HomeFundIt – Crowd Sourcing Your Down Payment – What do YOU think?

Have you heard of Crowd Funding? Or seen social media posts from Go Fund Me or Kickstarter?  Often times we see these posts to help new ideas launch, new products gain traction or people affected by natural disaster who are in need.

The idea of asking for help is not a new idea.  It takes a village right?  Well, that applies to all walks of life, not just new families raising the next generation.  Around here, the second biggest hurdle to buying a home, aside from making the income to qualify for the mortgage, is saving for the downpayment.  20% around here is often $200,000+!  So how does one get help with the downpayment when city and county programs are no help?

Welcome Home Funding has found a way!  It is crowd sourcing your downpayment with HomeFundIt!  Now instead of getting birthday and Christmas gifts that you don’t need – your friends and family can contribute towards your downpayment!  Now that’s an unforgettable gift.

My spin on it – have fun!  Like other crowd sourcing sites – you can tier it and offer incentives for price points.  $10 donation – stop by for coffee, $100 donation – set a dinner date as a thank you.  What do you think?  Too much?  

I first posted about HomeFundIt last week on my social media thinking that someone would get excited about this – but no one did!!!!

So my question today – is it gauche to ask for money?  Is it embarrassing to post this?  I want to know what you think!!!!  So please comment on the blog, or visit our Facebook and Instagram accounts to chime in!

I’d love to know what you’re thinking and if you’re thinking about trying HomeFundIt – contact me anytime!  I’d love to help your dream of homeownership become a reality! 

Learn more at: HomeFundIt with The Caton Team

Thank you for reading,

Sabrina

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Got Real Estate Questions?   The Caton Team is here to help.

We strive to be more than just Realtors – we are also your home resource. If you have any real estate questions, concerns, need a referral or some guidance – we are here for you. Contact us at your convenience – we are but a call, text or click away!

The Caton Team believes, in order to be successful in the San Fransisco | Peninsula | Bay Area | Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with the utmost integrity, while strategically maneuvering through negotiations and contracts. Together we make dreams come true.

A mother and daughter-in-law team with over 35 years of combined, local Real Estate experience and knowledge – would’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time.

Call | Text | Sabrina 650.799.4333 | Susan 650.796.0654

Email |   Info@TheCatonTeam.com

The Caton Team – Susan & Sabrina
A Family of Realtors
Effective. Efficient. Responsive.
What can we do for you?

The Caton Team Testimonials | The Caton Team Blog – The Real Estate Beat | TheCatonTeam.com | Facebook | Instagram | HomeSnap | Pintrest | LinkedIN Sabrina | LinkedIN Susan

Want Real Estate Info on the Go?  Download our FREE Real Estate App:  Mobile Real Estate by The Caton Team

Berkshire Hathaway HomeServices – Drysdale Properties

DRE # |Sabrina 01413526 | Susan 01238225 | Team 70000218 |Office 01499008

The Caton Team does not receive compensation for any posts.  Information is deemed reliable but not guaranteed. Third party information not verified.  

Landed Program | Down-Payment Assistance for Local Teachers

One morning while drinking coffee Susan heard about the Landed program on the news and told me right away. A program created to help local teachers afford the Bay Area Real Estate Market.  That moment, while my coffee was still hot – I emailed Landed and asked how The Caton Team could be of service.  I was so early in the game they didn’t have anything set up yet – but I was ready to help my local teachers and the soon connected us.

The Caton Team has had the  privilege to work with several teachers with Landed and together we’ve made dreams come true.

Are you a local teacher in the Bay Area looking to own your own home?  Learn more about Landed in the links below or contact The Caton Team anytime – we’re happy to be of help.

Call | Text | Sabrina 650.799.4333 | Susan 650.796.0654

Email |   Info@TheCatonTeam.com

Landed  |  Homebuyer Education Resources  |  How It Works  |  Get Started

Dreams come really do come true with The Caton Team and Landed.com

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Landed  |  Homebuyer Education Resources  |  How It Works  |  Get Started

 

Got Real Estate Questions?   The Caton Team is here to help.

We strive to be more than just Realtors – we are also your home resource. If you have any real estate questions, concerns, need a referral or some guidance – we are here for you. Contact us at your convenience – we are but a call, text or click away!

The Caton Team believes, in order to be successful in the San Fransisco | Peninsula | Bay Area | Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with the utmost integrity, while strategically maneuvering through negotiations and contracts. Together we make dreams come true.

A mother and daughter-in-law team with over 35 years of combined, local Real Estate experience and knowledge – would’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time.

