buying a home in myrtle beach | Myrtle Beach Homes

Jan 28 2020

Downpayment Cheat Sheet To Buying A Home For $500 Or LESS

This past week I attended a conference where they had an economist who was sharing some statistics on our local market and it’s current status here in Myrtle Beach. One of the slides she shared had an interesting statistic on it that I posted onto Facebook. It stated:

“34% of renters can afford to buy the typical home.”

After posting this onto Facebook, I had numerous comments posted there from friends, some in the industry, but many who were not that all basically said the same thing.

The #1 reason most people are renting instead of owning is because they do not know how much money they need to purchase. It was interesting because many of the comments said people do not understand that you do not need 20% down in order to own a home.

Because of this conversation, I created this video to discuss some of the various financing options that are out there currently to buy a home. Some of the options give you the ability to buy a home for as little as $500.

Financing Options In Myrtle Beach Area

So there are multiple types of programs out there to help you purchase a home. In this post, I’m going to cover the main types that most buyers are using to purchase a home. They are:

FHA
VA
USDA
Conventional
Second Home/Investment
Specialty/Portfolio

FHA Financing

This is probably one of the most typical types of loans that consumers are using to purchase a home in the Myrtle Beach area. In this type of loan, you would need to have a downpayment of 3.5% of the total purchase price in order to purchase a home. There isn’t any restrictions as to what area you have be in to purchase a home via FHA.

However, when purchasing a home with an FHA loan, the property is going to need to meet certain criteria & standards. Typically, you cannot purchase a fixer upper with this type of loan because the appraisers are going to make mention to any types of major repairs that would need to be addressed prior to closing.

I recently had a home that a buyer was purchasing with an FHA loan and the appraiser made mention of exposed wires hanging from the ceiling in the dining room where the previous owners had removed the chandelier and did not cover it up. Because the appraiser made mention, the seller had to buy a plate & wire nuts and cap off where the chandelier used to hang in order for the buyer to get a final sign off on the appraisal and final approval given to purchase the home.

VA Financing

VA Financing is an awesome program in which you can purchase a home for literally no money down. But, in order to qualify for this program, you have to have served in the military. There is a bunch of fine print on whether you qualify for a VA loan, this was a great resource to walk you through all of it.

As I mentioned, if you qualify for a VA loan, you get many breaks from little to no down payment, but you also normally qualify for lower interest rates as well as lower closing costs. VA loans definitely have many great benefits.

USDA Financing

USDA Financing is another low downpayment option that is a great way to own a home for little to no money down. This program though does have some rather specific location requirements for a home to be eligible. They actually have a pretty nice USDA eligibility map where you can type in an address and see quickly if a home is eligible for USDA financing.

Now some of the other stipulations that are applicable to a USDA loan relate to credit scores, and condition of the property. If you do not have a credit score of at least 640 in order to qualify for a USDA loan.

Conventional Financing

This is one of the more typical financing options that are out there which gets used to purchase a home. Since I am a Myrtle Beach REALTOR® which is self employed, this is the type of loan my wife & I used to purchase our current home last year.

This type of loan is flexible on what type of property you can purchase and also on the area in which you were to purchase it in. In a conventional loan, you will need 5% of the purchase price to put down on your home. This means if you were to purchase a $200,000 home, you would need $10,000 as a down payment.

Second Home Financing

In Myrtle Beach, we have a lot of people who purchase a second home here in the area & many times they are confused as to what type of financing they can use to purchase this type of home. Many of the financing programs we discussed above like FHA & USDA financing are programs designed to be used on the purchase of primary residences in which you are going to live permanently.

So when you are thinking of purchasing a second home, you will need to have 10% down to make the purchase. You are actually doing a version of conventional financing in this type of purchase, just a higher amount of downpayment is required here.

Investment Home Financing

Now, if you are thinking of purchasing a home that you plan to rent out most of the time instead of using it as a second home, then you are going to need a different type of financing than the ones listed above. First off, just like with a second home, FHA, USDA, & VA financing options are not available as they are designed for primary residences.

Most of the banks out there are going to require more of an investment into the downpayment on investment types of properties versus a primary residence or second home because they look at these type of properties as a higher risk to the bank. If something happens in your finances, you are more than likely to let go of an investment property faster than your main home you live in. To purchase an investment home, you are more than likely going to need 20-25% of the purchase price for the downpayment.

