Tag Archives: Kansas City Home Buying

How Will A 1% Rise In Interest Rates Affect Johnson County Kansas Home Buyers?

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The Pulse Of The Kansas City Real Estate Market

Today’s amazing low interest rates make it one of the best times ever to purchase a home. If you’re a home buyer looking to purchase a home in Johnson County Kansas or the surrounding Kansas City area, you’ll want to take a close look at today’s low interest rates and consider what it would mean to you if you wait to buy and rates jump in the near future. It could be just as important to you as the sales price you’ll be looking at ever so closely.

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Let’s compare today’s 4% mortgage interest rates to how things would look if they jumped 1% in the near future. On a $200,000 home, a borrower’s monthly principal and interest payment at 4% would be $955. Should they wait to buy a home and rates have jumped to 5% then the monthly principal and interest payment would be $1,074.  That’s almost $1,500 more a year for the same home should mortgage interest rates go up 1%! So be sure you consider today’s historically low interest rates if you’re on the fence on whether now is the right time to buy a home.

 Posted by Jason Brown

Is Your Credit Score Good Enough To Buy A Home In Kansas City Or Johnson County KS?

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Checking The Pulse Of The Kansas City Real Estate Market

If your credit score is over a 800, you’ll be in the drivers when getting Pre-Approved to purchase a home in Kansas City, Johnson County Kansas or the surrounding area. The mythical perfect credit score is 850 but in reality, even if you could obtain that score, there’s virtually no difference between that and an 800 credit score. More or less, if your credit score is over a 770 you’re considered an excellent credit risk and financing will likely be readily available to you.


Often times, a credit score of 750 is also considered excellent and may help you obtain the same good financing options that an 800’s credit score borrower gets.  But dip below 750 and you’ll likely fall below what most lenders consider an “A” paper borrower.  Still, there’s many lenders that consider a 720 or even a 700 credit score to be a solid credit risk. But dip any further, such as the 700’s to 720’s and lenders are likely to be scrutinized on your likelihood to repay the loan. If your score is in the 680’s or 690’s, you will face even more scrutiny, though you are likely to still be able to obtain a home loan.

If you’re in the 640’s to 680’s range, you may find lenders are unwilling to give you the most favorable terms and low fees. If you’re below 640, it’s possible you’ll get rejected for the loan. More or less, a mid 600’s presents lenders with a so-so credit risk, so you’re not going to get the most favorable terms. If your credit score is below 620, your ability to get a loan will certainly be in question with many lenders. Anything below a 600 could require you to check around for a lender willing to take on the credit risk. Once you find a lender willing and able to give you a loan, you should definitely expect a higher interest rate and/or higher fees to be charged.

If your credit score is in the 500’s, you are definitely credit score challenged and you should probably make plans to rent or move in with the in-laws. You’ll surely need to spend time improving your credit to raise the credit score and be able to purchase a home. Although I play one on TV, I’m not a mortgage lender, so be sure you contact a local mortgage lender to discuss your options in getting Pre-Approved to purchase an area home. It costs nothing to do so.


Posted by Jason Brown

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Test The Leawood Kansas Home You’re Buying For The Presence Of Radon Gas

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Checking The Pulse Of The Kansas City Real Estate Market

Radon gas is the second leading cause of lung cancer and that’s why the majority of home buyers in Kansas City, Johnson County Kansas, Leawood and the surrounding area are having the home they’re purchasing tested for radon gas. Most homes will have some level of radon gas since it’s a soil born gas and it can rise from the ground through just about any home penetrations like windows or cracks in your basement floor. The sump pit hole that most homes in our area have is one of the biggest culprits for allowing radon gas into a home. It’s certainly the biggest hole between the home and the earth and that’s why covering the hole is usually the first step in the radon mitigation process.  

You can’t sense radon gas because it’s invisible and odorless. Even the smallest cracks in your basement floor or foundation walls can allow in radon gas. Radon gas can be present on a 100-year-old home or a newly constructed home. The EPA recommends you test your home for the presence of radon gas and if the test results in a reading higher than 4.0 (picoCuries per liter of air) they recommend steps be taken to mitigate the radon down to a level below a 4.0 reading. If you think testing for radon gas is not worth the trouble, you should consider that more than 20,000 people die each year due to exposure to radon gas.

Besides covering the sump pit hole, other methods for reducing the level of radon gas in a home include filling the void where the basement floor meets the foundation wall, filling any visible cracks in the concrete and the installation of an exhaust pipe from the basement floor (sometimes straight out of the sump pit) that runs to the exterior of the home (with the help of a low voltage fan). The cost of installing a radon mitigation system has come down in recent years and many homes cost less than $800, depending on difficulty of the installation.

