Real Estate Newsletter Vol. 1: Down Payment Assistance.

Hey Baes! Happy THIS-HER Thursday!

It's your favorite NC Realtor Bae💋

I am elated to kick of BHM by sharing pertinent information to build and uplift my community!

In this New Month, we are poised to step into position with New Goals, Resilient Prosperity, Resounding Abundance with the same God!!

I know many of us have been Blessed with the duty of breaking generational curses and ushering our family into generational wealth. To do this we must employ methods of healthy mindsets to receive the blessings that are within our reach. For many, homeownership is the key to building and sustaining generational wealth. As millenials, I know there are so many of us who do not have a childhood home to 'go home to'. For one reason or another, our parents were unable to accumulate the tools necessary to make that purchase and live the "American Dream". As a result, many of us have become dedicated in our pursuit to break that detrimental curse to do better for our families. This is why understanding what options are available to facilitate your dream is paramount!

Let's get it! The State of North Carolina (like many other States Nationwide) has allocated millions, that's right, MILLIONS of dollars to First Time Home Buyers (FTHB) by way of Down Payment Assistance (DPA). In most cases, the maximum amount of DPA that a FTHB may be approved for is $51K. It is important to note that the income limits for DPA is well into the six figures. In most cases income limits are approximately $134K annually. This means that an average household size of 2 earning, $134,000 is eligible to receive up to $51,000 in DPA. Naturally, the buyer must first be approved for their first mortgage financing. DPA may be in second or even lien position behind the first purchase. 82% of all DPA funding is eligible to become grant money, (meaning it does not have to be paid back), by closing. Further, if you are a FTHB, defined as not having had ownership interest in a purchase in the last three years. Additionally, the purchase must be for a primary residence.

So what does all of this means? This means that in additional to being eligible for up to $51k in DPA, the FTHB may be eligible for FHA lending. FHA loans require only 5% down versus the traditional 20% down payment for a purchase. This means that $51,000 in DPA can be used to permanently buy down interest rates during the purchase. Let me break this down: DPA provides funds for down payment that can be used toward closing costs, down payment (of course) as well as home repairs. Up to $51,000 in funding can ensure that the buyer is able to use left over down payment funds to purchase points off of their mortgage rate. For example, if the buyer is eligible for the full $51,000 in down payment assistance, they purchase a house for $350,000, 5% down on that purchase would be $17,500. The remaining $33,500 is available to purchase a cheaper mortgage rate. Instead of the tradition 7% mortgage rate, the buy down may be well into 3%. I know this is a lot of information, so please stay tuned as we work to schedule our very first Home Buyer's Seminar of the year!

As always I would love your Feed Back! Text me! Email Me! Let me know what information you need to know!

Finance FriYAY: Credit Hacks

Nothing excites me more than a good hack hunny! Especially as the hack pertains to credit and finance! If you are anything like me, you are invested in all that Tik Tok, YouTube and Twitter Universities aspire to teach us. I am an avid proponent of learning, I consider myself a student at life. As such, I whole heartedly believe that our greatest investment is always in and of self. Secondly, observation is the key component to longevity and success. That said, paying attention to what’s happening in the world is key. Many economists agree that although we have been immersed in an economic downturn in the last several years (mainly due to the pandemic), it is the most opportune time to take advantage of establishing and leveraging credit. How does one do that? Great! I am so glad that you ask! I have stumbled across the following credit hacks that have assisted me in making tremendous strides in improving and preserving my credit.

First things first, while the information I am sharing pertains to Navy Federal it can be replicated with any Credit Union or Financial Institution that offers secure (collateralized) lending products. Further, it is important to note that membership with Navy Federal requires sponsorship. This means that an existing member must provide you with specific information in order to join. YASSSSS! Membership is extremely exclusive- invite only Chile! My type of exclusivity. I promise you that if you follow these steps precisely, you will notice an improvement in your credit score within 30 days!

Now that we have all of that out of the way, let’s jump into it!

• The first thing that you will need to do is establish a relationship with Navy Federal. If you don’t find a sponsor! 

  • To establish a relationship a membership must be created $5 into a savings account.

