What's Your Motivation to Buy and Finance a Home?

By
Mortgage and Lending with NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 IL Lic 031.0006220/WI
https://activerain.com/droplet/4YBc
 
What's Your Motivation to Buy and Finance a Home?
 
 
     During conversations with my new mortgage applicants, I try to discern what their "motivation" is for purchasing a home ...  

     Is the motivating factor ... the stimulus to buy and finance ... obvious or unclear?  Is the motivation based on need, fact, or emotion? 

     Why is that important?  It helps me guide them and service their needs as their Originator.  But maybe more importantly, Mortgage Underwriters think it is ... and here's why.

     Depending on a Buyer's motivation, the following things (and options) can vary or change within a mortgage:

  • Loan Terms
  • Underwriting Guidelines
  • Interest Rates
  • Down Payment Requirements
  • More

     As a result of this underwriting fact, my conversations with my clients must include fact-finding.  (No, I'm not just being nosy.)

     So, what are some of the questions I'll ask my clients?

  • Will they be occupying the property they buy?
  • Are they buying the property for a family member?
  • Will that family member also be on the loan?
  • Will the purchased property be an investment?
  • Have they already viewed homes?  
  • If so, do they have a specific home in mind?
  • And More ...

      Again, why do the answers they provide matter?  The financing options available to them will be based on their replies and final choices.  

     Example:

    If a Buyer isn't moving into the purchased property for their primary residence, the property is then considered a 2nd Home/Vacation Property ... or an Investment Property (AKA Non-Owner-Occupied Loans).  

    The down payment requirements for each (2nd Home/Vacation Property and Investment Property) are different than those required for a Primary Residence.  The down payment for these types of purchases can be as much as 20% or more.  (Note:  In some cases, a 15% down payment is allowed.  Contact me for details).

     It's also a fact:  FHA Loans are NOT available for Investment Properties, so these types of loans are financed via Conventional Financing Programs/Options only.  

     Something is always the motivating factor for a purchase.  In the case of first-time home buyers or even step-up buyers, the motivation is typically pretty clear-cut.

     But beyond the more common/major motivations, there can lie many secondary motivations.  While we know there can be many varied, emotional, and personal reasons behind home purchases, one of the most common denominators mentioned (besides affordability in payments) is:  
 
     Locale.  

     Factors that influence a choice of locale are:

  • Proximity to Employment
  • Proximity to Family
  • Real Estate Taxes
  • Quality of School Districts/Schools
  • Proximity to Public Transportation, Highways, etc.
  • Proximity to Services: Hospitals, Doctors, Stores, etc.
  • Proximity to Entertainment, Places of Worship
  • More

     (It's been my experience that the quality of schools districts and the commuting distance to employment are most commonly mentioned by my clients.  Click on each, if seeking info regarding Lincoln-Way Area CommunitiesWill County, DuPage County, or Cook/Chicagoland  communities, services, schools, more.)

     While most new applicants think mortgages are one large math equation or an act of gathering documentation ... there is much of the "ABC's", the elementary basics of a mortgage, that is based on the motivations mentioned above. 

     And that is why I spend so much time as a Mortgage Originator asking questions and gathering facts during the Pre-Approval phase of my mortgage service and during the processing of an Application.  Much rides on the answers I receive.     
     
     As an example ... 
 
      Let's consider Real Estate Taxes ... as even during the Pre-Approval stage of obtaining a mortgage, they are vitally important and can prove "motivational" within a purchase.

     In my example, my Buyer has been viewing homes with their agent. They have narrowed their choice of homes down to 2 properties.  

     What is known:

  • Home #1 and Home #2 have the same Sales Price 
  • Home #1 and Home #2 don't share similar real estate taxes
  • Home #2 has a notably larger annual real estate tax bill
     
     As a result:  

  • Home #1, if chosen, would possess a monthly tax escrow account payment lower than a purchase of Home #2 would
  • Obviously, the Buyer must qualify for the monthly payment associated with either home.  
       
     But because Home #2 has a higher tax bill, they would have to qualify for a higher dollar amount (in comparison to Home #1) in order to purchase that home. 

     As a result, real estate taxes often become a "motivation" and determinate regarding which home to purchase ... or what options remain available during financing.

     Motivations, whether large or small, do drive most home purchases and mortgage processes.  The motivations determine options considered and choices made throughout the entire process.

     Finding and working with a mortgage and real estate professional that can assist you in discovering your personal motivations ... those things you find of value in a locale, your choice of home, financing that is a sound comfortable fit for you ... is crucial.  

     What Motivations are determining your home purchase and financing?  Knowing them is the key to finding success when you purchase and finance any IL/Chicagoland home ...



