Kathryn Jean Keller

NMLS# 57801 • Mortgage Loans

Important Things You Should Know About Land Surveys

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Important Things You Should Know About Land SurveysA land survey is an essential tool that is used to determine the exact boundaries of a piece of land or property. It is often required when buying, selling, or dividing land, and is also important for resolving property line disputes.

Process: The process of land surveying typically involves a licensed surveyor visiting the property to take precise measurements and create a detailed map or plan of the land. This may include identifying any physical features of the property, such as trees, buildings, or natural landmarks, as well as any easements or encroachments.

Types: There are several different types of land surveys, each with its own specific purpose. For example, a boundary survey is used to establish property lines, while a topographic survey is used to map the physical features of the land. Other types of surveys include ALTA/NSPS surveys, subdivision surveys, and construction surveys. It is important to select the appropriate type of survey based on the specific needs of your project or property.

Land Surveys Can Be Used For Insurance Purposes

Land surveys can be used for insurance purposes. A land survey can provide valuable information about the physical characteristics of a property, such as the location of buildings, trees, and other features. This information can be used by insurance companies to assess the risk of insuring the property and to determine appropriate coverage and premiums.

For example, if a property is located in a flood zone, a land survey can identify the exact location and elevation of the property, as well as any nearby bodies of water or drainage patterns. This information can be used by insurance companies to assess the risk of flooding and to determine appropriate flood insurance coverage.

Similarly, if a property is located in an area prone to wildfires, a land survey can identify the location of any vegetation, structures, or other features that may increase the risk of fire damage. This information can be used by insurance companies to assess the risk of fire and to determine appropriate coverage and premiums.

Does a fence help a land survey?

Yes, a fence can help a land survey by providing a physical marker of the property boundary. A land surveyor can use the fence to determine the location of the property line and ensure that the fence is placed within the boundaries of the property. This can be particularly useful in situations where the property line is not clearly defined or where there may be disputes over the location of the boundary.

It is important to note that a fence alone is not sufficient to establish the legal boundary of a property. In order to accurately determine the property line, a land surveyor will need to conduct a thorough survey that considers all available evidence, including property records, physical markers, and other relevant factors. Additionally, it is possible for a fence to be installed in the wrong location, either intentionally or accidentally, which can result in boundary disputes and other legal issues. Therefore, while a fence can be a useful tool in a land survey, it should not be relied on exclusively to determine the property boundary.

Overall, a land survey can provide valuable information for many purposes and can help property owners make informed decisions about insurance coverage and risk management.

What is a Bridge Loan and How Does it Work?

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What is a Bridge Loan and How Does it Work?A bridge loan, also known as interim financing, is a short-term loan used to provide temporary financing until a borrower secures long-term financing or sells an asset. Bridge loans are commonly used in real estate transactions, such as when a buyer needs to close on a new home before selling their current home.

Bridge loans are typically secured by the borrower’s current property, which serves as collateral. The amount of the loan is determined by the equity in the borrower’s property and the value of the property they are purchasing. The loan is intended to bridge the gap between the purchase of a new property and the sale of the existing property.

Bridge loans often have higher interest rates and fees than traditional loans, due to their short-term nature and the increased risk associated with them. They may also require a lower loan-to-value ratio, which means that the borrower may need to put down a larger down payment to secure the loan.

Once the borrower secures long-term financing or sells their existing property, they can use the proceeds to pay off the bridge loan. In some cases, the borrower may choose to refinance the bridge loan into a traditional mortgage if they are unable to sell their existing property within the loan term.

Requirements for A Bridge Loan

The specific requirements for a bridge loan can vary depending on the lender and the purpose of the loan, but there are a few general requirements that borrowers should be aware of:

Collateral: A bridge loan is typically secured by collateral, which is often the property being purchased or the borrower’s current property. The lender will require a valuation of the collateral to determine the loan amount.

Creditworthiness: Although bridge loans are often easier to qualify for than traditional loans, lenders will still look at the borrower’s credit history and credit score to determine their ability to repay the loan.

Exit strategy: Lenders will want to see a clear plan for how the borrower intends to repay the loan. This could include selling the existing property, securing long-term financing, or other means.

Loan-to-value ratio: Bridge loans typically require a lower loan-to-value ratio than traditional loans, which means the borrower may need to provide a larger down payment to secure the loan.

Fees and interest rates: Bridge loans often come with higher fees and interest rates than traditional loans due to the increased risk and short-term nature of the loan. Borrowers should be aware of these costs when considering a bridge loan.

It’s important for borrowers to carefully consider their financial situation and their ability to repay the loan before taking out a bridge loan. Consulting with a financial advisor or a reputable lender can also help borrowers determine if a bridge loan is the right option for them.

What You Need To Know About Your Home Appraisal And Your Mortgage

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What You Need To Know About Your Home Appraisal And Your MortgageWhen buying a home, there are certain steps a buyer should go through before the home sale is official. First the buyer makes the offer, then the offer is accepted.

Next the buyer schedules the inspection and home appraisal. Finally, everyone is ready for closing.

It’s easy to overlook the impact of some of these steps, but when it comes to a mortgage, the home appraisal is actually quite important. Banks want to see that they are lending money for an investment that is worthwhile, so that appraisal is a crucial step to getting financing. Here is what buyers need to know about how the appraisal could affect their mortgages.

Understanding The Home Appraisal Process

The home appraisal gives a home valuation expert the chance to evaluate the home a buyer’s considering to determine its market value. Home appraisers are highly trained, state-licensed professionals that know how to evaluate homes and assign value to them.

The appraiser will use various approaches to determine the final appraised value. The appraisal typically happens after an offer on the home was approved but before the lender loans the money.

