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A purchase money loan can refer to a mortgage provided by a bank, credit union or mortgage company, or issued or guaranteed by a government agency. Usually, however, the term refers to a loan provided by the home seller.

Seller Financing
For homebuyers who dont meet a mortgage lenders requirements, obtaining financing through the seller may be an option. If the house is paid off, the seller and buyer can negotiate the terms of a purchase money loan, including the length, monthly payment, interest rate and down payment. A security instrument is usually recorded in public records in case a dispute arises.

A seller negotiating a purchase money loan may be more flexible than a financial institution would be. A seller may agree to an interest-only or less-than-interest loan with a balloon payment and may allow the buyer to make the down payment in installments. Since a buyer usually only seeks a purchase money loan as a last resort, the seller may charge a higher interest rate than a financial institution would or raise the purchase price.

Because theres no financial institution involved in the transaction, the parties can often close the deal faster than they otherwise would. Closing costs are usually lower with a purchase money loan than with a typical mortgage.

Sometimes a buyer uses a purchase money loan to take over the current owners mortgage. In that situation, the difference between the balance on the existing mortgage and the sale price is financed by the seller. The purchase money mortgage is considered a second mortgage and the original loan must be paid off first.

A seller may offer a purchase money loan to attract a buyer if there are more houses for sale than buyers or if the owner needs to sell quickly. A seller may get full list price or more and may pay lower taxes if the sale is completed in installments. The seller can also benefit from monthly income and a high interest rate.

In a land sale, the parties enter a lease-purchase agreement in which the seller gives the buyer equitable title and leases the property to the buyer. After the agreement has been fulfilled, the buyer receives the title and rental payments are credited toward the purchase price. The buyer can then obtain a loan to pay the seller.

Other Types of Purchase Money Loans
A conventional purchase money loan can be issued by a bank or mortgage lender. A lender may loan up to 20 percent of the sale price as a second mortgage to cover a shortfall if the amount approved for a first mortgage isnt enough to buy a desired house. The Federal Housing Administration and U.S. Department of Veterans Affairsoffer government-backed purchase money loans.

Many Ways to Buy a Home
You have numerous options to achieve your dream of homeownership. If things havent worked out with a conventional lender or government agency, financing a home purchase through the seller may be an avenue worth exploring.

Published with permission from RISMedia.

You probably consider your pet a member of your family, but a homeowners insurance company looks at it in terms of risk. Depending on the type of pet you have and the state where you live, it might be difficult to obtain homeowners insurance at affordable rates, or at all.

Obtaining Insurance Coverage for Dogs and Exotic Pets
Many homeowners insurance companies deny coverage for applicants with dogs based on the animals potential to cause injuries or property damage. Rather than evaluate individual dogs, companies often exclude entire breeds that are considered aggressive. An insurer may automatically deny coverage to an applicant who owns a dog that belongs to an excluded breed, regardless of whether it is a purebred or mixed-breed dog and whether it has ever attacked anyone.

Some homeowners insurance companies dont automatically exclude entire breeds, but rather evaluate the histories of specific dogs. Some states prohibit insurance companies from excluding entire dog breeds but allow insurers to charge high premiums for owners of those animals.

Homeowners insurance companies often exclude exotic pets, which may include ferrets and some reptiles and large mammals, such as snakes and tigers. If a company excludes your pet, you might be able to purchase a separate exotic pet insurance policy, but it will most likely carry high premiums.

What Homeowners Insurance Will and Wont Cover
If your pet is covered by your insurance and it injures someone not named on the policy, the insurance company will investigate the facts surrounding the incident. If the company finds you liable, your policy will cover medical bills, lost wages, pain and suffering and legal bills, up to your liability limits. If your dog bites or jumps on a member of your family and causes injuries or chews up your furniture, you will be responsible for associated costs.

Your insurance company wont necessarily cancel your policy if your dog bites someone, but it may decide not to renew your policy if your dog has bitten people more than once. If your homeowners insurance policy doesnt cover dog bites at all, you can get a separate dog liability policy, an umbrella policy that will cover damage or injuries caused by the dog, or an excess policy that will provide liability coverage beyond your homeowners policys limits.

Tell Your Insurance Company about Your Pet
Before you purchase a homeowners insurance policy, contact several companies to compare coverage and rates. If you have a dog or exotic pet, make sure you inform the insurance company. If the animal were to injure someone or cause property damage and you never told the insurer you owned it, you would be responsible for any related bills. If you decide to get a pet after you have obtained a homeowners insurance policy, contact the company to make sure the animal will be covered. If you dont notify the insurer about your pet and the company finds out, it may cancel your policy.

Published with permission from RISMedia.

Though most entryways are small, they can pack a big punch as a first impression to your home. Make the most of this space with necessary items that are not only functional, but show off your personal style and set the tone for the rest of your home.

Coat Rack or Hooks
After a rainy day or when guests come to visit, its nice to have a place to hang your coat right when you enter the home. No more dripping through the living room or piling coats on the end of the couch. Hooks can also be useful for holding scarves, bags and leashes.

Weather-Resistant Rug
Rain and mud, snow and salt, no matter what the weather brings, your shoes will get dirty. Avoid tracking dirt through your home by providing a place to wipe your feet. And just because its a practical and functional piece, doesnt mean it cant be a stylish one.

