3 Tips for Planning Your Monthly Mortgage Payment

June 22, 2016 by

3 Tips for Planning Your Monthly Mortgage PaymentOnce you’ve purchased a home and decided on a move in date, it may seem like a lot of the hard stuff is over, but you still have one of the most important things relating to such a large purchase to think about: the payments! If you’re looking for a few tips on ways to approach your monthly payment, the following will steer you in the right direction so you can broach your mortgage schedule successfully.

Set Up A Payment Schedule

Many people have been in the situation of neglecting their phone or credit cards by forgetting about the payment due dates, but this can cause a lot of strife when it comes to an investment as large as your home. Instead of leaving it to chance, choose a day each month and ensure that your bank is transferring the funds over automatically so you never have to worry about missing a payment. This will help you retain a reputation as a responsible borrower and it means you won’t have to deal directly with this important expenditure each month.

Be Aware Of Ways To Pay

Instead of being in the dark about ways to pay your mortgage each month, talk to your bank about your options for making your monthly payments in a timely, hassle-free manner. Before you get into the nitty-gritty of home ownership, look into this as soon as you’ve signed off on the papers so you know the best way to approach each month. This will prepare you for your approximate total mortgage payment.

Is It Really Affordable?

If you’re associated with a lender you trust, you’ve probably already been made aware of the amount of house you can and can’t afford, but ensure you’ve sat down and thought about what all the added interest on your home means. While it can certainly be a huge financial commitment for anyone to commit to a monthly mortgage payment, being able to swing the expense consistently is the difference between financial well-being and a purchase you’ll come to regret.

Making the decision to invest in a home can be one of the most exciting things you’ll commit to in adulthood, but ensure you’re aware of just what your monthly mortgage means so that it’s not something you’ll look back on. If you’re currently on the market for a home, contact your local mortgage professionals for more information.

Filed Under: Home Mortgage Tips Tagged With: , ,

Ready to Be a Landlord? Important Considerations Before Renting Your Home

June 21, 2016 by

Ready to Be a Landlord? Important Considerations Before Renting Your HomeWhether you’re going away on an extended vacation or considering downsizing into a smaller place, the popularity of websites like Airbnb has led many people to believe that there’s a lot of money in home rental. However, before putting your home on the market, it’s important to be aware of some of the factors that go into having a rental property. It may seem like extra money, but it’s the small details that can make it a more complicated process.

Is It A Short Term Solution

Many people plan on putting their home on the market for a short duration of time, but if you’re only planning on renting for 6 months or a year, it may not be as financially lucrative as you think. While tax breaks can go along with rental properties, the money you make off of this kind of investment is taxable so if you’re not in it for a slightly longer haul, you may not see the financial boost you’re looking for.

What Are You Willing To Deal With?

For those who are planning to put a home on the market, they still need some place to live, and this can mean that a certain amount needs to be made each month for the costs of having two homes even out. Before putting any serious considerations into this, ensure that you know it’s financially feasible. It’s entirely possible that you won’t have renters for certain periods of time and you could also run into problems with the renters you find, so you should sit down and put pen to paper to consider the investment potential.

Have You Considered The Maintenance?

Out of sight is often out of mind, but if you have a renter, you’re responsible for anything that goes wrong in the home. From small maintenance duties to sizeable but necessary overhauls, there are many things you’re legally obligated to do as a landlord and you’ll need to be prepared to take on these responsibilities. Since it will be the duty of the owner, in the event you don’t want to do it, you’ll have to hire a contractor who will be able to handle the work for you.

Having a house as a second property may seem like an ideal investment, but this can require you to take on the responsibilities of a landlord and you may even have to deal with problematic rental situations. If you’re searching for an additional property in the near future, contact your local mortgage professional for more information.

Filed Under: Home Mortgage Tips Tagged With: , ,

What’s Ahead For Mortgage Rates This Week – June 20, 2016

June 20, 2016 by

Whats Ahead For Mortgage Rates This Week January 18 2016Mortgage rates fell after Federal Reserve policymakers decided not to raise the Fed’s target federal funds rate. The Federal Open Market Committee cited ongoing concerns over global financial and economic developments and slow jobs growth as factors in its decision not to raise rates. Fed Chair Janet Yellen emphasized the committee’s decision-making process is not predetermined and said that ongoing review of current and developing news is significant to monetary policy decisions.

