Author: erick.merced

Your home’s equity is likely one of your most valuable assets, and it likely took years of hard work to accumulate. At first glance, going backwards by borrowing money on your home seems like a bad move.  However, in some situations, taking advantage of a reverse mortgage can be a lifesaver. While a reverse mortgage is not something to take lightly, it may be a smart call in certain situations.

If It Will Solve Long-Term Financial Issues

In order to qualify for a reverse mortgage, you either need to own your home outright, or have sufficient equity to satisfy the lender’s requirements for collateral.

Do some research on what your payout could be from a reverse mortgage. Such mortgages pay you a lump sum amount or provide a steady monthly amount to you (thus the term “reverse”) to help pay expenses while allowing you to stay in your home. There are certainly other options such as selling your home, which allows you to access all of your equity as opposed to just a portion of it. However, it is important to discuss all of your options with a mortgage professional in order to determine what matters most and is most beneficial to you.

If You’re Not Planning on Moving

If you prefer to stay in your current home, opting for a reverse mortgage may be a great idea. If someone is already stressed with certain financial worries, a move could further complicate things and add to their financial worries.

If You are 62 Years of Age or Older

In order to take out a reverse mortgage, you must be at least 62 years-old. However, if you are at least 62, but your spouse is not, both of you may be on the loan. Additionally, thanks to a recent court ruling, in the event of death of the older spouse, the surviving spouse is still protected from having to pay off the loan balance and would not be evicted.

Therefore, if you or your spouse are 62 years-old or older, you can both take full advantage of a reverse mortgage’s benefits no matter what happens.

Let Us Help

Though reverse mortgages are the targets of much criticism — typically by people who simply do not understand how they work — they are a great option for people in certain situations. If you’re interested in exploring a reverse mortgage as a way to get you the cash you need, the experts here at Butler Mortgage can help. Call us today at 407-931-3800 for more information.

A good credit score is not the only item in question when buying a home, but it is a major one. So, what is a good credit score? Generally, a FICO credit score of 700 is considered good.

The national average credit score has been slowly growing since the 2008 recession. In 2018 the average credit score was 704, the highest it’s ever been.

• Scores 750+ are excellent
• 700-749 is considered good
• 640-699 is considered fair
• 600+ is considered poor
• Less than 600 is considered bad

A perfect credit score is 850, but conventional loans usually accept a credit score of 620 and up, while FHA allows scores as low as 580. However, just because your score may be below that level, don’t throw in the towel.  Meeting with a mortgage professional is an excellent way to learn ways to boost your score.  They can provide you with guidance and put you on the path to homeownership.

Some ways to improve your credit score:

• Keep credit card balances low

  The lower your balance, the higher your score will be.

• Pay your bills on time

  Missing payments can drop your score up to 75 points. Therefore, always try to pay on time.

• Don’t close unused cards

  If they aren’t burdening you with fees, unused cards can increase your utilization ratio, which is the amount of available credit you’ve used. Additionally, paying things like collections before consulting with your lender, can actually lower your score since that payment will be considered the most recent transaction on a derogatory account.

• Have someone with good credit add you as an authorized user

  This action brings all the good credit on the main account over to the new authorized user, bumping up their credit. You don’t even need a card of your own for this action.

Butler Mortgage has worked with both first-time and seasoned home buyers for 25 years. Our loan officers do everything they can to make the mortgage process as painless as possible, so you can spend less time worrying, and more time enjoying your home. Call us today at 407-931-3800 with any questions.

Buying a home is likely the largest purchase you’ll make in your life. Whether it’s your first home or your dream home, you want to make sure you buy a house in a location you’ll love for years to come. Are you relocating to a new city? Do you have kids who need to be in a good school district? There are some important factors to consider that many inadvertently overlook.

Choosing an Area

No matter if you’re staying in the city you’ve called home for a long time, or you’re moving somewhere new, it’s important to do some research on different areas before you make an offer on a home. There will be neighborhoods more sought after than others, and some places are better for kids. Research areas that interest you to see what people are saying about living there.

Consider your distance from friends and loved ones. If you’ve been living right up the road from people you see regularly, moving somewhere an hour away or more might seem like a burden. The same can be said about your drive to work; don’t underestimate the toll that driving further every day can take.

