Steps To Follow When Buying A Home

 

Purchasing a home is a big life step and with any big life change, it is always best to be prepared and knowledgeable in order to make the right decision. Below are five simple steps to take when buying a home.

1. Organize your finances

The first major task in this step is to save for a downpayment. Most conventional loans require a 5% - 20% downpayment at closing. In fact, a conventional loan will require PMI(private mortgage insurance) if you put less than 20% down. A good incentive is the larger the down payment the better rates a lender will offer. Putting a larger downpayment on a home will allow you to save money over the life of the mortgage loan.

Another factor that will determine your interest rate and the type of loan you qualify for is your credit score. A credit check is required by lenders in order to offer you a mortgage. Remember lenders do perform hard inquiries on your credit report which will impact your credit score. If you are shopping around for mortgage lenders, ask them to do a soft inquiry on your credit check so it will not impact your score.

You will also want to save up for closing costs which will be about 3% of the total home price. These costs include the loan, underwriting, and other fees associated with the purchase.

2. Determine how much house you can afford

When sitting down to determine how much you are able to afford on a house, look at your debt-to-income ratio. A lender looks at your debt-to-income ratio. Basically, this is comparing your income to your debt and usually, it has to fall under 43% to qualify for a mortgage. An example would be if your monthly debt totaled $3,000 and your monthly income is $10,000 your DTI would be 30%.

Not only should you understand your DTI but also how a mortgage payment is calculated. A monthly mortgage payment includes the principal payment (goes toward the amount you borrowed), interest, escrow (property taxes/homeowner's insurance) and if applicable PMI. A mortgage calculator is a great way to become familiar with the cost associated with a mortgage.

3. Understand your mortgage

There are several pieces that lenders use to determine your interest rate. The better your credit score the better your interest rate. Someone with a lower credit score could have a 1% higher interest rate on the same mortgage as someone with a higher credit score. The length of the loan also plays a factor. In some instances choosing a 15-year loan over a 30-year loan will allow you to get a lower interest rate. The Federal fund rate also determines the interest rate. If the federal funds rate is low, it means it does not cost a bank as much to borrow money. Those savings are passed to you from the bank in form of a lower interest rate. Different lenders will offer different rates so shop around for the best rate. A primary residence will also be in favor when it comes to a lower rate. A secondary or vacation home will bump the interest rate up.

Conventional loans have stricter qualifications than an FHA loan. An FHA loan allows for a smaller down payment and less stringent qualifications. This is a great way to go if you are a first-time homebuyer. To compare, a conventional loan minimum credit score is around 620, where an FHA minimum credit score is 500 - 579.

As mentioned before, PMI can increase your monthly payments. If you want to avoid PMI you have to put at least 20% down. If you cannot put 20% down, PMI can be removed off a conventional loan once you have a built-up 20% equity. On an FHA you will either have to pay PMI for 11 years or the life of the loan. This depends on the loan amount, length of the loan and the loan-to-value ratio (LTV). If you do decide to go with an FHA, you will also be required to have Up Front Mortgage Insurance (UFMI). This will be 1.75% of the base loan amount and can be paid at closing or rolled into your monthly mortgage payments.

4. Get pre-qualified or pre-approved for a mortgage

There is a difference between getting pre-approved vs pre-qualified for a mortgage. Sellers like to see a pre-approval letter from a mortgage lender. This means the buyer is serious and can afford the home.

• Pre-qualification is a quick process that tells you roughly how much you can afford to spend on a home, based on your self-reported income, debts and assets.
• To obtain pre-approval, you’ll have to provide verifiable financial documents to the lender. The lender will review your credit report, financial history, income statements and more to determine how much they would be willing to lend you.

5. Look for a property and make an offer

In today's market, there are more buyers than sellers making it hard for a buyer to sit and think on it overnight. If you like the home and it fits all your criteria, submit an offer.