Last week’s economic news also included the NAHB Housing Market Index, the monthly inflation rate and retail sales along with weekly reports on mortgage rates and new jobless claims.

Home Builder Confidence Rises in June

According to the National Association of Home Builders Housing Market Index, Home builder confidence rose one point to a June reading of 60. May’s reading was 58 and analysts expected a reading of 59. June’s reading broke a four-month streak of unchanged readings. Sub-readings used to calculate the Housing Market Index were one point higher at 64 for current market conditions. Builders had higher confidence in market conditions for the next six months. June’s reading was five points higher at 70. June’s reading for buyer traffic remained below the benchmark of 50 at 47. The NAHB gauge of buyer traffic in new homes hasn’t hit 50 since the peak of the housing bubble.

National inflation as measured by the Consumer Price Index was lower in May at 0.20 percent as compared to April’s reading of 0.40 percent; analysts expected a reading of 0.30 percent. Core inflation held steady at 0.20 percent; the core reading excludes volatile food and energy sectors, but energy prices, fuel prices and food are major components of household budgets.

The Federal Reserve has set an annual inflation rate of 2.00 percent as a benchmark reading for its consideration or raising the federal funds rate. Readings have remained consistently lower in recent years, which contributed to the Fed’s decision not to raise interest rates.

Mortgage Rates Fall as Jobless Claims Rise

Freddie Mac reported lower average mortgage rates for fixed and adjustable mortgages last week. 30-year fixed rate mortgages dropped f six basis points to an average of 3.54 percent. Rates for a 15-year fixed rate mortgage averaged

2.81 percent, which was also six basis points lower. The average rate for a 5/1 adjustable rate mortgage was eight basis points lower at 2.740 percent. Lower mortgage rates are welcomed by first-time and moderate income homebuyers as home prices continue to rise.

New jobless claims rose to 277,000 as compared to an expected reading of 270,000 new claims and the prior week’s reading of 264,000 new claims. Analysts attributed the jump in new claims to seasonal influences including new claims filed by school workers eligible for benefits when classes aren’t in session.

What’s Ahead

Next week’s scheduled economic reports include reports on new and existing home sales along with weekly reports on mortgage rates and new jobless claims. A monthly reading of consumer sentiment will also be released.

Filed Under: Mortgage Rates Tagged With: ,

Mortgage Fraud: 3 Common Scams to Avoid

June 17, 2016 by

Mortgage Fraud: 3 Common Scams to AvoidThere are many ins and outs involved in securing a mortgage lender, and as a result there are many offers and options out there which are only around to take advantage of prospective homebuyers. If you’re on the lookout for a home and are trying to wade through all the details successfully, here are some things you may want to be aware of.

The Perfect Rental Deal

If you’ve ever rented an apartment in the past, it’s entirely possible that you’ve run into deals on Craigslist where a sizeable, stunning property is advertised at a very modest price. While scams like this are quite common when it comes to rentals, they also occur when scammers copy MLS listing and pretend to be an agent facilitating a real estate deal. There’s no sure way to avoid scams like these, but ensure you don’t hand over money or sign anything unless you’re 100% certain whom you’re dealing with.

Lenders Who Push The Envelope

Reliable lenders will be upfront with you when explaining the details associated with your mortgage, so it’s important to be cautious if you end up dealing with someone who asks you to exaggerate or embellish your financial claims. The only way to make a solid investment is to be honest about your financial situation, and anyone trying to inflate your income and the price you can pay is only hoping to gain a piece of the profit for themselves.

Investment Speakers And Seminars

With so much information out there, many people look for courses that will make them aware of the basics of investing so that they can do some of the legwork on their own. Courses like these can be useful in many cases but if they happen to be sponsored by an organization and are charging high attendance fees, there’s a good chance they’re trying to endorse their own services and may not be providing the most accurate information. Instead of guessing for yourself, you may want to read up on the basics and follow up with a trusted lender for any additional questions.

