Tips for buying foreclosures!
Here are some tips to consider:
1. Work with an agent who has access to foreclosure information.
Many home buyers assume that all agents have access to foreclosure listings. It's important to ask.
2. Bank-owned properties generally close faster than short sales.
While short sales can be bargains, they also can take a lot longer. Some banks will negotiate in a timely manner on short sales, but most will prioritize properties they have already repossessed.
3. Always offer less than the asking price.
Don't assume that banks are firm on their price. For example, asset managers responsible for liquidating bank-owned Marco Island, Florida condos are often willing to consider a lower offer.
4. Ask the bank to pay your closing costs.
The worst that can happen is that they say no. Sometimes buyers are surprised to find that banks can be quite accommodating when they want to.
5. Get pre-approved from the right bank.
When making an offer on a short sale, it's often strategically helpful to be pre-approved by the same bank. During negotiations, this may tip the scales in your favor.
RISMEDIA, January 25, 2011.
Showing posts with label banks. Show all posts
Showing posts with label banks. Show all posts
Tuesday, January 25, 2011
Tuesday, November 30, 2010
Mortgage Purchase Applications Hit 6-Month High
Mortgage applications to purchase homes increased 14.4 percent last week on an adjusted basis compared to the previous week, according to the Mortgage Bankers Association weekly survey.
The unadjusted Purchase Index increased 9.6 percent compared with the previous week and was down 7.4 percent compared to the same week a year ago.
On a seasonally adjusted basis, this is the highest Purchase Index recorded since the week ending May 7, 2010 in the middle of the tax-rebate push.
“The increase in purchase applications last week aligns with other incoming data suggesting that consumers are feeling somewhat more confident with their financial situation,” said Michael Fratantoni, the association’s vice president of research and economics.
“The level of purchase applications on a seasonally adjusted basis is now at its highest level since the expiration of the homebuyer tax credit,” Fratantoni concluded.
Interest rates were mixed, with 30-year fixed-rate mortgages rising to 4.50 percent from 4.46 percent and 15-year fixed-rate mortgages decreasing to 3.83 percent from 3.87 percent.
Source: Mortgage Bankers Association (11/24/2010)
The unadjusted Purchase Index increased 9.6 percent compared with the previous week and was down 7.4 percent compared to the same week a year ago.
On a seasonally adjusted basis, this is the highest Purchase Index recorded since the week ending May 7, 2010 in the middle of the tax-rebate push.
“The increase in purchase applications last week aligns with other incoming data suggesting that consumers are feeling somewhat more confident with their financial situation,” said Michael Fratantoni, the association’s vice president of research and economics.
“The level of purchase applications on a seasonally adjusted basis is now at its highest level since the expiration of the homebuyer tax credit,” Fratantoni concluded.
Interest rates were mixed, with 30-year fixed-rate mortgages rising to 4.50 percent from 4.46 percent and 15-year fixed-rate mortgages decreasing to 3.83 percent from 3.87 percent.
Source: Mortgage Bankers Association (11/24/2010)
Saturday, November 20, 2010
Mortgage Rates Back on the Rise
Rates for 30-year fixed mortgages rose to 4.39 percent this week from 4.17 percent a week ago, and average interest on 15-year loans moved to 3.76 percent from 3.57 percent, said Freddie Mac.
Interest for five-year adjustable-rate mortgages jumped to 3.4 percent from 3.25 percent, meanwhile, and one-year ARMs held at 3.26 percent. Rates have climbed along with long-term Treasury yields as traders unloaded Treasurys purchased before the Federal Reserve announced a $600 billion bond purchase program.
Source: Chicago Sun-Times (11/19/10)
Interest for five-year adjustable-rate mortgages jumped to 3.4 percent from 3.25 percent, meanwhile, and one-year ARMs held at 3.26 percent. Rates have climbed along with long-term Treasury yields as traders unloaded Treasurys purchased before the Federal Reserve announced a $600 billion bond purchase program.
Source: Chicago Sun-Times (11/19/10)
Sunday, November 14, 2010
Realtors' report says Dallas-Fort Worth home prices rose slightly in third quarter
Dallas-Fort Worth home prices were up by a small margin in the third quarter, and most of the increase was probably due to more sales of higher-priced homes.
The National Association of Realtors reported Thursday that median home sales prices in the D-FW area were up 1.6 percent from third quarter 2009.
The small gain here came as nationwide prices were basically flat, the Realtors said.
"Even with swings in home sales, prices this year have been changing very little from year-ago readings," Realtors' chief economist Lawrence Yun said in the report. The Realtors are forecasting flat home prices in the year ahead.
The just-released national data lines up with local figures that show median home prices in North Texas are up 1 percent year-to-date.
Of the 155 metropolitan areas that the Realtors track each quarter, 76 markets showed price declines.