Proximity to Shopping and Amenities

For some, convenience is everything. Consider the places you visit on a regular basis – things like grocery stores, coffee shops, gas stations. How far away are you willing to live from those things? They may seem like insignificant reasons to rethink where you want your home to be, but driving relatively long distances for everyday needs can get old eventually.

In addition to the necessities, consider the home’s proximity to entertainment, dining, and other attractions. Just like the specifics of the home’s interior, it’s up to you to decide what’s important to you and what you’re willing to give up when it comes to the home’s location.

When you do your due diligence and work with a team of experienced professionals like those here at Butler Mortgage, you’ll be well on your way to finding the perfect home in the perfect location. For more information, contact us today at 407-931-3800.

Traditional fixed-rate mortgages are the most popular types of loan programs for borrowers because they generally involve an unchanging monthly mortgage payment that is easy to budget around. The most common fixed-rate mortgages are 15-year and 30-year loans, and while both of their interest rates are fixed over their lifetimes, they each offer different advantages and disadvantages for homebuyers. To help you choose the right loan for your budget, here are some of the pros and cons of 15-year and 30-year mortgages.

Advantages of a 15-Year Mortgage

15-year mortgages allow borrowers with steady finances to:

• Minimize total borrowing costs with lower interest rates
• Eliminate debt quickly with each monthly payment
• Spend less in interest over the life of the loan starting in the first year
• Quickly build equity for their next home or other purchases
• Refinance easier with a lower loan-to-value ratio
• Enjoy only 15 years of mortgage payments, meaning most borrowers will enjoy a paid-off home long before retirement age

Disadvantages of a 15-Year Mortgage

• First-time homebuyers may lack the finances to qualify.
• Higher locked-in monthly payments leave little extra cash flow for other purchases.
• Higher debt-to-income ratio prevents qualification for other large loans.

If you want to spend the least amount on interest, a 15-year mortgage will lock you in at the lowest rate possible. However, if the 15-year payment is too expensive for your monthly budget, you may want to consider getting a 30-year loan.

Advantages of a 30-Year Mortgage

Most borrowers opt for a 30-year mortgage, because they can:

• Enjoy lower, more affordable monthly payments
• Free-up cash for savings, retirement, and other needs and expenses
• Still qualify for higher loan amounts
• Pay extra each month (when possible) towards the principle balance thus reducing the effective term of the loan

Disadvantages of a 30-Year Mortgage

• Higher interest rate
• Loan balance remains higher for longer
• Spend more in interest over the life of the loan
• Home equity is slow to build
• Making monthly payments over a long period of time

While the 30-year mortgage has a higher fixed rate, it offers flexibility in that you could always pay an additional amount each month to help pay off the loan faster.

Find the Right Loan for You

At Butler Mortgage, we offer fixed-rate mortgages in terms ranging from 10 to 30 years that can be paid off at any time without penalty. Our over 25 years’ experience allows us to help you decide which loan type makes the most sense for you. Whether you are interested in taking out a 15-year or 30-year mortgage loan, we are happy to serve your needs. Contact us at 407-931-3800 and request a free consultation today.

While interest rate fluctuations are common in the mortgage industry, there are actually several reasons why refinancing sooner rather than later can be a good idea. Here are some of the best times to refinance.

Before Your ARM Rate Fluctuates

If you have an adjustable-rate mortgage (ARM), then it’s a good idea to refinance before your fixed rate period reaches its end — especially if the rates are predicted to rise. Refinancing to another mortgage loan will lock you into lower monthly rates that you are accustomed to paying, thus giving you “peace of mind.”

After Boosting Your Credit Score

An improved credit score allows you to qualify for more types of loans, so shop around for the better mortgage rate. You can save a lot of money each month by refinancing to a less expensive loan. You can also consolidate your other debt to help lower the amount of interest you are paying.

When Cash is Needed for Important Expenses

Regardless of the rate situation, if you need money to pay for a wedding, college, home repairs, etc., a cash out refinance loan may be the perfect loan for you.  You will need to have some equity in your home in order to get such a loan and you should at least have decent credit in order to qualify.

Refinance with Butler Mortgage

At Butler Mortgage, we have offered both adjustable rate and fixed rate mortgages with flexible terms to the residents of St. Cloud, Kissimmee, Lake Nona, and other Central Florida areas since 1994. If you are interested in refinancing your mortgage, contact us at 407-931-3800 to request a free consultation.

