Kevin and I had the pleasure and privilege to work with two great people, and to assist them in finding  their second home at the beach. They already have a condominium in Ocean City, Maryland, and this time our search was on to find them a single family home on the water just outside of Ocean City in Worcester County.

We found a great property in the Piney Island community.  We wish Ted and Stevie all the best, and for allowing us to be of assistance to them.

Kevin McNamara Welcomes New Ocean City, Maryland Property Owner

Buyers, make sure you qualify for the mortgage loan you will be obtaining to purchase your home or condominium. The rules to qualify seem to be changing almost daily.

When you apply for a mortgage, most (if not all) lenders will sell your loan to the secondary mortgage market (a/k/a Fannie Mae or Freddie Mac). In order for you to be approved to borrow monies, there are debt to income ratios (as well as other things) that are used to determine your ability to repay. Today we are talking about changes to these ratios.

In the past, there had been some leniency in Fannie Mae’s debt to income ratio. Fannie Mae is making changes that will affect your borrowing power. They had been allowing up to a 55% total debt to income ratio.  Effective sometime this week (week of 12/7/09, they love to keep us guessing), they will be changing this ratio to reflect a total debt to income not to exceed 45% for almost all scenarios.

What does this mean to you the borrower? Well, the obvious is that you will either have to earn more money or have less existing debt in order to qualify for the same amount of a mortgage that you did as recent as last week.

If you had been pre-approved for a mortgage loan and have not yet secured your loan, you will want to contact your real estate agent and your lender and have them re-evaluate your qualifying criteria to make sure that you can still borrow the same amount of money.

Stay tuned. There is probably more change in store in the wonderful world of banking.

As an aside, don’t let this newest information be a deterent in making your property purchase.  The overall benefits of owning a primary, secondary or investment property, far out weigh some of the push ups we now have to go through to obtain that goal.

Oceanfront Condo - Ocean City, Md.

Why It’s A Good Time To Buy A 2^nd Home Or Investment Property

Most owners that have a 2nd home or an investment property own that property in a different location then where their primary residence is located.

It is quite common to have that property in a resort setting such as a beach or ski destination.  Since I am at the shore, our owners fall into the beach category. They use their property the most during the warmer summer months. They either use their property as a second home and/or vacation spot or put the property in a rental program to generate income.  Some do a combination of both.

Now that it is fall and these owners are using their places less, we do seem to see some additional inventory listed for sale, which can make it the perfect opportunity for a perspective purchaser to buy in a resort market. In some cases, the seller is ready to move on, and has just completed the time of year when they will utilize the property the most, therefore they may be more motivated to competitively price the property.

Hear that sound? That’s opportunity knocking. Many buyers have been uncertain about taking the jump into the housing market. With interest rates and property values at historic lows, what are you waiting for?