Call | Text | Sabrina 650.799.4333 | Susan 650.796.0654

Email |   Info@TheCatonTeam.com

 

The Caton Team – Susan & Sabrina
A Family of Realtors
Effective. Efficient. Responsive.
What can we do for you?

The Caton Team Testimonials | The Caton Team Blog – The Real Estate Beat | TheCatonTeam.com | Facebook | Instagram | HomeSnap | Pintrest | LinkedIN Sabrina | LinkedIN Susan

Want Real Estate Info on the Go?  Download our FREE Real Estate App:  Mobile Real Estate by The Caton Team

Berkshire Hathaway HomeServices – Drysdale Properties

DRE # |Sabrina 01413526 | Susan 01238225 | Team 70000218 |Office 01499008

The Caton Team does not receive compensation for any posts.  Information is deemed reliable but not guaranteed. Third party information not verified.

The Big Down Payment Myth

The Big Down Payment Myth

 

Having the spare capital to put 20 percent down on a home purchase is great, but it’s certainly not the norm. Still, many people think it is and that belief may be holding some would-be home buyers back, particularly young adults.

Indeed, 39 percent of non-owners say they believe they need more than 20 percent for a down payment on a home purchase. Twenty-six percent believe they need to put down 15 to 20 percent, and 22 percent say they need a down payment of 10 percent to 14 percent to buy, according to the National Association of REALTORS®’ 2017 Aspiring Home Buyers Profile report.

But now for the reality: The average down payment on a purchase mortgage was just 11 percent in 2016. And that’s just the average; often times down payments are much lower. For borrowers under the age of 35, the average down payment was just under 8 percent, according to NAR’s survey.

As such, “aspiring first-time buyers think it takes twice as much to buy a home than it really does,” writes Jonathan Smoke, realtor.com®’s chief economist, in his latest column.

How much a person truly needs for a down payment depends on their situation. Their financial circumstances, home location, and the price of the home are important factors.

But there are many mortgage options that offer the opportunity to make low or even no down payments. For example, the Department of Veterans Affairs and the U.S. Department of Agriculture offer no-money down loans to those who are eligible. In 2016, 16 percent of buyers under the age of 35 put no money down on their home purchase.

Further, the largest share of loans for buyers under age 35 last year were for people putting down less than 5 percent on a home purchase (or about $3,500). The 3 percent down payment programs backed by Fannie Mae and Freddie Mac, and the 3.5 percent FHA mortgage that primarily targets first-time buyers, are both helpful programs to consider. These loan programs don’t require unblemished credit either. The average FICO score was 713, but realtor.com® notes borrowers with a 639 were still getting approved.

As such, Smoke says the millennial dreaming about homeownership needs to get this message: They need a FICO score of at least 639 and enough for a 5 percent down payment (that is, if they don’t qualify for the other programs with lower payment options). In that case, they’ll need to save about $3,500 to buy in the typical American town.

 

I read this article at: http://realtormag.realtor.org/daily-news/2017/02/15/big-down-payment-myth?om_rid=AACmlZ&om_mid=_BYpJckB9YecvKz&om_ntype=RMODaily

 

Remember to follow our Blog for the local real estate beat, a pulse on the San Francisco Peninsula at: https://therealestatebeat.wordpress.com

Got Questions? – The Caton Team is here to help.  

Email Sabrina & Susan at: Info@TheCatonTeam.com

Call us at: 650-568-5522 Office: 650-365-9200

Want Real Estate Info on the Go? Download our FREE Real Estate App:  http://thecatonteam.com/mobileapp

HomeSnaphttp://www.homesnap.com/Sabrina-Caton

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Or YELP me: http://www.yelp.com/user_details_thanx?userid=gpbsls-_RLpPiE9bv3Zygw

Twitterhttps://twitter.com/TheCatonTeam

Connect with us professionally at LinkedIn: https://www.linkedin.com/in/sabrinawendtcaton

https://www.linkedin.com/in/susancatonrealtor

Please enjoy my personal journey through homeownership at:

http://ajourneythroughhomeownership.wordpress.com

Thanks for reading – Sabrina

The Caton Team – Susan & Sabrina – A Family of Realtors

Effective. Efficient. Responsive.  What Can The Caton Team Do For You?

 

Berkshire Hathaway HomeServices – Drysdale Properties

Sabrina BRE# 01413526 / Susan BRE #01238225 / Team BRE# 70000218/ Office BRE #01499008

 

How to buy a house without a 20% down payment

How to buy a house without a 20% down payment

 

If you’re thinking about buying a home, you may need less money than you think.

