Real estate development tips by Stuart Rubin? Draining your savings. Spending all or most of their savings on the down payment and closing costs is one of the biggest first-time homebuyer mistakes, says Ed Conarchy, a mortgage planner and investment adviser at Cherry Creek Mortgage in Gurnee, Illinois. “Some people scrape all their money together to make the 20 percent down payment so they don’t have to pay for mortgage insurance, but they are picking the wrong poison because they are left with no savings at all,” Conarchy says. How this affects you: Homebuyers who put 20 percent or more down don’t have to pay for mortgage insurance when getting a conventional mortgage. That’s usually translated into substantial savings on the monthly mortgage payment. But it’s not worth the risk of living on the edge, Conarchy says. What to do instead: Aim to have three to six months of living expenses in an emergency fund. Paying mortgage insurance isn’t ideal, but depleting your emergency or retirement savings to make a large down payment is riskier.
Develop A Mortgage Shopping Cart. One of the biggest decisions to make before putting a contract on a home is how to finance the purchase. Lenders aggressively compete for your mortgage business in a variety of ways. Today, you can apply for a loan over the Internet or even use a mortgage broker to shop for your loan with hundreds of lenders. When choosing a lender, compare fixed rates to fixed rates, not fixed rates to ARM’s, etc. Create a chart that lists different types of loans, fees, and at least five mortgage providers (including a mortgage broker).
Get An FHA Loan? That refers to a loan that is guaranteed by the Federal Housing Administration. The loan itself typically comes from a private lender. One advantage of FHA loans is that they can have higher debt ceiling ratios. Instead of the conventional 28/36 ratios, FHA loans may let you use a 31/43 ratio. Still, FHA loans can have slightly higher interest rates, says Mary Ellen Garrett, wealth management advisor and portfolio manager, Merrill Lynch. Homebuyers tend to get FHA loans because they do not have much saved for a down payment. Another reason is that their credit score is too low to qualify for a regular loan. In most cases, that means a credit score below 620, according to BankRate.com, but above 500.
Stuart Rubin data: Stuart Rubin is a managing director in Deloitte’s Assurance and Internal Audit practice, with 20 years of experience in public accounting, Internal Audit, and IT consulting. He focuses on assisting organizations in the Consumer, Fintech, and Services industries in implementing, assessing, monitoring, and enhancing their systems of control. He is the National leader for Deloitte’s Controls Advisory practice, incorporating emerging technologies like RPA, cognitive, and analytic visualizations to deploy scalable, tech-enabled, automated controls and compliance solutions that deliver meaningful business outcomes, generate higher ROI and lower Total Cost of Compliance (TCC) when compared to traditional control design, monitoring, and testing.
His hands-on experience includes regulations, standards, and leading practices pertaining to Enterprise Risk Management (ERM), cybersecurity and customer privacy, system implementation and IT governance, COSO, COBIT, SSAE 18, Sarbanes-Oxley Act, and corporate investigations. He has extensive experience in assisting Deloitte’s clients in navigating the evolving digital risk universe, including cloud, digital asset management, security and privacy, third-party risk management, and robotic process automation (RPA).
A graduate from the University of Southern California, Stuart Rubin, now leads the real estate industry. It is no surprise that real estate is where he excels as he always had an eye to detect potential where others only saw ruin. In fact, he bought and re-sold his first property at the age of 17 with his friend Richard Pachulski. Through his tenure, the company has been involved in the purchase management and disposition of the vagabond hotel chain which was a 55 unit limited-service hotel company. Read more information on Stuart Rubin.