When it comes to finding a lender for a mortgage loan, many borrowers take the same approach as with most other needs – they resort to the internet. This approach can be very fruitful, but it can also have some pitfalls. Today, we’re going to discuss some of the advantages of working with on-line lenders as well as advantages of working with local lenders.
Often times an on-line search for mortgages will result in finding mortgage brokers that are advertising very competitive rates. While getting the lowest interest rate is a goal for most borrowers, it may come with some unforeseen costs. Mortgage brokers usually have access to multiple investors so that they can “shop around” for low rates when it is time to lock in a loan for their borrowers. Generally speaking, the more investors they have access to, the better chances of getting a very competitive rate.
ONLINE LENDERS
So why not go on-line to find a mortgage broker that can offer a low interest rate? Because the rate is only part of the equation. Is the broker charging discount points to be able to offer such a good rate? If there are points involved, the lower rate could results in a worse financial scenario for the borrower.
Most mortgage brokers do not participate in the processing or underwriting of the loan. The mortgage broker is just a “middle man” that is paid to link a borrower with an investor and is left out of the most critical part of the loan approval process. They often gather the information from the loan application, along with supporting documentation, and then send it off to the investor so that they can process and underwrite the loan. Many times, the loan will have some “issues” that require additional documentation or explanations from the borrower. In some cases, the broker is not aware of any issues with the loan. Even worse, if they are aware of the issues, they have no control as to how the issues can be corrected or how long it may take to get the problem resolved.
Another important aspect of any loan is the appraised value of the property that is being used as collateral. If your mortgage broker is from a different part of the country, how do you know that they are using appraisers that have a keen understanding of the nuances of property values in the DC Metropolitan area? Just in Northern Virginia alone, property values for similar type homes can vary greatly by zip code, school district, and city. It is important that the appraisers understand these differences when compiling an appraisal report.
LOCAL LENDERS
Sometimes it is important to be able to have a face-to-face meeting between the lender and the borrower. Many borrowers would prefer to hand deliver valuable and sensitive personal financial information versus sending it via email or some other electronic format. In addition, it is also comforting for some borrowers to be able to shake hands with the people that will be making the determination of whether a loan of hundreds of thousands of dollars will be approved.
There are mortgage programs that are specific to a general area or state. Recently, VHDA was offering to pay 3% of a sales price to qualified borrowers purchasing a home in Virginia. The benefit to borrowers qualifying for this program could be as much as $15,000! Having knowledge of these types of programs is essential when determining the best loan solution for borrowers. It is unreasonable to expect a mortgage broker from another part of the country to know about specific programs in your area.
OUR PREFERRED LENDER
Intercoastal Mortgage Company is a local lender with headquarters located in Fairfax, VA and has been providing residential loan solutions for the DC Metro area since 1987. Intercoastal Mortgage Company will fund loans that have been processed and underwritten “in house” at our Fairfax, VA location. Similar to mortgage brokers, Intercoastal Mortgage Company (ICM) has access to multiple investors which allow us to look at various outlets when locking in a rate for a borrower. If the borrower has good credit and income, it may be as simple as seeing which investor has the lowest rate at time of the loan lock. If the borrower has experienced credit challenges, a short sale or foreclosure, ICM has access to investors that will service loans of this type. Perhaps there are programs such as the VHDA grant program that can save thousands of dollars for the borrower. We work very hard to keep updated on all local loan programs.
Because the processing and underwriting is completed “in house”, ICM is able to meet closing dates that many mortgage brokers are unable to meet.
The appraisal process is completed by having access to multiple “local” appraisers that know the DC area very well. The “pool” of certified appraisers that ICM uses have all shown their knowledge of the local area for an extended period of time.
The chart below sums up the advantages of working with a local lender versus an online lender.
As you can see, a local lender can access multiple investors to offer very competitive rates, along with excellent service and timeliness that is extremely important in today’s lending environment.
NMLS # 838973
Keith Harris
Senior Loan Officer
Office: 703-259-0788
keithh@icmtg.com
treatment you are able to take advantage of on your individual tax return. Deducting mortgage interest and real estate taxes is often what makes it more beneficial for taxpayers to itemize their deductions (rather than using the standard deduction); along with state income taxes paid. This makes itemizing more advantageous. These deductions reduce taxable income, which in turn, reduces taxes due. Typically, personal interest, such as credit card or car loan interest paid is not deductible, but qualified residence interest (with a few restrictions) is fully deductible.
You can also deduct the interest on a second home mortgage (such as a vacation or mountain home), as long as the second home mortgage amount, when combined with the principal residence mortgage, does not exceed a combined total loan amount of $1,000,000. For example, if your principal residence mortgage equaled $700,000, and you purchased a second home with a mortgage of $600,000, you would be able to deduct the interest on your $700,000 principal residence mortgage and you would be able to deduct the interest on $300,000 of your second home mortgage ($1,000,000 – $700,000) for a total interest deduction on $1,000,000 of your mortgage balances.
The interest on home equity loan debt is also deductible. The home equity loan interest deduction is the interest on a loan amount that is the lesser of the loan balance, up to a $100,000 loan, or the fair market value of the home minus 
A final major tax advantage comes when it is time to sell your home. If you own and live in your home for two of five years and you haven’t sold another home within the two years prior to the sale date, the gain on the sale, up to $250,000 ($500,000 for married filing jointly), is excluded from income tax. The con side to this exclusion is that any loss on personal residence is not deductible.
The type of lifestyle you and your family enjoy is a key component on where to buy a home. Do you like a more Urban setting where shops, restaurants and amenities are close by? Maybe even within walking distance? Or would your family prefer a more tranquil Rural setting with a little more privacy? The “stage” your family is in plays a large part in this decision. Younger couples, and singles just starting out tend to want a more urban/city location. Couples that are ready to start a family might want a more suburban/neighborhood kind of feel to raise their children. Before finalizing your decision on location, it’s a very good idea to take a look around the areas in the daytime and at night. This will give the buyer a more comprehensive idea of the neighborhoods they are considering.