A Realtor can help you with the process and help you navigate this hot market. They can negotiate your price and terms as well as recommend mortgage brokers, title companies and inspectors. A Realtor will be with you from your search to the closing.

Click Here For the Source of the Information.

A $75,000 Our Town Grant Goes to A Studio in the Woods

 

A program of Tulane University’s ByWater Institute called A Studio in the Woods, is receiving a $75,000 Our Town Grant from the National Endowment for the Arts. The grant will be used towards Searching for the Ghosts of the Gulf, a collaborative project with artist and biologist Brandon Ballengée and the Plaquemines Parish Government.

A Studio in the Woods is a retreat for artists, scholars, and the public. It is a place in Lousiana's protected forest along the Mississippi River where patrons can go to relax and focus on their creativity. The organization has built a network of artists interested in works based on southern Louisiana's environment.

Searching for the Ghosts of the Gulf is a project that artist and biologist Brandon Ballengée and the Plaquemines Parish Government are coming together to create. Brandon Ballengée will be a community-based residency at A Studio in the Woods where he will study and explore endangered fish species from the Gulf of Mexico.

“We are thrilled to be partnering with Brandon Ballengée and the Plaquemines Parish Government to bring dynamic, accessible, and fun programming about environmental change to our neighbors in Plaquemines Parish,” A Studio in the Woods Managing Director Ama Rogan remarked, “We hope this project sparks new understandings, conversations, and bonds in our communities.”

Ballengée states, “Together we will build resilience for coastal populations using citizen driven art/science research while taking collaborative actions towards a collective future survival.”

Our Town funding is the National Endowment for the Arts grant that will help fund projects such as this at A Studio in the Woods. There are 63 grants like this nationwide which supports projects that integrate arts, culture, and design activities into efforts that strengthen communities by advancing local economic, physical, and/or social outcomes; ultimately laying the groundwork for sustainable systems change.

“It is always exciting when Plaquemines Parish can partner with outside organizations to bring grant money into our parish. This project in particular will help us to expand our coastal resilience, which as we know is one of the most important and pressing issues we face,” said Plaquemines Parish President Kirk M. Lepine.

Click Here For the Source of the Information.

Belle Chasse Medal of Honor Park Honors War Veterans Will Finally Be Completed

 

The Louisiana Medal of Honor Park is finally going to be finished after construction came to a halt about 18 years ago. Originally the park was created to display over 4,000 medal recipients from the Civil War to present-day conflicts.

The structure was built by Seabees from the neighboring Naval Air Station and Joint Reserve Base. The five large concrete structures that make up the monument have been funded by donors and volunteers throughout the years.

“It’s an ongoing process for sure and the upkeep of it and the maintenance and everything,” park designer and board member Jody Coyne said.

Over the years the park has been short in supply for funding to complete it. Coyne says the park site is a tribute to all those who have served in the military and is a labor of love. It is a special play for Plaquemines Parish’s military community.

The funding to complete the 34-acre tribute will come from a federal grant that is also paying for a new main gate to the Navy base across the street from the park.

“If everything goes right, we should finally have a nice pavilion building with restrooms and stuff for the public, a large playground area in the front and a museum building off to the left side," Coyne said. “We hope we can complete this and dedicate this, have another re-dedication ceremony to honor everyone’s that ever given the ultimate sacrifice.”

Click Here For the Source of the Information.

Seven Mistakes On Mortgages That Can Be Dodged

 

Whenever you are making any large financial decisions, due diligence is a must. When it comes to obtaining a mortgage, overlooking these mistakes can cost several thousand. Here are seven mistakes that should not be overlooked when it comes to a mortgage.

Number one is to avoid not shopping around.

Just like with any other consumer product or service, you always want to shop around for the best deal. By doing this, homeowners can save by obtaining lower mortgage rates. According to a study done by Freddie Mac, consumers who obtain five rate offers saved around 16.6 basis points (bps) (or 0.166 percent) on their rate on average.

