Mortgage Rates Hit Record Lows for 3 Consecutive Weeks

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Over the past several weeks, Freddie Mac has reported the average 30-year fixed mortgage rate dropping to record lows, all the way down to 3.03%.  Last week’s reported rate reached the lowest point in the history of the survey, which dates back to 1971 (See graph below):best mortgage rates today Zimmerman, down payment assistance Elk River, down payment assistance Ramsey, down payment assistance Ramsey MN, down payment assistance Zimmerman, Fannie Mae home loans Ramsey

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What does this mean for buyers?

This is huge for homebuyers.  Those currently taking advantage of the increasing affordability that comes with historically low-interest rates are winning big.  According to Sam Khater, Chief Economist at Freddie Mac:

“The summer is heating up as record low mortgage rates continue to spur homebuyer demand.”

In addition, move.com notes:

“Summer home buying season is off to a roaring start. As buyers flooded into the market, realtor.com® monthly traffic hit an all-time high of 86 million unique users in June 2020, breaking May’s record of 85 million unique users. Realtor.com® daily traffic also hit its highest level ever of 7 million unique users on June 25, signaling that despite the global pandemic buyers are ready to make a purchase.”

Clearly, buyers are capitalizing on today’s low rates.  As shown in the chart below, the average monthly mortgage payment decreases significantly when rates are as low as they are today.

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A lower monthly payment means savings that can add up significantly over the life of a home loan.  It also means that qualified buyers may be able to purchase more home for their money.  Maybe that’s a bigger home than what they’d be able to afford at a higher rate, an increasingly desirable option considering the amount of time families are now spending at home given today’s health crisis.

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If you’re in a position to buy a home this year, let’s connect to initiate the process while mortgage rates are historically low.

For a hassle-free consultation, contact DJ Riley at United Family Mortgage in Elk River at 763-276-3960.

Be a Better Buyer: Ramp Up Your Homeownership Knowledge

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We’ve all heard it before — financial literacy and education is key to helping us become more prepared homebuyers. But, the internet is a big place. So, where do you begin? What experts should you follow?

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We pulled together a shortlist of resources recently highlighted at an Urban Institute seminar about Barriers to Accessing Homeownership.  Whether you want a person to be your guide or favor online tools, you’ll find something that fits your needs in this line-up.

Consumer Financial Protection Bureau (CFPB)

Did you know that data shows mortgage shopping can lead to an improved mortgage rate or solution? Before you make an offer on a home, check out the CFPB’s guide for owning a home, including resources on preparing to home shop and exploring loan choices. The CFPB also has a loan estimate explainer to help you navigate estimates from different lenders.

You can also learn about special loan programs for which you may qualify by contacting DJ Riley at United Family Mortgage in Elk River at 763-276-3960.

The CFPB includes information about HUD-approved housing counselors who can provide advice on buying a home, renting, defaults, foreclosures, and credit issues. Search for one in your area.

NeighborWorks America

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If you are interested in a personal guide to help you prepare for homeownership, NeighborWorks can help you locate services in your area.  Their counselors are knowledgeable about homeownership programs. In fact, 83 percent of their buyers use some type of down payment assistance with their loans.  You can also check out their homebuyer tips.

Credit Smart curriculum

The CreditSmart curriculum, offered by Freddie Mac, includes financial education modules on credit, money management, homeownership, foreclosure avoidance, and more. The 12-module curriculum is available in five different languages, including English, Spanish, Chinese, Korean, and Vietnamese. Organizations can offer this curriculum in community settings or individuals can complete it online.

Better Money Habits

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Some lenders are introducing their own educational content. In partnership with Khan Academy, Bank of America has a financial education curriculum with 10 different categories.  The homeownership segment goes over budgeting, questions to ask lenders, credit score, and much more.

Trusted Advisors

In addition to online tools, cultivate a group of trusted advisors you can turn to during this process.  DJ Riley at United Family Mortgage in Elk River is an expert in down payment assistance programs in our area.  Contact DJ directly at 763-276-3960.

Learn more about the latest research on homeownership barriers and what the industry is doing to help.  Watch the full Urban Institute Seminar below.

 

Get Help with Down Payment Assistance

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Down payment help sounds great, but how does it actually work?  What process should you follow?

