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Buying a home is full of numbers, including the all-important down payment and interest rate on the loan. The process also includes a lot of terms you may not be familiar with, especially if its the first home youre buying.

Your real estate agent, escrow officer and other experts who are guiding you along the way can help a lot. It can also help to know some mortgage terms ahead of time, which can make shopping for an agent and a home a little easier.

Here are some common mortgage terms youre likely to hear during the home-buying process, and what they mean:

Amortization:
The gradual reduction of the mortgage debt through regularly scheduled payments over the term of the loan.

Annual percentage rate:
Abbreviated as APR, this measures the cost of credit in a yearly rate. It includes the stated interest rate and certain charges.

Appraisal:
Written estimate or opinion of a propertys value prepared by a qualified appraiser. The appraisal amount should be close to the cost youre paying for the home to help make getting a loan easier.

Debt-to-income ratio:
Relationship between borrowers total monthly debt payments, including new housing expenses and gross monthly income. Its used to determine how much of a mortgage a borrower qualifies for. The less debt, the better. The maximum ratio is 43 percent, though below 36 percent is preferable. That means that 36 percent of your income goes toward debt and living expenses.

Escrow:
Something of value (money or documents) that is deposited with a third party to be delivered when the condition of the contract is delivered. Escrow can be used, for example, to deposit funds with an attorney or escrow agent to be disbursed upon the closing of a real estate sale.

Mortgage insurance:
Insurance that protects lenders against losses if a borrower defaults on a home loan. Its typically required if the down payment is less than 20 percent of the purchase price.

Prequalification:
A preliminary assessment by a lender of the amount it will lend to a potential buyer. It isnt an approval of credit and doesnt signify that underwriting requirements have been met.

Principal:
Amount of money owed on a loan, excluding interest. Making this monthly payment reduces the balance of the mortgage.

Underwriting:
Part of the loan process where its decided if a loan will be provided to a potential homebuyer. It is based on credit, employment, assets and other factors to assess risk and match it to an appropriate rate and loan amount.

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If youre looking for a home and doing research on mortgages, you should have a complete list of your assets in order for a smooth transaction.

When applying for a mortgage, if you dont have a sound credit history or anything to show you have some net worth, chances are you may be denied or faced with an interest rate thats on the high end of the scale.

Common assets that mortgage lenders will want listed are stocks, bonds, mutual funds, 401k and retirement accounts, life insurance, cars, boats, antiques, jewelry and other real estate. When an asset is liquid, it has cash value or can be easily converted to cash. Liquidity is important in cases of financial emergency.

When a mortgage company looks at your worth and compares it to the down payment, closing costs and other money needed for the home transaction, it is making a decision that can impact the rest of your life, so you want to be sure you are honest and include everything.

The source of assets is also considered. For instance, if you list $100,000 in savings, but it was given to you by a parent or relative recently to beef up your account, that will raise a red flag. Who is to say that youre not going to give it back once the deal is signed?

Or maybe you took some money out of your retirement fund or took a loan against future income in order to pay off some debt. That too could have negative consequences, because mortgage lenders will know you will have less money in the future.

Any large deposit on your statement will raise an underwriters eyebrows and make you wonder if a borrower took out a loan that has yet to appear on a credit report.

Before applying for any mortgage, make sure to get your assets in order and have all documents to prove that everything is on the up and up. And if you dont think your assets are enough for your dream home, you may need to consider opting for a smaller home or waiting a little longer until everything comes together.

Published with permission from RISMedia.

Bathroom renovations are typically expensive. Even relatively minor upgrades can cost tens of thousands of dollars. If you plan to sell your house in the future, you want to recoup a substantial percentage of the money you invested in bathroom remodeling. Fortunately, you dont need to completely gut your bathroom and spend a fortune to increase your homes value and appeal to prospective buyers.

Bathroom Upgrades With the Highest Return on Investment
Homebuyers focus on the appearance and functionality of bathrooms. Simple repairs, such as replacing the caulk around the tub, installing a new toilet and replacing fixtures, can significantly improve the appearance of your bathroom at a relatively low cost. Replacing your sink, toilet or shower with a more energy-efficient model will appeal to potential buyers, since they would use less water and save money each month.

A dated bathroom may cause prospective buyers to pass on your house, even if its filled with other appealing features. To attract buyers, replace and upgrade dated fixtures, but avoid ornate ones and just keep things neat and functional. Make sure new fixtures complement the other components and colors of the bathroom.

If the vanity in your bathroom is worn out, stained or dated, replacing it with a new one with an attractive sink, faucet and countertop, as well as plenty of storage space, can improve the overall appearance of the bathroom and make it more functional, both of which will make it more desirable to buyers. Marble and granite countertops can be worth the relatively high price tag since they tend to appeal to home shoppers.

Flooring thats worn out from years of daily use can detract from the overall appearance of a bathroom. Tile and vinyl flooring materials can mimic the appearance of stone or wood. You shouldnt choose the cheapest materials, since they may be of poor quality, but you dont need to spend a boatload of money to install the most expensive flooring either.