One myth that can be laid to rest is by shopping around for a mortgage you will lower your credit score. This is not the case. Usually, there are two weeks where you can have additional hard inquiries without penalty. Take your time and shop around do not just take the first offer without making sure it is the best for you.

Number two avoid paying unnecessary fees.

Do not just focus on your mortgage payment, there are additional fees that need to be considered when obtaining a mortgage. Even with no origination fees or lender commissions, there is still some additional cost that cannot be waived. The fees that can be waived are application fees, loan origination fees, loan officer commission and credit report fees.

Number three consider a 15 or 20-year mortgage.

You do save a little with a 30-year mortgage but that is only short-term. Over the life span of the mortgage, you will make payments for a longer period of time adding more interest than you pay to the lender.

With a 15-year mortgage, the monthly payments are higher but you will pay off the principal faster and with less interest paid to the lender. A 15-year mortgage interest rate is lower so you will be paying more towards the principal.

To make sure you make the right decision for you, compare the principal and interest on a 30-year fixed vs a 15-year fixed. If you are obtaining a $250,000 mortgage with a 10% down payment, a 30-year fixed will have a monthly payment of $1,024 with a 3.61% interest rate that totals to $143,719 in interest costs and a 15-year fixed with a rate of 3.13% will have a monthly payment of $1,568 and total interest cost of $57,226.

Number four consider all the cost when it comes to owning a home.

There are tons of hidden and sudden expenses when it comes to owning a home. Your final cost is not just the monthly mortgage payment so do not count on the figure a mortgage calculators give you.

A rule of thumb is to put away at least one percent of your home’s value each year for home maintenance and repair. So for a $360,000 house, you would set aside $3,600 a year or $300 a month.

Number five make sure you have a clear understanding of points and lender credits.

Points on a mortgage are referred to as discount points. When obtaining a mortgage you can pay off a one-time fee or points on top of your normal closing cost to get lower interest rates. Credits are referred to as lender credits. You would pay less in closing costs but have a higher interest rate.

Weigh each option to see which would be the best for you. Ask yourself how long will you hold on to the property? If you are going to keep the property for a long period of time you would benefit from paying discount points. However, if you are only planning to sell or refinance in a couple of years, lender credits are the way to go.

Number six check your credit score prior to obtaining a mortgage.

Your credit score can have a huge impact on approval for a mortgage. Each credit bureau allows a free credit report every year. It is always a good idea to review your credit report annually.

Number seven never leave any information off of your mortgage application.

The mortgage application is the first key step in getting preapproved. Misinformation or omitted information can lead to a non-approval. A common mistake many make is not including child support or alimony payments.

Lenders want to see everything you owe to make sure you can afford your mortgage payments. Even if you incur debt but make little or no payments, it is still owed.

Avoiding these mistakes is just one of the many steps you should take when obtaining a mortgage. When purchasing a home, your Realtor can help you make the right decision on a mortgage lender.

Click Here For the Source of the Information.

Algiers Point Sees Plans For A Multi-Use Development

 David Fuselier, a real estate developer, wants to put a multi-use development that will include a grocery store, single-family houses and condominiums on 10 acres in Algiers Point. The property was once home to a local steam locomotives manufacturer.

The 10-acre site, located at 1200 Opelousas Ave, is the biggest undeveloped piece of land on Algiers Point. Unfortunately, contaminants were found on the land from decades of diesel fuel spills but in December 2020 after the issue had been rectified, Louisiana issued a certificate of completion.

In January 2020 Fuselier and his partners his sister, Megan Fuselier Spiehler; Stuart Coleman; and Andrew
Coleman, purchased the land for close to $3.9 million. They plan to begin construction in the Fall of 2021 and is slated to complete in two years. The partners hired architecture firm Concordia and will hold a meeting with the architect firm and the public for input.

If approved by the New Orleans Planning Commission and the City Council, they plan to build a 22,000-square-foot grocery store with a rooftop restaurant and bar. Although they have not signed with any grocery store tenant, they feel optimistic.