Home sales in North Texas have slowed dramatically since federal housing tax credits expired at the end of April. But the bulk of the decline has been for lower- and moderate-priced homes. High-end home sales are still rising in many neighborhoods.
"Now that the tax credits have expired, we have seen a real drop-off in the activity at the lower end of the price spectrum," said Ted Wilson, a housing analyst with Dallas-based Residential Strategies Inc. "As a result, the median price has climbed."
David Brown of MetroStudy Inc. agreed: "The average and median prices have increased over the last year because of the surge in sales of homes priced over $500,000."
The National Association of Realtors reported Thursday that median home sales prices in the D-FW area were up 1.6 percent from third quarter 2009.
The small gain here came as nationwide prices were basically flat, the Realtors said.
"Even with swings in home sales, prices this year have been changing very little from year-ago readings," Realtors' chief economist Lawrence Yun said in the report. The Realtors are forecasting flat home prices in the year ahead.
The just-released national data lines up with local figures that show median home prices in North Texas are up 1 percent year-to-date.
Of the 155 metropolitan areas that the Realtors track each quarter, 76 markets showed price declines.
Home sales in North Texas have slowed dramatically since federal housing tax credits expired at the end of April. But the bulk of the decline has been for lower- and moderate-priced homes. High-end home sales are still rising in many neighborhoods.
"Now that the tax credits have expired, we have seen a real drop-off in the activity at the lower end of the price spectrum," said Ted Wilson, a housing analyst with Dallas-based Residential Strategies Inc. "As a result, the median price has climbed."
David Brown of MetroStudy Inc. agreed: "The average and median prices have increased over the last year because of the surge in sales of homes priced over $500,000."
Thursday, November 11, 2010
Mortgage Applications Rise
Applications to purchase homes rose 5.5 percent last week compared to the previous week on a seasonally adjusted basis, according to the Mortgage Bankers Association weekly survey.
On an unadjusted basis, purchases increased 3.1 compared over the previous week. This was the third consecutive week that purchase applications rose. They are at the highest level since May.
“The increases in purchase applications we have seen over the past couple of weeks align with the better than expected news from October’s employment report and other data indicating some improvement in the economy’s growth prospects,” says Michael Fratantoni, MBA’s vice president of research and economics.
Mortgage rates held steady:
· 30-year fixed-rate mortgages remained unchanged at 4.28 percent.
· 15-year fixed-rate remained unchanged at 3.64 percent.
Source: Mortgage Bankers Association
On an unadjusted basis, purchases increased 3.1 compared over the previous week. This was the third consecutive week that purchase applications rose. They are at the highest level since May.
“The increases in purchase applications we have seen over the past couple of weeks align with the better than expected news from October’s employment report and other data indicating some improvement in the economy’s growth prospects,” says Michael Fratantoni, MBA’s vice president of research and economics.
Mortgage rates held steady:
· 30-year fixed-rate mortgages remained unchanged at 4.28 percent.
· 15-year fixed-rate remained unchanged at 3.64 percent.
Source: Mortgage Bankers Association
Thursday, November 4, 2010
Mortgage Purchases Rise
Applications to purchase homes rose 1.4 percent last week compared to the previous week on a seasonally adjusted basis, according to the Mortgage Bankers Association weekly survey.
On an unadjusted basis, purchases increased 0.2 percent last week compared to the previous week, but were down 28 percent compared to the same week a year ago.
Overall, mortgage application volume declined 5 percent over the last week on a seasonally adjusted basis because refinances decreased 6.4 percent.
Interest rate changes were mixed.
Average 30-year fixed-rate mortgages increased to 4.28 percent from 4.25 percent, while the average rate for 15-year fixed-rate mortgages decreased to 3.64 percent from 3.67 percent.
Source: Mortgage Bankers Association (11/03/2010)
On an unadjusted basis, purchases increased 0.2 percent last week compared to the previous week, but were down 28 percent compared to the same week a year ago.
Overall, mortgage application volume declined 5 percent over the last week on a seasonally adjusted basis because refinances decreased 6.4 percent.
Interest rate changes were mixed.
Average 30-year fixed-rate mortgages increased to 4.28 percent from 4.25 percent, while the average rate for 15-year fixed-rate mortgages decreased to 3.64 percent from 3.67 percent.
Source: Mortgage Bankers Association (11/03/2010)
Tuesday, November 2, 2010
3 New Anti-Foreclosure Strategies
Here are three programs that are considered promising replacements for the government’s Home Affordable Modification Program (HAMP), which has failed to stop foreclosures.
· Fannie Mae and Freddie Mac would be encouraged to refinance loans for some 30 million borrowers with high-interest rate mortgages. The new mortgages would be folded into a new round of mortgage-backed securities issued by the government-sponsored finance firms.