There’s a lot involved in delving into the real estate market, and that’s why it’s important to watch out for the kinds of things that may not be serving your best interest. If you’re currently looking for a lender and are planning on buying a home soon, contact your local mortgage professional for more information.

Filed Under: Home Mortgage Tips Tagged With: , ,

Fed Monetary Policy: No Rate Increase in June

June 16, 2016 by

According to its post-meeting statement issued Wednesday, the Federal Open Market Committee of the Federal Reserve voted not to increase its target federal funds rate. The target federal funds rate will remain at 0.250 to 0.50 percent.

Based on review of current and anticipated financial and economic events, the Committee cited slowing job growth and momentum of inflation-based compensation as reasons supporting its decision. While the national unemployment rate recently fell to 4.70 percent, FOMC members saw room for growth in employment. Unemployment rates are calculated based on active workforce members and do not include those who are under-employed or who have left the workforce. Global influences on the Fed’s monetary policy include uncertainties about China’s economy and the possibility that the United Kingdom may exit the European Union.

Housing markets and household spending improved, but the Fed cited lagging business investment and dismal jobs growth as concerns that led to a unanimous decision not to raise the federal funds rate.

Analysts characterized FOMC members as being “dovish” as compared to previous meetings. Only one member expected a single rate increase this year at the April meeting, but six members expected only one rate increase at June’s meeting.

In a post-statement press conference, Fed Chair Janet Yellen said that while a rate increase is possible at FOMC’s July meeting, she noted that there is no post-meeting press conference scheduled, which would make it more difficult for the Fed to explain its decision. Analysts also said that a rate increase is unlikely in September in advance of national elections in November.

Inflation remains below the Fed’s goal of two percent and is expected to do so for the short to medium term.

Fed Chair Cites Changing Economic Conditions, Forecasts Incremental Rate Hikes

Fed Chair Janet Yellen said during her post-meeting press conference that current economic conditions indicate that gradual rate hikes are needed to ensure ongoing economic growth. Rate hikes, when and if they occur, would increase very slowly and are expected to remain “accommodative.”

Clair Yellen said that each FOMC meeting is “live,” which means that meeting agendas and actions can flex according to current developments that influence monetary policy. The FOMC has repeatedly said that its decision-making is primarily based on members’ constant evaluation of developments affecting domestic and global economies.

Filed Under: Mortgage Rates Tagged With: ,

The Pros and Cons of Buying a Second Home to Rent

June 15, 2016 by

The Pros and Cons of Buying a Second Home to RentWith the ever-fluctuating cost of housing, buying real estate can be one of the best investments a person can make. However, a lot of important factors can be left out of the final decision when it comes to purchasing a home as rental property.

If you are taking the initial steps to invest in a second home, here are some important things to consider before you make the financial commitment.

The Distance To A Destination

Many people who purchase second homes to rent out choose to buy in places that are sought after, whether it’s a trendy area or beachfront property. While buying a home in a popular area may end up being good for your bank account, areas like this can often be out of the way and will take a little bit of car time to get to. If you’re doing the landlord duties on your own, this may take up a lot of precious evening and weekend time.

A Potential Vacation Home

There is certainly a great financial boon to be found in a home that you can rent out year round, but if you’ve purchased in an enviable location, this can also be a great place for you to take your family for a couple weeks out of the year during low-rental season.

While this may mean no rental income for a time, the savings of having a home at which to hang out can make up the difference. Of course, if it’s a place you won’t want to vacation, it may not be the right choice for you.

The Possibility Of Additional Income

If you’re planning to purchase in a cool new area or by a university, there’s a good chance you’ll have no issues finding a good renter as long as you have a nice property. However, while renting out a home can seem pretty straightforward, it’s necessary to consider how many months out of the year the place will actually be rented.

Many people go into this type of purchase expecting it to be occupied all year around, but demand can shift from season to season and this will directly impact the upside of your investment.

There are a number of benefits associated with owning a second home for rental property, but it’s also important to be aware of the financials downsides that can come from taking on another property.

If you are currently considering an investment property, you may want to contact your local mortgage professional for more information.