You can learn more about radon at the EPA’s site. Many home inspectors can test for radon and then recommend a company for installing a mitigation system, should one be needed. Some radon companies both test for radon and install mitigation systems, though you may find that to be a conflict of interest. To help you, here’s a list of some local radon inspection and mitigation system installation companies…

Affordable Radon Solutions
AAA Radon Solutions
Air Chem Radon
Certified Radon
Complete Home Inspection
Crown Home Inspections
Custom Home Inspection
Family Home Inspection Services
Home Team Inspection Services
Mid America Property Solutions
Midwest Radon


Posted by Jason Brown

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Owning A Kansas City Home Has A Huge Effect On Our Economy

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Checking The Pulse Of The Kansas City Real Estate Market

Wondering if housing really drives the economy? According to a study by NAR, one job is created for every two homes sold and homeownership accounts for more than 15% — over $2 TRILLION — of our U.S. GDP.  With the exception of many homeowners who purchased in 2006 and 2007, the financial reward of owning a home has been the single best investment most people have ever made. For those who haven’t done well or who have treaded water, there are still MANY other benefits to owning a home.

Though complicated to assess, the social benefits of home ownership are certainly huge. The NAR study indicates that homeowners pay 80% to 90% of federal income taxes collected. During our country’s great history, homeowner’s net worth has been about 40 times greater than that of renters. People who own homes also contribute greatly to stabilizing the neighborhoods in which they live, enjoy reduced crime in their areas and generally live more enriched lifestyles than those who rent.


Posted by Jason Brown

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There’s More To Choosing A Kansas City Mortgage Lender Than The Interest Rate Being Quoted

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Checking The Pulse Of The Kansas City Real Estate Market

Are you considering buying a home in Kansas City, Johnson County Kansas, Overland Park or in the surrounding area? If you are, one of the first things you should start checking on are today’s mortgage interest rates. The lower the interest rates available, the lower your mortgage payments will be… or the more home you’ll be able to afford. 30-year fixed rate loans are the most common loans made today and you can check how today’s rates are looking here at BankRate.com, Yahoo and CNN Money. 

Remember, while interest rates are a critical part of the equation, there’s a lot of other details than need considered as well. Ask each lender what fees and costs are associated with the loan. Check with multiple lenders too and once you’ve determine what you deem to be a solid interest rate and fair fees, go to work in locating a local LOAN OFFICER who can get the job done. Dealing with an out-of-town loan officer GREATLY increases the likelihood of some sort of trouble with getting the loan closed on time — or closed at all in some cases. There’s something about having a local loan officer that you or your Kansas City Realtor has done business with in the past that keeps a transaction moving along smoothly.  

How do you know how much the loan you’re inquiring about will cost you? Ask for a Truth In Lending estimate that spells that information out. It will show the interest rate being quoted on that given day (remember that interest rates change daily) as well as any fees associated with the loan in question. 


Posted by Jason Brown

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Lower Kansas City Mortgage Interest Rates Lead To Surge In Mortgage Applications

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Checking The Pulse Of The Kansas City Real Estate Market

Kansas City mortgage interest rates have fallen drastically the past week and the result is the popular 30-year fixed rate mortgage loan has dropped from a 4.57% national average to 4.45%. These are the lowest mortgage interest rates we’ve seen all this year. Not surprisingly, the Mortgage Banker’s Association reports that mortgage loan applications jumped an astounding 7% over the past week.

Many economists feel home prices have bottomed out or will bottom out this year. Couple that with today’s low interest rates and this could be the best time ever to buy a home. Home buyers can certainly lock in an unbelievably low mortgage payment for years to come. Even if the real estate market encounters a slow rebound, first time home buyers will still be able to enjoy the pride of home ownership, a monthly payment lower than many rental payments, and building of long-term net worth when property values start rising again.


Posted by Jason Brown

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Home Buyer Survey Reaffirms The Need To List Your Kansas City Home With A Tech Savvy Agent

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Checking The Pulse Of The Kansas City Real Estate Market

There’s still Kansas City home sellers out there who will hire an agent just because they used the agent on a prior home sale or purchase.  Some sellers will hire an agent that’s a relative. Other will call a real estate brokerage and let the broker assign an agent. There’s more sellers than I can count that will hire the agent with the most yard signs in the neighborhood. But hiring a Kansas City real estate agent in any of these ways overlooks one of the most important aspects in hiring an agent… the online marketing the agent will do to get the home sold.