“We’ll have one soon,” Fuselier said. “We’re going to be talking to every local and national grocery tenant we can think of. There’s gonna be a lot of effort put into attracting the best that we can find.”

Plans show there will be 24 lots for single-family housing, 24 units for military veterans and 204 condo units for “workforce” housing priced at 60% to 120% of area median income.

“It’s really targeting people who do not qualify for other subsidy programs … but still need housing,” Fuselier said. “A lot of people are priced out of the market, and  we’re looking to bring opportunities for homeownership at affordable price.”

Click Here For the Source of the Information.

Things To Consider When Deciding To Downsize Your Home

 

Different stages in your life also can affect the amount of living space you need. If you are in an empty nest stage or just want a change, downsizing might be your answer. Of course, downsizing has financial advantages but a smaller living space also means less upkeep, and lower monthly expenses overall.

Taxes can play a big part in this decision. Selling your bigger home will net you more income that can be taxed. According to the Department of Treasury Internal Revenue Service (IRS), if you sell your principal residence for a profit, up to $250,000 of that capital gain can be excluded from tax. If you are a married couple who files jointly you could have up to $500,000 from the sale of your home that is not taxed. For example, there are exceptions if a homeowner has owned their home for several decades or if a homeowner lives in a neighborhood that has experienced a huge appreciation.

Before selling your current home check to see if you pass the ownership and use test from the IRS. For you to claim the maximum exclusion you must have owned your current house you are selling for at least two years and the house you are selling must be your primary residence for at least two out of the last five years. The two years counted towards residency do not have to be consecutive.

The IRS will make exceptions such as selling before owning a home for two years because of a job change, divorce, or natural disaster or what the IRS deems as an unforeseen circumstance.  If the IRS decides you are eligible, then you will be able to prorate the exclusion.

You will need to determine the capital gains on the sale of your home. In order to do this, take the cost basis and subtract it from the selling price. Your cost basis includes the original purchase price, settlement fees, closing costs. The higher the cost basis the lower your potential tax liability will be.

If you are in the market to downsize, go through a local sales agent to both sell your current home and purchase your downsized home. A Realtor can help you with the right financial way to go when downsizing.

Click Here For the Source of the Information.

A Unique Learning Tool for Students at Belle Chasse Academy

 Belle Chasse Academy is giving its students the opportunity to learn through the school’s culinary garden and teaching kitchen. The school follows the unique teaching method that incorporates food into traditional math, science, and social studies. Students can learn about botany, nutrition and Native American culture through food such as corn.

The Victory Garden is partially backed by the Emeril Lagasse Foundation and is the “nature-based classroom.” Emeril’s Culinary Garden & Teaching Kitchen, founded by Emeril Lagasse, incorporate gardening and cooking into regular school curriculums. The program enriches the lives of kids through a fun, fresh perspective on food. The program is used throughout elementary and middle schools around the country.

The crops which include this spring collard greens, cucumbers, carrots, tomato vines and peppers are surrounded by a butterfly garden. The butterfly garden serves as the pollinator garden and is filled with flowers. The garden also features several hydroponics systems that are in a greenhouse-like structure. Certain types of food such as bib lettuce is grown in a nutrient-rich water solution instead of soil.

During the year students plant and harvest the crops. While working with the crops students learn math skills, science skills and social studies skills. Math is learned from measuring ingredients in the kitchen classroom, social studies are learned by studying where each crop comes from and science is learned through proper food nutrition. A great hands-on example is Chef Ryan Galle, Belle Chasse Academy’s culinary education coordinator, recently guided his students through a lesson on how food provides them with energy.

“A light bulb goes off. A lot of times they think culinary arts is just pulling out a pan or a pot and putting some food in it, and that’s it. The kids really enjoy it, said Galle, a native New Orleanian. “This is one of the best concepts of hands-on learning because it gets them out of the classroom. They get fresh air. The experience brings a lot of children out of their shells.”

Click Here For the Source of the Information.