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How To Use A Plat Map

Plat maps convey information that is beneficial to Real Estate Agents and San Diego home buyers.

A plat map is a diagram detailing boundary or property lines for a particular plot of land. For real estate purposes, a plat map will show a tract of land and how it is separated into divided parcels, indicating the placement and length of property lines, easements and right-of-ways on the land.

Drawn to scale, plat maps convey information that is beneficial to Real Estate Agents and San Diego homebuyers. With a plat map in hand, you can know:

  • Locations of the property’s tract easements (power, water, sewer, phone, etc.); recreation areas; roads; greenbelts; and monuments and dimensions for measuring and identifying lot boundaries
  • Length and width and square feet of the parceled property, easement areas, parks, etc.
  • Longitude and latitude lines of the property
  • Lot tract numbers, builder lot numbers and parcel numbers
  • Shape of each lot (parcel boundary) and its orientation (north, south, east and west)
  • Where iron pins/pipes were set as property markers

OTHER USEFUL INFORMATION

The more atypical the shape of the plot of land, the better the chance it could have an erroneous reading of the property’s square footage on the San Diego County record. The plat map can help determine discrepancies with the square footage, which could be helpful in understanding a home’s true value.

Also, plat maps are excellent visual tools that can help orient a buyer. For example, a review of the map shows the homebuyer which side of the house gets the sun first, neighbor proximity, yard size, etc.

Basic plat maps can be found online from various sources, but usually without the important measurement and location data. Detailed plat maps can be obtained from the property title company, from the San Diego County Recorder’s office, or even their online portal. I am also able to assist in obtaining San Diego plat maps, so feel free to give me a call and I would be happy to help.

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San Diego County FHA Loan Limits Lowered for 2014

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The 2014 San Diego County FHA loan limits have been lowered from their 2013 levels. The maximum loan limit for a single family dwelling will now be $546,250, a significant decrease from last year’s $697,500 for San Diego FHA loans. FHA loans with loan amounts below $417,000 in San Diego are considered “conforming” and will have slightly lower rates and less stringent guidelines.

FHA Loans in San Diego that exceed $417,000 to the maximum of $546,250 are classified as “jumbo” or “High Balance”. San Diego High Balance FHA Loans will have slightly more restrictive guidelines and rates that are about .25% higher than the conforming loan amounts. High Balance FHA loans remain one of the few options for San Diego Mortgage Brokers to get loan amounts in the $500,000 range without going with a San Diego Jumbo Loan or a VA Loan.

The FHA loan program is a great low down payment loan option for San Diegans and is used many times by First Time Home Buyers. It offers great flexibility, low rates, and an opportunity to buy a house with as little as a 3.5% down payment.

There are many other benefits to the San Diego FHA loan for borrowers. The 3.5% down payment on a purchase can be gifted to the buyer by relatives. This allows San Diego First Time Home Buyers or others who have not been able to save in today’s current economy to buy a home without having to accumulate the down payment on their own.

FHA loans in San Diego allow non-occupying co-borrowers as well. This is another great way for San Diego First Time Home Buyers to get into the housing market because parents can help them qualify for the loan. San Diego FHA loans still allows the seller to pay up to 6% of the purchase price to cover the buyer’s closing costs.
The up-front mortgage insurance premium remains at 1.75% for San Diego FHA loans as of April 2014. The good news is, this premium is not paid in cash, it is included in the financing of the loan and does not affect your loan-to-value ratio.

Please feel free if you would like to get a more information. For other California counties please see https://entp.hud.gov/idapp/html/hicost1.cfm.

Realtor Insight – 5133 Renaissance Ave San Diego CA 92122

Today I toured a townhome at 5133 Renaissance Ave, San Diego CA 92122. This home is within the La Florentine gated community of La Jolla Renaissance. This 2 bedroom home boasts over 2,100 square feet of living space. Talk about a large two bedroom home. It’s an inviting floorplan designed for entertaining, but not in the kitchen, which is tucked away in the corner off the dining room. However, the main living area has a bonus room with a wet bar and a rather low bar table, presumably for serving food.

