Financial analysts warned us for years that as we approached a recession Newport Beach real estate prices and the price of homes throughout the United States would have to find a natural ceiling within a very short period. Put simply, people have less money to spend on housing as the cost of living has increased. Owning Newport Beach homes became less a priority for many families because of this which has helped decrease property values as the demand for Newport Beach homes decreased significantly.

This is, of course, bad news for any homeowners that need to sell Newport Beach homes. However, for those that have put off buying homes in Newport Beach due to the cost… wait no longer! Newport Beach condos, homes, and other property types have reached record lows this year making the dream of owning beach property a reality for many families in Orange County.

If you have always dreamed of owning homes in Newport Beach be sure to give us a call and we’d love to help you determine your buying power (the amount you are able to borrow for your home loan) and help you find a Newport Beach home that fits your specifications and family needs.

Paying points simply means making a lump sum payment up front, which will significantly lower the interest rate on your fixed rate mortgage in Newport Beach. Typically each point will cost 1% of the entire amount of the mortgage. The more points you buy, the lower your interest rate and the lower your repayments will be. So which would be best for you? Buy more points and pay a lower rate or buy fewer points and pay a higher rate?

When trying to decide consider whether you can afford to make a significant up-front payment to buy points now.  If you are able to make a significant payment up front this will save you money in the long run. Take into consideration the length of the mortgage; the longer the duration of your Newport Beach mortgage the more it will make sense to buy points now, because you will benefit from those points for a fairly long time.

You really should seek the advice of a professional Newport Beach Realtor and Morgage Broker who will be able to help you decide which is best for you. A wrong decision can leave you paying far more for your Newport Beach home than you should have. A Newport Beach Realtor with Harbor Realty will be able to advise you on mortgage types and how points work, they will also be able to help you with the mortgage application process and make the whole house purchase process much quicker and simpler.

Before you even begin your search for Newport Beach homes it is important to obtain a pre-qualification letter from your local bank or mortgage broker. Being able to provide this letter of approval when you are ready to make an offer will provide your offer with a solid foundation. When sellers know that you have been pre-qualified for a home loan matching their home value they are much more likely to accept your offer over someone who does not have pre-qualification. However, it is important to remember that a pre-qualification letter does NOT guarantee approval of a home loan once you have found the home of your dreams.

For example, Suzy Q goes to the bank to obtain a pre-qualification letter. At this time Suzy Q has little credit card debt and her car loan is almost paid off.  She obtains a pre-qualification letter for a specific amount and begins her search for Newport Beach homes. Over the next four months Suzy Q gets excited about the possibilities of owning her own Newport Beach home and begins a buying spree of new furniture to outfit her new home. Additionally, she feels that having a new car to match her new home is important. When Suzy goes to get approved on a home loan for the same amount she was previously approved for she is denied: her new found debt will not allow her to make the payments necessary on her new home with her existing salary.

After you obtain pre-approval from your bank be sure to curb your spending habits.  Now is not the time to make large credit card purchases or to buy a new car.  Depending on the amount spent you could either decrease the amount of the loan approval or lose it altogether. Keeping your spending habits to a minimum during your search for Newport Beach homes will enable you to buy a home in a higher price range.

If you dream of owning Newport Beach homes it will be important that you save at least 20% of the purchase price of your Newport Beach home. For example, if you are considering purchasing a Newport Beach condo for approx. $400,000 you should have at least $80,000 ready to use as a down payment. If you are looking at a Newport Beach home from $700,000 you should have at least $140,000 ready to use as the down payment.  And if you are looking at a one-million dollar property in Newport Beach have $200,000 saved specifically for use as a down payment.

The larger the down payment you make, the less you will need to borrow and less interest will be accrued, this means that you will pay significantly less over the long term.

The best advice is to speak to a professional Newport Beach Realtor at Harbor Realty who will be able to help you determine the right amount for your family to pay for the down payment of your Newport Beach home.

Fixed Rate Mortgage – In this type of Newport Beach home loan, the interest rate remains the same across the life of the mortgage. This is generally the safest, most common, and in most cases, the smartest type of home loan to use when purchasing Newport Beach homes. Since the interest rate does not fluctuate over the course of your mortgage life you’re less likely to find yourself in a situation where you are unable to pay your monthly mortgage payment.

Adjustable Rate Mortgage – An adjustable rate mortgage has an interest rate that will vary over time which will change the monthly payment or alter the life of the mortgage. This can be an excellent option for homebuyers that do not plan to stay in their home for an extended period. For example, if you are in the military and move often or transfer locations regularly, an adjustable rate mortgage might be the right option for you when purchasing Newport Beach homes. Talk to a Newport Beach Realtor with Harbor Realty today to find out if an adjustable rate mortgage is the way to go.