Where are your family and friends located? Is it important for you to be close to grandma? Or are you looking for that happy balance between close enough to visit, but not right next door.
Commuting to your work place is another major factor, especially in our area! Northern Virginia is a growing, busy place to live. Some people are more tolerant of a longer commute than others. Do you want to be within walking distance of public transportation? We have an extensive public transportation system that includes bus services, metro, VRE, carpools, commuter buses, and more. These options can help with commuting to work. Most people still like to drive themselves to work, so knowing how long your commute will be is useful information when deciding on the location of where to buy a home.
Families with school age children will want to consider school districts. Although our area has very strong school systems, the curriculum, teaching methods, and educational options available to the students can vary greatly. Buyers should definitely factor in the educational needs of their children and compare the different school options before deciding on where to buy.
THE most important tip to buying your first home is to find an experienced Realtor and have an initial consultation. Your Realtor will lay out the entire buying process and give you an idea of what to expect, along with a timeline of the events leading up to you closing on your home. In today’s ever changing market place, being represented by a strong Realtor is paramount. New lending laws, called 
-What type of home are you looking for?
a certain amount and being comfortable with the payments at that amount can sometimes be different. Say you buy a house worth X amount of dollars, then the down payment and closing costs will be X, and the PITI (principal, interest, taxes, insurance) plus HOA/Condo fees will be X. Once you are comfortable with those amounts, you will have less anxiety looking at homes in your price range. Another reason to get pre-approved is to find out what type of loan you will be using. The type of loan – whether it’s conventional, VA, FHA, or some other program, could make a difference in your home purchase. For example, some condos are not FHA certified, meaning they would not qualify for a FHA loan. This would be important to know before you got your heart set on a condo only to find out you cannot purchase it with your preferred loan program.
Setting out to tour luxury homes can be a fun way to spend an afternoon, and a great way to get design ideas! But don’t set yourself up to be disappointed when you fall in love with a home who’s price is double (or more!) what you have been pre-qualified for. Know your price range, and stick to viewing homes within that budget. You can always incorporate some of those design elements you admire and give your new home that luxury feel.
Pay close attention to your home inspector at the 
Location: Most condominium complexes are located in an urban setting. If you want to be within walking distance of shops, restaurants, and amenities then a condo might be the right choice for you.
Location: Townhomes offer a more condensed living style than single family homes.
Location: Single family homes tend to have more privacy, because they have a larger “footprint”, meaning there is more space overall, and your house is not attached to your neighbors.
The JS Realty Team is please to introduce you to our newest listing!
Hardwood floors can be found throughout the main level. The kitchen features granite counter tops, plenty of cabinet space, and a custom backsplash. Recessed lighting and a breakfast bar complete this beautifully updated kitchen.
Spacious family room has large windows that let in tons of natural light. The dining room boasts designer lighting and access to the fenced-in backyard. 
This is arguably the single most important step. Your Agent needs to know the market and neighborhood very well. You’ll want to hire an Agent with a lot of experience, but in this industry, experience doesn’t equal years in business. What you want to look for is the number of transactions. Finding an Agent that has sold a lot of homes shows you that the agent is successful in selling homes and knows how to negotiate for you. Transaction Experience is the best way for an Agent to learn negotiating skills. Your Agent should also have an extensive marketing plan that includes professional photos, a virtual tour, social media platforms, and a strong web presence. Another important element of a strong listing Agent is monitoring feedback and communicating with you – the Seller.
If you over price your home, you will reduce the number of showings with qualified, serious buyers – because they will know the neighborhood and market. Serious Buyers will have been tracking your neighborhood and today’s Buyers are in tune with the market value. We have heard Sellers say “Let’s just try this price and see what happens”. That strategy does not work well because the first two weeks the home is on the market is when the most buzz and excitement for the new listing is happening. If the Seller has overpriced the home, Buyers will look elsewhere and your listing will lose out on the initial enthusiasm. If the Seller stays overpriced for too long, then the listing becomes “stale” and that tends to encourage low ball offers.
The old adage “you never get a second chance to make a first impression” is very apropos when selling your home. Make sure the front yard, front door, and surrounding area is in top condition. As the Buyer approaches your home and are waiting to get in, they are feeling their first impressions, so make it shine! If you are going to upgrade, concentrate on kitchens, baths, floors, and walls. These will give you the most bang for your buck. Inexpensive fixes like paint, replacing old drapes, replacing door handles, kitchen and bath hardware, light fixtures, and leaky, rusty faucets can go a long way on a tight budget. For more ideas on sprucing up your home check out 
It seems like everyone these days has a crazy, busy schedule. It can be difficult, but if you make your home available for showings and try not to limit the showing times, that can go a long way towards finding the right Buyer and the right price! The key to getting a great contract is to have as many people as possible seeing your home. If you miss out on a Buyer because of restricted showing times, you could have missed your best offer.
With over $200 million in sales, the 
Our new listing is located at 
Upstairs the Master bedroom boasts vaulted ceilings, his & her closets, and a
The 
Another scenario where a buyer can escape the need for a down payment is a loan from the 
A third loan option that has no down payment is a 
Conventional
Contacting a lender to get pre-approved for a loan should be the first action item for anyone that is interested in buying a home. The pre-approval process will typically begin with a phone conversation or a face-to-face meeting between the borrower and the loan officer. The prospective borrower will need to fill out a loan application and give the loan officer permission to run a credit report.
-Does the borrower own any properties currently
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If you are curious about how the process works, check out our previous blog on the entire