With multiple floor levels cascading up and down it feels like a large open space. It helps that it’s an end unit with lots of morning sun exposure to the East. The master bedroom is roomy with a nice fireplace as the center of attention. The His and Hers walk-in closets are great, no fighting over closet space. The master bathroom has a functional layout and plenty of natural light to start your day.

The carpeting definitely needs replacement, and a good coat of paint couldn’t hurt either. Plan to get your daily exercise because there are lots of steps throughout this unit. That makes up for the tiny front yard, as you won’t be doing much walking there. I’m also not a big fan of the kitchen being tucked far away from the main living area, but the kitchen itself is functional with plenty of space for a 2-bedroom household.

Realtor Insight – 4432 Via Amable, San Diego CA 92122

Today I toured 4432 Via Amable, San Diego CA 92122. Built in 1981, this townhome is part of the Vista La Jolla Townhomes community and represents the Walnut floorplan. The listing is quoting 1,716 square feet of livable space but I believe it’s actually closer to 1,657 square feet.

There were certainly some remnants of the 1980s on display, but overall the home was clean and move-in ready, with new carpeting and paint throughout. The highlights included the large functional kitchen, a wet bar for entertaining, the very tall vaulted ceilings in the master bedroom and the attached garage with epoxy flooring. I really liked the large skylight on the 2nd floor above the stairway. This brought in lots of golden sunlight into that central area of the home.

Some of the downsides to this unit include the absence of a separate dining room from the kitchen nook, small living room, the out-dated tile work in the bathrooms, the very small backyard patio that abuts the community pool area, and the lack of a front driveway for parking. With a list price of $659,000 I think that is a bit aggressive for this particular property and community. I’d peg 443 Via Amable in the low low 600s. Comparing this home to the Los Robles floorplan in the Barcelona community, which sell in the same price point, I’d take the Barcelona home any day. Click to see an example of the Los Robles floorplan.

All in all, I think this home is priced way over market, particularly for it’s condition. Wait a few weeks and watch the asking price to fall!

Make An Extra Mortgage Payment Each Year And Save Thousands

Did you know, by making just one extra mortgage payment each year you can shave off years from your mortgage and reduce thousands of dollars in interest payments. There is no secret to this statement if you understand the time-value of money. The sooner you give the bank your payment, the sooner interest STOPS accumulating on the money borrowed. Doing this consistently over the life of the loan can save you lots of money and reduce the term of your loan from 6 to 8 years.

So how do you go about making an extra mortgage payment each year? Mortgage Payment Due

Mortgage Payment Due - roycekemp.com

There are three primary ways in which you can accomplish making that extra mortgage.

  1. Send an additional principal payment equal to 1/12 of a normal payment each month. At the end of 12 months, you’ll have paid a full extra payment. An easy way to do this is to configure your automatic payment to send in that additional 1/12 as principal along with your normal payment.
  2. Instead of monthly payments, perform bi-weekly payments equal to 1/2 your normal monthly payment. This results in a total of 26 half payments (or 13 full payments). Also, because your making payments sooner, you reduce the compound interest you incur. Now, before you run to your online banking and start scheduling bi-weekly mortgage payments, you have to first see if the bank (loan servicer) will even allow this, and if so, does it have the desired result. Let me explain. The loan servicer is often a middle man between you and the actual lending institution. So while you may send the loan servicer a payment every other week, they may be hold onto it and only pay your loan for you on a monthly basis, negating your intention. Therefore, it is important that you inquire with your loan servicer to see if you can reduce the compound interest charged by making bi-weekly payments and if there are any fees associated with doing this.
  3. Send a one-time additional principal payment equal to a full month’s payment once a year.

Beware of Bi-Weekly Mortgage Reduction Services and Savings Programs

Most anytime you take out a mortgage, either as a home purchase or a refinance, what soon follows is an invitation from your bank or loan servicing company to make your payments bi-weekly. The enticement is that they will make bi-weekly mortgage payments for you. This convenience usually comes at a cost though, sometimes as an upfront enrollment fee ($200-$400), or as a monthly transaction fee ($4 to $9). This hefty price tag can chew away from the benefits of paying early, and can be easily avoided by doing it yourself.

