What is a conforming loan?

A conforming loan is one that conforms to Fannie Mae and Freddie Mac guidelines. Fannie Mae and Freddie Mac are giant government-chartered mortgage companies that buy loans from lenders, allowing lenders to have more flexibility to make new housing loans.

Most everyone who gets a mortgage has a conforming loan.

How much you can borrow to conform:
Conforming loans are generally limited to $424,100, although there are higher limits in areas where housing is very expensive. The conforming loan limit can go up to $636,150 in specific housing markets, such as certain counties in California and New York, among others.

Loan-to-value ratio:
Your down payment has to be equal to 20 percent or more of the home’s value, but buyers can qualify for an FHA loan with as little as 3 percent down. With a down payment of less than 20 percent, buyers have to pay Private Mortgage Insurance, which can be expensive.

Credit score:
A conforming loan requires a FICO credit score of 620-640. However, an FHA loan requires a credit score of 580. A lower credit score than that requires a higher down payment.

Debt-to-income ratio:
Your debt-to-income ratio can be no more than 41 percent (although there may be exceptions that raise this percentage) of your gross income.

A non-conforming loan, by contrast, goes over the loan limit and the requirements are stricter. Credit scores must be 680 or higher. The down payment must be 15 percent or higher. Debt-to-income ratio must be 43 percent or less. Generally, the borrower shows high cash reserves, according to the Lenders Network.

 

What is a Business Owner Package (BOP), and How Can One Help You?

If you are a business owner, you know how important comprehensive coverage can be to protect your interests. Properly insuring any business requires different types of coverage that may be found in separate policies. In order to fully protect your business, it may be necessary to carry a different policy for each type of coverage which can be less than convenient. With a Business Owner Package (BOP) many lines can be bundled together which can save you money as well as help you to keep your insurance streamlined. InsureUS has the necessary experience and expertise to help you protect your business. If you are in the greater Cypress, TX area we are here to work with you to ensure that you have the coverage you need.

What Exactly is a BOP?

This bundle of commercial coverage is perfect for small businesses that are looking to save money. The package generally includes Commercial Property Insurance and General Liability Coverage, bundled together. There is no coverage for business or commercial vehicles in these packages, and a separate vehicle policy will be necessary. This package covers lawsuits brought by third-party interests, catastrophic loss, such as fire damage, and third party property damage. Some BOPs also include Business Interruption Coverage which is vital for small businesses. Our agents can work with you to ensure that you have the comprehensive coverage you need.

Please give our agency a call today at (281) 640-8888 to schedule an appointment with one of our business specialists who can review your current coverage and help to streamline your policies to make your insurance work best for you. InsureUS is here to help you with a BOP and all of your other insurance needs in the greater Cypress, TX area. 

Negotiation: Tips for buyers and sellers

At the most basic level, home sellers and buyers want the same thing: A good price and a smooth deal.

But between price and smooth, there is a lot of wiggle room and emotion.

The key points for a seller, according to Zillow.com:
– A full price or higher
– A pre-approved buyer
– Smooth timing for a move
– Sellers may also want buyers to either waive an inspection or be responsible for any repairs.

Before negotiations, the best idea for sellers is to carefully calculate what they need from a buyer.
– Minimum amount of money you’ll need, considering outstanding mortgage, any debt you want to clear up, or money for a down payment on another house.
– Decide what personal property you want to go with the house and what you don’t want to include in the deal.
– Know how much it will cost to stay in the home during any transition time. This can help in negotiations since a buyer who wants to quickly take possession might save you money. Or, on the other hand, a buyer who will work with you on timing might be preferable. These considerations can help you choose between offers.
Key idea: Know exactly what you need and don’t rush into a deal if you don’t have to.

Negotiation tips for buyers:
One key idea to remember: Don’t start negotiations too low.
Case in point: Heirs are selling a 40-year-old home on wooded acreage. The home will need treatment for mold, new carpets, deep cleaning, and some new fixtures, but the bones are good. The sellers have priced it on the low-end for comparable homes. The listing agent quickly gets two offers. One for $5,000 less than the list price, and one for the list price. It’s October and the heirs want to sell quickly. They don’t want to take the chance of maintaining the home through the winter when home sales are slow. The buyer offering full price is ready to move in immediately and agrees to do so. The sellers accept the full price, rejecting the lower one without negotiation. The unsuccessful buyers lost the home they wanted over a mere $5,000, which on a 30-year loan amounts to just a few dollars a month.

According to credit.com, going in with a too-low offer accomplishes nothing. While a potential buyer can’t always know how their offer will be accepted, it’s probably not a good idea to offer a lower price if the property is already priced reasonably. The exception may be a foreclosure or a slow market, when sellers might be highly motivated to sell.