Filed Under: Home Mortgage Tips Tagged With: , ,

Boomerang Home Buyers: 4 Things to Consider Before Stepping Back into Homeownership

June 14, 2016 by

Boomerang Home Buyers: 4 Things to Consider Before Stepping Back into HomeownershipWhether you’ve gone back to renting for the sake of money saving or recently downsized to a more compact space, the idea of owning a home can be a big responsibility that may require more than you’re willing to give. If you’re considering jumping back into the fold of home ownership, here are a few things to contemplate before re-entering the market.

Is It Affordable?

Many people avoid home ownership for a long time because of the high cost of a down payments and the associated property taxes and maintenance fees, but it can be easy to forget these extras if you’ve been out of the game. Instead of being blindsided, sit down and determine these additional costs before putting an offer down on anything.

Is It Really What You Want?

With all of the conversation around the market that says it’s best to buy now, it can seem like having a home is a necessity for a secure financial future. However, if home ownership is something you feel pressure to do, it may not be worth such a sizeable purchase. Instead of jumping in, ensure you’ve determined what such a significant investment means to you first.

Does Home Ownership Match Your Lifestyle?

It’s easy to be aware of the financial benefits of buying a home up front, but simply because it may suit your pocketbook doesn’t mean it serves the life you’re living now. You should first consider the things in your life that have changed, as a new home may not have all the nearby amenities you’re used to and there may also be a lot of maintenance and yard work you’ll have to take on.

Is It A Good Investment?

If you’ve decided that delving into another home is really the right thing for you, you’ll want to make sure it’s the kind of purchase that’s really going to be fruitful down the road. It can be easy to buy in a popular neighborhood or by the beach, but instead of going for what’s right now, consider communities that will be popular in the future as this may maximize your investment potential.

Many people make a second foray into home ownership for a reason, but it’s worth being clear on what your expectations really are so you don’t end up with an investment you’re not interested in holding onto. If you’re currently considering your housing options, you may want to contact one of our mortgage professionals for more information.

Filed Under: Home Mortgage Tips Tagged With: ,

What’s Ahead For Mortgage Rates This Week – June 13, 2016

June 13, 2016 by

What's Ahead For Mortgage Rates This Week - June 13, 2016Last week’s economic news was highlighted by Fed Chair Janet Yellen’s speech in Philadelphia. Although Chair Yellen alluded to future Fed rate hikes, she did not specify when Fed policymakers would next raise the target federal funds rate. 

Increases in the fed funds rate typically signal increases in consumer credit and home mortgage rates. Last week’s speech was seen as a precursor to the Federal Open Market Committee statement that will occur at the conclusion of next week’s FOMC meeting. 

Chair Yellen is also scheduled to give a press conference after the FOMC statement next Wednesday.

Mortgage rates and new jobless claims also fell last week.

Fed Chair Speech: Fed Rate Increases Likely, but Subject to Economic Developments

Fed Chair Janet Yellen said that remarks would be “largely favorable” although economic developments were “mixed.” Chair Yellen cited economic progress toward the Fed’s dual goal of achieving maximum employment and price stability. Labor benchmarks included national unemployment below five percent, rising household income and indications of rising wages were cited as positive signs for economic expansion.

Slowing job growth and inflation staying below the Fed’s goal of 2.00 percent were cited as signs that the U.S. economic recovery is underway, but Chair Yellen also said signs of slower job creation along with uncertainties in global economic conditions and oil prices prevented short-term predictions about how the economy would perform.

Fed Chair Yellen also repeated her usual caution that Fed policy is not set in stone, but instead is subject to FOMC members’ ongoing review of economic developments and related readings.

Mortgage Rates, New Jobless Claims Lower

Freddie Mac reported lower mortgage rates last week. The average rate for a 30-year fixed rate mortgage was six basis points lower at 3.60 percent; the rate for a 15-year fixed-rate mortgage averaged 2.87 percent, which was five basis points lower than the previous week. The average rate for a 5/1 adjustable rate mortgage was six points lower at 2.82 percent. Discount points averaged 0.50 percent for all three loan types tracked by Freddie Mac.

New jobless claims were also lower at 264,000 new claims filed against expectations of 270,000 new claims and 268,000 new claims filed in the prior week.