No Down Payment – This type of mortgage does not require the borrower to hold an amount of money for use as a down payment. Interest rates are often higher with this type of mortgage. Of course, these days loans are rarely, if ever, offered with no down payment. If you are serious about purchasing Newport Beach real estate it is certainly in your best interest to begin saving for a down payment.

Jumbo Loans – This is a type of loan that is valued above the general conforming loan limits. As a non-conforming mortgage, interest rates can be somewhat higher than other types of Newport Beach home loans.

Interest Only Loans – With this type of mortgage, only the interest is actually paid, at the end of the mortgage term the borrower has the option of paying the principal sum in full, or possibly starting a fresh mortgage.

Talk to a professional Newport Beach Realtor as well as a Mortgage Broker to discern which type of mortgage is right for you and your family; a wrong choice can cause severe financial problems down the road. While a Fixed Rate Mortgage is the right choice for most people purchasing Newport Beach homes, there are certainly some that should consider other types of home loans.

Closing is a word that is used to define the final part of the entire chain of events that has lead to the successful sale of a property in Orange County. Closing will be scheduled for a specific day, and on this day your property will change hands.

Funds will be exchanged, contracts will be signed and keys will be handed over, this is the final process that sees you saying goodbye to your old home and taking hold of your new home in Orange County. Usually the funds will have been deposited into an escrow service, and your agent or Newport Beach Realtor would have taken care of the specifics.

On day of closing you will also need to physically move out of your home if you are the seller, this means arranging with a moving company to have your goods picked up and moved to your new house, or moved into storage if you have yet to complete closing on your new Orange County home.

In the past, closing day was a stressful time, when both parties carried concerns over the deal going bad at the last minute. These days there are very few problems with the closing of a sale; problems can be further reduced by employing the services of a Newport Beach Realtor to handle most aspects for you.

Unfortunately, escrow can fall through for a variety of reasons. The main reason escrow will fail is due to the purchaser not being able to acquire the required funding. Usually this means that their pre-approved mortgage loan has actually been turned down at the last stage, usually because of undisclosed financial situations resulting in their inability to purchase the property. In years past… many buyers were able to push through even with serious financial failings. In fact, as you likely already know… many buyers were able to secure funding without even proving their financial status. However, times have changed and lenders rules are much more stringent.

The second reason that escrow may fall through is because of property inspections. The home inspection may provide a negative indication such as termite infestation, termite damage, or mold. In such cases escrow does not always fall through but it can if both parties are unable to reach an agreement on the final purchase price.

To minimize the risk of your escrow transactions becoming a problem, you should employ an Orange County Realtor from Harbor Realty to ensure that all your i’s are dotted and t’s are crossed . Something as simple as a typing error on a title deed can cause escrow to fall through, employing somebody to take care of these minute details is a good idea.

As we previously discussed, a property inspection will check the structural integrity of the building, it will also check for potential problems such as mold, rot, or termites. Cosmetic issues will not form part of the survey as they are deemed non-threatening to the property.

Of course, not all inspection results will be negative. You may well find positive aspects highlighted, such as certain materials used which make the house easy to maintain, or parts of the construction which are completed to an exceptionally high standard. A survey is not always doom and gloom.

A good survey can also act as a maintenance route map, giving you an overall idea of the state of your home, allowing you to plan repairs and improvements better, by having a good idea of the importance of each.
Buying a property without an inspection would be a foolish act; you need to know that you are purchasing something that is basically sound before you invest your hard earned money.

Inspections will cover a whole range of things; there will no doubt be a full structural survey which will check that the house is basically sound, including all weight bearing beams and joists along with the foundations and roof. If your house has a large amount of wood used as a construction material, then you can expect the buyer to commission a survey for rot and termite infestation as well. Almost all purchasers will want to undertake a mold and moisture survey, especially if you are in a coastal location. Keep these things in mind when you buy your next home as well!

An inspection is not usually intended to make assessments about the cosmetics of a property. If your walls need painting, for example, this will not be indicated in an inspection of your home as it is deemed cosmetic and does not threaten the structure in any way.

Quite often the buyer will be willing to share the full results of the inspection with you, so that you may decide if you wish to make repairs to increase the final sale price of your home.

When a potential purchaser makes an offer on your Newport Beach home for sale, do not consider it set in stone. Most offers are made on the low side, and some debate is always expected. When you do receive an offer, consider how the offer was made; is it making fair comment over the valuation? Is it so low, that even after negotiation will still see you selling below your asking price? Consider whether you are in a buyers or sellers market as well.

If you feel there is room for negotiation, you will make a counter offer. This could simply be a request to raise the value of the offer, or it could include some more complicated issues such as pledging to repair something that has been found faulty, or even offering to share some of the costs of purchase with the buyer if the offer is increased.

Once you have received an offer you feel you can accept, and then simply let your buyer know, usually via your agent, that you are willing to go ahead with the sale. Again, if you are using the services of a Realtor at Harbor Realty, we will handle the subsequent paper work for you, alleviating much of the stress involved with the pre-sale process.