Are You A Starter Buyer?

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Royce Kemp Realtor with Premiere Properties
will make your home ownership dreams a reality.

Currently there are many starter buyers who with just a little (family) assistance can begin the journey of owning their own home. Often termed “kiddie condo” financing because younger buyers reside in the property while the Non-Occupying Co-Borrower (NOCB) receive the tax benefits. Of course, it doesn’t have to be a condo at all, but the vast majority of purchases just happen to be condos.

Typically the future appreciation is split at sale date between the starter buyer and the relative providing assistance. A true win-win situation.

There are several factors affecting qualification depending on the type of financing obtained; whether the loan is a FHA, Fannie Mae, or Freddie Mac loan.

  • VA does not allow for NOCB.
  • FHA requires just 3.5% down.
  • Fannie Mae and Freddie Mac both require 20% down; due to Private Mortgage Insurance (PMI) restrictions that preclude any non-occupying co borrowers.
  • Buyers can buy with just 10% down with a seller carry back of 10%.

What is Non-Occupying Co-Borrower?

A Non-Occupying Co-Borrower (NOCB) is the person(s) who:

  • Is liable for the mortgage.
  • Will have an ownership interest in the home (name is on the title).
  • Enables the primary applicant to obtain the loan but does not receive the loan proceeds (in the case of “cash out refinance”).

GENERAL GUIDELINES:

  • NOCBs must have sufficient credit scores and income to qualify.
  • Lenders still go by the lesser of applying applicants’ credit scores.
  • Adding NOCBs never overcomes credit challenges that pertain to the primary borrower.
  • NOCBs are not required to live in the same state of the purchase.
  • NOCBs are not required to be a blood relative of the borrower.
  • NOCBs can be refinanced off the loan at any point when there is sufficient income for the primary applicant to qualify for the mortgage on their own.

RELATED NON-OCCUPYING CO-BORROWERS

Definition: NOCBs are related to borrowers through blood or (i.e. spouses, parents, grandparents, children, siblings, aunts, uncles, cousins, nieces and nephews). FHA makes a provision for unrelated individuals who document evidence of a “longstanding, substantial family-type relationship not arising out of the loan transaction.” This means co-borrowers not related by blood would have to show evidence of a familial relationship and that it was not created specifically for the purpose of acquiring investment property.

The key to remember: burden of proof is on the borrower. It would be better that we consult about your specific situation than try to cover every scenario in this article. (Fannie & Freddie do not allow for unrelated individuals as NOCBs).

  1. NOCBs may not be a party that has a financial interest in the transaction (i.e. seller, builder, real estate agent), etc.
  2. Unless otherwise exempted (e.g., military service with overseas assignments, U.S. citizens living abroad), any NOCB must have a principal residence in the United States.
  3. The degree of financial contribution by the NOCBs, (and the number of properties similarly owned by the NOCBs) may indicate that the primary borrower is simply a straw buyer.
    For example:
    If Aunt Mary has cosigned for 3 other family members, all of which own 2 bedroom 2 bath condos in close proximity; then the loan will probably be declined as it will be determined that Aunt Mary is an investor. In this case (for all practical reality) Mary is using family members as straw buyers for the sake of acquiring rental properties at a low down payment / and low interest rates, afforded only to primary borrowers.
  4. Gift funds should always be in the account of the primary applicant 60 days before escrow is opened on the buyer’s (future) property.
  5. In the case of a refi mortgages the rules become a little murkier.

Both FHA and Fannie Mae requires NOCBs be on title to the property 12 months PRIOR TO THE LOAN BEING SUBMITTED. Freddie Mac allows for NOCBs to be added to title just prior to the date of application.

Purchasing “Units”

Both Fannie and FHA limit NOCBs purchases to primary residence duplexes. Primary residence triplexes and four-plexes cannot be financed using NOCBs participation (low down payment / and low interest rates are afforded only to primary borrowers).

