Ayelet Gilad

Alpharetta Living, Real Estate and Community

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The Misconception About Closing Costs

Closing cost are the fees assocaited with the closing of the mortgage and unlike most people mistakingly think, they are the sole responsibility of the buyer, and not the seller’s responsibility. This misconception stems from the fact that as part of the negotiation of the deal, the seller pays for the closing cost. Indeed, more than 75% of the transactions last year had the closing costs paid by the sellers (in various %).

Basically, the closing costs are a cash amount, that together with the down payment, the buyer needs to “bring to the table” Often, an offer on a house will include the request to cover (partially or fully) the closing costs. If the seller agrees to this concession it means less cash for him, as this will come out of his net amount, and for the buyer it means – less cash to bring to the transaction.

If you have the cash, my advice would be to pay for the closing costs yourself, as it means that you can give a “clean offer”. This is of great importance in today’s market, which is becoming more and more seller’s market and you and your offer may be competing with other buyers & offers.

Need more info? Don’t hesitate to contact me for a free consultation! I’m always here to help!


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On Mortgages, Lenders And Everything In Between

Do you really know your mortgage company? Is it so important to know who your mortgage lender is BEFORE you start a transaction with them? Hell YEH! This is so keen, I wish I could emphasize this even more!

How much stress can you pile on a home purchase? A LOT! It is such an emotional and stressful process anyway, so why not reduced it a bit in advance? Trust me – it’s totally worth it to have one less thing to sweat about.

As the market shifts to seller’s market, and the regulation are loosening up a bit, you see more mortgage brokers returning, as well as new ones, entering the business claiming they can get you a mortgage.  But since they’re not established or experienced enough you can become a victim! Please be aware of all the new and less known lenders – you won’t get your mortgage, lose money and even the house you wanted! As I mentioned above, purchasing a home is a very emotional process and you have to get into it with logic in mind. This is why you need get your mortgage from a reputable company (ask me for referral) and you have to it before you start looking at homes.

Especially in this market, if you see a house that is very relevant for – you have no time to lose. You need to be ready with your pre-approval letter, be aware of all the costs (like closing costs, escrow etc.). Working with someone that has no solid reputation,  may lead to delays in closing and even eventually losing the house you really wanted to be your home. This is why I highly recommend to all my clients that the first and foremost important thing you should do when you decide to buy a home is to get your mortgage; and I don’t mean just pre-approved mortgage based on your credit score, I mean give the lender all the documents (like W-2, tax returns, etc.). I saw in the past, when the pre-approval is only based on credit history, sometimes, when you submit all the documents they will reveal your real financial situation and your mortgage might not be approved.

As I write about often in my blog, there’s plenty possible pitfalls when you’re buying a house, and when you work with me and with a reputable lender, we can make sure to avoid them and have a smooth, less stressful transaction.  Call me today @ 404-245-7172 to see how I can help you!

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Buyers – Are You Ready To Compete?

As the current market shifted towards a seller’s market, you as a buyer sshould  adjust your expectations. Yes, indeed, in case you didn’t notice the market has changed! There are fewer homes on the market, actually there’re ¼ of the amount of homes that were available last year; so even if the amount of buyers didn’t increase as compared to last year, the competition sure did and is way more intensive! Buyers should be aware, that if they are serious about buying a house now, buyers have no choice and compete for it, assuming the price and condition justifies the house.

As a buyer today, if you find a house that is attractive to you, even if its price seems a bit over the market, don’t assume people won’t jump on the opportunity and be willing to suggest even a higher price than the listing price – the competition is rough!  As I alluded to before, buyers should adjust to the current market and be willing to make the right offer if they really want the house.

As a realtor I always ask my clients – what would be the max amount you’re willing to put on the house, so if your offer is not accepted, you won’t feel that you missed a great house, just because someone else offered a bit more than you. Lastly, this is why it’s imperative, that you are ready with a pre-approved mortgage from a well-known reputable lender.

Contact me today to find out how we can help you find your dream house!

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How Your Credit Score Affects Your Mortgage Rate

Credit checks are a necessary part of applying for any loan, but they are especially important during two stages of the loan process: on the day you apply for a mortgage and shortly before closing on the loan. The first credit check is to ensure that you pay your bills on time and have sufficient income to purchase the property. The last credit check before closing is the lender’s last assurance that you are, indeed, creditworthy.