· The right-to-rent plan would offer delinquent borrowers an option of renting their foreclosed homes at a market rate for five years. At that point, owners turned renters would have another chance to buy their homes at market value. It’s a compromise. Borrowers lose their homes, but lenders have to accept lower payments.
· Mortgage cramdowns give a bankruptcy judge the right to consider all of a borrower’s debts and create a solution that would force all interested parties, including holders of mortgage debt, to compromise.
· Fannie Mae and Freddie Mac would be encouraged to refinance loans for some 30 million borrowers with high-interest rate mortgages. The new mortgages would be folded into a new round of mortgage-backed securities issued by the government-sponsored finance firms.
· The right-to-rent plan would offer delinquent borrowers an option of renting their foreclosed homes at a market rate for five years. At that point, owners turned renters would have another chance to buy their homes at market value. It’s a compromise. Borrowers lose their homes, but lenders have to accept lower payments.
· Mortgage cramdowns give a bankruptcy judge the right to consider all of a borrower’s debts and create a solution that would force all interested parties, including holders of mortgage debt, to compromise.
Saturday, October 30, 2010
Majority of Americans: Buying a Home Is a Good Decision
Despite the continuing challenges facing the U.S., nearly eight out of 10 respondents believe buying a home is a good financial decision, according to NAR's eighth annual Housing Opportunity Pulse Survey.
The survey, which measures how affordable housing issues affect consumers, also found job security concerns to be the highest in eight years of sampling, with 70 percent of Americans saying that job layoffs and unemployment are a big problem in their area; eight in 10 cite these issues as a barrier to homeownership. The telephone survey of 1,209 urban and suburban adults in the top 25 metropolitan statistical areas was conducted for NAR by American Strategies and Myers Research & Strategic Services for NAR's Housing Opportunity Program.
Some key results:
* Americans continue to believe that buying a home is a good financial decision (77 percent believe strongly or not so strongly, 68 percent strongly so).
* More than two-thirds of respondents (68 percent) say that now is a good time to buy a home.
* Job insecurity and the lack of jobs continue to be the primary obstacle to home ownership and market recovery.
* Respondents see the recession and job losses as the main reasons for the foreclosure problem, a shift from last year when they were more likely to blame homeowners who bought homes they could not afford.
* A majority of renters say that owning a home at some point in the future is either one of their highest priorities (39 percent) or a moderate priority (24 percent). Just 21 percent of renters say that owning a home is not a priority at all.
* Frustration with banks is up: now a majority worry that banks have made it too hard to qualify for a home mortgage loan.
* 51 percent of respondents say foreclosures remain a big or moderate problem in their area. While there has been a significant drop in the percentage of those surveyed who say foreclosures have increased, 51 percent say that the rate of foreclosures is about the same as it was last year.
* Most of those surveyed say that it is harder to sell a home in their neighborhood than it was a year ago.
* Looking forward, 70 percent expect real estate sales in their neighborhood to remain about the same over the next few months. A nearly identical number (69 percent), also expect home values to remain the same.
* Nearly one-quarter (23 percent) are now very concerned about the number of homes and condos for sale in their area—a number that is up 7 points from last year.
* Most respondents are more concerned about the drop in home values than they are about home costs being too high. Still, cost remains the significant barrier to many who would otherwise like to buy a home.
The survey, which measures how affordable housing issues affect consumers, also found job security concerns to be the highest in eight years of sampling, with 70 percent of Americans saying that job layoffs and unemployment are a big problem in their area; eight in 10 cite these issues as a barrier to homeownership. The telephone survey of 1,209 urban and suburban adults in the top 25 metropolitan statistical areas was conducted for NAR by American Strategies and Myers Research & Strategic Services for NAR's Housing Opportunity Program.
Some key results:
* Americans continue to believe that buying a home is a good financial decision (77 percent believe strongly or not so strongly, 68 percent strongly so).
* More than two-thirds of respondents (68 percent) say that now is a good time to buy a home.
* Job insecurity and the lack of jobs continue to be the primary obstacle to home ownership and market recovery.
* Respondents see the recession and job losses as the main reasons for the foreclosure problem, a shift from last year when they were more likely to blame homeowners who bought homes they could not afford.
* A majority of renters say that owning a home at some point in the future is either one of their highest priorities (39 percent) or a moderate priority (24 percent). Just 21 percent of renters say that owning a home is not a priority at all.
* Frustration with banks is up: now a majority worry that banks have made it too hard to qualify for a home mortgage loan.
* 51 percent of respondents say foreclosures remain a big or moderate problem in their area. While there has been a significant drop in the percentage of those surveyed who say foreclosures have increased, 51 percent say that the rate of foreclosures is about the same as it was last year.
