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REAMS is the shorter and easier way of saying Real Estate And Mortgage Section; But the term also describes large quantities of paper and hard copy documents, and – as such – we hope to bring you the equivalent of large quantities of quality content relating to real estate and mortgages. So…

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…We hope you are successful in finding information relating to real estate and mortgages that will meet your needs; and you have an open invitation for future visits to REAMS as often as you’d like. New and updated content is added on a regular basis and we hope this is your Web destination for all your REAM information. So browse at your leisure, we appreciate your support.

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One of the programs I wrote extensively about on this blog, and spent much of my time promoting while still active as a mortgage lender representative, is the FHA-insured 203k rehabilitation loan. Having said that, I recently came across a video on the subject of 203k mortgages which does a great job of promoting the program and I want to share it with you. Click the REbuild USA link below to watch the video:

REbuildUSA With 203k on NBC Miami

Here are my remarks on this video:

This video hits the nail on the head about the FHA-insured 203k program!
It manages to convey (in 4 minutes, 45 seconds) the true essence and real
benefits of the program, something I have been writing about for at least
3 years as of the time of this post. Thanks to Dennis & Teresa for putting
203k in the spotlight where, hopefully, more first-time home buyers and
qualified refinancing homeowners, will take advantage of the program.

Admin

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Admin’s Observation: In civilized society we adhere to certain codes, some of which you may be familiar with: Code of Ethics, Code of Conduct, Code of Honor, Dress codes, Tax codes, Penal Code, etc. And that’s only a smidgen of the offline codes we are all subjected to in one way or another.

But there are also a number of codes that are specific to the online world that affect those of us who are frequent users of the Internet and the digital marketplace; and if you are reading this you may also be familiar with some of these online codes: Country codes, QR codes, Internet Access Codes, Promo codes, Coupon codes, HTML codes, CSS codes, PHP codes and various others that cannot be listed here at this time.

However, there is one basic code which is the most fundamental of all codes pertaining to the use of this incredible resource we know as the Internet. It’s the code upon which passwords are being created; and how frustratingly difficult and vulnerable would our Internet lives be without codes on which to base strong passwords that are easy to create and remember, but tough to crack into? Very difficult indeed without the code!

Your quality, affordable Web hosting!

Read This Story About The Grand Colonial

Home Construction & Renovation in October

These words (except for quotes) are my views & opinions and do not represent those of my employer.


Newly constructed residential home
From specs, plans and a vacant lot to this perfect abode.

Home Construction and You. A Couple of Thoughts (2 min read)

For a home buyer having a new home built or buying an existing older home is a big decision. More first time home buyers are even considering new construction is a great opportunity to personally design their dream home and save big money down the road on the repairs and maintenance costs of owning an older home. Here are a couple things to think about if you are considering new home construction:

Customization

New construction allows you to design everything from the roof to the basement. You can choose your floor coverings, windows, doors, cabinets, appliances, bath fixtures, built security and entertainment systems and a lot more. Some predesigned home floor plans even allow for customization of interior space like the location of walls and number of bedrooms and bathrooms. Brand new homes come with modern energy efficient heating and cooling and Smart Home technologies. All can be designed to your specification when you build a new home. All customization items should be factored into the total construction cost budget. This is very important when selecting custom items to avoid any unexpected financial issues during construction.

For economic and social reasons it seems fairly certain, there will be more multi-generational households in the years to come. New construction can be designed specifically for multi-generation occupancy, or with that option to convert later. They may even sell for more someday when it comes time to move (something else to think about!)


Financing

Unless you plan to use personal funds for everything, financing will be a critical part of the home construction process. Lenders require more documentation than they did a few years ago. So have your paperwork in order and ready to go. Your lender will tell you what’s needed. Speak to a mortgage loan officer with construction lending experience. An upfront review of the documentation and a prequalification interview will help you determine an affordable budget. This, in turn, will help you to determine what type of home you can build.