There’s a lot of agents still selling homes that aren’t current on the most effective marketing means.  The MLS is one of the major ways that homes sell but relying mostly on that tool to sell a home puts a seller at a disadvantage. In today’s real estate market, it’s vital that sellers hire an agent who understands exactly where buyers are searching for homes. This means knowing where and how to market a home online. Along with networking with other agents, the marketing an agent does online can give a Kansas City home seller a CLEAR advantage over the competition. I’ve sold homes as soon as they’ve gone online because of where we put them and how well they show once buyers see the home online.

Some things never change and one of those is that there’s no marketing I know of to overcome a grossly over-priced home. But for sellers who are priced appropriately, the online marketing that’s done is vital since the 2010 NAR buyer survey found that 89% of home buyers found the home they purchased online. Think about that for a moment and you’ll realize the first and last question you should ask your listing agent is how they will market your home online.

In addition to finding that 89% of buyers search the internet to find their homes, the buyer survey also found that 88% of home buyers use a buyer’s agent. This is much higher than the 80% figure in a previous survey. So it’s more important than ever to hire a listing agent who will properly market your home online AND network with the buyer’s agents in the community to get the word out about your home.

Posted by Jason A. Brown

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Despite The Valleys In The Real Estate Market, The Will To Own A Home Is As Strong As Ever

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Checking The Pulse Of The Kansas City Real Estate Market

As we head into 2011, it doesn’t appear the will to own a home is cause for concern. A Fannie Mae poll in the past month shows that most Americans who don’t currently own a home STRONGLY aspire to do so. Given the lows of our current economy and given the challenges in our current real estate market, that impresses me. But I’ve never been one to underestimate the pride of home ownership in our country, so this Fannie Mae poll does not catch me by surprise.


I can’t imagine a scenario where I wouldn’t own my home. Just thinking about accepting what a landlord feels is good enough depresses me. I don’t want someone telling me what color my home will be. I don’t want to park my car in a parking lot or have to hit the ceiling with a broom stick to quiet the neighbors. Whether I was single or married, with kids or without, 25 or 65, I can’t imagine not owning my own home. Yes, home ownership comes with a lot of responsibility. There’s the mortgage payments… the maintenance…. there will no doubt be unforeseen expenses. But it would all still be worth it even if I didn’t get the mortgage interest deduction or appreciation over the years.

The Fannie Mae poll, which questioned more than 3,500 Americans, focused on owning versus renting and also found that more than 65% of respondents found it both a good time to buy a house and home ownership to be one of the safest of all investments. I found it interesting that 60% of Americans believe that buying a home today is much more difficult that it was for their parents.  Note: the poll did ask parents any questions about having to walk uphill both ways to school.

Posted by Jason A. Brown

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Only You Can Truly Decide How Much Kansas City Home You Can Afford

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Checking The Pulse Of The Kansas City Real Estate Market

As a Kansas City home buyer, the Golden Rule for how much you can afford is to simply ask yourself. No one is more qualified than YOU to decide what YOU can afford. Now a mortgage lender is going to tell you the max amount they’ll let you borrow. But that amount may be much more than you can or want to truly afford. And by afford, I mean how much you can “afford” to sacrifice other things in your life. It’s one thing to afford a $2000 a month house payment and another completely to be able to do so without compromising your favorite boat or expensive dining habits.


So when the lender says here’s your Pre-Approval Letter and you can buy up to a $290,000 home, the better question is “how much will my payments be? Once you know that you’ll know if buying a $290,000 works into your master plan. If it doesn’t, then maybe you should be looking at $200,000 or $250,000 homes. It’s up to you and this is not something than any loan officer, Kansas City Realtor, friend or family member can decide for you. When a lender pre-approves you, the underwriting guidelines are designed to minimize the lender’s losses and are not in place to protect your  future finances. A good loan officer will certainly help you with that, but the underwriting guidelines that spit out a Pre-Approval Letter don’t factor it into the equation.

So what are some good rules of thumb when deciding what’s the right amount of mortgage payment? A good general rule of thumb is that your house (including principal, interest, taxes, insurance and PMI on the loan and also including your HOA dues) should not take up more than 25% of your gross income. But if you use this rule of them then you’ve already broken the Golden Rule in  the first paragraph. I know that I’m seeing buyers purchase homes at double to quadruple the amount they make per year.  In other words you could use as a general rule of them that someone who makes $50,000 may be able to purchase a $200,000 home — of course that’s making a whole lot of assumptions. But you would never use a rule of thumb anyhow when making such an important decision, would you?


Posted by Jason A. Brown
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