* Most of those surveyed say that it is harder to sell a home in their neighborhood than it was a year ago.
* Looking forward, 70 percent expect real estate sales in their neighborhood to remain about the same over the next few months. A nearly identical number (69 percent), also expect home values to remain the same.
* Nearly one-quarter (23 percent) are now very concerned about the number of homes and condos for sale in their area—a number that is up 7 points from last year.
* Most respondents are more concerned about the drop in home values than they are about home costs being too high. Still, cost remains the significant barrier to many who would otherwise like to buy a home.
Wednesday, October 27, 2010
Simple Tips to Take the Stress Out of the Home-Buying Process - Focus on the Positives
For many prospective buyers, the thought of going through the home-buying process is often filled with a lot of stress. From finding a qualified real estate agent, to narrowing down your choice of homes and then packing your belongings and moving across town can be an overwhelming process.
Here are some tips to help you keep your cool as you begin the process of a buying a home.
-Buying a home is one of the biggest financial decisions you will make in your lifetime, and along with the finances come emotions. When you are choosing a real estate agent to work with, be patient and take the time you need to find an agent that you connect with. Finding a highly-skilled agent who fits with your personality is crucial.
-Every home buyer and seller is in a different situation, so it is important that you don’t compare your timeline and decisions to anyone else’s. As you make your way through the home buying process, remember that there is no right time to buy, just as there is no perfect time to sell. If you find a home that fits your needs, don’t let it slip out of your hands by waiting for interest rates to drop lower as you run the chance of losing out on the home of your dreams.
-It is natural to want to get opinions from those you trust before you make your final choice, but too much input will ultimately make the decision process much harder. Remember to focus on what your immediate wants and needs are so that everyone will be happy with the final decision.
-You probably aren’t going to find a home that is 100% perfect, so it is important to make a list that includes your top priorities that you can’t live without. Be sure to stick to the items on your list and let go of the minor things.
-Negotiation is an important part of the real estate buying process, but be sure you don’t take your negotiating too far. Trying to get an extra-low price or refusing to budge on your offer may cost you the home in the end. Successful negotiation depends on give and take, so make sure you are being fair in your requests.
-Don’t get too caught up in all the physical aspects of a home and forget about the more important issues. While the size of the rooms and the layout of the kitchen might not be exactly what you expected, be cognizant of issues such as noise level, location to amenities and other aspects that will have an impact on your day-to-day life.
-Getting approved for a mortgage should be taken care of well before you find a home and make an offer.
-Create a budget before you move into your new home and be sure to include maintenance and repair costs. Even if you buy a new home, there will be extra costs, so it is important to not come up short and let your new home deteriorate.
-After purchasing a home, a little buyer’s remorse is inevitable, but it will pass. Buying a home is a big financial commitment, but it also yields big benefits. If you are feeling remorseful after buying your home, remind yourself why you wanted to buy a home and what made you fall in love with your new property.
-When choosing a home, buy it because you love it. A home’s most important role is to serve as a comfortable, safe place to live, so don’t get bogged down with thinking about your home’s appreciation.
Here are some tips to help you keep your cool as you begin the process of a buying a home.
-Buying a home is one of the biggest financial decisions you will make in your lifetime, and along with the finances come emotions. When you are choosing a real estate agent to work with, be patient and take the time you need to find an agent that you connect with. Finding a highly-skilled agent who fits with your personality is crucial.
-Every home buyer and seller is in a different situation, so it is important that you don’t compare your timeline and decisions to anyone else’s. As you make your way through the home buying process, remember that there is no right time to buy, just as there is no perfect time to sell. If you find a home that fits your needs, don’t let it slip out of your hands by waiting for interest rates to drop lower as you run the chance of losing out on the home of your dreams.
-It is natural to want to get opinions from those you trust before you make your final choice, but too much input will ultimately make the decision process much harder. Remember to focus on what your immediate wants and needs are so that everyone will be happy with the final decision.
-You probably aren’t going to find a home that is 100% perfect, so it is important to make a list that includes your top priorities that you can’t live without. Be sure to stick to the items on your list and let go of the minor things.
-Negotiation is an important part of the real estate buying process, but be sure you don’t take your negotiating too far. Trying to get an extra-low price or refusing to budge on your offer may cost you the home in the end. Successful negotiation depends on give and take, so make sure you are being fair in your requests.
-Don’t get too caught up in all the physical aspects of a home and forget about the more important issues. While the size of the rooms and the layout of the kitchen might not be exactly what you expected, be cognizant of issues such as noise level, location to amenities and other aspects that will have an impact on your day-to-day life.
-Getting approved for a mortgage should be taken care of well before you find a home and make an offer.
-Create a budget before you move into your new home and be sure to include maintenance and repair costs. Even if you buy a new home, there will be extra costs, so it is important to not come up short and let your new home deteriorate.
