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Granville, Licking County  -  We invite everyone to visit our open house at 131 Philipps Glen Drive on March 30 from 2:00 PM to 4:00 PM.  A terrific opportunity to own a beautiful Ghiloni-built home on 5 acres in Granville.  Granville Schools.

Property information

Granville, Licking County  -  We invite everyone to visit our open house at 131 Philipps Glen Drive on February 17 from 2:00 PM to 4:00 PM.

Property information

Posted December 28, 2007 - Jeffrey Noe

"We are seriously considering buying a home in the next 6 months. Should I get pre-approved or pre-qualified for a loan beforehand? Why? Is it necessary? What's the difference?" Understanding the answers to each of these questions is an important key to a successful, stress-free home buying experience. First of all, a pre-qualification is not the same as pre-approval. In any real estate transaction, the buyer, seller, and agents involved in should be in agreement regarding the buyer’s ability to bring the home purchase to a successful close. If you haven't done so already, your Realtor will want you to talk with a mortgage company as soon as possible. The Realtor needs to know the top price range you can afford as well as the housing expense that you are comfortable with. In addition, it significantly helps your Realtor from a negotiating standpoint when presenting an offer to the seller’s agent to show that you have taken the necessary steps for your mortgage approval. Not only can it help to persuade the seller to accept your offer, it strengthens your position in the negotiation. It can greatly speed-up the closing process by, essentially, eliminating a step after the offer is accepted and can eliminate a "contingency" with your offer (i.e. pending mortgage approval). In many markets, and specific real estate transactions, a pre-qualification or pre-approval letter is required as part of the purchase documents to the sellers and their agent agent.

Let's begin with pre-qualification. Getting pre-qualified for a mortgage helps give you an idea as to how much you might be able to borrow. When you speak with a mortgage lender to be pre-qualified, you are essentially providing information about your financial condition. But since you did not actually apply for a loan and the lender only has your word on your credit, assest, liabilities, and income, the mortgage loan is not guaranteed simply because no information has been formally verified. The lender will ask questions regarding your credit. There may be a credit bureau check to see where you stand in terms of your credit score. The lender will provide you with an opinion of what you can afford based solely on the information that you have provided. It is important to understand that this is not a commitment to actually make the loan. The mortgage company should provide you with a letter outlining the pre-qualified mortgage amount as well as the type of loan. It should clearly state that loan approval could likely be issued after the information you provided is verified and formally underwritten. The term means that someone has taken a general look at your income and expenses and plugged them in to a debt-to-income ratio formula. Pre-qualifying yourself before you start looking for a home gives you nothing more than a general idea of the price range you can afford. A mortgage pre-approval has significantly more weight than a pre-qualification.

A pre-approval letter will give the maximum loan amount with the specifics of the type of mortgage loan that you qualify for. The pre-approval letter should only state conditional terms such as a clear title report, underwritten appraisal, general closing conditions, and no negative change in your status as a buyer. It can discuss the interest rates it will offer for different types of loans. A pre-approval is a much firmer commitment on behalf of the mortgage company and is a more formal process which includes a credit check and even an employment verification. During the pre-approval process, the mortgage company does almost all the work of a full approval, except for the appraisal and title search. The lender will obtain a copy of your credit report to verify your monthly payments on installment loans and credit cards and to check whether you have a history of making your payments on time. You will need to provide paystubs and W-2 forms (or tax returns if you are self-employed), plus statements from savings and investment accounts to verify your assets. If you've been pre-approved for a loan, you can shop for a house with more certainty about your buying power and less anxiety because you won't be going through the whole process worrying about your mortgage approval. However, it still isn't a guarantee that the lender will ultimately approve the loan. At a minimum, if you are serious about buying a home and satisfied with the mortgage company, you should always get a pre-approval. Neither you, your Realtor, the Seller, or their agent wants to have any surprises along the way.

A loan commitment is issued by a lender after it has approved both the home and you. A home appraisal must meet the lender's guidelines, which usually includes a stipulation that the home must appraise at or higher than the sales price. Price is just one aspect of the home the bank considers. An FHA appraisal is even more detailed than those required for conventional loans. Every area has its own issues. Your Realtor should be able to advise you about potential red flags or problems that could affect your purchase. In addition, a title search must show that the home's title is cloud-free, meaning there are no problems associated with it such as outstanding liens that can't be paid at closing, pending lawsuits, right-of-way issues, etc. Your credit report could be checked again prior to closing in order to make sure it hasn't negatively changed. You'll be asked to show proof that the home will be insured as soon as ownership transfers to you. The loan commitment letter is issued only when the bank is sure it will lend. Therefore, if you must provide a loan commitment date on your offer to purchase, be sure it provides plenty of time for the lending institution's requirements. If a commitment date is a part of your contract, the seller can request to see written proof that your lender has issued it as soon as the date has passed.

Nationwide, home prices are falling, sales are sluggish and the number of foreclosures is mounting. Ask any economist and you'll hear that things are bad, and likely to get worse.

Unless you live in Seattle, where the market is slowing but fundamentals remain strong.