Building a new home provides many personal rewards and personal satisfaction but it’s also complex and can also be costly. A “one-time-close” construction to permanent mortgage can help keep monthly expenses low with interest-only payments during the construction phase.

On a purchase, you can finance up to 80 percent of the land and construction costs. If you own the land (or house if it’s a knock-down) you can finance 100% of the construction costs but you will need to pay off any outstanding loans on the land. This can be included in the new construction to permanent mortgage. When the 12 to 18 month construction phase is complete the construction loan converts to a permanent mortgage with principal and interest payments.

One final thought. Don’t be in a hurry. The planning out, design and construction of a new home can take a lot longer than you might think. Expect delays. In fact, plan ahead for them if you can.




“If you drink you will die, If you don’t drink you will die anyway” – Mongolian proverb.


Arthur Aranda • NMLS #1042093
Construction & Renovation Loans
New Jersey, New York, Connecticut
201-741-1537 talk/text


Networking…

Interested in using LinkedIn to build your business? If yes, then let’s work together by following & supporting each other on LinkedIn.

Home Construction & Renovation – August

These words (except for quotes) are my views & opinions and do not represent those of my employer.


Product of Construction-to-permanent financing.
New construction, as completed, with a Construction to Permanent mortgage!

A Realtors’ Quick Guide to a Construction to Permanent Mortgage (3 min read)

When you combine a permanent fixed rate mortgage with a short term home construction loan you get a hybrid loan package that may fit your client’s needs perfectly. A Construction-Permanent Mortgage can finance both a home purchase and any construction or renovation costs, including a total knock-down. For homes already owned, equity created by the renovation can be applied to the total equity needed to finance the loan, effectively creating a no-down payment option. During the construction phase interest-only payments are made on the funds advanced to pay for the construction. A loan Disbursement Schedule is set up prior to closing so the borrower and builder will know how the payments will be made during construction. When the construction is done the interest-only loan converts to an amortizing 30 year fixed rate mortgage.

The rate on a Construction to Permanent mortgage can be locked at application for 60 days or longer if needed. The rate stays the same when the loan converts to a permanent mortgage.

To apply, your client will need a 1) signed construction contract & cost breakdown with the contractor, 2) a signed property purchase contract and 3) a set of building specs & plans. Permits are not needed to apply but will be required before construction may begin.

Because of the lengthy time frame involved with construction, up to a year in some cases, there are special considerations when it comes to construction financing. Each Construction to Permanent mortgage is structured to meet the borrower’s specific needs. Being prepared to make the transition financially and physically while a home is being built or undergoing major renovation can require some juggling and careful planning.

If the borrower waits to sell their current home until the new home is ready to move in, they must qualify for the new construction loan while still making payments on their existing home even if it’s listed for sale but has not closed. If the borrower cannot qualify this way, they may need to consider selling their current home before construction begins and temporarily rent or live with family until the new home is ready.



On a construction purchase transaction the borrower must put down at least 20% of the total Acquisition Cost, i.e. the combination of the property contract and construction contract. The construction-to permanent mortgage can cover up to 80% of this amount. Construction costs are generally categorized as “hard costs” and “soft costs.” Construction materials and labor are hard costs and things like design plans, architectural drawings, engineering fees, permits, etc. are soft costs. Some soft costs can be financed if they are included into the construction cost breakdown.

The borrower may need the proceeds from the sale of their current home to help with their down payment on the new home. If that’s the case they’ll need to sell before they close on their construction to permanent mortgage. In addition to the down payment the borrower may need money for closing costs. The borrower must also have additional funds on hand to cover any potential cost overruns and may need reserves to cover certain housing expenses during the construction phase. The reserve requirements depend on the transaction. During the pre-qualifying interview the borrower is prepared upfront for what is needed.