-After purchasing a home, a little buyer’s remorse is inevitable, but it will pass. Buying a home is a big financial commitment, but it also yields big benefits. If you are feeling remorseful after buying your home, remind yourself why you wanted to buy a home and what made you fall in love with your new property.
-When choosing a home, buy it because you love it. A home’s most important role is to serve as a comfortable, safe place to live, so don’t get bogged down with thinking about your home’s appreciation.
Tuesday, October 26, 2010
Get Credit Score in Order Before Applying for Credit
If your mailbox is starting to fill up again with credit card offers and you're tempted to apply, be realistic about your chances of qualifying.
Increased credit card solicitations are an indication that things have gotten much better for card issuers, with declines in defaults and delinquencies, said Bill Hardekopf, CEO of LowCards.com and author of "The Credit Card Guidebook."
"They are once again aggressively pursuing new customers, but this time around, they seem to really be focusing on those with good or excellent credit scores," he said.
Consumers may have to jump through more hoops than before to get a credit card today. But it's not impossible to get a card.
Before you apply for a credit card, get a copy of your credit report and your FICO credit score, the dominant score used by lenders, which uses a score range of 300 to 850.
Use your credit score as a guide to what kind of credit card you should apply for.
If your score is lower than you expected, check your credit report for errors and correct them before you apply for credit. If your score is too low, be prepared to pay.
"If your FICO score is 750 or above, you should apply for the cards specifically offered for excellent credit," Hardekopf said. "A score of 720 or above is considered good credit; 660 to 720 is acceptable."
If your score is below 650, you could find yourself in the subprime category, and you could have a tough time getting approved, he said.
"Anything below a 650 FICO score seems to be the dividing line between prime and subprime," agreed John Ulzheimer, president of consumer education at Credit.com.
The scary thing is that as of April, 35.2 percent of consumers had FICO scores below 650, according to the company that produces the influential number.
"Scores below 650 are there for a reason," Ulzheimer said. "It's negative information, such as late payments, foreclosures, bankruptcy, tax liens, hitting your credit report and excessive credit card debt."
According to Hardekopf, "consumers should not waste their time and apply for a card for which they are not qualified. If you apply for too many credit cards at once, this is a red flag and may actually cause your score to drop."
Some credit card issuers will give you some guidance as to what your credit level is.
For example, Capital One considers you to have excellent credit if you've had a loan or credit card for at least five years, have a credit limit of more than $10,000, have never been more than 60 days late on a credit card, medical bill or loan payment and have never declared bankruptcy.
You have average credit in Capital One's eyes if you have a credit card limit of less than $5,000 or you may have been late on more than one credit card, medical bill or loan payment in the past six months.
How you pay your credit card bill also should determine what kind of card you apply for.
If you pay off your card each month, you should look for a card with a good rewards program, Hardekopf said.
But if you carry a balance each month, you want a card with the lowest annual percentage rate and then work your tail off to pay off the card as quickly as possible.
"You really need to decide before you apply for a card what kind of credit card customer you are," Hardekopf said.
(c) 2010, The Dallas Morning News.
Increased credit card solicitations are an indication that things have gotten much better for card issuers, with declines in defaults and delinquencies, said Bill Hardekopf, CEO of LowCards.com and author of "The Credit Card Guidebook."
"They are once again aggressively pursuing new customers, but this time around, they seem to really be focusing on those with good or excellent credit scores," he said.
Consumers may have to jump through more hoops than before to get a credit card today. But it's not impossible to get a card.
Before you apply for a credit card, get a copy of your credit report and your FICO credit score, the dominant score used by lenders, which uses a score range of 300 to 850.
Use your credit score as a guide to what kind of credit card you should apply for.
If your score is lower than you expected, check your credit report for errors and correct them before you apply for credit. If your score is too low, be prepared to pay.
"If your FICO score is 750 or above, you should apply for the cards specifically offered for excellent credit," Hardekopf said. "A score of 720 or above is considered good credit; 660 to 720 is acceptable."
If your score is below 650, you could find yourself in the subprime category, and you could have a tough time getting approved, he said.
"Anything below a 650 FICO score seems to be the dividing line between prime and subprime," agreed John Ulzheimer, president of consumer education at Credit.com.
The scary thing is that as of April, 35.2 percent of consumers had FICO scores below 650, according to the company that produces the influential number.
"Scores below 650 are there for a reason," Ulzheimer said. "It's negative information, such as late payments, foreclosures, bankruptcy, tax liens, hitting your credit report and excessive credit card debt."
According to Hardekopf, "consumers should not waste their time and apply for a card for which they are not qualified. If you apply for too many credit cards at once, this is a red flag and may actually cause your score to drop."
Some credit card issuers will give you some guidance as to what your credit level is.