NOCBs can be used to purchase “units” as investment properties with 20% down (minimum) and an interest rate that is typically .75% higher than the owner occupied rates.

To learn more and see if you might be a starter buyer, contact me, Royce Kemp, Owner of Royce Realty & Property Management, today at 858-480-5570.

Budgeting to Buy Your First Home

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Budgeting To Buy Your House

In today’s market, conventional lenders generally require anywhere from 5% to 20% down depending on your credit profile. FHA loans can go down to 3.5% and VA loans for Military Veterans require zero down. If you have the means, the more money you put down, the better. 20% down will often net you the best interest rate on the loan. That means for the average home in San Diego County (with a current median price of $425,000 going into 2014), a home buyer would need to come up with $85,000 for just the down payment. With an FHA loan, that number drops to below $15,000, and with special finance programs we have here at Royce Realty & Property Management, we can get even lower at 1% down loan, which takes you under $5,000 for a down payment on a $425,000 home. Of course, that’s just the down payment, you then have to consider closing costs, which can vary from lender to lender and the loan product you have selected.

Saving up this money takes time and careful planning. The best way to start is by coming up with a budget that is realistic enough for you to stick with and by using other tips to help you get ahead financially.

The Budget

The only thing more challenging than setting up the budget is sticking with it over the long run. Using personal finance software will help you set it up, but only self-discipline and the desire for a new house will motivate you to stick with your budgeting plan.

First, you need to determine your total income from all sources. The second step is to list all the money that goes out every month, beginning with your fixed expenses. These include anything that has a fixed payment due every month, including:

  • Rent or mortgage (if you have a fixed rate).
  • Car payment.
  • Insurance.
  • Child support and alimony.
  • Installment loan payments.

Next, list your variable expenses. These may be a little more difficult to track, so you may want to document them over the course of a week or two on a chart such as the spreadsheet offered for free by a Canadian credit counseling service. Common variable expenses include:

  • Utilities.
  • Telephone.
  • Cable or satellite TV.
  • Anything you purchase on a daily basis (morning coffee, etc.).

I suggest that you track and update your budget regularly so that nothing falls through the cracks.

Modify Spending

Once you have used the budget for a month or two you will be able to see where your money goes every week. This snapshot shows you where it’s being wasted and, thus, where to make cuts. Any items cut from the budget mean more money to set aside for your house.

Some of these cutbacks might include bringing a lunch from home rather than hitting the deli every day, riding your bike to work instead of driving, and using coupons at the grocery store to save money.

Bring Home More Bacon

Cutting your budget expenditures and paying down debt are not the only ways to move more quickly down the road toward home ownership. Finding ways to bring in more money gives your plan a turbo boost.

If you can take on overtime hours at work, do it. Consider holding a garage sale or selling unused items online. Sock away that extra cash for your down payment.

Savings

If you’re like a lot of us, you may be tempted to use the money you’re saving for something else that comes along. To avoid the temptation, put it in an online savings account that makes it difficult to withdraw. If you have to wait a few days for the money, you may think twice about withdrawing it.

As you build your savings, avoid the urge to add to your debt. There will be plenty of time after you buy the house to buy furniture, a car or whatever else you might be thinking of purchasing. Keep that house you want top-of-mind to motivate yourself to stay out of debt and continue saving.

For additional strategies for budgeting to make home ownership a reality, feel free to contact me, Royce Kemp, at 858-480-5570 or via email royce@roycekemp.com and we can review your situation and personal goals to get you on the right track.

5 Factors That Decide Your Credit Score

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Buying A Home in San Diego? Make Sure You Check Your Credit Score!

If you are looking to buy your first home in San Diego, you will want to ensure your credit score is as high as possible. Credit scores range between 200 and 800. You want to have a score above 620 to be considered desirable by a lender, and of course, the higher the better. The following five factors will impact your credit score when trying to buy a home in San Diego:

  1. Your payment history. This is the number one factor as it indicates whether you tend to pay credit card obligations on time.
  2. How much debt you have. Owing a substantial amount of money might suggest you are over-extended.
  3. The length of your credit history. The longer your history, generally the better, as it gives a longer time horizon to evaluate your payment history.
  4. How much new credit you have. New credit is considered more risky even when you pay promptly.
  5. Your credit mix. Generally, you want to have more than one type of credit — installment loans, credit cards, student loans, and mortgages are different types of credit and the greater your mix, the better.

