All opinions are those of Michael Haigh or the Guest Blogger featured.
They do not necessarily reflect the opinions of W.J. Bradley Mortgage Capital, LLC
If you are considering applying for a refinance, it is important to understand the mechanics of your mortgage loan. Before you sit down to speak with your loan officer, you should consider preparing a list of questions you feel may need to be answered.
Typically, your loan officer will be available to assist through the entire mortgage process. Here are some questions that you may need to get answers to before completing your application:
1. What Type Of Loan Is Best For Me?
Your loan officer can discuss the various loan programs available to help you refinance. Some borrowers will benefit greatly from adjustable rate mortgages while others prefer fixed rate. However, other borrowers may find a fixed rate is the best option. Discuss various loan terms such as 30-year or 20-year mortgage loans.
2. What Documents Are Required?
Be prepared to provide your loan officer with several documents. The most common documents include pay stubs, bank statements and tax returns. Loan officers will also need a complete list of debts including auto payments, credit card payments and student loans.
3. What Costs Are Involved?
Prior to a loan closing you will be required to pay some costs up front. These may include appraisal fees, credit report fees and application fees.
Discuss all these costs with the loan officer to determine how much money will be required prior to the loan being approved. In addition, discuss any funds that will be required to complete the loan closing.
4. Can I Select My Own Appraiser?
When you apply for a refinance loan, lenders will require a property appraisal. Lenders typically maintain a list of approved appraisers and supply those lists to the loan officers. Typically, the loan officer will assign an appraiser to review the property. Borrowers generally have no input regarding the choice of appraisers.
5. When Will I Get A Good Faith Estimate?
Good Faith Estimates must be issued after you have completed your loan application. A second GFE is typically presented along with the HUD1 prior to closing. Keep in mind, the GFE is only an estimate of costs and that actual costs may be slightly higher or lower.
Never hesitate to ask your loan officer any questions you may have. The more questions you have addressed during the application process, the less likely you will be to be confused at the time of your mortgage closing.
Keep in mind, your loan officer is there to answer your questions and guide you through the entire loan process. For additional questions you should ask, check out tomorrow’s blog post.
According to the S&P Case-Shiller 10-and 20-City Housing Market Indices for September, home prices grew at an average of 13.30 percent year-over-year and achieved the highest growth rate for home prices since February 2006.
On a month-to month basis, home prices are slowing in most areas with 19 cities included in the S&P 20-City Housing Market Index showing lower rates of growth in home prices. September’s average month-to-month growth rate was 1.0 percent for the 20-City HMI as compared to 0.90 percent in August, and 1.90 percent posted earlier in 2013.
Home prices increased by 0.70 percent in September for the combined 20-City and 10-City Housing Market Indices tracked by Case-Shiller.
Rapidly Rising Home Prices In The West: Another Housing Bubble On Tap?
Home prices continued rising in the West, with Las Vegas leading the pack with a 29.10 percent gain year-over-year although average home price in Las Vegas, Nevada remains 46 percent than its peak in February of 2006.
California also showed double-digit year-over-year growth for home prices with San Francisco at 25.70 percent, Los Angeles at 21.80 percent and San Diego posting 20.90 percent growth in home prices year-over-year.
Rapidly increasing home prices in the West are largely due to demand exceeding supply, but buyers may be sitting on the sidelines due to concerns over another housing bubble in the making.
Buyers in this scenario are aware of increasing home prices, but aren’t buying now to avoid higher prices later. Instead they are waiting to see what happens with current home prices and housing market conditions in the longer term.
Chicago, Illinois posted its highest year-over-year growth rate since 2005 while Cleveland, Ohio posted a growth rate of 5.00 percent for September as compared to a month-to-month growth rate of 3.70 percent.
This was the second lowest month-to-month growth rate for home prices, with New York City posting a month-to-month home price growth rate of 4.00 percent from August to September.
FHFA Reports Slight Gain In Home Prices
The Federal Housing Finance Agency reported stronger gains in home prices for properties financed with mortgages owned or guaranteed by Fannie Mae or Freddie Mac. In September, home prices reported by FHFA rose by 0.30 percent as compared to August’s growth rate of 0.40 percent.
On a year-over-year basis, FHFA reported a gain of 8.40 percent between the third quarter of 2012 and the third quarter of 2013. Adjusted for inflation, home prices as reported by FHFA have risen approximately 7.20 percent. FHFA noted that home prices are growing at a rate far above the rate of 1.20 percent reported for other “goods and services.”
Lower numbers of foreclosed homes are seen as a boost for home prices in general; as mortgage lenders tend to offer foreclosed homes for sale at low prices in order to reduce inventories of real estate owned.
The short holiday week brought a flurry of economic reports last week. Highlights included pending home sales, the S&P Case-Shiller Housing Market Indices and the FHFA home price index. No reports were released on Thursday and Friday in observance of the Thanksgiving holiday.
The NAR released its Pending Home Sales report for October. Although pending home sales dropped by -0.60 percent, the decline was less than September’s reading of -4.60 percent.
NAR cited higher home prices and mortgage rates along with concerns over the then-pending government shutdown as factors that contributed to fewer pending sales. Pending sales are determined by signed purchase contracts and are considered an indication of future completed home sales and mortgage loan closings.
Department of Commerce reported that building permits issued increased from 974,000 in September to 1.03 million for October. Permits for multi-family dwellings rose by 17 percent from September, but permits for single-family homes rose by 1.00 percent.