For example, Capital One considers you to have excellent credit if you've had a loan or credit card for at least five years, have a credit limit of more than $10,000, have never been more than 60 days late on a credit card, medical bill or loan payment and have never declared bankruptcy.
You have average credit in Capital One's eyes if you have a credit card limit of less than $5,000 or you may have been late on more than one credit card, medical bill or loan payment in the past six months.
How you pay your credit card bill also should determine what kind of card you apply for.
If you pay off your card each month, you should look for a card with a good rewards program, Hardekopf said.
But if you carry a balance each month, you want a card with the lowest annual percentage rate and then work your tail off to pay off the card as quickly as possible.
"You really need to decide before you apply for a card what kind of credit card customer you are," Hardekopf said.
(c) 2010, The Dallas Morning News.
Sunday, October 24, 2010
What You Should Know Before Buying a Home
There are so many things to understand as you embark on purchasing a home, especially if it's your first purchase. Learn the basics as you get started and understand everything you need to know as it relates to financing.
Here are 10 tips about financing:
1. Before you start looking for a home, get pre-qualified for a loan. Banks, credit unions and mortgage bankers make home loans; mortgage brokers process them. The lenders will take an application, process the loan documents, and see the loan through to the funding stage.
2. If you have marginal or bad credit, consult your lender. You may be able to qualify for a loan depending on how long ago and what reason(s) caused the bad credit. A lender should be able to advise you on whether your credit history will prevent you from qualifying for a home loan.
3. You will need a down payment. Down payment requirements vary depending on the type of loan. Many down payment assistance programs exist. These programs may loan or grant you the funds necessary for the down payment. Consult with a lender about programs available in your area.
4. You will need funds for closing costs. Closing costs are charges for services related to the closing of your real estate transaction. They include, but are not limited to:
* Escrow fees charged by the company handling the transaction
* Title policy issuance fees charged by the title insurance company
* Mortgage insurance fees
* Fire and homeowners insurance
* County Recorder fees for recording your deed
* Loan origination fees
Consult your lender for an actual estimate of these costs, as well as information about loan programs which can assist in financing your closing costs
5. Some loans have "points" and some do not. A point is a loan origination fee equivalent to 1% of the loan amount. Together with the interest rate they constitute the yield on your loan for the lender. Some lenders charge a higher interest rate to compensate for charging no points. It is important to comparison shop lenders to make sure your loan is at a competitive yield.
6. Should you select a mortgage with a fixed rate or an adjustable rate? The answer to this question depends on whether mortgage rates are at a high or a low point when you purchase, and on how long you plan to live in the home. If rates are high, an adjustable rate might be attractive since subsequent rate drops could reduce your monthly payments. Additionally, lenders may offer a low rate during the first few years of an adjustable mortgage to make it appealing to you. If interest rates are low you might want to take a fixed rate to protect yourself against the possibility of rising interest rates.
7. Be aware of the two main types of loan categories.
* Conventional Loans. Conventional mortgage loans are available with fixed or adjustable interest rates. Some loans may require mortgage insurance.
* Government Loans. These include Federal Housing Administration (FHA) fixed and adjustable rate mortgage loans, and Veterans Administration (VA) fixed rate mortgage loan
8. If you are a low or moderate income home buyer, there are special programs designed to help you. These loans are available through private lenders, as well as local and state housing agencies, like the California Housing Finance Agency (CalHFA). Most lenders specializing in real estate mortgage loans are aware of these types of loan programs.
9. Why might I have to pay mortgage insurance? Mortgage insurance protects the lender from potential loss if you should default on your mortgage loan payment. Generally, conventional loans that require larger down payments do not require mortgage insurance. Mortgage insurance is always required on FHA mortgage loans.
10. Many organizations offer home loan counseling to prospective home buyers. These organizations provide classes for homebuyers to cover the steps to homeownership. They will cover home selection, realtor services, lenders, loan programs, homeownership responsibilities, saving for a down payment, and other important pieces of information. Many first-time home buyer programs require homebuyers to attend this type of class to be eligible for selected programs.
Here are 10 tips about financing:
1. Before you start looking for a home, get pre-qualified for a loan. Banks, credit unions and mortgage bankers make home loans; mortgage brokers process them. The lenders will take an application, process the loan documents, and see the loan through to the funding stage.
2. If you have marginal or bad credit, consult your lender. You may be able to qualify for a loan depending on how long ago and what reason(s) caused the bad credit. A lender should be able to advise you on whether your credit history will prevent you from qualifying for a home loan.
3. You will need a down payment. Down payment requirements vary depending on the type of loan. Many down payment assistance programs exist. These programs may loan or grant you the funds necessary for the down payment. Consult with a lender about programs available in your area.
