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Select one of the frequently asked questions below to learn more about buying, selling, and renting real estate. Also, begin to think about important things to consider when diving into your real estate search.

Question about buying & selling

Can a home depreciate in value?

Generally, real property never depreciates in value, or more so, it is not very common for property to depreciate.  This is why it’s a great investment. Make sure you carefully consider location and community when choosing a home; it can affect the home’s future value greatly.

If you are in a newly developed area, do some research on the construction of the surrounding areas being developed to determine if they may affect your home’s value.

Is an older home as good a value as a new home?

This is really just a matter of preference, but both newer and older homes offer distinct advantages, depending upon your unique taste and lifestyle.

Older homes can cost less than new homes, however, there are many cases where new homes can also cost less than older homes. Most new homes will not have any backyard landscaping and some don’t include any front landscaping, either. With an older home, the landscaping is already completed and could have tens of thousands of dollars in landscaping done, which is included in the purchase price.

Taxes on some older homes may also be lower. Some people are charmed by the elegance of an older home but shy away because they’re concerned about potential maintenance costs. Consider a home warranty to get the peace of mind you deserve. A good home warranty plan protects you against unexpected repairs on many home systems and appliances for a full year or more after you move in.

In a new house, you can pick your own color schemes, flooring, kitchen cabinets, appliances, custom wiring for TV’s, electrical, computers, phones and speakers, etc., as well as more upgrade options. Modern features like media rooms, extra-large closets and extra-large bathrooms and tubs are also more attainable in ground-up construction. In a resale, you rely largely on the previous resident’s tastes and technological whims, unless you plan to farm thousands into remodeling and rewiring.

New home designers can use new building materials such as glazed Energy Star windows, thicker insulation and other technology that will lower future energy costs for the owner. Most states now have minimum energy-efficiency requirements for new construction. Kitchens and laundry areas in new homes are designed to house more efficient energy-saving appliances. Older homes, unless they have undergone an energy retrofit, usually cost much more per square foot to air-condition and heat.

Builders have to follow very strict guidelines in new homes and additions, especially in the West and Northwest, where earthquake safety standards must be observed. In Florida, hurricane standards in new

construction must be adhered to.  New homes are usually more fire-safe and more accommodating of new security and garage-door systems.

As you can see, there are advantages and disadvantages to each, but it really comes down to what works best for you and what you are looking for in a home.

What is a broker?

An agent who is authorized to open and run his/her own agency. All real estate offices have one principal broker.

What is the difference between being prequalified and preapproved for a loan?

If you’re pre-qualified, it means that you could POTENTIALLY  get a loan for the amount stated, assuming that all of the information you provide to the bank or mortgage lender  is accurate and true. This is not as strong as a preapproval.

If you’re pre-approved, it means that you have undergone the extensive financial background check, which includes looking at your credit history, previous tax returns and verifying your employment – and the lender is willing to give you a loan, basically meaning you’re approved!  Then it goes to underwriting for final approval.

You will usually be provided an accurate figure which shows the maximum amount for which you are approved.  Most sellers prefer buyers that have been pre-approved because it gives them more confidence that the sale will be completed.

What is title insurance?

Title insurance is insurance that protects the lender and buyer against any losses incurred from disputes over the title of a property.

Can I pay my own taxes and insurance?

When a loan is originated, the mortgage documents specify the escrow conditions. This has become a standard practice for all mortgages, including FHA, VA and conventional mortgages.  Occasionally on conventional loans, FRFCU waives the collection of escrow requirement at closing if the member has a minimum 20% equity position in the property.

How can I avoid private mortgage insurance?

The easiest way to avoid PMI is by putting 20% down payment; however, PMI can also be avoided if you only have 5% or 10% for the down payment. The way to accomplish this is via a first and second mortgage combination commonly referred to as 80/10/10^s or 80/15/5^s.

These two methods combine a first mortgage lien for 80% of the home price with a second mortgage lien for either 10% or 15% of the home price leaving the remaining 5% or 10% as the down payment. Because the first lien is at the magical 80% loan=to-value, there is no PMI required, even though a second mortgage is being |piggybacked| onto the financing thus allowing for the lessor down payment.

While the second lien terms are not as attractive as first lien rates, the second mortgage is still home mortgage interest and thus deductible as such on your federal tax return where PMI is insurance and offers no deduction.

How is interest calculated on a mortgage loan?

Most mortgages originated today calculate interest in arrears, unlike consumer loans which calculate interest to the date of payment receipt. As an example, when borrowers pay their February mortgage payments, they are paying the January interest. This method of calculating interest is based on a 360 day year in which each month has 30 days.

Is there a minimum credit score?

There is no set credit score that will guarantee a mortgage loan approval. The lenders take many things into consideration when underwriting a loan. Your mortgage broker will explain what requirements including credit scores are needed for your specific circumstances.

What benefits do I receive from private mortgage insurance?

Ask a mortgage broker today.

What do I do if I receive a tax statement?

Many tax authorities will mail an informational copy of the real estate tax statement to the homeowner in addition to the Credit Union.  However, there are some statements tax authorities do not forward to the credit union, and in special cases we will need your assistance in obtaining the bill. If you receive a statement for any of the following, please forward it to our office by mail or fax.

  • delinquent real estate taxes
  • supplemental or additional real estate taxes
  • special assessments
  • if the tax authority will not honor a bill request from another party.

How long does the loan process take?

Most mortgages can be done within 30-45 days. However, this depends on what your lender requires and may depend on multiple factors. Not to mention the bank being used to close the loan and what their underwriting times are. Typically all Real Estate transactions have the loan application period and loan approval time defined for all parties before signing a contract.

Question about renting

Is there any application I need to complete?

Yes, most Treasure Coast homes for rent are listed with local Real Estate brokers for rent. They will require a detailed application from potential tenants. Most landlords want employment information, income verification and references in the initial application.

Should I drive around and look for rental homes?

This is really up to you because there are many homes for rent throughout the Treasure Coast. Many are listed on the MLS and we can easily email you detailed reports on all of them. In some cases, you may find a private rental and these are typically not something our agents get involved with.

We have successfully placed hundreds of clients into amazing rental homes on the Treasure Coast.

What credit score do I need to rent a home?

There really isn’t any set credit score to rent a home on the Treasure Coast. There are many factors that go into renting a home and credit is a large part of that, but not everything.

We constantly surprise our clients with the level of support we offer when credit becomes an issue.

If I have pets when is the right time to tell my agent?

You should disclose any pets that live with you and will be moving into your new rental home. We will provide accurate rental home listings that allow pets like yours. Plus many of the homes for rent on the Treasure Coast do not allow pets and we won’t email you those.

Is there a minimum credit score?

Many rental homes require a minimum credit score. If you are concerned please ask our Real Estate agents so we can help you in the best way possible.