Detroit Real Estate

As a real estate agent and previous loan officer I have heard just about every excuse for bad credit.  Having bad credit is easy to do.  I myself had horrible credit as a young man.  My excuse was that I was arrogant.  I owned a small business and when somebody didn't perform a service right, I simply refused to pay them.  My motto was sue me.  I never went through the right process.  One of my bad credit stories was with Gardner White.  Gardner White delivered a table set that I ordered.  The problem was that they only delivered three chairs with the table.  Well they wanted me to wait another 4 hours to deliver the chair on another day.  They had the 4 hour window for delivery.  Well I refused to wait.  I told them to make me first and deliver at a specific time because they made me wait once already.

Well they refused, and I refused to wait again and I never paid them.  So I started down the road of bad credit.  Everybody with bad credit has a story and an excuse.  But I hate to say it, the only ones that I think are credible are loss of job, and medical issues.  The rest of the excuses are laziness, arrogance, and living above your means.

Anybody can spend more money than they make.  Anybody can make late payments.  I have heard so many excuses.  I have heard so many people complain that the banks won't give them a chance.  That the banks won't do a refinance for them.   They get so mad at the bank because they won't give them money to get out of the hole.  That they won't give them a better rate.

The banks make a financial decision for their shareholder to make a loan.  The bank is in it to make money.  They want people that will pay them back.  They don't want dead beats.  They only want to make a profit on lending money.  They don't have a sign on the front of their business that says "CHARITY".  They aren't in the business of giving second chances.  They are in the business of loaning money to qualified borrowers. They have their guidelines and why should they change them for you.  They know the chance of getting repaid.

So it is up to you in 2010 to meet the bank's standards.  Gone are the days of easy loans to poor credit people.  So if you want a loan, now is the time to start rebuilding your credit.  There is no excuse, nobody going to bend the rules to get you money.  So do like I did 25 years ago.  Start rebuilding your credit.  You will be glad you did.  Sure it takes time but it will go by quickly.  Then you will have good credit and good credit scores.  

My quote of the day:

Mankind must put an end to war before war puts an end to mankind.

                                                                                    John F Kennedy

What are debt ratios and what do they matter when buying a West Bloomfield home?  Debt ratios are a key component of what a bank looks at when determining whether or not to give you a home loan. Here is what debt ratios are:

They are your debt compared to your income.  So the bank verifies your income via your paystubs, your W-2's, and tax returns.  Then they take all the debts on your credit report add it to the proposed house payment, property taxes, home owners insurance, and PMI.  That is what they call your total debt ratio.

All your debts including the housing costs compared to your income is the total debt ratio.

The bank also compares just your housing costs (house payment, home owners insurance, property taxes, PMI) to your income.  That is called the housing ratio.  The bank looks at both ratios to determine whether you qualify for a loan and how big of a house payment (house) you can afford.

So when you buy a home the cost of the property taxes and the home owners insurance can influence the price of the home you buy. I hope this explanation of what are debt ratios and what do they matter when buying when buying a home.   It doesn't matter whether you are buying a West Bloomfield home or a Novi home, debt ratios do matter to the bank. 

My quote of the day is:

"When you reach the end of your rope, tie a knot in it and hang on."~ Thomas Jefferson

Cash real estate closings don't take long at all.  Basically in Michigan there are only 5-10 documents that you have to sign when you are buying a house cash.

The title company closer will go over the buyer's statement which is a breakdown of all your costs.  They will show you the deed to make sure your name is spelled right.  (You won't get the deed at closing as the title company will take it to the County to get the deed recorded).

Then there is the property transfer affadavit and the Homestead exemption forms that you will have to take to the local city hall or township hall.  These documents put the property in your name at the local city and let's the city know if you are eligible for the homestead exemption (which gives you a reduction in your Michigan property taxes).

Then the rest of the documents usually are what I call CYA documents.  "cover your #ss" documents are documents that the title company makes you sign acknowledging that the house is being sold as is, that they have no responsibility, and that you can't sue them because of the house condition known or unknown.

So sometimes a cash home closing can take less than 15 minutes

My quote of the day is:

He who asks is a fool for five minutes, but he who does not ask remains a fool forever.

                                   Chinese Proverb

On any mortgage loan the bank or lender want a house in good shape.  They don't want to loan money on "bad 

collateral"  With FHA loans it is even tougher.  When I got out with Metro Detroit home buyers I find out what type

 of loan they are getting.   FHA appraisals and mortgages are tougher than many other loans.  Here in the Metro

 Detroit Michigan real estate market the FHA appraiser will pick up on these repairs.

This missing window would cause problems with a conventional mortgage or a FHA mortgage.  Broken windows will need to

 be fixed on a FHA mortgage.

Peeling paint is a major.  Whether it is inside or out it has to be scraped and painted.

                    (Redford home)

Missing light fixtures or hanging wires will always be caught and noted in a FHA appraisal

                               (Westland home)

This broken step will draw the attention of the appraiser (Southfield home)

This much mold will cause a underwriter to suspend the loan and possibly even cancel the mortgage application.  So forget

about buying a home with mold if you need a mortgage.

                                              These missing plumbing (tub) fixtures will cause a problem. 

This missing water heater and furnace will have to be replaced and reinspected by the FHA appraisers.

               (Detroit homes - most Detroit foreclosures will be missing the furnace and water heater)

                 Here is the general process of what happens during the FHA mortgage process.  The FHA appraiser does

their inspection.  The inspection report is reviewed by the loan underwriter who notifies the buyer and the real estate

agent what items need to be repaired or fixed before loan can go forward.  The items are repaired and the FHA

appraiser goes out and checks the repairs.  Then the FHA appraiser lets the underwriter know all the items are

repaired or what is not completed correctly.

                Search FHA homes for sale and Metro Detroit foreclosures

Livonia real estate Michigan

Pickney chain of Lakes real estate Michigan

Oakland County Michigan facts

Plymouth Michigan subdivisions

So how long does a closing take when you are buying a house and doing a mortgage?  When you do home closing with a mortgage there are basically two parts.  You will have the real estate / title company documents.  Then you will have the mortgage documents.

The real estate side of your closing is only about 5 -10 papers and takes less than 10 minutes.   It is the mortgage documents that take the time.  There will be about 25 -50 papers that you will have to sign.  So warm up your hand.  If both you and your spouse have to sign it takes time.   I would plan to spend anywhere from 1 hour to an 1 1/2 in the closing.

We send you the real estate documents a few days before the closing when we get them for the title company.  You can also ask your mortgage loan officer to send you the complete mortgage package 2 days before so you can read over the mortgage documents.  If you have a day to read over the documents you will feel comfortable signing them quickly because you can ask your questions before the closing.

My Quote of the Day

Our greatest glory is not in never falling, but in getting up every time we do.

                                                                            Confucius