     
           When in need of mortgage information, guidance, and service in New LenoxWill County, and elsewhere in the Chicagoland/IL/WI area, please contact me.  I'll be happy to put my 40+ years of experience and expertise hard to work on your behalf.
     I'm easily found at:

Gene Mundt
Mortgage Originator  -  NMLS #216987  -  IL Lic. #031.0006220  -  WI Licensed
 
American Portfolio Mortgage Corp.
NMLS #175656
 
Office:  815.524.2280
Cell:  708.921.6331
eFax:  815.524.2281
 
 
 
 
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Gene Mundt

 Mortgage Originator  -  NMLS #216987    

                                 IL Lic. #031.0006220  -  WI License #216987                                                                                                    

NMLS #175656

 

Gene Mundt, Mortgage Originator,  40+ years of #mortgage experience, will offer you exemplary mortgage service and advice when seeking:  #Conventional, #FHA, #VA, #Jumbo, #USDA, and Portfolio Loans in #Chicago and the greater Chicagoland region, including:  The #Lincoln-Way Area, #Will County, (#New Lenox, #Frankfort, #Mokena, #Manhattan, #Joliet, #Shorewood, #Crest Hill, #Plainfield, #Bolingbrook, #Romeoville, #Naperville, #Wilmington, #Peotone, etc.), #DuPage County, the City of Chicago, #Cook County, and elsewhere within IL and Wisconsin. 

 

Your Referrals & Testimonials are Always Greatly Appreciated! 

 

 

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Debbie Reynolds 01/17/2017 03:13 PM
Topic:
Home Buying
Location:
Illinois Will County Joliet
Groups:
Mortgages
The Single Home Buyer and Seller
First Time Homebuyer
Chicagoland and Northern Illinois Real Estate
Bananatude
Tags:
buying a home in will county il
buying a chicagoland home
new lenox homebuying
new lenox mortgage lenders
motivation to buy a home

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Joe Pryor
The Virtual Real Estate Team - Oklahoma City, OK
REALTOR® - Oklahoma Investment Properties

Gene, I have been working with a Wells Fargo person who is doing the 15% investor loans, but with the higher rate and the PMI it is hard to make sense of it on a reutrn basis. I know the motivation is to buy two properties at 15% versus one at 20%, but the buy better be really good.

Jan 06, 2017 02:36 PM #1
Rainmaker
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Roy Kelley
Realty Group Referrals - Gaithersburg, MD

Prospective mortgage borrowers will be in very good hands when they use your professional services.

Jan 06, 2017 05:37 PM #2
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Dick Greenberg
New Paradigm Partners LLC - Fort Collins, CO
Northern Colorado Residential Real Estate

Hi Gene - When I compare your professional approach to what buyers go through when they apply on-line, it's pretty obvious which one is going to meet the buyer's needs and actually close. It's always better to work with a pro who cares.

Jan 07, 2017 12:09 PM #3
Rainmaker
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Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Hi Gene - very well thought out.  You could teach the course on consultative selling.

Jan 07, 2017 05:32 PM #4
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Charita Cadenhead
Keller Williams Realty - Birmingham, AL
Serving Jefferson and Shelby Counties (Alabama)

Wonderful post Gene. As began reading this, the thought occurred to me that in the buyer's mind they might have been thinking "but we just want to buy a house." (lol). And while that might be true, both their mortgage professional and real estate agent are there to guide them through the process and we can't do that without having our ducks in a row and seeing that they have theirs in a row too.

Jan 09, 2017 07:11 AM #5
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Debb Janes EcoBroker and Bernie Stea JD
ViewHomes of Clark County - Nature As Neighbors - Camas, WA
REALTORS® in Clark County, WA

You explain this process so well, Gene. And I concur with Dick, you illustrate the importance of working with a lending who has ethics, experience, and expertise. I tell our buyers, don't get offended when you talk to your lender, the more information you can give them the better. It's not just you. ;) 

Jan 14, 2017 12:43 PM #6
Rainmaker
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Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker - Retired

Good morning Gene. Great tips about the loan process! Closing in on the million point level. Keep posting and we'll keep commenting to get you there! Enjoy your day!

Jan 16, 2017 06:33 AM #7
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Debbie Reynolds
Platinum Properties - Clarksville, TN
Your Dedicated Clarksville TN Real Estate Agent

Asking the right questions gets you on the path to a closing. If the answers aren't right, then it is cause to question why and for you to know if you are wasting your time or not.

Jan 17, 2017 08:03 AM #8
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Debbie Reynolds
Platinum Properties - Clarksville, TN
Your Dedicated Clarksville TN Real Estate Agent

BTW Gene, I will be reblogging this post. I feel like more agents and consumers should see this.

Jan 17, 2017 08:04 AM #9
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Michelle Carr Crowe,Altas Just Call...408-252-8900!
Get Results Team...Just Call (408) 252-8900! . DRE #00901962 . Licensed to Sell since 1985 . Altas Realty - San Jose, CA
Family Helping Families Buy & Sell Homes 40+ Years

Yes, a good client consultation will include thought-provoking questions.

Jan 18, 2017 09:48 PM #10
Rainmaker
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Jack Tenold
Jack Tenold LLC - Spokane, WA
Specializing in Reverse Mortgages

Nice post, Gene.  You are a shining example of a mortgage professional who cares about doing the right thing.  While online applications are handy and provide a starting point for the important questions, face to face interviews are always the best.  Plus it is fun to meet the client and really get to know them in order to establish a long term friendship.  Keep up the good work and have a great weekend.  Jack 

Jan 19, 2017 01:12 PM #11
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Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi

708.921.6331 - 40+ yrs experience
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