Specialty/ Portfolio Financing

Sometimes, you are wanting to purchase an awesome condominium in a complex that has a current litigation matter against the original builder where the HOA is suing them for things they were paid to build and never did, or for construction that was done improperly.

There isn’t necessarily something wrong with the property, but because of the litigation, most typical financing options will not be able to be used. In these cases, you will need a specialty/portfolio financing option. Normally, these are offered by smaller local banks that have flexible financing options.

These types of loans typically require 25% for a downpayment. The other thing to note with this type of loan is that they normally are not offered with a 30 year fixed rate. Instead they are usually either a 15 year loan, or something if a flexible rate arm after a few years.

Additional Expenses When Purchasing

In addition to your downpayment for the mortgage, you are going to have a few more expenses that you can expect when purchasing a home. The first is for a home inspection. You aren’t required to get a home inspection done, but I always highly recommend a home inspection be done before purchasing a home. These are typically around $300-$500.

Many of the other expenses you would incur when purchasing a home, you could request the seller to pay for you. With a strong enough offer, you can normally get the seller to agree to cover these expenses.

These closing costs would include attorney fees, appraisals, taxes, loan processing, title search, homeowners insurance, title searches, courier fees, and many other items. The last home I sold with an FHA loan for my buyers we asked for the seller to give 3% of the purchase price to the sellers as a credit and it basically covered all their expenses other than the downpayment, so it is possible to get most of the items covered.

I hope that this post helps explain financing options and how much you will need in order to purchase a home here in Myrtle Beach. It hopefully is nowhere near the amount you originally thought it might be. If you would like more information on buying a home, which lenders you should consider, and what options might fit your situation best, feel free to reach out & contact me. I’d love the opportunity to help you start the journey to home ownership in the Myrtle Beach area.

Dec 18 2019

3 Mistakes To Avoid In A Real Estate Transaction

Whether you are buying or selling a home in Myrtle Beach, there are some mistakes that you want to avoid during the transaction that can make the purchase or sale of a home more difficult. Check out this video below to watch quick video of what these three mistakes are:

Vacation

Everyone needs a vacation right? Yes, we all definitely need time away where we can simply relax unwind and disconnect. One of the best ways to do this is to take a cruise. Unfortunately taking a cruise on the week before buying or selling a home is not a good idea.

When buying a home, there are several times throughout the process the lender will need more documentation for the underwriters to clear the conditions placed on the loan. If you are unable to deliver these documents in a timely manner, it could make it impossible to close on time.

Or, say you are in the process of buying a home and the week before closing you are on a boat when the lender is trying to get in touch with you to review the closing disclosure and sign off. Due to the laws established by TRID in 2017, buyers must sign a disclosure and there must then be a 3 day waiting period before the loan can be funded and the sale recorded.

If you are out of the country on vacation or on a cruise ship without access to your email when the lender sends you the disclosure, you will not be closing the day after you return from your trip because the time period will prevent it.

Or, if you are selling a home in a gated community in Myrtle Beach like Waterbridge and you out of the country without any way to communicate with your REALTOR® for the weeks leading up to the sale of your home and a repair request comes in for the buyer. As I’ve shared in the past, one of the items your agent helps you negotiate after the contract is the home inspection repairs. If this communication does not happen, it could cost you the sale of your home.

So while you think a vacation is something you have to do right then, it can be a very bad idea to take during a real estate transaction.

Get The Right Attorney

To buy or sell a home in Myrtle Beach, you need to have an attorney to represent you in the process and to get the transaction recorded at the court house. So whether you love or hate attorneys, it is a necessity in order to do any type of real estate transaction here.

Too many times I run into clients who want to use a high school friend who is an attorney now to try & save a few dollars in the transaction. The issue is that normally this can end up causing more problems then the little amount of money you will save.

When buying a home in Myrtle Beach, the attorney is responsible for reviewing the chain of title on the property you are purchasing to make sure it is clear and that you are able to be issued a clear title on the property. While with some properties that isn’t that big of a deal, on others it can be much more work as they may have to go back through 30-40 years of research and look through a chain of ownership that could be very long.

Having an attorney that does this type of work every day is crucial to make sure you have no issues during the purchase or an issue come up when trying to sell. This past year I had issues come up more than once on transactions with title issues and all of them came from when the person purchased the home and used an attorney that doesn’t specialize in real estate.