Beneficial to both tenants and landlords, rent-to-own agreements provide tenants the option to purchase a rental property after living a specified amount of time at that residence. While such contracts commonly involve single-family homes, they can also be applied to apartments, condos, and duplexes. To better understand how such an arrangement can benefit you, here are some of the basic concepts and components of rent-to-own agreements.

Basic Components of Rent-To-Own

A rent-to-own agreement actually consists of two separate agreements: a standard rental or lease agreement and an option to purchase the property. The contracts for both the property rental and option to purchase are established and settled before the lease begins.

• The Rental Agreement

  Similar to standard lease agreements between a landlord and a tenant, this agreement establishes the rental amount, rental period, and each party’s responsibilities.

• The Option to Purchase

  This option guarantees the tenant the right to purchase the rental property within a set amount of time. This option determines the tenant’s purchase window and purchase price.

Benefits for Tenants

Rent-to-own agreements are nice options for those with poor credit or insufficient funds to own a home. By paying higher than average rent each month, tenants involved in rent-to-own agreements are making upfront payments and thereby building equity in their future home during their rental period. That’s because their landlord takes a portion of their rent and puts it in an escrow account to be applied toward the principle of the house. However, the tenant must follow the terms of the contract during their rental, or they risk voiding the purchase option.

Benefits for Landlords

Rent-to-own agreements benefit landlords who have been unable to sell their rental property. Such agreements also free landlords of some of the responsibilities of maintaining a rental property. While the property is still legally owned by the landlord until the tenant exercises their right of purchase option, in rent-to-own agreements the tenant, not the landlord, is responsible for all property repairs, renovations, and maintenance.

Rent-to-Own Penalties

Tenants are not obligated to purchase the property in a rent-to-own agreement. Choosing not to exercise their right to purchase will not hurt a tenant’s credit score, but they will forfeit any equity, and the landlord will keep all accumulated escrow fees paid toward the house.

Let Us Help You into a Home

If you’re having difficulty becoming a homeowner, contact Butler Mortgage. Our experienced loan officers can help you find a flexible mortgage plan that will best suit your needs. If you are interested in taking out a mortgage loan, contact us at 407-931-3800 and request a free consultation today.

As a first-time home buyer, finding the right mortgage solution can be overwhelming. Because all mortgage loans differ from one another, it is best to work with an experienced mortgage firm that can help you select the best one.

Some factors to consider when choosing a mortgage option are:

• The size of your down payment
• Your credit scores
• Borrower traits that may restrict you from qualifying for certain loans

Popular first-time home buyer loan programs include:

Conventional

Sometimes referred to as conforming, Fannie Mae, or Freddie Mac, these loans usually have a fixed rate. Conventional mortgages tend to be a bit more restrictive when it comes to credit scores and debt to income ratios. Private mortgage insurance is required when a down payment is less than 20%.

Federal Housing Administration (FHA)

FHA loans are often not as strict with credit requirements and allow a down payment as low as 3.5%. They are an excellent option for first-time home buyers.

S. Department of Veterans Affairs (VA)

Veterans and active duty personnel can get a home loan with favorable terms such as no down payment and in a lot of cases are easier to qualify for than a conventional loan.

S. Department of Agriculture (USDA)

Available in certain geographic locations, USDA loans do not require a down payment and offer low-interest rates.

As you can see, first-time home buyers have access to a variety of loan options.  There are many other options as well that may fit your particular needs.  Before shopping for your dream home, simplify the process by getting pre-qualified.

Take the First Step with Butler Mortgage

For over 25 years, Butler Mortgage has worked with both first-time and seasoned buyers wanting to own a home in Central Florida. Let us help find the best loan solution for you by calling 407-931-3800 or by filling out our free consultation form online.

Although you may have chosen a 30-year mortgage loan, who says you must wait that long to own your home outright? If you are someone who would like to pay off your mortgage early, there are several ways to accomplish your goal.

Refinance into a 10, 15, or 20-year mortgage

Although a 30-year mortgage is most common, many lenders give you the choice of taking out a shorter loan. Since 10, 15, or 20-year loans are on an accelerated schedule, your payments will go towards lowering the principal rather than the interest.