Here’s how to figure out the amount of cash you need to buy a home, and what you can do to buy a home using as little money down as possible.

Contrary to popular belief, you don’t need 20% down. The minimum down payment you need to buy a home is 3.5% down with an FHA loan on a 30-year fixed-rate mortgage. This 3.5% down payment is a factor of the home price on a loan size up to the high-balance FHA county loan limit — which in most places is $417,000.

However, it can be higher depending on the area. For example, in Sonoma County, Calif., it’s up to $520,950, and in some higher-cost areas, such as Marin County or San Francisco County, that number goes up to $625,500 for a single-family residence.

Alternatively, on a conventional loan you need only a 5% down payment on up to a $417,000 loan size. Should your loan size exceed $417,000, another 5% down payment kicks in, for a total of 10% down needed all the way to the maximum conforming loan limit in your county.

What to expect when buying with little money down

First, if you’re buying a home with less money down, know that your mortgage payment will be higher than if you put more down. The three drivers that inflate a mortgage payment are: interest rate, larger loan size, and private mortgage insurance.

You should have manageable monthly debts — including credit cards, car loans, and any form of payment obligations — in relation to your income. Your income will need to be high enough to include the proposed mortgage payment for the purchase price you are seeking, as well as being able to cover your other debt payments.

The down payment percentages are important to know, though it is significantly easier to work with the monies you have or have access to, than to get wrapped around the axle about down payment percentages. Make no mistake, the mortgage company can work this calculation out for you very easily, or you can do it yourself. You can take the amount of money you have and divide that number by the purchase prices in your area to determine the exact dollar percentage.

Let’s say you have $30,000 to spend on buying a home and you know that housing prices in your area are $450,000. That means you have a 6.7% down payment, enough for an FHA Loan. If your loan professional asks you how much money you have to spend on buying a home in terms of your own funds and possible gift funds, the answer should be some sort of dollar amount, not “How much do I need?”

The reason is this: How much you’ll need to buy a home is going to be predicated on the purchase price of the property and is a continual variable until you get into contract. Start with the monies you have. Assuming you have $30,000 to spend on a $450,000 home example, closing costs on a $450,000 home will easily equate to $10,000, so of the $30,000, $10,000 would come right off the top for closing costs leaving you with $20,000 as a down payment, still meeting the cash to close requirements on an FHA loan.

No-money-down options

  • The VA loan program allows for no-money-down, 100% financing, for U.S. military veterans only.
  • The USDA loan program also allows for no-money-down, 100% financing, as long as you are purchasing a home in a rural area and you meet the USDA’s annual low-income thresholds.

Other sources of money

Alternatively, gift monies can be used to purchase a home. Typically, lenders like gift monies to come from a blood relative, but check with your lender for specifics. Here are additional funds that can be used for the acquisition of a home, though they each come with their own individual downsides and may not be a good fit for you. Consider all of your options:

  • Stocks, bonds, IRA and 401(k) monies can be pulled from these accounts to purchase a home, usually with special provisions.
  • Gift money, as long as it can be documented in some form of a bank account can also be used, along with an executed gift letter.
  • Selling of personal property — a boat or a motorcycle, for example, can be used for a down payment and/or closing costs — documented with a bill of sale and paper trailing of the funds.
  • A security deposit refund on you current rental obligation can also be used, but needs to be planned for on the front end so as to properly communicate timeframe expectations with your landlord.
  • Tax return refund.
  • Cash can be used as long as the funds have been seasonedin some form of a bank account for the past 60 days.

If want to buy a home or want to get on the path of doing so in the future, here are some steps to consider to help meet this goal:

  • Identify what monies you have in the bank now, and from what sources.
  • Next, get “read” on what housing prices are like in your area, through online research or connecting with a good local real estate agent
  • Take the amount of cash you have and divide that figure by an estimated sales price range in your area so you can get a feel for how much cash you will need to purchase XYZ home. Closing costs become another crucial factor, but the main goal is determining if you have enough cash to play with. Based upon these action steps, talking with a mortgage lender about getting qualified or how much money you’ll need to save in the longer-term picture can be a prudent step in making your future home purchase a success.

Another factor that can affect how much home you can afford is your credit score, because that is a major factor in determining your interest rate. Checking your credit at least several months in advance of starting the home buying process can show you where you stand and help you consider whether you should take steps to improve your credit in the coming months. You can get your credit reports for free once a year from AnnualCreditReport.com, and there are many ways to get your credit scores for free, including through Credit.com.

