Fannie Mae's "3/2 loan program" provides loans to first-time buyer of 95% of the house price. The buyer may put down as little as 3%, with the additional 2% down payment in the form of a gift from family members, a government program, or nonprofit agency.Call (800) 732-6643
If you cut out your agent when you buy you will still pay the same, click to see how fees are in NM

Tip

The following eight states are "community property" states:

• Arizona
• California
• Louisiana
• Idaho
• Nevada
• New Mexico
• Texas
• Washington

Tip

Moving to an unfamiliar town? Subscribe to the local paper to get a flavor for the area. Trish and I can give you the information.

Tip TO SEE FAIR HOUSING INFORMATION

Federal Housing Administration (FHA) loans are not limited to low income families. The current FHA loan limit is about $100,000. The FHA does not provide the loan directly. Instead, the FHA simply guarantees the loans, which are obtained through local lenders. Ask Mike Potts about this.

Tip

Often a new-home builder will not negotiate on the base price, because the base price will impact the appraisal value of subsequent homes the builder sells.

However, in a buyers market, the builder will negotiate on the options and amenities included in the base price.

Tip

You can limit your competition for homes by making purchase offers during the November to January holiday season.

Tip

A home sold without a real estate agent may not be lower in price. Sellers enduring the headache of marketing their own home are usually trying to save the commission for themselves, not for their buyer.

Tip

Even if you have no children, the quality of the local schools will be important to potential buyers when you eventually sell. Make a list of the schools that serve your area and have it with your home brochure.

Tip

Of the many factors influencing the potential profit of home ownership, the most important is appreciation. Trish and I think satisfaction is also right up there.

Tip

You can reduce the total amount of interest you pay on the loan by pre-paying some of the principal. The impact of this prepaid principal is to reduce the life of a fixed-rate loan. The monthly mortgage payment remains fixed however. When you prepay the principal of an adjustable rate mortgage, the life of the mortgage stays fixed. The monthly mortgage payment is reduced at the next adjustment date.
INTEREST RATES

Tip

If the current owners keep all items in the basement elevated off the floor, suspect that the basement takes on water in the winter.
Tip

Turning on utilities:
city of Abq. water sewer refuse 768 2800
PNM ele. gas 246 5700
US West Residential service 800 244 1111
Business 800 603 6000

Tip

Water rates in Albuquerque:
Compare rates

Tax in NM

Three closing costs are tax deductible in the year of the sale:

• Points
• Pro-rated mortgage interest
• Pro-rated property taxes

Tip

Keep a shoe box with lid in your closet. Every time you are faced with an unmatched sock, put it in the shoe box. On your birthday, dump out all the socks. You will discover that all of your unmatched socks have magically found their mates!

Tip

Within three days of applying for your home loan, the lender must send you a "Good Faith Estimate" of your closing costs. Verify that this estimate agrees with the information that the lender gave you before you applied for the loan.

Tip

If you paid for the appraisal, you are entitled to a copy of it. If it is not offered, request a copy in writing.

Tip

When qualifying you for a loan, lenders typically do not consider income from rooms rented out in a home you are purchasing as a personal residence.

Tip

Verbal agreements aren't worth the paper they're written on.

Tip

Ask the utility company for the average monthly bill of the home you are considering. Ask the same question about your current home, so you can compare.

TipTypically a home should have at least 100 amp electrical service. The amperage of the service is determined by the main circuit breakers. The amperage of the service is usually less than the sum of the individual circuit breakers.

Tip

Insurance agents have a wealth of information on any given neighborhood.Give your insurance agent the address. Ask him or her to tell you everything they know about the area. Request an estimate of your car and hazard insurance premium at the address under consideration. If you need an agent ask Chuck or Trish.

Tip

A termite report focuses on fungal and pest infestations. The focus of a building inspection report is much broader, including checks of the foundation and appliances, among other items. In Albq. Are of NM we do not see a lot of above ground infestations. Most are subterranean type.

Tip

Typically fixed-rate loans are not assumable, and adjustable rate loans usually are. FHA loans made prior to December 1, 1986 and VA loans made prior to March 1, 1988 are freely assumable. Any loan sold to Fannie Mae before November 10, 1980 is fully assumable.

Tip

Lenders usually qualify borrowers for an adjustable rate mortgage using the maximum possible interest rate at the beginning of the second year. For example, assume that the initial rate is 5% and that the interest adjusts annually. If the annual adjustment cap is 2%, then the lender qualifies the borrower at 7% (=5% + 2%).

Tip

Adjustable loans include a ceiling on the maximum interest rate over the life of the loan. Always get this life-time cap figure as an absolute maximum interest rate (such as "16.5%"), not as a maximum change in interest rate (such as 5%). This prevents any ambiguity.

Tip

The best home owner's insurance policy guarantees "full replacement value," not simply "depreciated value."

If the home is more than a few years old, always include the "code upgrade" option, which covers the cost of meeting new code requirements since construction of the home.

Tip

If you intend to live in the home less than seven years, always ask if the lender offers "short-term fixed" loans. These loans are amortized over 30 years, but are due in 5 or 7 years. The interest rate is often .5% lower than a straight 30 year loan.

Tip

For bargains, look for ads that imply cosmetic problems with the house, such as "diamond in the rough" or "has potential." A house that requires a $1,000 face lift is often priced $10,000 below market value.

TipPoints are tax deductible by the buyer in the year of the sale. Even points paid by the seller can be deducted by the buyer.

Tip

When purchasing in a new development, always ask residents who have already purchased if they are satisfied with the quality of construction and with the responsiveness of the builder to complaints.

Tip

Some of these tips are taken from "HomeBuyer - The Book and Software Home Buying Kit" for Windows. $27.95 from Stratosphere Publishing. 1-800-646-6456. Press the "More Info" button for details.

TipThe top three remodeling jobs in terms of "return on investment" are:

• Adding a fireplace to a home without one
• Bathroom addition
• Minor kitchen remodel

Tip

Seven states have no state income tax:

1. Alaska
2. Florida
3. Nevada
4. South Dakota
5. Texas
6. Washington
7. Wyoming

For a free copy of your credit report, call TRW at 1-800-392-1122.

Tip

During your regular commute hours, drive from and return to the home you are considering purchasing. This alerts you to potential traffic problems. We have average mileage's on our web site.

Tip

For information on repossessed homes owned by the Fannie Mae, the largest housing finance agency in the nation, call 1-800-553-4636.

Rental ads are loaded with potential home sellers, waiting to be harvested. Call on rental ads for homes that interest you and ask the landlord if he or she would consider selling the home.

Tip

The local school district office can direct you to the results of school-by-school tests. We have them on our web site nmhomes.com.

Tip

A prequalification letter from a lender may encourage the seller to take your offer seriously. This letter states that, given the preliminary financial information that you have provided the lender, you qualify for a loan of a given amount at a given interest rate. Contact Mike Potts Go to: www.nmloans.com/money.

But a pre-approval letter is even better. This letter states that you are actually approved for a loan of a given amount at a given interest rate, pending only an appraisal on the home of your choosing. To get preapproved by the lender, you must formally apply for the loan and pay the associated loan application fee. Don't pay any fees up front! Or you can fill out the loan app. we send you or online click here.

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TRISH DAWSON, JD, REALTOR AND
CHUCK DAWSON, MA, ASSOCIATE BROKER
both with Coldwell Banker Legacy 898 2700
DIRECT 505-793 7632 HOME  505-898-9380 
971-8584 PAGE  898-9372 FAX