Archives for May 2016

How to Determine the Price of Your Home for Sale

How to Determine the Price of Your Home for SaleMany people rely on the price they paid for their home as a starting point for selling, but with the ever-shifting tides of the real estate market, the price paid is not always the best metric to go by. If you’re putting your home up for sale and are looking for the ideal price point, here are some ways you can arrive at a number that will keep potential buyers interested.

Check Out Your Neighborhood

Your house may have a lot of different features than the homes of your neighbors, but checking out what real estate in your area is selling for can still be a good means of determining the price you’ll be able to ask for. Instead of just perusing the pricing, ensure you’re looking at the listings for what’s been successfully sold in your neighborhood as only this will allow you to determine the conditions of the market and what people will be prepared to offer.

Complete A Home Inspection

Instead of being surprised by repairs that need to be completed after an offer price has been accepted, organizing a home inspection before your home is sold can make a difference in the price you’re able to ask for. Not only will this provide you with a determination of what needs to be repaired or overhauled, it can be a boon to potential buyers who won’t have to worry about your inspection revealing any hidden flaws.

Utilize Your Agent’s Advice

Even if you’ve done your research and carefully considered the value of your home, it can still be complicated to come up with the right price, so be sure to enlist an agent who will be able to determine a fair amount with you. Since your agent has no attachment to your home, they’ll be able to objectively strike the right balance between what won’t sell and what’s too low. The right price, after all, may mean you’ll get to spend a lot less time selling it.

There are a lot of factors that go into arriving at the proper asking price for your home, but by organizing a home inspection and being aware of what’s going on in the market, you should be able to arrive at a reasonable sum. Contact your local mortgage professional for more information.

What’s Ahead For Mortgage Rates This Week – May 16, 2016

Whats Ahead For Mortgage Rates This Week December 21 2015Last week’s economic news included reports on retail sales and consumer sentiment along with weekly releases on new jobless claims and mortgage rates.

Retail sales jumped 1.30 percent in April as compared to the March reading of 0.30 percent. Retail sales excluding the automotive sector rose from 0.40 percent growth in March to 0.80 percent growth in April. Both retail sales reports exceeded expectations. Growth in consumer spending suggests higher confidence in economic conditions and may lead potential homebuyers to consider buying rather than renting their homes.

Consumer sentiment jumped in May to a reading of 95.8 as compared to an expected reading of 89.5 and April’s reading of 89.0. This reading further supports easing of consumer concerns over current economic conditions and could bode well for housing markets as the peak sales season continues. May’s reading was the highest in nearly a year according to the University of Michigan, which conducts the Consumer Sentiment Survey.

Mortgage Rates Fall, New Jobless Claims Rise

Housing markets received a boost as average mortgage rates reported by Freddie Mac fell. The rate for a 30-year fixed rate mortgage fell by four basis points to 3.57 percent; the rate for a 15-year fixed rate mortgage was five points lower at 2.81 percent. The average rate for a 5/1 adjustable rate mortgage was two basis points lower at 2.78 percent. Discount points averaged 0.50 percent for all three types of mortgages.

In spite of good economic news, lower mortgage rates and higher consumer sentiment, new jobless claims jumped to a 14-month high of 294,000 new claims from the prior week’s reading of 274,000 new claims and expectations of 270,000 new claims. Analysts said this increase could indicate softening of labor markets. Putting last week’s urge in claims in perspective, new claims remained below the benchmark reading of 300,000 new claims for 62 consecutive weeks, which is the longest period since 1973.

Labor laws in New York State likely influenced the jump in claims as certain school workers are allowed to file for unemployment benefits during spring break. A strike by some telecommunications workers likely contributed to the abrupt rise in new jobless claims. Analysts noted that New York allows striking employees replaced by their employers while on strike to collect unemployment benefits, and that new claims were near historically low levels in all other states.

Whats Ahead

This week’s scheduled economic reports include the National Association of Home Builders Housing Market Index and Commerce Department reports on housing starts and building permits issued. Monthly reports on inflation are also expected.The National Association of Realtors® will release its report on existing home sales. Weekly reports on new jobless claims and mortgage rates will also be released.

