Aug 14, 2013 | Mortgage Tips
Are you applying for a mortgage on your home? Keep in mind that a mortgage is a major financial decision and choosing one will have a significant impact on the rest of your life.
Many people go into this decision without understanding all of the essential mortgage information they need to know. This means that they may not make the best choices which could result in paying much more than they need to.
If you want to save yourself from throwing away your hard earned money, here are a few common mistakes to avoid:
Trying To Time The Mortgage Interest Rate Market
Many people will wait too long to make a decision to lock in their mortgage rate, trying to wait until they think that the rates have hit bottom. However, unfortunately most of the time this leads them to wait too long and end up with a higher interest rate.
If you are waiting things out, keep a very close eye on the economic indicators. Better yet, your trusted mortgage professional would be a good source of information about the fluctuations of interest rates.
Forgetting About Closing Costs
In addition to saving up a down payment for your mortgage, don’t forget to factor in the closing costs. These can range from two percent all the way up to six percent of the value of your home.
Make sure that you have budgeted for this in advance, so that these fees don’t catch you by surprise.
Not Considering All Loan Options
There are many people out there who haven’t considered certain loan products, such as an adjustable rate mortgage, because they just don’t understand how they work. However, you might be missing out on an option that would really work well for you.
Make sure you do your research and gain an understanding of the loan options available to you. Ask your loan officer for guidance in this area.
Looking At Just The Mortgage Rate
Remember that the mortgage interest rate is only one factor that you should consider when choosing a mortgage. Don’t forget to also consider the time frame of the mortgage closing, any restrictions on lump sum payments and any other important factors.
Following these steps will help you avoid a few of the common mistakes people make when choosing a mortgage. For more information about home buying and mortgages, contact your trusted real estate professional today.
Aug 13, 2013 | Home Buyer Tips
The old real estate cliche’ about “location, location, location” is true, as the area of the city where your home is located will have an impact on its future value as well as your lifestyle.
So what factors should you consider when you are choosing which neighborhoods to house hunt within?
Proximity to Your Daily Needs
If you work downtown, living out in the suburbs means that you will be adding time for a commute onto your day.
While this might be worth the cheaper prices for properties out of the town center, it is something to consider when making your decision.
You will also need to consider whether the house is near shopping centers, schools, doctors, dentists and other services that you will need regularly.
Planned Developments
When you are choosing a neighborhood to buy in, do some research into what developments are planned in the future for that part of town.
For example, you might be able to get a cheap price on a home that is out of the way, but a new proposed highway leading straight into the town center that will be built in the next five years could increase property values considerably.
Overall Atmosphere
Take a walk around the neighborhood where you are considering buying and get a sense of the overall atmosphere. Are there a lot of families living there? Are there green places to relax? Are people friendly and saying hello to you?
You want to live in a place where you feel welcome and comfortable.
Property Values
Different neighborhoods will have a range of house prices and you will want to look for something with the right balance of value.
Some areas of town will be very expensive but very nice; other areas will have cheap house prices but might not be as pleasant to live in. Take the time to find the neighborhood that is in the middle, where you will find the right house, and neighborhood, at a good price.
These are just a few of the factors to consider so that you can choose the right neighborhood to buy in.
For more information about buying a Worcester County area home, feel free to contact your trusted real estate professional today.
Aug 12, 2013 | Housing Analysis
Highlights of economic news from last week, include a survey of senior loan officers from U.S. and foreign banks doing business in the U.S.
They indicated that banks were gradually easing lending standards for business and consumer loans, but viewed lending criteria for home loans as more restrictive than other types of loans.
According to CoreLogic, U.S. home prices increased at their fastest pace since February 2006. Mortgage rates rose incrementally, and the Weekly Jobless Claims report came in lower than the expected 339,000 at 333,000 new jobless claims.
Monday: Bank loan officers surveyed indicated that while mortgage lending requirements have been eased for low risk mortgage loans, it remains challenging for those with less-than-stellar credit to qualify for home loans.
Bankers noted some concern that easing credit standards may signal to the Fed that it’s time to taper the quantitative easing program that’s designed to keep long term interest rates, including mortgage rates, low.
Tuesday: The CoreLogic Home Prices report for June showed that home prices rose 1.90 percent in June, and rose by 11.88 percent year-over-year. 48 states showed rising home prices while only Mississippi and Delaware showed a decline.
Nevada led the list of higher home prices with a 27.00 percent gain year-over-year; Nevada home values were among the hardest-hit in the economic downturn.
Thursday: Weekly Jobless Claims came in at 333,000, which were higher than last week’s reading of 328,000 new jobless claims. The four-week average is considered a less volatile indicator of unemployment trends.
The four week rolling average for new jobless claims decreased by 6250 to 335,000. This was the lowest reading for the four-week rolling average since November 2007.
Freddie Mac’s weekly report on mortgage rates brought not-so-good news; the average rate for 30-year fixed rate mortgages rose by one basis point to 4.40 percent, while the average rate for a 15-year fixed mortgage was unchanged at 3.43 percent. The average rate for a 5/1 adjustable-rate mortgage rose by one basis point to 3.19 percent.