What’s Ahead This Week

This week’s scheduled economic news includes the Fed’s post-meeting FOMC statement and press conference, reports on the consumer price index and core CPI, housing starts and the NAHB Housing Market Index. Reports on mortgage rates and new jobless claims will be released according to their weekly schedule.

Economic indicators such as price inflation, rising mortgage rates and housing data impact housing markets and consumers’ ability or willingness to buy homes.  

Filed Under: Financial Reports Tagged With: , ,

The Pros and Cons of Mortgage Rate Locks

June 10, 2016 by

The Pros and Cons of Mortgage Rate LocksIf you’re just jumping into the game of home purchasing, you are likely considering all of your loan options and may even have heard the term mortgage rate lock. For those who don’t like to gamble, a mortgage rate lock can offer a bit of reassurance, but there are also some downsides to this type of protection. Before signing off on this, here are the details on rate locks so you can make an informed decision.

What Is A Rate Lock?

For many people who are buying a home in such a tumultuous market, the idea of interest rates can make the heart race a little faster, but this is the purpose of rate locks which offer consistency in a market in flux.

Instead of having to deal with day-to-day fluctuations of the rate – which increases or decreases what you owe – a rate lock is a lender promise that you will be held to a specific rate or your rate will not rise above a certain number.

Easy Balancing Of The Budget

The easy thing about utilizing the rate lock, especially for a buyer who is less familiar with the market, is that it will enable you to instantly determine your monthly payments based on that rate. Instead of having to pay more per month, you’ll be able to estimate exactly what your payment will be and it won’t rise above the limit you’ve set for yourself. While daily fluctuations can be a drag, a mortgage lock takes the guesswork out of the day-to-day.

The Added Cost Of Security

It might seem like a rate lock is an option that everyone would utilize, given the stability, but lenders charge for this type of offer because of the risk factor. While lenders can certainly stand to gain if your rate lock is higher than the interest rates, in the event that they rise beyond this point, they will end up losing money. So, while a 30-day rate lock may not end up costing you, this type of lock stretched over a longer period may actually end up costing you more than fluctuating rates.

If you’re not familiar with the world of investing and interest rates, a mortgage rate lock can sound like a great idea; however, there are downsides to this offer and they’re worth considering before getting locked in. If you are currently on the hunt for a home, you may want to contact one of our mortgage professionals for more information.

Filed Under: Home Mortgage Tips Tagged With: , ,

4 Negotiation Tips for Home Sellers

June 9, 2016 by

4 Negotiation Tips for Home SellersWhen you’ve already placed your home on the market, it can seem like the stress is over once you’ve received the offer, but the buck doesn’t stop there. Instead of being caught off guard when the time comes to negotiate, consider these tips that will assist in making the sale.

Rely On Your Agent

Once you’re at the point where you’ve received an offer and are unsure as to whether you should take it, it’s a good idea to sit down and discuss the options with your agent. Because a real estate professional will have plenty of experience with this part of the process, they’ll be able to guide you through what’s an acceptable offer and what you should pass on.

Sell Until It’s Signed

It’s very exciting to receive an offer on your home, but a verbal offer is not set in stone so don’t forget about other interested parties that are still in the mix. Since a buyer’s purchase of your home won’t be official until they’ve signed a contract and put down a deposit, make sure you to keep in touch with other potential buyers that might have an offer if your best option backs out.

It’s Not Just About Money

It’s great to receive the asking price you’re looking for, but there are many things to consider with the sale of your home. In the event that your home inspection has come up with a few maintenance flaws, you may need to adjust the price for your buyer. As well, it’s possible your buyer may not be ready to move in when you’re ready to move out, so be sure to consider any issue that may impact the final sale.

Don’t Hold On To Your Price

There are no set rules when it comes to price, but if you haven’t received any offers and your house has been on the market for more than 60 days, there’s a good chance it’s time to sit down with your agent. While it’s great to know all of the negotiation rules, if your price is set to high for the market, you’re not going to have the opportunity to get to the table.

There are plenty of negotiation strategies to consider when it comes to selling your home, but staying in the game and trusting your agent can go a long way towards a successful sale. If you’re planning on putting your home on the market, contact your local mortgage professional for more information.

Filed Under: Home Seller Tips Tagged With: ,