Pay more on your loan each month without refinancing

This option allows you to pay off your home in a quicker amount of time, but still gives you the flexibility of being able to use your money in case of an emergency. Should you become severely sick or lose your job, you may find yourself unable to afford the higher payments of a shorter mortgage term. Just keep in mind – if you decide to go this route, it’s up to you to make the extra payments each month. This option can be difficult for some as it can be very tempting to use the money for other things other than your mortgage loan.

Make bi-weekly payments

Rather than making monthly payments, make a payment every two weeks. At the end of each year, you will end up giving your lender 13 mortgage payments instead of 12 – helping you to pay off your loan faster.

Shop for less expensive homeowner’s insurance

Lowering your homeowner’s insurance premiums will also drop your monthly mortgage payment. Contact different companies or ask if you can bundle policies together (such as your home and car) to get a lower rate. Just remember to keep making the same payment amount to help accelerate your payoff date.

Even if you cannot afford to pay a lot of extra money on your loan every month, start small and increase the payments whenever possible. Use a mortgage calculator to see how adding a payment to your principal can help reduce your interest and shorten the length of your loan.

Let Us Help You Pick the Best Loan Option

At Butler Mortgage, we offer numerous loan programs. Before picking out a 30-year conventional loan, contact us to see if there is another mortgage term that may better suit your needs. For more information or to get-prequalified, call us today at 407-931-3800.

Not only does paying late and defaulting on your mortgage loan lower your credit score, but it also makes it more difficult for you to refinance or obtain another loan in the future. Even worse, the lender could repossess your home and sell it. While unexpected events happen such as job loss or illness, defaulting on a loan is a serious situation that bears many long-term consequences.

To avoid added late fees and collection costs to your loan, losing your tax refund, or being sued for the balance of your loan, take the following steps:

Never borrow more than you need

minimize loan debt by carefully reviewing your budget and only borrowing what you need to buy the home – even if you can get approved for more.

Be aware of your rights and responsibilities

before signing a mortgage agreement, be sure you have a clear understanding of the terms. Do not hesitate to ask your lender to answer any questions you may have. Getting clarification from a professional at the start of the loan process will help you to avoid potential issues later down the road.

Stay in contact with your lender

let your lender know about your situation as soon as possible. How you choose to deal with your loan problems could really help or hurt you. Most lenders prefer to work with you over taking back the home, but you must contact them to discuss available options.

Keep your account current

once you a set up a plan with your lender to get back on track, it is crucial to maintain a good repayment history. Do not agree to something that is unrealistic or that you may not be able to do.

If you fall behind on your mortgage loan, make it a priority to catch up as quickly as possible. The faster you recoup, the easier it will be to prevent bankruptcy and foreclosure, giving you and your family peace of mind.

We Can Help

At Butler Mortgage, we understand that each of our customers has different financial backgrounds. If you want to buy a home but think you may not qualify because of issues you have had in the past, contact us first. Many people are surprised to learn they still have a chance at owning their dream home. For more information or to get prequalified, please call us today at 407-931-3800.

As new construction continues, employment steadies, and U.S. wages rise, we can expect to see many Americans buying homes in 2019. Whether someone wants to live an active lifestyle downtown or a more relaxed one close to the beach, the Central Florida housing market is a compelling real-estate investment choice for both locals and those looking to move to the sunshine state.

Things to Consider When Buying a House in Florida

When it comes to buying a primary residence, second (vacation) home, or investment property in Central Florida, it is important to consider a few factors beforehand such as:

• Selecting a property that works with your budget
• Researching areas that are safe to live in and have good schools
• Investigating the cost of living
• Setting specific goals to help pick the right home and location
• Purchasing expenses
• Deciding between a mortgage or cash purchase
• Working with a reputable mortgage firm

As the economy continues to thrive, interest in Central Florida real estate remains strong, resulting in more individuals looking for assistance with home financing. If you are looking to buy a home in Florida, do not wait until prices increase and availability declines. At Butler Mortgage, we can help get you approved for a home loan today.

Take the First Step

Before you pick out a home, know what you can afford. Get pre-qualified online or by calling 407-931-3800. We will help you get the best loan program to suit your needs and make your dreams of owning a Florida home a reality.