• Once your membership has been cultivated you will need to open a checking account. There are several options, the most cost effective option is the free checking account with no miminum balance requirements. 

• You then want to deposit the amount that you would like your secured loan to be in the savings account. E.g. if you want the loan to be for $1,000 you will need to deposit $1,000. 

  • I recommend going for as much as you can afford to not have access to for the next 11 months or so. 

  • By establishing a higher credit limit, the amount of the trade line will be reported to the credit bureaus. In turn, this will make you more attractive to lenders in the future.

• Once the money is available in the savings account, open a CD. Again there are several options. ( I will post a picture of the Easy CD below).

• Select a 12 month CD, then apply for a secured loan. A member representative will call you to confirm the details, discuss the rate and set up payment options. 

• Once the secured loan is approved, ensure that the funds are directly deposited into the savings account.

• Set up an automatic payment deduction from the savings account to begin paying the loan back. You may need to deposit approximately $100 extra in the savings account to cover the finance charge. (Again the interest rate and finance charges will vary based upon credit as well as how much the loan is for). 

• Rinse and repeat the process of depositing cash into the savings account. This time apply for a secured CD.

  • The minimum for the secured CD is $200. There aren’t any annual fees, but the interest rate is a tad bit high. 

  • Our goal is to pay off the balance in its entirety every month, so we aren’t concerned about the interest rate. 

  • Remember, interest is only owed on a balance that is carried over from statement cycle to statement cycle. Paying the balance down to zero eliminates accrued interest.

• Set up an automatic bill pay to a utility bill from your secured credit card.

  • This way you have monthly activity on the card and its going toward an item that you actually need. 

  • Set up an automatic payment through your new Navy Fed checking account to pay the credit card balance in full every month.

  • Split the payments in half. Make one payment at least three days prior to your statement cycle date, and the other payment at least three days prior to your actual due date. (This will trick the system into reporting two payments for you in one month as well as a reduced balance between your statement date and due date which helps the utitlization portion of your credit score).

• The final step is to then create an Experian profile. Apply for Experian Boost by attaching the same utility bill that is being paid from your secured credit card to the Experian Boost profile. 

  • This will allow you to have the same utility bill used twice essentially to boost your credit. 

Listen, building, rebuilding, establishing and preserving credit is no easy feat. As with most things in life, it will only work if you do the work. It is also important to note that there is no easy fix to credit. Credit repair can be lengthy and requires personal dedication. I cannot stress enough how important it is to invest in protecting your credit! Keep in mind that your score will fluctuate, much like weight it is not a number that we should be married to. With that said, again, much like weight, credit is something that requires constant attention and monitoring! Please let me know if you find these tips to be helpful or if you are in need of more information! What are you interested in learning more about? Hit me up! I want to know!

Breaking Generational Curses & Gifting Generational Wealth. Part I.

Breaking generational course is absolutely not for the weak Chile.

It is a blessing that often feels like a burden.

It holds more weight than at times you may feel as though you are able to bear.

It is foreign in the sense that it goes against everything that you have been conditioned to accept. I am in the process of unlearning everything that I was conditioned to know and understand as my way of life. I am healing my inner child & raising my adult self at the same time. Unlearning and relearning simultaneously.

It is a painfully, yet equally beautiful coexistence that I endure with the very essence of my being. It’s loving the life that I lead & the lessons that turned into blessings. It was me then & it’s ME now.

For me, there wasn’t anything in my adolescent life that modeled the lifestyle I unknowingly set out to attain. There weren’t any precedented behaviors that provided me with the opportunity to mol d my own behaviors after.

Hurt and pain are magnificent teachers in the sense that they teach you what not to do.

Much of what my life is modeled after is based upon what I did not want to occur in my life.

I was so busy moving beyond what I did not want that I did not recognize the power of my own manifestations that afforded me the opportunity to control what I allowed in my life.

I did not know enough to know what exactly my power held.

I was hyper-focused on absolving myself of the life that conditioned my entire existence. I had not even begun to wrap my mind around the fullness of the legacy that I was steadfastly creating.

Often-times for me, reflecting is the way that I purge all that I have held on to. Creating the space I require to reflect, provides me with the opportunity to fully acknowledge my current place and purpose.