4. You will need funds for closing costs. Closing costs are charges for services related to the closing of your real estate transaction. They include, but are not limited to:
* Escrow fees charged by the company handling the transaction
* Title policy issuance fees charged by the title insurance company
* Mortgage insurance fees
* Fire and homeowners insurance
* County Recorder fees for recording your deed
* Loan origination fees
Consult your lender for an actual estimate of these costs, as well as information about loan programs which can assist in financing your closing costs
5. Some loans have "points" and some do not. A point is a loan origination fee equivalent to 1% of the loan amount. Together with the interest rate they constitute the yield on your loan for the lender. Some lenders charge a higher interest rate to compensate for charging no points. It is important to comparison shop lenders to make sure your loan is at a competitive yield.
6. Should you select a mortgage with a fixed rate or an adjustable rate? The answer to this question depends on whether mortgage rates are at a high or a low point when you purchase, and on how long you plan to live in the home. If rates are high, an adjustable rate might be attractive since subsequent rate drops could reduce your monthly payments. Additionally, lenders may offer a low rate during the first few years of an adjustable mortgage to make it appealing to you. If interest rates are low you might want to take a fixed rate to protect yourself against the possibility of rising interest rates.
7. Be aware of the two main types of loan categories.
* Conventional Loans. Conventional mortgage loans are available with fixed or adjustable interest rates. Some loans may require mortgage insurance.
* Government Loans. These include Federal Housing Administration (FHA) fixed and adjustable rate mortgage loans, and Veterans Administration (VA) fixed rate mortgage loan
8. If you are a low or moderate income home buyer, there are special programs designed to help you. These loans are available through private lenders, as well as local and state housing agencies, like the California Housing Finance Agency (CalHFA). Most lenders specializing in real estate mortgage loans are aware of these types of loan programs.
9. Why might I have to pay mortgage insurance? Mortgage insurance protects the lender from potential loss if you should default on your mortgage loan payment. Generally, conventional loans that require larger down payments do not require mortgage insurance. Mortgage insurance is always required on FHA mortgage loans.
10. Many organizations offer home loan counseling to prospective home buyers. These organizations provide classes for homebuyers to cover the steps to homeownership. They will cover home selection, realtor services, lenders, loan programs, homeownership responsibilities, saving for a down payment, and other important pieces of information. Many first-time home buyer programs require homebuyers to attend this type of class to be eligible for selected programs.
Saturday, October 23, 2010
Survey: Economy Driving People Out of the Housing Market
Nearly two-thirds of Americans say the current economic situation is making them less likely to buy a house, according to a new national survey by FindLaw.com (http://www.findlaw.com), a popular legal information website.
Sixty-three percent of American adults say they are less likely to buy a house because of the current state of the economy. Despite record-low mortgage rates and an abundance of houses available on the market, only 8 percent of people say the current economic situation makes them more likely to buy a house. About a quarter of people – 28 percent – say they are neither more likely nor less likely to buy a house because of the economy.
In particular, the current economy is driving lower-income individuals and families out of the market. People with annual incomes less than $50,000 were significantly more likely to say they are less inclined to buy a house than people with higher incomes.
"The current economic situation has greatly changed the dynamics of the housing market," said Stephanie Rahlfs, an attorney and editor with FindLaw.com. "Although mortgage rates are near record lows, stricter lending requirements are often making it more difficult for many people to obtain mortgages. High unemployment rates are raising concerns about housing appreciation, affordability and foreclosures. Together, these factors are causing many people to shy away from the idea of buying a house. Buying a home, selling a home and owning a home are all becoming more complicated, and it's important to know the ins and outs of contracts, finances and your rights as a buyer, seller or owner."
Free Internet resources such as the FindLaw Real Estate center (http://realestate.findlaw.com/) can provide helpful information on buying, selling and owning a home, including obtaining a loan, borrowers' rights, finding the best mortgage, homeowners' rights, avoiding foreclosure and more. It also has useful information for renters, including negotiating a lease, tenants' rights, and fair housing and discrimination laws.
The FindLaw.com survey was conducted using a demographically balanced telephone survey of 1,000 American adults and has a margin of error of plus-or-minus 3 percent.
Sixty-three percent of American adults say they are less likely to buy a house because of the current state of the economy. Despite record-low mortgage rates and an abundance of houses available on the market, only 8 percent of people say the current economic situation makes them more likely to buy a house. About a quarter of people – 28 percent – say they are neither more likely nor less likely to buy a house because of the economy.
In particular, the current economy is driving lower-income individuals and families out of the market. People with annual incomes less than $50,000 were significantly more likely to say they are less inclined to buy a house than people with higher incomes.