‘Free Pizza for Life’ and Other Crazy Home Sales Gimmicks from Across the Nation

'Free Pizza for Life' and Other Crazy Home Sales Gimmicks from Across the NationWith the real estate market going through constant fluctuations, it can sometimes be a matter of strife to sell a home. Some will take the familiar road of staging and hope the offers come in, while others will do some crazy things to prove their home is worth buying. While you may not want to take the risk of making these bold moves yourself, here are the unusual things that some people did in hopes of getting their home off the market a little sooner.

The Perk Of Added Incentives

While there are a variety of goods that can be an added incentive to purchasing a home, one homeowner in Virginia Beach offered a 42-inch flat screen television to the lucky person who would make them an offer that couldn’t be refused. While this owner managed to sell in just a couple of weeks, other offers like expensive cars and gift certificates have long been attached to houses in the hopes of getting a more spontaneous sale.

A Real Ingenious Raffle

In the state of Maryland, log cabin owners Tom and Diane Walter opted to host a raffle so they could raise enough money to pay off the loan on their home. While the winning raffle ticket buyer would go away with a new home for only $50.00, the profits from the raffle would go to a local non-profit and the Walters loan fund. With the toughness of the real estate market, it’s a tactic that has gained popularity given the excitement of getting a house at a very economical price.

Testing Out The New Home

It’s certainly the case that being able to test something out might lead to more sale success, but a local builder in Portland, Oregon took it a little bit further than usual. Instead of offering up a staged suite, potential buyers were provided with a stay in a home at Atwater Place that was free of charge and included restaurant gift certificates, a gym pass and a lovely view of Mount Hood.

Staging a nice home at a reasonable price is always a great way to achieve selling success, but some have gone out on a limb to offer things that went well beyond the benefits of a new home. Contact your local mortgage professional for more information.

5 Uncommon Mortgage Terms You Need to Know

5 Uncommon Mortgage Terms You Need to KnowWhen it comes to finding a new home, there are lots of complex ratios, terms, and contracts that you’ll encounter – and at times, it’ll feel like you’re trying to navigate a minefield. Here are five mortgage terms you may not encounter regularly that you’ll need to know when buying a home.

Escrow: Money Held In Trust To Pay Taxes

An escrow account is a bank account that your lender maintains on your behalf. When you close your mortgage, you’ll need to deposit a certain percent of your annual property taxes into the escrow account, which your lender will hold in trust and use to pay your property taxes.

PITI: How Your Lender Calculates Your Monthly Payments

Your lender uses a specific formula used to calculate exactly how much money you need to pay your lender each month. Each month, your mortgage payment will include portions that go toward your principal loan amount (P), your interest payment (I), your property taxes (T), and your homeowner’s insurance (I). If you have private mortgage insurance, it’ll be included with this PITI payment.

Rate Buydown: Lowering Your Interest Rate With A Larger Down Payment

A rate buydown, also known as a discount point, is a chunk of your mortgage interest that you pre-pay in order to get a lower monthly interest rate over the life of the loan. Each point you buy reduces your interest rate by a small amount.

Loan Estimate: What Your Lender Must, By Law, Give You

A loan estimate is a form that your lender is required to give you when you apply for a mortgage, as per the Truth in Lending Act. Your loan estimate will include your estimated costs of carrying the loan – including monthly payments, interest rates, and processing fees. Loan estimates allow you to compare terms and rates across different lenders.

Loan-To-Value: Determining How Much House You Can Afford

Your LTV (loan-to-value) ratio is a ratio that is used to calculate the amount of equity you have in your home and to assess your risk as a borrower. Typically expressed as a percentage, your LTV is determined by dividing the total amount of your mortgage loan by the property’s fair market value. Borrowers generally prefer to see lower LTV ratios.

Mortgages contain a variety of legal terms that can be challenging for the uninitiated to understand. But with a qualified mortgage advisor on your side, you’ll have no difficulty navigating mortgage contracts and finding the right mortgage for you. Contact your local mortgage professional to learn more.