In one situation, it was for a client of mine trying to purchase a house had a title issue that was found when the property was sold 2 owners prior and required weeks of work tracking down heirs of the previous owner to have them sign documents in order for my clients to be able to purchase a property with an insurable title. So when buying, always pick an attorney that handles real estate transactions on a regular basis.

Living Life

This one is kinda obvious, but if you were to pass away during the transaction, it will make it almost impossible to buying a property or sell one. Now, selling a home can still happen if one of the sellers passes away, but you would definitely want to have all the correct types of documents in place.

This includes owning the property as joint tenants with rights of survivorship so that if one of the owners passes away their ownership rights automatically pass to other owners. This is the quickest way to keep the property transaction in place.

If you don’t own it with rights of survivorship, then it is really important to have some sort of will in place stating who inherits the property. I had a client who was trying to purchase a condo this year where the seller had passed away and it was an estate property.

The representative for the estate tried to probate the property, but there was no will in place so they had to get documents signed off by all the heirs of the deceased which are currently located all around the world and not local. So we have now been waiting over 6 months on these items to be completed so that my buyer can eventually purchase the home.

If there was a will in place that was properly executed in South Carolina, none of these issues would be present. The executor would have been able to take the notarized will to the court house, process the estate and we would have been able to do the transaction with no problems. But because this wasn’t in place, we unfortunately are now months into this with no idea when we will be able to actually purchase the condo.

Avoiding the Mistakes

So avoid these three mistakes when you are either buying or selling a property and the transaction will be able to happen much faster. In our market, the average days from contract to closing is around 30-45 days. But, if you make one of these mistakes, the transaction could take considerably longer if it is even able to be done.

Nov 20 2019

Getting The Final Amounts For Closing on a Myrtle Beach Home

Congratulations! It’s almost closing day and you are excited to purchase that fantastic home in Myrtle Beach! Your agent has helped you through the search process, connected you with a lender for the loan, helped you find the right closing attorney, negotiated repairs on the home, and we are now only a few days from closing!

But, you are stressing out because nobody has given you a final amount you will need for closing to transfer yet. Unfortunately, here in Myrtle Beach, it is fairly common for the final figures to not be ready until just a day or two prior to closing.

There are a lot of things that factor into when the final amounts are calculated and each and every thing gets figure down to the day. So things like taxes, HOA dues, interest, all are calculated to the day. This means if you close on the 31st of a month versus the first can alter those numbers greatly that are due on the day of recording. That being said, attorneys & lenders do not have the final amounts calculated until there is a clear to close notice given from the lender.

Once that is given, everyone can then plan for that day, start calculating and give you final numbers of how much will be needed for the day of closing.

So, if you are stressed about not knowing how much just yet, do not stress, it is normal, and nothing to worry about. You will get that number and then be able purchase that awesome Myrtle Beach Home.

Aug 20 2019

Insuring Your Home In Myrtle Beach During Hurricane Season

We are now a little past halfway through hurricane season here in Myrtle Beach for 2019 and I thought it would be good today to share some tips to help you with purchasing a home in Myrtle Beach during hurricane season. If you follow these tips, it will make your home buying process much easier during this hurricane season.

Buying a home in Myrtle Beach comes with making many decisions, but one of the most important ones has to be the property insurance. You are obtaining a huge asset and often taking a mortgage to purchase. So, insuring the property and covering the debt are not just required by the lender but should be taken very seriously by the buyer. When buying a home, here are 7 important tips to remember when buying a home in Myrtle Beach during hurricane season:

Choose an experienced local Myrtle Beach insurance agent.
Obtain quotes prior to contract.
Don’t just go with the cheapest quote.
Watch for tropical storm and hurricane warnings during the purchase.
Consider binding insurance as soon as possible.
Discuss The Addition of Flood Insurance, Even When Not Required
Perform a walk through right before closing.

Choose a Local Myrtle Beach Insurance Agent Early

Do your homework and discuss insurance coverage, exclusions, and premiums early with a local Myrtle Beach agent. Even if there isn’t a property chosen yet, get educated on the process, terms, and products. As mentioned, consider flood insurance even if not in a high risk area.

A local insurance agent can discuss this and all other insurance related areas areas. Also, one of the most common delays just before closing is waiting on the insurance binder. This happens typically, when someone wait until the last second to decide on coverage or even tell the agent about the purchase. Don’t be that buyer because lenders will not approve your loan until you have insurance in place and your closing will be delayed!