Knowing what lenders look for on your credit report and in your FICO® score is important information and can help you prepare to get the best mortgage possible.

Mortgage Lenders

Mortgage lenders take your credit score very seriously. Even though studies show that applicants with high FICO® (Fair Isaac Corporation) scores are more likely to strategically default on a mortgage loan (walk away from it), applicants with low scores are still considered a greater risk by lenders.

Generally, the better your score, the more options you have. You’ll be able to buy with a lower down payment, access a wider variety of loan types, and pay fewer points for a lower mortgage interest rate.

Good Score? Lower Mortgage Interest Rate

How much lower will your interest rates be if you have a good credit score? This will vary from individual to individual.

Keep in mind that the FICO® scoring range runs from 300 to 850. Let’s say you’re applying for a 30-year mortgage and your FICO® score is 760, which is a very good score. Your interest rate may be among the lowest on the market.

Now, let’s assume your FICO® score is quite a bit lower: only 620. Suddenly your interest rate is dramatically higher. If your score falls between 500 and 520, you will have much higher interest rates and you’ll find fewer lenders willing to work with you.

Borrowers with scores between 300 and 500 are generally not considered creditworthy. If you’re interested in learning more about how your score impacts the interest rate on your new mortgage loan, see the chart at MyFico.com.

My Score was Fine. Why Wasn’t I Approved?

Even with a sterling FICO® score, you may still be turned down for a mortgage loan. If you are unemployed or have been within the past two years, you may not be approved for a loan. If you don’t make enough money to cover the monthly payments, you may be denied a loan. There are any number of reasons a lender may not want to work with you, even with a high FICO® score.

Credit Checks and Life

Your financial history will not only affect your chances of buying a house, but may impact your ability to receive financing for a car, a vacation or for home renovations.

Insurance rates may also be affected by your rating, as poor ratings usually mean higher premiums. Many colleges will consider your financial history before they approve student assistance programs. Even employment may be affected, as many employers require a credit check as a character reference before offering a position.

I have a preferred list of mortgage lenders and will be happy to assist you with getting the best mortgage, feel free to contact me.

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Low Inventory is Driving The Market Up

The data is in (see chart below)!  This is not a buyer’s market anymore! The inventory is low and therefore, buyers today agree to compromise on different criteria they wouldn’t have if the inventory situation was different. So there is almost no more houses that go on the “do not buy” list, buyers will expand their search to include different neighborhoods, school district and even number of rooms so they can still find a house and take advantage of the low mortgage rates, which are surprisingly getting still continue to lower.

To find out what’s on the market in your area, click here.

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Local Metro Atlanta Area Updates Q2

Want to know the local trends in the housing market?

Take a minute to get updated on housing prices, supply & demand, new constructions, the mortgage situation and more by visiting the  Metro Atlanta Area Local Market Report for Second Quarter 2012.


Don’t miss the opportunity to find your dream home and search listings in you community today.

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Most Common Things That Can Go Wrong When You Buy a House – no. 3 – It’s Not Enough To Be Pre-Approved

A huge part of being prepared to buy a house is to be pre-approved for a mortgage. But, unlike the common belief – it’s NOT enough to be pre-approved for mortgage!

In the current real estate atmosphere when inventory is low and there are more buyers than properties you must put your best foot forward! You should be prepared with all the required documents and respond quickly to the loan officer requests, so he can approve the loan in a timely manner.

What often happens is that buyers have a false sense that they got it covered just because they were pre-approved, then they might find themselves approaching the end of the due diligence period and not having the mortgage approved. In this case, if they are not approved they will lose the earnest money and will not be able to proceed to closing! The other thing that might happen is that the loan is not approved before the closing date and thus needs to be postponed. Under most contracts, you will need to compensate the seller for every day of delay in the closing date, and you might need to pay them as much as 1% of the price a for every day of delay! This can adds up to a substantial amount of money!

For those reason, your mortgage should be approved and ready for the due diligence period. Then you can really be assured that you can buy the house you want!

I guide my clients through this process and help them with choosing the lender, deciding on the best offer and more. Contact me today to schedule your consultation!