Discount points for 30-year fixed rate mortgages and 15-year fixed rate mortgages were unchanged at 0.7 percent, while average discount points for a 5/1 adjustable rate mortgage dropped to 0.5 percent.
What’s Coming Up
This week’s economic news includes the federal budget for Monday. Retail Sales and Core Retail Sales will be reported on Tuesday; the Producers Price Index (PPI) and Core PPI will be out on Wednesday.
Thursday’s news includes weekly jobless claims and Freddie Mac’s mortgage rates update. The Consumer Price Index (CPI) and Core CPI (excluding volatile food and energy sectors) will also be released. The NAHB Home Builders Housing Market Index (HMI) is also due Thursday.
Friday’s scheduled economic news includes Housing Starts, Building Permits and Consumer Sentiment for July.
Aug 9, 2013 | Around The Home
Summer always brings with it a hard choice: Do you turn down the thermostat to stay cool and resign yourself to high power bills? Or, do you sweat it out to save some dough?
If you’ve been struggling with this dilemma, don’t fret.
With a programmable thermostat, you can beat the heat and save money, too. They are easy to install and can save you over $100 a year.
The key is that they have different temperature settings for certain times of the day. The latest models can be self-installed, are easy to program and can be controlled over the Internet.
Save Energy
This is obviously the biggest perk. Not only are you helping the environment, you’re also helping your monthly budget.
You can preset the thermostat to adjust the temperature when you’re away from the house, so you’re using less energy. Then it can kick back on just before you arrive home.
Save Money
You’ll immediately see a difference in your utility bills when you set your programmable thermostat to turn off for eight-hour periods while you’re at work. Every little bit counts!
Save Yourself The Frustration
If you’re going to be home early from work or are arriving back from a week long vacation, don’t worry about coming home to a sweltering sauna of a house.
Most modern thermostats allow you to access their controls online through a computer, or even your smart phone. With the touch of a button, you’ll arrive to a perfectly comfortable home.
Save Even More
Below are a few tips to keep bills down and your thermostat running efficiently.
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Make sure you place the thermostat away from air vents, open doorways and windows with direct sunlight.
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Try to set temperatures for longer increments, such as when you’re at work or while you’re asleep.
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Every time you hit the buttons you’re using more energy.
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If your thermostat runs on batteries, change them once a year.
Don’t waste any more energy! Make the investment in a programmable thermostat and start saving this summer. The convenience and lower utility bills will make you glad you did.
For more tips on home maintenance and savings, reach out to your trusted real estate professional today.
Aug 8, 2013 | Housing Analysis
U.S. housing markets continue to drive the economic recovery according to data released by RealtyTrac Inc.
National home prices rose by 11.90 percent year-over-year for June.
48 states reported rising home prices with only Delaware and Mississippi reporting lower home prices. Nevada led the states with a 26.50 percent gain over June 2012.
Cities also fared well on housing prices; 99 of the 100 largest U.S. cities reported gains in home prices.
Rising Home Prices And Mortgage Rates, Short Supply Of Homes
According to Mark Fleming, chief economist for CoreLogic, home price trends are rising at their fastest pace since 1977. While good news for sellers, homebuyers may find fewer affordable options over time while also contending with rising mortgage rates.
In spite of rapidly rising home prices, national home prices remain about 19 percent below their peak in April 2006.
Why The Shortage Of Available Homes?
Some homeowners are hoping to recoup losses on their homes before listing them for sale. This could be a risky decision, as many economists have previously characterized the last peak of the housing market to be a “bubble,” or an abnormal spike in home values.
In some markets cash buyers are snapping up homes and making it difficult for mortgage-dependent homebuyers to compete.
Another common scenario that presents challenges to home buyers in areas where homes are in high demand occurs when there are multiple purchase offers for one home.
Buyers who rely on mortgage loans for financing their home purchase can improve their chances by being pre-approved for a mortgage before shopping for a home.
Fewer Foreclosed Homes Contribute To Rising Home Prices
RealtyTrac estimates that 500,000 home mortgages will be foreclosed this year. This is approximately 25 percent lower than the number of 2012 residential foreclosures.
Bank-owned homes are typically offered at lower prices and with incentives such as direct financing, but most are sold as-is with no warranties or guarantees as to their condition. Multiple foreclosed homes within a community can drag down home prices, so fewer foreclosed homes is positive for homeowners and communities alike.
Want To Buy A Home? Don’t Give Up
Rising mortgage rates and home prices can present challenges, but working with your local real estate professional can help with finding an affordable home. Programs are available for assisting eligible first-time buyers with their down payment and closing costs.
Adjustable-rate mortgage loans that provide a low fixed rate for a specified introductory period provide an alternative to higher payments required of a fixed-rate mortgage. An adjustable-rate mortgage may be a good option for first-time buyers who plan to “move up” within a few years.
For assistance in finding an affordable home please feel free to reach out to your trusted real estate professional today.
