provide a partial claim advance if you can’t pay your mortgage. Note that not all policies have these benefits, so be sure to ask.
While it is true that mortgage insurance provides benefits to lenders, it also offers significant benefits to you as the borrower. To learn more about mortgage insurance or to get pre-approved for a mortgage so you can buy a home, give us a call today. Our friendly team of real estate professionals is happy to help.
Feb 3, 2023 | Home Mortgage Tips
Whether you have recently graduated from college or are getting close to retirement, it’s likely that you have given some thought as to how you can grow your net worth. You might have invested in stocks, picked up a few bonds or have a 401(k) plan set up to help fund your retirement. But have you considered buying real estate as part of your portfolio?
In today’s blog post we’ll have a look at three reasons why real estate investing is one of the most effective ways to grow your overall net worth.
Reason #1: It Generates Passive Income
One of the best reasons to hold real estate as part of your investment portfolio is that it can generate passive income in the form of rent. Whether you buy a single-family home or an apartment block, you can almost certainly find interested tenants who will live there. Part of the rent you receive each month will cover the costs of owning and operating the property. The rest of it is income which will continue to build over time.
Reason #2: It Increases In Value Over Time
Another great reason to invest in real estate is that in most cases, it increases in value over time. As long as you are maintaining the property and investing in its upkeep you have a decent shot at it being worth more in the coming years, should you decide to sell. Keep in mind that real estate is cyclical and that it’s not always going to be the right time to sell and realize your gains.
Reason #3: You Can Leverage Equity To Buy More Properties
Finally, our third reason that real estate is the best way to build your worth is your ability to use it as leverage to buy more real estate. For example, say you decide to purchase a house valued at $100,000 as an investment property. Once the mortgage on that home is paid off, you have an asset valued at $100,000 that you can then borrow against. So you can go out and acquire another $100,000 home without having to sell the first. As you can see, this can scale quite nicely over time.
If you are interested in learning more about real estate investing, give us a call. We are happy to share our insight and expertise as well as advise you on the best local investment properties currently available.
Jun 14, 2022 | Home Mortgage Tips
Technology has come a long way, and you might be thinking about turning your house into a smart home. Now, there are a lot of smart home products available, and you may have a difficult time keeping track of which ones are best for you. What are some of the top smart home products you need to know about?
A Smart Lock
If you are tired of misplacing your keys, you should consider investing in a smart lock. Smart locks come in many shapes and forms, and many of them allow you to program multiple combinations into them. This means that you can give different combinations to different people, keeping track of who comes into your home based on the combination that is entered. This is particularly helpful if you want to allow your kids to enter the house when you are not home. You may even want to invest in the smart lock that comes with Bluetooth connectivity. That way, you don’t have to worry about getting locked out of your house ever again.
A Video Doorbell
If you don’t want to deal with solicitors anymore, you may want to invest in a video doorbell. With a video doorbell, you can see who is on the other side of your door when he or she rings the doorbell. You can even communicate with these people when you are not home. You can give instructions to food and package delivery personnel, or you can ignore the doorbell if there is someone outside you do not want to talk to.
A Smart Thermostat
A smart thermostat can help you save money on your utility expenses. Using a smart thermostat, you can place the HVAC system on a predetermined schedule, ensuring that it does not work as hard when you are not home. A smart thermostat can also give you access to detailed analytics, helping you figure out what you can do to reduce your utility expenses. You can even control your HVAC system remotely when you are not home.
Upgrade Your House With Smart Home Products
These are just a few of the many smart home products that can help you upgrade your standard of living. Consider taking a look at how these products might work with your home.
Jul 7, 2021 | Home Mortgage Tips
A mortgage application is typically several pages in length, and it requires you to provide a considerable amount of information about your personal, professional and financial life. Some mortgage applicants may not have access to all of the information when completing the application, and others may simply skim over the form and provide incomplete answers. These are only a few of the reasons why information on the mortgage application may not be accurate, but there are several key reasons why applicants should avoid giving inaccurate information.
Loan Approval is Based on It
The initial loan application will usualy serve as a basis for the pre-qualification of the mortgage request. The applicant may make a decision to move forward with an offer to purchase a home based on this pre-qualification, but the pre-qualification is based on the accuracy of the information that is initially provided to the lender in the loan application. If the information is incorrect then an applicant may not be able to qualify for the loan and the deal could fall through.
Information Will Be Verified
The majority of the information that is provided by the applicant in the loan application will be verified at various points throughout the loan process. For example, a credit report may be pulled very early on in the loan process, and it may be used to document the accuracy of the debts and monthly payments that the applicant wrote on the loan application. Tax returns, pay stubs and other related documentation may also be required. Essentially, the lender will eventually have access the accurate data, so there is little benefit to provide inaccurate information up-front on the loan application.
It Is Against the Law
A final reason why it is not advisable to provide inaccurate information on the application is because this is illegal. There is a disclaimer on the standard mortgage application that goes into detail about the law regarding providing false information on a loan application. There are also disclosures that are signed before and during closing that relate to this.
Completing a loan application is among the first steps mortgage applicants take when applying for a loan, and it is easy to overlook the importance of providing accurate and detailed information at this stage in the process. It is best to take time complete the loan application as thoroughly and accurately as possible since it is a legal requirement and because of many other negative consequences. Those who have questions about how a loan application works or who would like to begin the loan application process can reach out to their trusted mortgage professional for assistance.
Mar 24, 2021 | Home Mortgage Tips
There is a lot of jargon that comes with purchasing a home. Even though this could be confusing, purchasing a home is also a significant decision. Therefore, it is critical for everyone to understand exactly what they are signing before they scribble their name on the dotted line. In some cases, a co-borrower or a co-signer (also called a non-occupying co-borrower) could be needed to strengthen the application. What is the difference between these two terms?
What Is A Co-Borrower?
First, a co-borrower is simply a co-owner. Both names are on the title of the home. The co-borrower also shares the responsibility of the debt. This arrangement is typically used when two people are purchasing a home together. Usually, the primary borrower is going to be the person with the higher credit score. At the same time, the credit scores of both owners will be taken into consideration.
What Is A Co-Signer?
Also called a nonoccupying co-borrower, a co-signer is similar to a guarantor. Legally, a cosigner will not have any claim on the home. They will not take possession of the home and their name will not go on the title. On the other hand, they are still financially responsible for paying back the loan. In the event the primary borrower is unable to meet the monthly mortgage payments, the financial responsibility will fall on the co-signer.
Choose The Right Co-Borrower Or Co-Signer
It is critical for everyone to make sure they choose the right co-signer if they need one. Ideally, a primary borrower will be able to file a successful home application on his or her own. On the other hand, if the bank or credit union says that a co-signer or co-borrower is needed, it is critical to find someone who is reliable and trustworthy. Remember that they are going to be responsible for paying back a loan in the event the primary borrower cannot make the monthly mortgage payments.