The Emerald City has experienced strong price appreciation over the last six quarters, and that's expected to continue in the new year, though at a slower pace. In addition to a very low housing inventory and a strong sales rate, there are few non-conforming and high-risk loans on the books than in other cities, which means the area will likely see fewer defaults in the coming months than the rest of the country's markets.

In Pictures: America's Most Stable Real Estate Markets

Also primed for a stable year are Pittsburgh, Columbus, Ohio, and Dallas. They follow Seattle in our ranking of the country's 10 most stable markets. All are projected to have median home sale price increases next year, thanks to a combination of factors including lower-than-average inventory levels, little price volatility and high job growth.

To arrive at our list, we teamed with Moody's Economy.com to develop three prediction models based on a range of factors that affect how prices move. These include, among other things, the state of local economies, new construction contracts, foreclosure rates, local credit markets, sales rates, affordability and inventory. Each of America's 40 biggest cities was ranked on all three models, with price appreciation counting one half and sales rates and credit models accounting for the other half. Data were drawn from the U.S. Census Bureau, National Association of Realtors, Equifax (nyse: EFX - news - people ), a credit-market tracking firm and Moody's Economy.com.

Behind The Numbers
The first model looks at projected median existing home price growth from fourth-quarter 2007 to fourth-quarter 2008. Factors influencing this data include the market's inventory of unsold homes and the amount of new construction underway, both of which have obvious effects on supply. Housing affordability and local construction costs also play a role, acting as indicators of the market's ability to accommodate first-time buyers and new construction. Next is job growth, which attracts people to the area and increases their ability to buy a home.

Expensive markets like Seattle and San Francisco, which have low housing inventories and low construction costs, do well by this measure. Most of the top performers, however, are affordable, high-job growth markets like Dallas and San Antonio.

"It largely reflects that these markets never went through the boom and aren't going through the severe bust," says Mark Zandi, chief economist at Moody's Economy.com. "Price growth is not great, but [these markets] are not having house price declines. [All markets] are experiencing pricing problems, but in these markets it's less of a problem."

Moody's second predictive model examined market activity by calculating sales rate, which measures how quickly unsold inventory is expected to sell, and turnover, which measures how much of the overall housing stock those sales represent.

For example, the projected volume of home sales in San Francisco for the coming year represents a low 1.1% of the market's overall housing stock. In a market like Los Angeles, hamstrung by foreclosures and inventory glut, a 1% to 2% sales rate is potentially devastating--but given San Francisco's supply-side fundamentals and low foreclosure rates, prices are expected to modestly climb.

The last measure took into account delinquency and foreclosure predictions. By this model, adjusted-rate mortgage- and subprime mortgage-rich Detroit, Riverside, Calif., and Las Vegas got hammered, while Pittsburgh and Seattle performed well.

Regarding this measure, "it's important to differentiate between [delinquencies]: how many people are late relative to their most recent due date and how many people are in the process of losing their home," says Douglas Duncan, chief economist of the Mortgage Bankers Association. "Ninety percent of all 30-day late pays get fixed. Serious delinquencies are 90 days past current due dates."

When lending problems like this occur, the markets hit hardest are those with a high proportion of non-conforming loans. The most troublesome types are subprime mortgages and jumbo mortgages--those that are above the range of Fannie Mae (nyse: FNM - news - people ) and Freddie Mac's (nyse: FRE - news - people ) $417,000 securitization limit. Because few banks eagerly take on mortgages that aren't backed by Freddie and Fannie, the spread on jumbo loan interest rates compared to those of regular loans is at an all time high, according to data from HSH Associates, a credit-market tracking firm.

With fewer lenders wanting to take on jumbos and no banks willing to securitize jumbos, that adds another barrier to sales, especially in an expensive market. In Atlanta, for example, where the median home-sale price is $175,500, it's not an enormous setback, but when securitization stops in Los Angeles--where the median price is $593,000--a greater chunk of market activity halts.

As a result, cheaper markets are more likely to be healthier, as loan activity is less constrained.

Still, no market finds itself in a boom. As Zandi points out, discussing which markets are the healthiest "is a relative term."

"It's not like any of these markets are going gangbusters," he says. "Even Seattle: It's been very strong, but conditions are weakening and this year, at best, will be an OK year."

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For 2006, RE/MAX® was the #1 real estate agency for Sold Listings in the Granville area and Licking County. RE/MAX® outpaced the homes sales of competitors such as Prudential, Keller Williams, Coldwell Banker, and HER Real Living. RE/MAX Listings Sold in Granville during 2006 were 107% higher than the next closest competitor, Prudential. In Licking County, RE/MAX Sold Listings were 52% greater than Coldwell Banker, who posted the 2nd greatest number of Sold Listings last year. This information is based in whole or in part on data supplied by the Columbus Board of REALTORS and their Multiple Listing Service. When you're thinking about buying or selling a home, contact the Kendle/Ingle Group of RE/MAX ~ a proven, results leader in the Licking County and Granville real estate markets - "Your Dream. Realized."

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