"The current economic situation has greatly changed the dynamics of the housing market," said Stephanie Rahlfs, an attorney and editor with FindLaw.com. "Although mortgage rates are near record lows, stricter lending requirements are often making it more difficult for many people to obtain mortgages. High unemployment rates are raising concerns about housing appreciation, affordability and foreclosures. Together, these factors are causing many people to shy away from the idea of buying a house. Buying a home, selling a home and owning a home are all becoming more complicated, and it's important to know the ins and outs of contracts, finances and your rights as a buyer, seller or owner."
Free Internet resources such as the FindLaw Real Estate center (http://realestate.findlaw.com/) can provide helpful information on buying, selling and owning a home, including obtaining a loan, borrowers' rights, finding the best mortgage, homeowners' rights, avoiding foreclosure and more. It also has useful information for renters, including negotiating a lease, tenants' rights, and fair housing and discrimination laws.
The FindLaw.com survey was conducted using a demographically balanced telephone survey of 1,000 American adults and has a margin of error of plus-or-minus 3 percent.
Friday, October 22, 2010
Fannie Mae Announces New Incentives for HomePath Properties
Fannie Mae announced a seller assistance incentive on Fannie Mae-owned properties listed on the company’s REO website, www.HomePath.com, and expands the initiative to offer an incentive to real estate agents and brokers. Qualified homebuyers who will be owner-occupants can receive up to 3.5 percent of the final sales price that can be used toward closing cost assistance, including a home warranty, if desired and available. In addition, selling agents representing owner-occupants will receive a $1,500 bonus. Eligible offers must be submitted on or after September 23, 2010, and must close by December 31, 2010. The sale must close within 60 days of the offer being accepted.
“More than eighty-seven thousand families have purchased HomePath® properties in the first half of 2010—nearly double the number of Fannie Mae foreclosed properties sold in the first half of 2009,” said Terry Edwards, Executive Vice President of Fannie Mae’s Credit Portfolio Management. “We continue to look for ways to stabilize neighborhoods and offer incentives to qualified buyers who will occupy these properties over the long-term and help support their communities."
HomePath properties are owned by Fannie Mae and include a wide selection of homes, including single-family homes, condominiums, and town houses. HomePath properties may also be eligible for special HomePath Mortgage and HomePath Renovation Mortgage financing.
“More than eighty-seven thousand families have purchased HomePath® properties in the first half of 2010—nearly double the number of Fannie Mae foreclosed properties sold in the first half of 2009,” said Terry Edwards, Executive Vice President of Fannie Mae’s Credit Portfolio Management. “We continue to look for ways to stabilize neighborhoods and offer incentives to qualified buyers who will occupy these properties over the long-term and help support their communities."
HomePath properties are owned by Fannie Mae and include a wide selection of homes, including single-family homes, condominiums, and town houses. HomePath properties may also be eligible for special HomePath Mortgage and HomePath Renovation Mortgage financing.
Thursday, October 21, 2010
Fewer Homes Pushed into Foreclosure
Big banks pushed fewer U.S. households into foreclosure for the seventh consecutive month in August, a real estate firm reported, though repossessions of properties already ensnared in the process hit a record.
The continued convergence of the two trends — fewer notices of default filed on homes but more properties sold at courthouse steps — indicates that major lenders are meting out foreclosures in a systematic way so as not to flood the housing market with a wave of steeply discounted properties, RealtyTrac said.
RealtyTrac Chief Executive James J. Saccacio called the trends "a clear indication that the clogged foreclosure pipeline is being carefully managed on both ends by lenders and servicers."
A total of 94,469 properties received default notices in August, a 1 percent decrease from July and a 30 percent decrease from August 2009. On the other end of the process, lenders seized 95,364 properties in August, the highest monthly total in the history of RealtyTrac's report, an increase of 3 percent from July and a 25 percent jump from August 2009.
Lenders are working through a backlog of properties that developed last year after many foreclosures were frozen by moratoriums and slowed by trial mortgage modification attempts.
(c) 2010, Los Angeles Times.
The continued convergence of the two trends — fewer notices of default filed on homes but more properties sold at courthouse steps — indicates that major lenders are meting out foreclosures in a systematic way so as not to flood the housing market with a wave of steeply discounted properties, RealtyTrac said.
RealtyTrac Chief Executive James J. Saccacio called the trends "a clear indication that the clogged foreclosure pipeline is being carefully managed on both ends by lenders and servicers."
A total of 94,469 properties received default notices in August, a 1 percent decrease from July and a 30 percent decrease from August 2009. On the other end of the process, lenders seized 95,364 properties in August, the highest monthly total in the history of RealtyTrac's report, an increase of 3 percent from July and a 25 percent jump from August 2009.
Lenders are working through a backlog of properties that developed last year after many foreclosures were frozen by moratoriums and slowed by trial mortgage modification attempts.
(c) 2010, Los Angeles Times.
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