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Obtain Insurance Quote Prior to Contract

Knowing the costs up-front could make or break a purchase. The insurance premium(s) are part of a housing and closing expense. So, it will effect the mortgage payment and the cash to close. Depending on the area and the property, the insurance cost could vary widely. For example, there have been buyers who find that a particular home requires $3,000 per year in flood insurance when it was only expected to be about $500.

That is a major factor in making a decision and could prohibit you from qualifying for the loan! I’ve seen many deals in the past fall apart because the buyer cannot afford the insurance premiums at the price they originally were approved to purchase at because the home required a high insurance premium.

Don’t Just Go With the Cheapest Quote

Of course, the premium and payment are very important, but do not sacrifice coverage for a super discounted premium. If a buyer cannot easily afford to pay an insurance claim shortage, why pay for coverage that won’t rebuild the home adequately? Foremost, make sure the property is covered against perils with a quality company and then get the premium as affordable as you can.

Pick a company that has been established and is familiar with Myrtle Beach area to help you so that if there is a disaster, they will be able to help you fix any damage quickly and get you back into your home. If you are having trouble finding a reasonable quotes, you can always ask your agent to contact the listing agent to find out who the sellers have their insurance currently with.

Tropical Storm and Hurricane Warnings

Be aware when a named storm is approaching Myrtle Beach. Once a named storm is within a certain distance of the coast, insurance companies will not bind or increase insurance coverage. So, with an imminent storm during hurricane season, insurance companies know the risk is much increased.

Thus, no insurance will be written until the property is out of harm. So, buyers need to be proactive and know the options, potential issues, and process early.

Consider Binding Insurance Early

Typically, insurance companies will bind an insurance policy very early with an effective date of the closing. “Binding insurance” means to put the policy in force or to have an effective date. This can be particularly helpful in times where storms are on the way. Keep in mind once the insurance is bound for a certain date, you cannot close prior to the insurance effective date. Make sure to stay in constant communication with your mortgage lender, closing attorney, REALTOR®, and insurance agent on binding the insurance.

Nothing is worse than having a proposed closing date coming and you have to delay everything because the buyer has not yet secured financing. If the binder has been written before the storm is named, they will cover you and you can close on your property on time.

Discuss The Addition of Flood Insurance, Even When Not Required

While many areas of Myrtle Beach do not require flood insurance to close on the home, it is always my recommendation to consider purchasing flood insurance when buying a home as an added level of security.

Back several months ago, I did a quick interview with a local insurance agency regarding flood insurance:

Perform a Walk Through Prior to Closing!

Yay it’s closing day! I know you are so excited and ready to move into your new home. You have made it through the purchase process and all you have to do is sign the paperwork. But, don’t forget to do a final walkthrough.

Just before closing, it is so important to check the home out again because there are so many things that could happen. We have seen movers damaging the home moving out the sellers, broken water lines damaging the home, flooding, and more. Once the home is yours, there are usually not many options for a remedy. Make sure you or at least your buyer’s agent checks it out thoroughly before signing the papers.

I hope you find these tips to buying a home during hurricane season in Myrtle Beach helpful. If you need help buying a home in Myrtle Beach, feel free to reach out!

Jan 02 2018

Five Things Every Home Inspector Checks In Myrtle Beach

When buying a home in Myrtle Beach, should you get a home inspection done? What will the home inspector check when going through the property? I’m going to cover this topic in today’s Two Minute Tuesday Video:

Should I Have A Home Inspection Done When Buying a Home In Myrtle Beach?

When you are buying a house, one of the things I always suggest is for my buyers to get someone to do a professional home inspection of the home. This means hire a licensed insured home inspector to come into your property and check everything about it. It will cost a few hundred dollars and take the person a few hours, but they will do a full and complete walkthrough of the property to make sure there are no major issues found throughout the property. Now in Myrtle Beach, they are going to check for five main areas of the house. They are not going to cover things that are cosmetic though. So you want to make sure when you are doing your contract if you see something cosmetic like a cracked tile or chip in the wood that you put those things are written into your contract to get them addressed.

Five Areas Checked

When a home inspector comes into the property, they are going to go over the entire property and do visual inspections of everything, but they are going to focus into these 5 main areas:

Structure
Heating/Cooling System
Plumbing
Electrical
Appliances

These five areas are what a South Carolina Residential Agreement directly talks about in the contract. If the item mentioned by an inspector does not fall under one of these 5 categories, then it’s possible the seller will resist taking care of the item.