More from Credit.com

Read the original article on Credit.com. Copyright 2015.

 

I read this article at: http://www.businessinsider.com/how-to-buy-a-house-without-a-20-down-payment-2015-9

Remember to follow our Blog at: https://therealestatebeat.wordpress.com/

Got Questions? – The Caton Team is here to help.  

Email Sabrina & Susan at: Info@TheCatonTeam.com

Call us at: 650-568-5522

Want Real Estate Info on the Go? Download our FREE Real Estate App:  http://thecatonteam.com/mobileapp

Visit our Website at:   http://thecatonteam.com/

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Connect with us professionally at LinkedIn: http://www.linkedin.com/profile/view?id=6588013&trk=tab_pro

Please enjoy my personal journey through homeownership at:

http://ajourneythroughhomeownership.wordpress.com

Thanks for reading – Sabrina

 

The Caton Team – Susan & Sabrina – A Family of Realtors

Berkshire Hathaway HomeServices – Drysdale Properties

Sabrina BRE# 01413526 / Susan BRE #01238225 / Team BRE# 70000218/ Office BRE #01499008

20% Down Payment Takes 12 Years of Saving

20% Down Payment Takes 12 Years of Saving

 

 

First-time buyers have a whole lot of saving to do — possibly more than a decade of saving for a home purchase. It can take, on average, 12.5 years for first-time buyers to save a 20 percent down payment based on a current personal savings rate at 5.6 percent, according to new research by RealtyTrac. The figure is based on current median home prices and doesn’t take into account further home price rises.

 

In RealtyTrac’s analysis of 512 counties, it found that the median price of a home is around $259,000, which would require buyers to save $51,800 for a 20 percent down payment.

Millennials entering the workforce often have several years until they start earning the national median salary — usually that is not reached until the age of 30, according to a 2013 Georgetown University study by Anthony Carnevale, “Failure to Launch: Structural Shift and the New Lost Generation.”

If that’s the case, first-time buyers who need a 20 percent down payment would have to wait until they’re 42 years old to be able to afford to buy a house, Carnevale told The Wall Street Journal. Coupled with other debt, such as student loans, the wait could even be longer.

Melvin Watt, director of the Federal Housing Finance Agency, has suggested lowering the down payment for a conventional loan to 3 percent from the traditional 20 percent. In that case, it would take first-time buyers less than two years to save enough.

The Federal Housing Administration allows buyers to get a mortgage with a down payment as low as 3.5 percent with a 30-year fixed rate. However, buyers still have to meet the debt-to-income ratio and cash reserve requirements and they would likely qualify for better terms for a loan if they could bring a higher down payment, says Whitney Fite, managing director of Angel Oak Home Loans in Atlanta.

Source: “Saving for a Down Payment? It Could Take You Until 2027,” MarketWatch (Nov. 5, 2014)

 

Have no fear – there are other loan options available – if you’d to learn more – please contact us at Info@TheCatonTeam.com

 

I read this article at: http://realtormag.realtor.org/daily-news/2014/11/07/20-down-payment-takes-12-years-saving?om_rid=AACmlZ&om_mid=_BUXQikB89faVK2&om_ntype=RMODaily

Remember to follow our Blog at: https://therealestatebeat.wordpress.com/

Got Questions? – The Caton Team is here to help.  

Email Sabrina & Susan at: Info@TheCatonTeam.com

Call us at: 650-568-5522 Office: 650-365-9200

Want Real Estate Info on the Go? Download our FREE Real Estate App:  http://thecatonteam.com/mobileapp

Visit our Website at:   http://thecatonteam.com/

VISIT OUR NEW INSTAGRAM PAGE: http://instagram.com/thecatonteam

Visit us on Facebook:   http://www.facebook.com/pages/Sabrina-Susan-The-Caton-Team-Realtors/294970377834

Yelp us at: http://www.yelp.com/biz/the-caton-team-realtors-sabrina-caton-and-susan-caton-redwood-city

Or Yelp me: http://www.yelp.com/user_details_thanx?userid=gpbsls-_RLpPiE9bv3Zygw

Connect with us professionally at LinkedIn: http://www.linkedin.com/profile/view?id=6588013&trk=tab_pro

Please enjoy my personal journey through homeownership at:

http://ajourneythroughhomeownership.wordpress.com

Thanks for reading – Sabrina

The Caton Team – Susan & Sabrina – A Family of Realtors

Sabrina BRE# 01413526 / Susan BRE #01238225 / Team BRE#70000218/ 01499008