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Income:
Employed at: _________________________ Rate of pay: $____________/hour Convert to monthly: Pay rate X 40 X 52 = Annual income. Divide by 12 for monthly gross income. Example: 23.50/hour X 40 = $940/week X 52 weeks = $48,880 annual. Divided by 12 = $4,073 (Repeat with second borrower and add the 2 monthly results together for total gross monthly income.) Multiply the result by 40% for the “front ratio” which is the amount they could use for a monthly mortgage payment including taxes and insurance, PMI and HOA assuming they have no long-term debt. Make an estimate of what monthly property taxes and home owners insurance will be and subtract that from the amount available. Example: $4,073 X 40% = $1,629 – 200 for taxes and 150 insurance leaves $1,279 for a monthly mortgage payment. Using a financial calculator determine the mortgage amount this would finance. $1,279 at 4% for 30 years = $267,970. Determine “Back Ratio” Using the amount determined above as available for actual mortgage payment, subtract all monthly payments of long-term debts such as auto loans, credit card (minimum payment only), student loans, etc. The balance will be the amount available for a mortgage payment. Example: $1,279 less long term debt payments. 370 Auto loan 250 credit cards 100 student loans 559 amount available for Principal and Interest Use a financial calculator to determine the new mortgage amount. ($117,158 in this case) Ask about down payment resources they have to determine the price range of house they should be looking for. Remember to factor in closing costs and pre-paids such as homeowners insurance and escrow start-up. This will help the real estate agent to know if they need to request the seller to pay the buyers closing costs. If sufficient funds are available, it may be advantageous to use some of those funds to pay off or down existing long term debt to increase the amount they can borrow for the house purchase. |
Effective Buyer Loyalty Program:
Have you ever spent hours and hours looking at property with a buyer and then have that buyer use another agent to actually buy a house? Of course you have! Putting into practice an effective buyer interview is the key to protecting your time and your commission. Most agents are uncomfortable with asking the right questions before ever showing a house, but it is the key to establishing your ability to find the best house at the best price and to make sure they can get the financing to close the transaction. This 60 minute course will save you lost opportunities and a whole lot of gas money.
Making Commercial Properties/Sellers bankable:
This service comes from Larry's years as a Commercial Lender and President of a nationally chartered bank. Many businesses with real estate have challenges due to the seller's practice of using tax deductions for personal expenses to reduce their tax liability. This is fine until it comes time to sell their business which shows either a break-even or worse, consistent losses based on tax returns. Larry works with agents and their sellers to analyze tax returns and interview the seller to determine the actual profitability of the business which will justify a selling price and give the buyer something to present to their lender that makes sense. This program is available for a minimal upfront fee and an additional fee only when and if the business sells.
Making Commercial Properties/Sellers bankable:
This service comes from Larry's years as a Commercial Lender and President of a nationally chartered bank. Many businesses with real estate have challenges due to the seller's practice of using tax deductions for personal expenses to reduce their tax liability. This is fine until it comes time to sell their business which shows either a break-even or worse, consistent losses based on tax returns. Larry works with agents and their sellers to analyze tax returns and interview the seller to determine the actual profitability of the business which will justify a selling price and give the buyer something to present to their lender that makes sense. This program is available for a minimal upfront fee and an additional fee only when and if the business sells.