Although most people shower daily, many like the option of relaxing in a tub. If your bathroom has space for a tub, installing one, if it doesnt already have one, may help you attract a buyer in the future. A whirlpool tub wouldnt help you much when you sold your house, however, since it would require a lot of maintenance and most homeowners would only use it occasionally.

Spend Your Money Wisely
Before you remodel your bathroom, think about which fixes would do the most to improve its appearance and functionality and increase your homes value. Splurging on high-end materials wouldnt give you a significant return on investment at sale time. If you have a limited budget for bathroom renovations, some simple, relatively inexpensive upgrades may pay off a lot more in the long run than a costly remodeling project.

Published with permission from RISMedia.

Even when home prices are rising overall, they may fall significantly in some areas. That can lead to a high loan-to-value ratio, or a situation in which a homeowner has a mortgage balance that is close to, or even higher than, the homes market value. Having little or no equity can make it difficult for homeowners to refinance, even with a high income and credit score, and can leave them stuck in mortgages with high interest rates. Fortunately, several refinancing programs can help borrowers in that situation.

Fannie Mae and Freddie Mac
The Home Affordable Refinance Program (HARP) ended in 2018. Fannie Mae introduced the High Loan-to-Value Refinance Option (HLRO) for homeowners with little, or even negative, equity who didnt take advantage of HARP.

If you have a Fannie Mae mortgage with a Note Date on or after October 1, 2017, at least 15 months have passed since that date, and you are current on your payments, you may be able to refinance. You may not have had more than one 30-day delinquency in the past year, any 30-day delinquency in the past six months or any delinquency greater than 30 days. Your mortgage may not have already been refinanced through a Fannie Mae program. There is no limit on debt-to-income ratio and no minimum credit score.

HLRO may reduce your monthly payments, lower your interest rate, shorten the amortization term of the loan or switch you to a more stable loan product, such as a mortgage with a fixed instead of adjustable rate. If you currently have mortgage insurance, it must be transferred to the new mortgage.

Freddie Macs Enhanced Relief Refinance Mortgage is similar to HLRO. Its for homeowners who are current on their payments but who dont have enough equity for a standard refinance, especially those suffering due to declining property values.

Other Federal Refinancing Programs
The Federal Housing Administration has a refinancing program that can help if you have a high LTV, even more than 100 percent. Your loan must be current, and you must extend existing mortgage insurance to the new loan.

The Veterans Affairs Administration offers the VA Interest Rate Reduction Refinance Loan. If you choose this option, you will probably have to pay a VA funding fee, but you wont need an appraisal, credit underwriting or mortgage insurance. Although there is no limit on the amount you can borrow to refinance, the VA will usually only assume up to $36,000 in liability per veteran.

Conventional Loans
For a conventional mortgage refinance, many lenders require at least 20 percent equity. You may be able to refinance with less equity, but your new loan will probably be subject to a higher interest rate, fees and private mortgage insurance.

Explore Refinancing Options
If you would like to lower your monthly mortgage payments but dont have enough equity for a traditional refinance, other avenues are available. Contact your lender to find out if you are eligible for one of these programs.

Published with permission from RISMedia.

Say what you want about millennials, but theres no denying that they have a knack for creating stylish and photogenic living spaces. As this generation continues to play a growing role in the luxury home market, it only makes sense that theyve begun to dictate whats in vogue and whats not. If youre looking to stage your home in a style that appeals to young, affluent homebuyers or simply want to keep your new residence up with the latest trends, here are a few interior design styles that millennials love.

Warm Minimalism
Theres much to love about minimalism, but for some people it just feels a little too cold. The obvious solution, of course, is to warm it up with earth tones, natural textures and handmade objects. Warm minimalism is one of the darlings of todays design world and is quite similar to another current favorite ” Scandinavian farmhouse.

Maximalism
On the other end of the spectrum, some of us need a burst of color, texture and patterns. If you love collecting items from different places, time periods and design movements, then Maximalism is for you. As always, when creating a sense of contrast, its important to thoughtfully curate each space so that it feels intentional and not chaotic.

Grandmillennial
Grandmillennial surged onto the scene towards the end of 2019 when House Beautiful coined the term and perfectly captured the aesthetic. While some millennials gravitate toward sleek and modern interiors, there are those who prefer to decorate with an eclectic mix of antique objects, needlepoint pillows and chintz fabrics. You know, the way their grandmothers used to!

Transitional
Walking the line between traditional and contemporary, transitional style holds widespread appeal. Young and affluent homeowners who have an appreciation for classic aesthetics but still want to feel current are choosing this look to create sophisticated interiors.

Memphis Movement
The iconoclastic Memphis Movement of the 1980s has made a comeback of sorts in recent years. While its over-the-top and quirky look might not be exactly what were seeing now, its definitely influenced current tastes, like the ever-popular shade of millennial pink or the resurgence of terrazzo surfaces and graphic patterns.

Published with permission from RISMedia.