Simple Storage
Gloves, scarves, bags, hats, umbrellas, leashes, keys, wallet”these are just some of the items that you may find in the entryway of any home. Revamp an old dresser, utilize a storage bench or bring in plastic cubbies to keep this area clear and organized.

Casual Seating
Speaking of a storage bench, having a place to sit down and take off or put on your shoes is a convenient and smart addition to your entryway. Benches, chairs or stools are all appropriate choices. Show off your style with accent pillows and textured cushions to liven up this space.

Accent Mirror
For a last look before you head off to work in the morning, an accent mirror is a great focal piece for this area. Place it above your storage space, as it can act as a reminder for one final check of items you need for your day. Find a mirror with a bold or decorative frame to instantly reflect your style.

Overhead Lighting
Possibly the first thing you do when you enter your home is turn on the light. Your entryway should be a bright and welcoming space where you can easily spot all the items you may need and where to put them. Choose a light that best fits the look youre striving for and be sure to install the light switch near the front door.

Published with permission from RISMedia.

Many homeowners are surprised to receive a letter stating that their mortgage servicer has changed. Financial institutions that issue mortgages are permitted to sell loans or to transfer the rights to service mortgages to other financial institutions without borrowers consent. That doesnt mean the homeowner has done anything wrong or that there is anything to worry about.

How and Why Mortgages Change Hands
A mortgage originator works with borrowers to set up a mortgage, while a mortgage servicer takes care of administrative tasks, such as collecting payments and handling escrow accounts. Many mortgage originators dont service loans. In those instances, after a borrower has obtained a mortgage, its quickly sold to a mortgage servicer. In some cases, a mortgage is owned by Fannie Mae, Freddie Mac or the Federal Housing Administration, not by the mortgage originator or servicer.

Mortgage lenders have a limited amount of money that they can lend to borrowers. They sometimes sell mortgages to free up credit so they can then issue mortgages to other homebuyers. Lenders may also sell mortgages to earn commissions. Sometimes a mortgage lender sells loans or the right to service them, but not ownership of the loans.

What to Expect If Your Mortgage Servicer Changes
The old servicer is usually required to notify customers at least 15 days before the effective date of transfer. The new servicer is usually required to provide a notice of transfer within 15 days after the effective date of the transfer. Sometimes both servicers send a combined notice at least 15 days before the effective date of transfer.

The new loan servicer must provide information on the transfer and how to contact the company. When you receive your first mortgage statement from the new loan servicer, review it to make sure all the information is accurate.

The new servicer may have different procedures and paperwork, but that doesnt mean that the terms of your loan will change. If you have a fixed-rate mortgage, your monthly payments will only go up or down if your property taxes or private mortgage insurance change. Those have nothing to do with which company services your loan. The change in loan servicer just means that you will be sending your payments to a different company.

Lenders typically dont give their customers any advance notice before a mortgage servicer changes. If you were in the process of modifying or refinancing your loan when the change occurred, you might not have to start over from scratch, but you should always keep accurate records to prevent problems and delays.

Dont Panic
Many homeowners, particularly first-time owners, are shocked and confused when they find out that their loan servicer is about to change. The fact is, this happens all the time. If you have a new loan servicer, the old servicer made a business decision that had nothing to do with you personally and that will have a minimal effect on you.

Published with permission from RISMedia.

How many times in your life have you talked about the appeal of a house and mentioned the plumbing?

Thats why, when youre prepping your house for sale, you probably dont give the subject much thought. As long as there are no leaks and no noises coming from the sink, the plumbing probably wont be an issue with anyone looking to buy your home.

Still, that doesnt mean you should ignore plumbing when putting your house up for sale.

A potential buyer might think to check and that means flushing all the toilets, turning on all the faucets and checking out the showerhead. And maybe theres a slight problem that you have learned to live with through the years, but its enough of a buzzkill to end any hope of this buyer placing a bid.

Additionally, you may have buyers who are skilled in home improvement look under the cabinets for leaks or checks for water spots around key areas. The last thing you want is for a sale to be ruined because you didnt take the time to fix a simple plumbing issue.

Before allowing people into your home, make sure you have strong water pressure and that there are no stains on any of the porcelain. If you have a difficult stain to remove, hire a local house cleaning company on a one-time basis, as they often have the materials to make the stains go away.

If you do nothing else, take care of any leaks in your plumbing system, as these can be an instant deterrent for buyers. You should also check as much of your plumbing as possible for corrosion or rust. Be sure to thoroughly check any plumbing thats easily accessible, since potential buyers will likely be checking for signs of any problems here, too.

If your house has more than one story, a buyer might look at ceilings to check for water stains from leaking pipes. Even if the problem had been fixed long ago, make sure to paint the ceiling so no alarm bells go off.

You should also make sure that sinks and tubs are draining easily, and if not, there are plenty of un-clog solutions you can buy at your local supermarket. It couldnt hurt to clean the drain yourself of any hairs or debris.

Prospective homeowners tend to focus on things where they can use their hands, so make sure that all the hot and cold water knobs are easy to turn and that the faucets do not leak. If they do, replace the washers.

The look is important as well. Having nice shiny fixtures makes an impression and it doesnt cost much to replace them. Matching faucets for the different bathrooms in your home will also give the house a polished, finished appearance.

Published with permission from RISMedia.