Structure

Let me start by stating this, your inspector is not going to do a full structural inspection of your home. In order to do that, you would need to hire a structural engineer who has specific training to handle such a thing. What a home inspector in Myrtle Beach is going to do instead is a visual inspection of the property. They are going to make note of any defects or things that look out of the normal. If they see a crack in the foundation they will alert the buyer of it. If the buyer has greater concern based on the findings in this original report, they could then hire a structural engineer to come out to the property and do a specific structural inspection of the home.

The home inspector is also going to check the roof to make sure there are no leaks noticeable to the eye. They will go into the attic and make sure that nothing is out of the ordinary. That there is the proper amount of insulation present to keep the home insulated right. If they see any signs of a prior leak, they normally have a moisture meter that they will then test the affected area to see if it just a stain from previous issue or if it is something that is current and needs to be addressed immediately. They will walk around the exterior of the home and make note of any wood rot, or damage caused by wood destroying organisms as well.

Heating/Cooling System

The second main area the inspector is going to focus on is your HVAC system. Now, home inspectors as a whole are not normally experts on everything related to your heating & cooling system, but, they are going to do a full visual inspection of your equipment. They are going to make sure that if it’s a hot summer day the air conditioning is working and making cool air. If it is a cold winter day, the heat is working properly and it’s making warm air. They are going to note the age of the unit, and make sure that there are no leaks on any of the lines and that all dr

ains are properly installed and that drain pans are in place.

They will open up your filters and make sure that they are clean and that the coils in the unit are also fairly clean and free from any debris that could cause the unit to work hard and thus wear out quicker. They will also run tests to check the outflow vs intake of air temps. They will use their best skills to make sure your system is running optimally.

Plumbing

During a home inspection in Myrtle Beach, they are going to check this third section, the plumbing systems. While they aren’t going to be able to see what is going on behind the drywall, they are going to test all your faucets throughout the property and make sure that they are working properly. They are going to look under the sinks and make sure that when the water drains out that it is not leaking.

The inspectors are going to make sure your drain plugs are in proper working order and that there are no leaks in the faucets. The home inspector is going to give you all kinds of information about your hot water heater like it’s age, size, whether it has an expansion tank, if it is heating water to a proper temperature without being too hot. They will make note of the temperature to make sure you do not get scalded when taking a shower, or placing a child into a freshly drawn bath.

Electrical System

Next, the inspector is going to go the electrical box and they are going to check to make sure that there is nothing faulty in there. They will make note of the amperage in the box. They will do a thorough inspection of the panel to make sure that somebody didn’t take a circuit breaker and stick it in on their own, improperly. This could be a major fire hazard that could burn your house to the ground at any moment if not addressed.

The inspectors are going to go to every single outlet in the home and make sure they are working properly and are grounded. They are going to test the GFCI outlets in your kitchen and bathrooms to make sure they are shutting off when surged to keep you protected. They will check all the lights in the home and make sure they work properly as well.

Appliances

The fifth and final area they are going to test are the appliances. The home inspector is going to make sure that your dishwasher is running properly and free of leaks. That your garbage disposal doesn’t make a clanking noise when turned on because something is stuck in it. That the ceiling fans are not wobbling and about to fall down. He’s going to make sure that all appliances are in working order as of that day.

This does not mean that the week after closing that one of the appliances might break down. They are machines that can break down at any moment. When we moved to the area, we had bought a fairly new home and one month after moving into the home, the refrigerator that was only 3 years old broke down and wasn’t cooling any more. Luckily we had purchased a home warranty that covered us and we only had to pay a service call to have someone come and fix it. This is one of the many reasons I also recommend my clients get a home warranty when purchasing property. It gives you an added level of protection for that first year of ownership for a minimal fee.

Wrap Up

These are the five areas that the home inspector is going to check when they come into your property. While it does cost you some money to hire them to do the inspection, I hope I have now given you a much clearer explanation of what is covered so that you can see the value in hiring one when purchasing your next home in Myrtle Beach. When completed, they will provide you a very in depth report of just about anything and everything you would ever want to know about your new property you are buying.

If you have any more questions on what a home inspection covers when buying a home in Myrtle Beach, or anything else related to buying or selling a home in Myrtle Beach, feel free to reach out to me. You can either call me at 843-222-9402 or use the contact form to email me directly.