Establishing generational wealth requires a substantial amount of self-awareness. In an effort to truly embrace the journey, growth and adaption must occur. This means that we must step out of our comfort zone and do things that we have never done before. What’s more, we are unable to lean on our family for assistance, support or guidance. The responsibility shifts to us to manage the familial elevation.

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Here’s how being armed with pertinent information aids you in the process:

We live in a world full of entrepreneurial endeavors which if leveraged appropriately can be paramount to breaking generational curses and gifting generational wealth. There is a clear delineation between the poor and the wealthy. If you have ever read 'Rich Dad, Poor Dad' you know that the paradigm shift occurs when the author, Robert Kiyoaski reveals that the major difference between the two groups (aside from economic means) is the thought processes that could not be more abstract from one another. In the book, Kiyosaki outlines the thought process from his 'Poor Dad'- (which I am sure that many of us can relate to) is to work hard for money. While his 'Rich Dad' understand that no matter how hard one works for money, wealth will not be established until they understand how to make their money work for them. If you're like me, with a very Caribbean parent , and the other a from a generation of cohorts who believed in working for one company for 30 + years and retiring with a pension was the way to go. Then you are able to more than relate to the very limited capacity with which economically unstable communities operate with in regard to finance. The truth of the matter is that it does not matter how hard you work at a job that pays you less than minimum wage, you will not achieve success and wealth through working hard. Further, the discrepancies created from working under deplorable conditions with less than optimal wages is that, in that scenario one often finds themselves with more month than money. So the question becomes- how do we access the tools and resources required to free us from the oppresive way of thinking to truly take advantage of less than conventional ways of accumulating wealth?

• Do your research. Which industries are growing rapidly? What skill set are you in possession of that aligns with said industry?

• Check Eventbrite, YouTube, Tik Tok, Instagram and other social media platforms for others who have found success in the industry that you want to break into.

• Develop a business plan- this should speak in detail to the ways in which your business will operate, logistically on a daily business,.

• Seek funding opportunities- Angel investors, grants, leverage business credit, etc.

• Build your brand!

• W9 your child(ren) as a sub-contracted employee to establish employment and payment history for that child. Limited to $12,000 annually.

• Invest the funds into an IRA, 529 Coverdell Education Plan, Whole Life Insurance Plan or an annuity.

• Add your child(ren) as an authorized user(s) to your oldest (earliest established) credit card or trade line.

• Add your child(ren) as an authorized user(s) to the trade line/ line of credit/ credit card with the highest limit.

• Now you have established credit history and credit limits for your child(ren) to inherit.

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Now that you have prepared your child(ren) to inherit good credit, it is essential to understand the ways in which credit parameters may positively impact their credit portfolio. In July of 2010, the Dodd-Frank Wall Street Reform and Consumer Protection act became federal law. Its purpose was to re-examine the financial instability ushered on to the economy by way of The Great Recesssion and further exacerbated by bail out money. I’m sure that you’re wondering how that impacts credit- well let me tell you!

Do you remember standing on the yard your first day of college and being offered a free pizza? As broke, hungry college students away from home many of us (myself included) opted for the free pizza, free t-shirt, free cooler, etc.. What we were unaware of is that by signing up for this ‘free’ pizza we were also signing up for a credit card. Dodd-Frank invoked consumer protection to increase the age of consent (as it pertains to credit) to 21. Knowing and understanding how to maneuver through credit restrictions and guidelines will further aid in the process of cultivating healthy credit habits. As such, when the child(ren) become of age it becomes time to transition their status as an authorized user to the primary user on a credit account. Begin with a gas card, this is a practical way to transfer responsibility from the child to the young adult as they are able to hone in on the previously established credit history for further support in the process.

One thing's for sure and two thing's for certain, cultivating, managing, and preserving both personal and business credit is an investment of time and energy. There is no quick or easy fix. One must truly exhibit a considerable degree of commitment to see the intended results come to fruition. With that said, let me know if the information that I shared was helpful? Do you need more? What do you want to know?

Drop a comment! I am waiting for your feedback!