Real Estate Costs, Fees and the Mortgage-Backed Securities System

Residential Real Estate is Not an Asset; it’s an Expense. It is a “Non-liquid assets” that cannot be sold or converted into cash easily without a significant loss of investment and time.

That’s why before you buy or sell real estate, contact an independent, third-party professional to advise you properly before you buy or sell your residential property. The Real Estate Industry is a thirty trillion-dollar industry; it’s incredibly complex and loaded with regulations, state and federal laws, good and bad guys, and gals. And more changes have taken place since 2017 that impact real estate costs than the previous 30 years.

If you’re a person who appreciates an honest assessment, then please read on. Residential properties generate no income for their owner; they do, however, create expenses. Let’s start with real estate taxes, property insurance, mortgage insurance, and utility bills.

Now add the ongoing time-suck of interior and exterior maintenance. Now the big one; having to pay contractors when you’re unable to DIY (Do It Yourself) and those costs can bleed you dry. Yes, your home has cash (equity value.) However, you can’t tap into it unless you sell or refinance-which is another costly expense.

Appraisers are State Credentialed and Certified Real Estate Appraisal Experts. Appraiser fees are on average, incredibly modest ($550), and clients gain a wealth of unbiased third-party data and insight into your home and where it stands in your market.

When compared to the Real Estate Salesperson that Markets a modest $200,000.00 home, with the average and typical fee of 6% This will cost a homeowner approximately $12,000. Not including transfer and local taxes, which could run between $1000 and $6000.

Mortgage and Refinance cost. That depends on your FICO score and Lending institution. This process can set you back from a low $2800.00 for the best FICO score up to $9000.00, and beyond.

Every single residential home produces expenses, and you need to view it through that lens. For each dollar you tie up in your home, that’ll be one dollar you can’t invest and use to grow your wealth.

Your Home Budget Painted by the Numbers

  • Create a spreadsheet of your spending priorities:
    Automobile(s) and required insurance, maintenance, fuel.
  • College savings and Loan Repayments
  • Breakfast and Lunch Costs
  • Entertainment, Recreational Expenses like Travel Trailer, Vacations, Technology
    Retirement Funding, Healthcare Costs, Life Insurance
  • Costly Bad Habits
  • Add 10% extra wiggle room for unexpected expenses.

Now subtotal, and subtract from your current single or combined monthly income. In the Lending world, this is Debt to Income (DTI) and what is left is what you can afford to them.

That loan you just closed at your local Lender, will be sold within two to four weeks after you close the mortgage deal, to Government-backed institutions. They are publicly known as Fannie Mae, along with others. They bundle your home mortgage on the open market to thousands of global Investors every single day.

This exchange or process is called a Mortgage-Backed Securities (MBS). And according to The National Association of Realtors report, as of late 2019, 93% of all home sales involve a mortgage, and 88% of repeat home buyers have mortgages as well.

Only a *Certified Residential Real Estate Appraisers have the day to day knowledge, experience, and credential on what the lending system (MBS) requires.

No one else in the involved transaction has the professional credentials to inform you of how the complete Mortgage-Backed Security system works like an affordable and skilled Certified Appraiser. Not the Real Estate Broker/Agent or the Local Lender. After all, they’re required by law to hire a qualified Appraiser.

Trust Real Estate Appraisal Services PLC. Residential Appraisals, Valuation and Consulting Services in Grand Rapids and West Michigan. Data-driven, clear Scope of Work and solution Based Data Services: Deep dive historical and current trends, Suburb Location analysis. We always walk our clients through the best and worst-case scenarios of our products/services. Schedule your Appointment Today?

*A State Certified Appraiser credential allows for Complex properties of any type or Value. State Licensed Appraisers are not allowed to perform complex appraisals. Choose wisely, choose Trust Real Estate Appraisal.

Trust Real Estate Appraisal Services PLC

Hire us before you buy or sell real estate in Grand Rapids of West Michigan. Unbiased, third party market appraisals, valuations and Real Estate Consulting. Our clients receive far more value that what we charge in Fee's.

Leave a Reply