How to Smartly Leverage Your Home Equity

How to Smartly Leverage Your Home EquitySo you’ve been a homeowner for some time. You’ve been faithfully paying off your mortgage for years, and you have a fair bit of equity built up in your home – and that makes you proud. But now, you’re wondering what good equity is if you’re not using it.

How do you actually use home equity? And how do you leverage it to get a high return for low risk? Here are just a few options you may want to consider if you’re looking for something to do with your equity.

Use A Home Equity Loan Or HELOC To Pay Off High-Interest Debt

If you have a certain amount of money invested in your home, you can borrow against that investment by taking out a home equity loan or a Home Equity Line of Credit (HELOC). A home equity loan is ideal for borrowing a large amount of money for a specific purpose, whereas a HELOC works much the same way a credit card does – you can use credit as needed, then pay back what you owe. And if you have a lot of high-interest debt, one of these vehicles could be a great way to pay off your creditors – while it may seem like borrowing from Peter to pay Paul, you actually save thousands of dollars in interest rates by paying off high-interest debt using a lower-interest HELOC or home equity loan.

Buy An Investment Property With A Home Equity Loan

If you’ve been looking to enter the real estate investment market but haven’t had the liquid funds for a deposit, leveraging your home equity in the form of a loan can get you into the landlord game quickly and easily. This is a smart move because while you are taking on more debt, you’re doing so in order to create a new income stream. Ideally, you’ll want to buy a duplex or a home with a granny suite so that you can maximize your investment by renting out more than one dwelling space.

Downsize To A Smaller House And Invest The Difference

Perhaps you’re living in a large house that has seen its value appreciate in recent years, and you’re looking to move in the near future. Selling your large home and moving into a smaller, less expensive home is a great way to simply turn your home’s equity into cash – cash that you can invest.

Leveraging your home equity can be a smart move if it’s done with a larger goal and a solid strategy in mind. But when done irresponsibly, taking equity out of your home can have severe consequences. Talk to your local mortgage professional today to learn more about smart options for leveraging home equity.

Avoiding Home Buyer Remorse: 5 Tips for a Happier Homeowner

Avoiding Home Buyer Remorse: 5 Tips for a Happier HomeownerThe rush of excitement that comes with finding the home you’ve been looking for is ideal, but just because it seems like the perfect place, it doesn’t mean there aren’t other factors to consider. Instead of getting hit with buyer’s remorse, here are some tips so that your home purchase doesn’t become something you’ll regret.

Forget About The Competition

If you’re contemplating a house and happen to be dragged into a bidding war, it’s important to take a step back and determine if it’s really the right home for you. It can be easy to get carried away and up your offer, but make sure you determine what the home is really worth to you.

Take A Second Look

If you’ve been to a lot of home viewings and have finally found a place you feel good about, it can be easy to overlook the minor details. Instead of trusting your memory, make sure you visit the home a couple of times before putting in an offer so you’ll be aware of any major flaws you might have missed the first time around.

Visit The Neighborhood

The instant appeal of a home that seems perfect for your family can be unexpected, but it’s worth considering the neighborhood you’re going to be living in to ensure it’s livable. A home is one thing, but local amenities and an area your family feels comfortable will come to be equally important.

Avoid A Fixer-Upper

The kind of home you can fix up might make for a fun project for the DIY person, but biting off more than you can chew in an effort to save can be a mistake. A few small renovations may not be a big issue, but a home that needs a lot of changes will likely end up being more of a burden once the deal is sealed.

Stick To Your Purchase Price

Many people get so overwhelmed when they find a unique place to settle that their price point flies out the window. However, instead of making allowances for a purchase price you can’t really swing, keep what’s affordable in mind and be sure you don’t veer too far above it.

It can be exciting to find the kind of home you’re looking for in a center you love, but it’s important to pay a price that’s affordable and get the home you really want. Contact your local mortgage professional for more information.

What’s Ahead For Mortgage Rates This Week – May 9, 2016

Closing Paperwork: How to Read and Understand the Truth-in-Lending Disclosure Statement

Mortgage rates fell across the board last week according to Freddie Mac’s Primary Mortgage Market Survey. Other economic news included reports on construction spending, public and private sector employment and national unemployment.