Building a new home or doing a major renovation can be a complex process. A one-time close Construction to Permanent mortgage makes the financing simple. Your client can focus their energy and time on their project with peace of mind knowing both the construction financing and the mortgage are approved, the rate is set and the details for financing each stage from start to finish has been worked out ahead of time.


“The secret to staying young is to live honestly, eat slowly, and lie about your age.” – Lucille Ball


Arthur Aranda • NMLS #1042093
Construction & Renovation Loans
New Jersey, New York, Connecticut
201-741-1537 talk/text


Networking…

Interested in using LinkedIn to build your business? If yes, then let’s work together by following & supporting each other on LinkedIn.


Home Construction & Renovation – July

These words (except for quotes) are my views & opinions and do not represent those of my employer.


One Loan, One Rate, One Close

Framing of a newly constructed home
Framework of a future gorgeous home!

A Construction to Permanent Mortgage

This is one loan with one set closing to fund the construction and provide a permanent mortgage. The loan can be used to finance the purchase of the property and the construction costs. If the property is already owned, any equity created when the construction is complete can be used toward the total equity to finance the transaction, effectively creating a No-Down Payment Option. During the typical 12 month construction phase interest-only payments are made on the funds advanced to pay for the construction. A Loan Disbursement Schedule is set up prior to closing so both the borrower and builder will know how the construction will be funded. When all the work is complete the construction loan converts to a 30 fixed rate mortgage.

Depending on the borrower’s needs, the rate on a Construction to Permanent mortgage is locked at application or prior to the closing. This will be the same rate when the construction loan converts to a permanent mortgage.

At application, the borrower will need to provide the lender with a signed construction contract, signed property purchase contract, if applicable and a set of building plans. Building permits are not needed to apply but will be required before any actual construction may begin.


Because of the lengthy time frame involved with construction, up to a year or even longer in some cases, there are special considerations when it comes to construction financing. Each Construction to Permanent mortgage is structured to meet the borrower’s specific needs. Being prepared to make the transition financially and physically while a home is being built or undergoing major renovation can require some juggling and careful planning.

If the borrower waits to sell their current home until the new home is ready to move in, they must qualify for the new construction loan while still making payments on their existing home even if it’s listed for sale but has not closed. Borrowers who cannot qualify this way, may need to consider selling their current home before construction begins and temporarily rent or live with family until the new home is ready.

On a construction purchase transaction the borrower must put down at least 20% of the total acquisition cost, i.e. the combination of the property contract and construction contract. The lender will typically finance up to 80% of this amount. Construction costs are generally categorized as “hard costs” and “soft costs.” The materials and labor are hard costs and things like design plans, architectural drawings, engineering fees, permits, etc. are soft costs. Some soft costs can be financed if they are included into the construction contract.

The borrower may need the proceeds from the sale of their current home to help with the down payment on their new home. If that’s the case they’ll need to sell before they close their construction to permanent mortgage. In addition to the down payment the borrower will need money for closing costs and reserves. With only one loan needed for both construction and permanent mortgage, closing costs are much less than when two separate loans are used to finance the project.

The borrower must also have additional funds on hand to cover any potential cost overruns and may need reserves to cover certain housing expenses during the construction phase. The reserve requirements depend on the transaction and are calculated by the lender before the loan is approved so the borrower is prepared upfront for what is needed. Building a new home or renovating an existing one is a complex process. A one-time close Construction to Permanent mortgage makes the financing simple. The borrower can focus their energy and time on their project with peace of mind knowing both the construction financing and the mortgage are approved, the rate is set and the details for financing each stage from start to finish has been worked out ahead of time.


“Possession make you rich? I don’t have that type of richness. My richness is life, forever” Bob Marley


Arthur Aranda • NMLS #1042093
Construction & Renovation Loans
New Jersey, New York, Connecticut
201-741-1537 talk/text


Networking…

Interested in creating more opportunities through LinkedIn? If yes, then let’s work together by “networking” through LinkedIn!