For more on understanding your credit score, go to www.myfico.com.

A Garage with a Home Attached

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A 4-car Garage with a Home Attached

Normally I get requests from Buyers that read, “I need at least 4 bedrooms, 3 bathrooms, 2500-sqft and a large backyard”. Nope, not this time. When Kevin contacted me he wrote “My main criteria is a large driveway and RV parking and at least 3 car garage.” I knew Kevin was into working on cars, racing cars, stockpiling cars (and their parts), but when he asked me to help him find his first home, I thought we’d be focusing on the home. Nope, not Kevin. Everything about his new home should revolve around the garage and his hobby of working on cars. It didn’t matter if he had to drive 40 miles to work each day, as long as a freeway was close, and so long as had what he needed in terms of garage space.

So we set out to find homes, err, I mean garages, throughout San Diego and that put most of our attention in places like San Marcos, Vista, and Escondido. After some power weekends we really came upon this beauty in Escondido. It had everything Kevin needed. In fact, the owner himself was an avid car enthusiast, and the 4-car garage was already outfit with bells and whistles, like 220V electrical circuits perfect for a welder, shop lights, a huge attic and tons of shelving. Not to mention an RV space, shed, Jacuzzi, and low-maintenance yards. I mean, could this get any more perfect for Kevin, a bachelor with no time for anything but his hobby.

In the end, Kevin settled on this beauty and with persistent negotiations we got the seller down from their high list price of $699K down to a more agreeable price of $615K. Kevin couldn’t be more thrilled and he’s already looking into adding a 2-post lift to one of his 4 bays. To many late nights in the garage!

761 Ocean Crest Rd, Cardiff by the Sea, CA 92007

2013-07-07. Today I took my clients to see this 2,958 sq ft home for sale in Cardiff By The Sea. This home is turnkey, in fact, the homeowner is a custom home builder and built this beautiful home brand new from the ground up in 2004. Most everything is very high-end, featuring 9-foot ceilings throughout and a grand entrance. This one of a kind home also has an optional rental that the current homeowner rented for the past 9 years for $700 per month. With a great location, walking distance to beach, schools, parks and shopping, you can’t go wrong! Extra wide street with plenty of parking for guests. This custom home has everything to offer from space, location, finishes and more. Professional landscaping in both the front and back yards, you’ll enjoy the beautiful sanctuary. The kitchen needs a little work, and perhaps new paint in the bedrooms, but other then that this home is move in ready.

roycekemp

Royce Kemp Realtor presents this gorgeous home
at 761 Ocean Crest Rd, Cardiff by the Sea, CA 92007

The asking price is 1,049,000 – $1,079,000 for this 4 bedroom, 3 bathroom home on a quiet street. Great backyard area too, and you feel very relaxed when you enter this home because it is very open. At today’s interest rates the payments would be around $3539 per month, which is great for a 4 bedroom, 2,958 square foot home in Cardiff by the Sea. This home is close to schools, restaurants and freeways and has privacy too. If you are in the market for new home, inventory is low right now, but there are still great homes for sale that I would love to show you. I primarily help couples and families look for new homes in San Diego, and I am seeing a lot of 3 bedrooms on the market. I just picked up a great listing in University City at 4081 Caminito Suero, San Diego, CA 92122 listed for $669,000-699,000.

If you are looking for a family home to buy in Cardiff, Encinitas, Solana Beach or Carlsbad, in the price range of $900,000 to $1,100,000, then I suggest you consider this home at 761 Ocean Crest Rd and give me a call 858-480-5570. I would love to show you this home!

Royce Kemp, Broker Owner of Royce Realty & Property Management – A Tradition of Sound Advice!