What is Mortgage Insurance

A few days ago, a first time home buyer asked me, “How many insurance policies do we have”? It really is a bit confusing when you start looking at the additional monthly costs of obtaining a loan. There are actually two insurance policies you need when financing a home. The first is your standard homeowners policy, which covers the structure and personal property against loss. The second is a Mortgage Insurance Premium (MIP) for a FHA loan or Private Mortgage Insurance (PMI) on conventional mortgage, where the borrower has less than 20% down payment. Both are a lender fee for an insurance policy which protects the lender from loss if the home owner should default on their loan. Mortgage insurance premiums are calculated by risk based pricing. They take into account the percentage of the purchase price you are financing, as well as your credit score. Typically, rates range from .5% to 1.5% of the loan balance. If you have a $100,000. loan balance at .5%, you would calculate your mortgage insurance by multiplying $100,000 x .5 , which equals $500.00. Divide $500.00 by 12 and your monthly PMI payment would be $41.67 a month. As you pay down your...

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Staying Cool in Indy

It’s actually a bit cloudy as I write this, which is a welcomed break for sun heat humidity drenched Indianapolis. I can take hot, I survived 15 years in Phoenix Arizona, so in that respect, it’s never really hot here in Indy. It’s the humidity that makes a hot day unbearable and leaves all of us drenched or feeling like we need a shower any time we walk outdoors. I could probably even handle the humidity if there had been some rain to cause it. But, there’s no rain either. Just dry, humid, hot, dog days of summer! Humidity has a way of draining you. I drove into my community today and had to laugh, because the parking lot at the pool was full. No one even wanted to walk to the pool. It’s just that kind of weather. We stay inside our air conditioned homes or offices, walk to our air conditioned cars and head to the closest air conditioned building we can find. Or we drive our car to the swimming pool, where we can spend the afternoon staying cool. We can complain about how hot it is and take shelter in A/C , but seriously, I’d rather...

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You Can’t Take it With You When You Go!

Defining Real vs. Personal Property It’s so tempting for a seller to take something from their home when they pack up and move. Recently, one of our buyers walked in the door of their new home to find the light which was once hanging above a pool table had been removed by the sellers. I can almost see the logic; it was a billiard’s light, quite nice and definitely looked good with the pool table. Problem is, it was attached to the home and the buyer expected it to be there, not an empty spot where it once hung. What was once personal property became real property the moment it was attached to the home. Detach it, put it back in the box and it is once again personal property. We always recommend our sellers think about things they may not want to sell with the home. Lighting fixtures of sentimental value are one such item. I prefer they be taken down and replaced before the home is listed for sale, so there is no doubt in the buyers mind what fixtures they will be buying. Just saying it is not included and will be replaced, leaves the buyer wondering...

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Your Next Home Program from Indiana Housing

Indiana Housing has been instrumental in providing no downpayment loan programs for first time home buyers. They now offer a loan program for home buyers who are moving up or buying their next home, aptly named the “Next Home” program. Many home sellers today are faced with breaking even after the sell of their home and do not have the additional funds to put a down payment on their next home. The new program from Indiana Housing offers up to 4% toward down payment and closing costs. So a home buyer can buy their next home with no money down. Highlights of the program: 4% given to home buyer (borrower) to be used toward down payment, closing costs or pre-paids. Seller can contribute up to 6% toward buyers closing costs and pre-paids. Income limits are higher No acquisition or purchase price limit No third party inspections No home buyer counseling classes Guidelines of the program: Minimum 650 credit score FHA loans only Income limits 0.125%  of loan amount upfront fee payable to Indiana Housing There are quite a few differences between the first time home buyer program and the Next Home program. The most significant are the income and repayment...

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Paula and Ines go head to head: Miami vs Indianapolis

This weeks guest post is written by Ines from Miamism. Ines and her husband Enrique are Miami Beach Realtors. Ines brings Miami to life through photos and her blog, which was recently featured in Forbes. If you are thinking about a vacation home in Miami, Ines is the Realtor I recommend. People are drawn to my website, miamism.com because they say that my love for Miami is evident.  Who better to help you find the perfect home, second home or vacation getaway than someone who really has a passion for where they live?  Well . . .  I’m happy to tell you that Paula has that same passion for Indy and we’ve had a few conversations about this.  She is so convincing that now I really want to visit Indy and see what she is talking about! Becoming a trusted source of information for you is no easy task and takes research and commitment.  Just reading HometoIndy’s articles on parks, monuments, places to visit, historic homes, local events just puts a huge smile on my face. So let’s take a look at different aspects of both Indy and Miami Beach and see why so many would be drawn to our...

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