Construction Spending Grows in March

The Commerce Department reported that the growth rate for construction spending fell in March to 0.30 percent/Analysts expected a reading of 0.70 percent based on February’s upwardly revised growth rate of 1.0 percent. Construction spending was propelled by a 1.50 percent increase in residential construction spending; this is good news for would-be home buyers who’ve been shut out of the market due to high demand and low inventories of available homes.

Housing market analysts have repeatedly said that new home construction is the answer to short supplies of homes and high buyer demand. Year-over-year, construction spending is up 8.0 percent overall; residential construction spending grew by 7.60 percent year-over-year.

Mortgage Rates Dip

Average mortgage rates were lower last week. The rate for a 30-year fixed rate mortgage fell by five basis points to 3.61 percent; the average rate for a 15-year fixed rate mortgage was three basis points lower at 2.86 percent and the average rate for a 5/1 adjustable rate mortgage dropped six basis points to an average of 2.80 percent.

While any drop in mortgage rates is welcomed by home buyers, the high demand for homes continues to drive prices up and has raised concerns about affordability of single-family homes in many communities.

Jobs Growth Slows

The national unemployment rate held steady at 5.0 percent in April, but job growth slowed in public and private sectors. ADP reported private sector jobs increased by 156,000 jobs as compared to 194,000 jobs added in March. According to the Bureau of Labor Statistics, Non-Farm Payrolls increased by 160.000 jobs as compared to expectations of 203,000 jobs added and March’s reading of 208,000 jobs added. Non-Farm payrolls measure public and private sector job growth.

New jobless claims rose by 17,000 to 274,000 new claims, but remained below the benchmark of 300,000 new claims for 61 consecutive weeks. Analysts projected that new claims would grow by 265,000 new claims based on the prior week’s reading of 257,000 new claims. The less volatile four-week rolling average of new jobless claims indicated that 258,000 new claims were filed. The labor force participation rate dropped from 65 percent to 63 percent in March. Retiring baby boomers contributed to some but not all of this workforce decline.

What’s Ahead

This week’s scheduled economic news includes weekly reports on mortgage rates and new jobless claims along with a report on consumer sentiment.

A Quick and Easy Guide to Hiring the Best Contractor for Your Pre-Sale Home Renovations

A Quick and Easy Guide to Hiring the Best Contractor for Your Pre-sale Home RenosIf you’re planning to complete some renovations on your home before putting it on the market, you may be unsure of the best way to go about finding the right contractor for the job. While there are probably many contractors available who can do your renovations right, here’s how you can get to the bottom of who will work the best for you.

Make A Few Phone Calls

Once you’ve done some research and determined a short list of prospective contractors, you’ll want to call each contractor to determine that they can complete your project in good time and are the right candidate for the work required. If they’re not available or are cagey about your question, this can be an easy way to whittle down the list.

Arrange A Meeting In Person

While a phone interview should provide you with some good insights right off the bat, you’ll also want to meet your potential contractors face to face before making any final decisions. If you get along well with the contractor and they are able to answer the questions you ask with confidence, it’s a good sign that they may be the right pick for your project.

Check In On The References

Once you’ve decided between a few candidates, make sure you contact their former clients to determine how happy they were with the work and the contractor. Since you may have a date in mind for when you want to put your home on the market, it will be important to know if the job was completed in good time, as well as if any final issues were left hanging in the air unfinished.

Consider The Estimated Costs

Last but not least, you’ll want to have each contractor break down the project and provide a projected cost for labor and materials. You should be able to get a good sense of exactly what it’s going to cost and which bid is the most realistic. While it may be tempting to go for the lowest bid since you’ll probably be moving soon, you’ll want to strongly consider which contractor and which price will turn out the best in the end.

It can seem complicated to hire a contractor for your home renovations, but by conducting simple interviews and checking references you should be able to determine who the best person for the job is. If you’re curious about home renovations and would like to know more about financing options, contact your trusted mortgage professional for more insights.