A lagging supply of available single-family homes has been driving home prices up as demand also increases. The multi-family reading reflected the sector’s volatile nature and was largely concentrated in the West.
Case-Shiller And FHFA Report Higher Year-Over-Year Average Home Prices
The S&P Case-Shiller 20-City Housing Market Index for September reported its highest year-over-year gain in seven years, but the month-to-month reading was lower. The year-over-year reading was 13.30 percent in September and the month-to-month reading showed lackluster growth at 0.70 percent.
When seasonally adjusted, September’s reading was 1.00 percent against the seasonally-adjusted August reading of 1.90 percent.
In addition to the then-looming government shutdown, concerns over rapidly rising home prices in the West may have caused would-be buyers to sit on the sidelines as fears of another “housing bubble” gained traction.
Rising home prices also impact affordability and impact the ability of buyers depending on mortgage loans to compete with cash buyers.
The Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac, issued its housing market index report for September. Based on sales of homes financed with Fannie Mae or Freddie Mac-owned mortgages, FHFA’s report indicated that year-over-year home prices at an annual rate of 8.50 percent in September as compared to August’s year-over-year reading of 8.40 percent.
Economists noted that the increase of home prices is slowing due to a number of factors including higher mortgage rates and restrictive lending policies that are making it more difficult for buyers to purchase homes.
Analysts said that next year could bring a more sustainable rate of home appreciation with year-over-year readings averaging between five and eight percent.
Freddie Mac issued its weekly Primary Mortgage Market Survey on Wednesday; average mortgage rates for 30 and 15 year mortgages rose to 4.29 percent and 3.30 percent respectively.
Discount points for fixed rate mortgages were unchanged at 0.70 percent. The average rate for a 5/1 adjustable rate mortgage dropped by one basis point to 2.94 percent with discount points unchanged at 0.50 percent.
This week’s scheduled economic reports include Construction Spending, ADP Employment, New Home Sales and the Fed’s Beige Book. The Bureau of Labor Statistics will release its Non-farm Payrolls report and the national unemployment rate.
Weekly jobless claims and Freddie Mac’s Primary Mortgage Market Survey will be released as usual on Thursday.
The calendar has turned and with that we receive less sunlight, colder temperatures, and shorter days ahead, it’s an opportune time to cross those last-minute maintenance items off your homeowner to-do list.
Practicing preventive care – both inside and outside your home – can save thousands of dollars in repairs come later this winter. What follows is a brief checklist to get you started.
For Outside The Home:
- Inspect exterior lights and outlets. Be sure that none of the outlets are cracked or broken, or have exposed wires.
- Clean gutters and clear all blockages. If leaves are falling, redo after leaves are off all trees.
- Inspect and test outdoor railings and stairs.
- Have problem trees trimmed, including those that may damage your home in a storm.
- Protect outdoor water faucets from freezing. Consider using foam cups, sold at hardware stores.
For Inside The Home:
- Change batteries in all smoke detectors and carbon monoxide alarms, whether they’re “dead” or not.
- Vacuum refrigerator condenser coils, plus the front bottom grill. Empty and clean the drip pan.
- Inspect wood stoves and fireplace inserts. Hire a certified chimney sweeper to clean the chimney, if needed.
- Insulate bare water pipes running through your home to prevent freezing and to limit condensation on cold-water lines.
- Inspect automatic garage door opener. Lubricate chains according to manufacturer’s instructions. Make sure bolts and screws are properly tightened and secured.
As a constant series of chores, home maintenance is a four-season job and one which should not be taken lightly. The tasks of each season are unique and this month is mostly preparatory in advance of colder weather.
If your routine maintenance uncovers larger issues including a faulty HVAC unit, or a leaking faucet, for example, seek professional help to make the repair.
“There’s always something to be thankful for. If you can’t pay your bills, you can be thankful you’re not one of your creditors” – Author Unknown
With Thanksgiving being tomorrow, I find myself thinking about everything I have to be thankful for. For instance, I’ve been a real estate agent for some time, which is a position that I enjoy and love.
What Am I Grateful For?
I’m also grateful to be able to share the knowledge that I’ve learned throughout the years with my clients and those of you who read my blog. It’s a wonderful and rare thing to do something that you love for a living.
Most of us are so busy reaching our goals, making plans for the future, pushing and struggling to rise to wherever we feel our position in life should be, that we very rarely take the time to look back at where we started.
While it’s always a good idea to have goals, to visualize and work towards them, if you never take the time to appreciate what you’ve done then it becomes a constant, maddening race to the finish line. Intangible things, such as happiness and satisfaction, fall by the wayside, considered unimportant in the grand scheme of things.
What Do I Savor?
With Thanksgiving drawing closer, this real estate agent invites you to think about what you have to be thankful for. Whether big or small, you’ll find yourself savoring all the good things in your life.
So what are some of the things that you’re grateful for? It doesn’t have to be a big thing to be appreciated. Was the sky particularly beautiful today?
Maybe you caught the bus on time, or you’re throwing the family Thanksgiving dinner this year and everyone is coming. If it brightens your life, brings a smile to your face, lightens your mood or warms your heart, be thankful for the experience.
Enjoy each moment as if it were your last, sipping from the cup of gratitude and appreciation; you may find that your heart is constantly filled with happiness. Your trusted real estate professional invites you to make every day Thanksgiving Day.
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