The Appraisal And Mortgage Approval

The appraisal is one factor that a mortgage lender considers when deciding whether or not to approve a final loan request. Even if a borrower had preapproval, a low appraisal could cause the mortgage to fall through.

Why is this? A lender only wants to lend enough to cover what the home’s actual value, and if the appraisal comes in lower than what the borrower is asking for, the lender can deny the loan.

If the lender does not deny the loan completely, they may refuse to lend more than the home’s value. In order to buy the home at the agreed price, the buyer may need to come up with the difference in cash at closing.

What Can Buyers Do If The Appraisal Is Low?

If an appraisal comes in low on the home someone wishes to buy, the buyer shouldn’t panic. It is possible to get a new appraisal at a higher value.

First, consider the condition of the home. Did the seller let some things fall into disrepair? If the seller fixes those items, a new appraisal may be higher.

Does the home look rundown or cluttered? This shouldn’t affect the appraisal, but it can sometimes cause the appraiser to trend lower. Sometimes, simply asking for a second opinion might get a slightly different appraised value.  That said, if the appraisal is low, make sure to evaluate the purchase price. Is it in line with current market conditions and the overall condition of the home?

If the answer to that question is no, then the offer may be too much for the home. The appraisal, in this case, gives the buyer the opportunity to reevaluate the purchase decision.

When it comes to mortgage approval, the appraisal is one of the critical steps in the process. If a buyer has shopped wisely, the home should pass with flying colors, and soon the home sale process will be over.  As always, your trusted mortgage professional is the best resource for appraisal information in your local market.

Buying A Home With Cash Versus Low Interest Rate Mortgages

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Buying A Home With Cash Versus Low Interest Rate MortgagesWhen deciding whether to buy a home with cash or to obtain a low-interest rate mortgage, there are several factors to consider. A cash offer can be very competitive in a real estate market, as it can give the buyer a significant advantage over buyers who need to obtain financing through a mortgage.

Here are additional advantages and disadvantages of both.

Advantages of buying a home with cash:

  • You own the property outright, which means no mortgage payments are necessary.
  • You may be able to negotiate a lower purchase price if you’re able to pay in cash.
  • You avoid interest charges and fees associated with a mortgage.

Disadvantages of buying a home with cash:

  • You may tie up a significant amount of your liquid assets in the property.
  • If you need cash for emergencies or investments, it may be difficult to access it if it’s all tied up in your home.
  • You may miss out on the opportunity to leverage your credit to earn a higher rate of return on your investments.

Advantages of obtaining a low-interest rate mortgage:

  • You can preserve your liquid assets for other investments or emergencies.
  • You may be able to earn a higher rate of return on your investments than the interest rate on your mortgage.
  • You can take advantage of tax benefits associated with mortgage interest deductions.

Disadvantages of obtaining a low-interest rate mortgage:

  • You will have to make regular mortgage payments, which may be a strain on your budget.
  • You may end up paying more with the interest charges over the life of the loan than if you had bought the home with cash.
  • You may be required to put down a larger down payment or pay mortgage insurance premiums.

The decision to buy a home with cash or obtain a low-interest rate mortgage depends on your personal financial situation and goals. If you have the cash available and want to own your home outright, buying with cash may be the right choice for you. However, if you prefer to preserve your liquid assets and have the ability to earn a higher rate of return on your investments, a low-interest rate mortgage may be the better option. It’s important to note, however, that a cash offer may not always be the most competitive offer in every situation. In some cases, a seller may be more interested in accepting a higher offer that is contingent on financing, rather than a lower cash offer. It depends on the specific circumstances of the sale and the preferences of the seller.

What’s Ahead For Mortgage Rates This Week – May 15, 2023

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What's Ahead For Mortgage Rates This Week - May 15, 2023Last week’s scheduled economic reporting included readings on inflation, consumer sentiment, and weekly readings on mortgage rates and jobless claims.

Inflation Rate Rises in April, Slower Pace Expected in Coming Months

The  U.S. Labor Department reported the month-to-month pace of inflation rose by 0.40 percent in April and matched analysts’ expectations. April’s reading surpassed the March reading of 0.10 percent month-to-month inflationary growth. Inflation rose by 4.90 percent year-over-year in April. Analysts expect inflationary growth to continue, but at a slower pace through 2023.

Core inflation, which excludes volatile food and fuel sectors, rose at a month-to-month pace of 0.40 percent in April, which matched expectations and the March reading. Year-over-year core inflation rose by 4.90 percent in April as compared to the expected reading of 5.00 percent and the March reading of 5.00 percent.

Mortgage Rates Fall as Jobless Claims Rise

Freddie Mac reported lower average mortgage rates last week as rates for 30-year fixed-rate mortgages fell by four basis points to 6.35 percent. Rates for 15-year fixed-rate mortgages averaged one basis point lower at 5.75 percent. First-time jobless claims rose with 264,000 claims filed as compared to the expected reading of 245,000 claims and the prior week’s reading of 242,000 initial jobless claims filed.

As inflation slows, rapidly rising rental rates and home prices are also expected to increase at a slower pace. As homeownership becomes more affordable, fewer families will rely on rental homes. Less demand for rentals should help with easing very high rental rates seen in many metro areas. In general, more affordable housing choices could help ease housing challenges in areas with few affordable housing options.

The preliminary consumer sentiment survey for May reflects less consumer enthusiasm for current economic conditions. The initial index reading for May is 57.7, which fell short of the expected reading of 63.0 and April’s index reading of 63.5. May’s reading was the lowest since November 2022.

What’s Ahead

This week’s scheduled economic reporting includes readings on sales of previously-owned homes, housing market conditions, housing starts, and building permits issued. Weekly readings on mortgage rates and jobless claims will also be released.

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