2016 Kitchen Decor Trends to Inspire Your Renovations

2016 Kitchen Decor Trends to Inspire Your RenovationsA kitchen upgrade may seem like the sort of renovation that will cost a pretty penny, but there are a lot of funky things you can do that will add an easy accent and make for a current look. If you’re planning some home improvements in 2016, here are some upcoming trends you may want to try out.

Cue The Contrasting Cabinets

It can be a major undertaking to change the style of your kitchen cabinets, and that’s probably why many people are considering a little switch instead of a major upheaval. By keeping your top cabinets the same and adding a funky new color or material to the bottom half, you can create a striking appearance. Keep in mind that if you don’t want to change out your cabinets entirely, you can go for a bold paint color instead.

Bring Color Into Stainless Steel

From teakettles to mixers, brightly colored kitchen appliances have certainly seen a retro rebirth in recent years, but the stainless steel trend is also experiencing a bit of an upgrade. While the material remains popular, many people are becoming interested in different stainless steel color options like black and sunset bronze which offer a unique look for an old mainstay.

A Multi-Use Island

Space in the kitchen can become an issue when it comes to dinner parties, and that’s why the diverse utility of a kitchen island is maintaining its popularity. Instead of the prominent counter for holding fruit bowls and extra papers, think of a funky, fashionable drink cart or side table that can be used for prepping extra food and will have many other purposes once the party is over.

The Non-Committal Kitchen Shelf

While kitchens have become more of a gathering space for family and friends in recent years, this has led to the popularity of a less-formal kind of kitchen. Instead of a lot of counter space and pots and pans in their place, create a bookshelf or cabinet that mixes the living room and kitchen together, full of dishware, books, utensils and other popular household items. It’s a piece that will easily transform your space.

There are a lot of unique fixes on the horizon for 2016 that will instantly modernize your kitchen and easily improve its look. If you’re currently renovating and are looking to put your home on the market, contact your trusted mortgage profssional for more information.

When is Refinancing Not a Good Idea?

When is Refinancing Not a Good Idea?Refinancing your home can be a great way to reduce monthly mortgage payments or interest rates – or even pay off your debt faster. And while it is a useful tool in budgeting for millions of homeowners, a home refinance may not necessarily be useful in every situation – in fact, there are some situations where refinancing can cost you a great deal of money.

So when should you skip the refinance and simply keep with the original plan? Here’s what you need to know.

If You’ve Already Paid Off Much Of Your Mortgage

When you first start paying a mortgage, most of your monthly payment goes toward the loan’s interest rather than its principal amount. But as you start paying down your mortgage, more and more of your payments are applied directly to the principal. And if you only have 10 years left on your mortgage, the vast majority of your payments are being applied to the principal.

Refinancing a mortgage essentially restarts the loan over from scratch – so if your mortgage is mostly paid off, a refinance will put you back where you started and cause you to owe much more money in interest payments.

If You’re Not Prepared To Pay More Closing Fees

Refinancing can be a great way to lower your interest rate, extend your loan, or get better terms, but it also comes at a cost. Since refinancing essentially starts a new home loan, you’ll need to pay all of the closing costs associated with a new mortgage – and on average, closing costs can total up to 5% of your home’s value. If you don’t have enough cash on hand to pay for your closing costs for a second time, refinancing your mortgage will harm you more than it will help you.

If You’re Giving Up An FRM For An ARM

If you have a fixed-rate mortgage, you have a great guarantee that your mortgage rate will stay the same. And if you already have a low interest rate, trying to get a lower interest rate will make it difficult for you to break even on your closing costs – unless you go with an adjustable-rate mortgage, which typically has lower closing costs.

But opting for an adjustable-rate mortgage is a poor idea right now. Today’s interest rates are at historical lows, which means they have nowhere to go but up. If you refinance with an adjustable-rate mortgage, you’ll end up paying more money than if you simply kept your existing fixed-rate mortgage.

Refinancing is often a useful tool, but it’s not always helpful in every situation. A qualified mortgage advisor can tell you whether refinancing is right for you. Contact your trusted local mortgage professional to learn more.