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While down payment programs vary greatly by state and community, there are some universal steps that will help you stay on track if a homeownership program is part of your home financing plan.  Let’s look at how it worked for one Florida buyer highlighted in Business Insider.

One buyer’s story

Willy Harris, 24, and his girlfriend used a Florida first-time homebuyer program to purchase a $204,000 new construction home in Jacksonville, FL. The program allows first-time homebuyers within the qualified income and purchase-price limits to receive up to $15,000 in secondary financing toward down payment and closing costs.  If the homebuyer lives in the home for five years, the secondary loan is forgiven. Harris used an FHA home loan that required a 3% down payment.

They put down a $1,000 deposit to reserve the lot, while the grant covered their $7,750 closing costs and $6,150 down payment.  The remaining amount of the grant went toward the principal of the home loan.  Because they put 3% down, they also paid a monthly mortgage insurance premium of $109.  Their first mortgage payment is currently $1,503 a month.

Harris recommends setting up a budget and savings plan and researching programs that can give you a boost.

 

Similar Down Payment Assistance Programs are available in Sherburne County and throughout Minnesota.

 

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Follow these steps to get the most of using a homeownership program:

• Do some upfront homework.  Research local homeownership education and counseling resources that can help you with the process.

• Determine your budget.  Figure how big a monthly mortgage payment you can afford on your salary. Don’t forget that your mortgage payment may include taxes and insurance too which you can estimate.

• Create a savings plan. Build a spreadsheet (or use an app) to track your expenses.

• Research down payment assistance programs in your area. Contact the agency offering the program or a homeownership counselor who can help you with the process.

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• Both the buyer and the home must qualify for the assistance. Find out the home price limits and any community or neighborhood boundaries for the program that may impact your home search. Find out if you can use the program on new construction.

• Get a list of participating lenders for the homeownership program, available on the program provider’s website. Not all lenders offer every program.

• Get prequalified for a loan so you can review the numbers and make an educated decision on the type of financing.

• Compare offers and ask lenders about any other programs for which you may qualify. You may even be able to layer programs, for example down payment assistance plus a tax credit.

• Review mortgage insurance options with your lender.

• Complete homebuyer education courses that are often required when using a down payment assistance program.

• Ask about your options for using the funds. Can they be used for down payment or closing costs, or both?

VA Loans: A Home for the Brave

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Since the creation of the Veterans Affairs (VA) Home Loans Program, over 22 million veterans have achieved the American Dream of homeownership. Many veterans do not know the details of the program and therefore do not take advantage of the benefits available to them.

If you are a veteran or you know someone who is, here is a breakdown of the VA Home Loan benefits that can be used to achieve the American Dream!

Top 5 Benefits of a VA Home Loan

  1. The greatest benefit of a VA Loan is that borrowers can buy a home with a 0% down payment.In 2016, 82% of all VA Loans put down 0%!

 

  1. Private Mortgage Insurance (PMI) is not required! (Most other loans with down payments under 20% require PMI, which adds additional costs to your monthly housing expense!)

 

  1. Credit Score requirements are also lower for VA Home Loans. The average FICO®score of a borrower for an approved VA Loan is 620, compared to 676 (FHA) or 753 (Conventional).

 

  1. There is also a limitation on a veteran buyer’s closing costs.Sellers can pay all of a buyer’s loan-related closing costs and up to 4% in concessions in some cases.

 

  1. Even with interest rates rising, VA Loans continue to have the lowest average interest rates of all loan types.

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One of the most important first steps when applying for a VA Home Loan is obtaining your Certificate of Eligibility (COE). “The COE verifies to the lender that you are eligible for a VA-backed loan.”

You Can Apply for a VA Loan if You:

  • Serve 90 consecutive days during wartime
  • Serve 181 consecutive days during peacetime
  • Have more than 6 years in the National Guard or Reserves
  • Are the spouse of a service member who has died in the line of duty or as the result of a service-related disability

You Can Use a VA Loan To:

  • Purchase a Home
  • Purchase a Condo
  • Build a Home
  • Refinance an existing home loan
  • Make improvements to a home by installing energy-related features or making energy-efficient improvements

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Bottom Line

For more information or to find out if you or a loved one would qualify to use the VA Home Loan Benefit, let’s get together! Thank you for your service!

 

 

For a Hassle-Free consultation with United Family Mortgage on: Home Refinancing, First-Time Home Buyer Mortgage, Zero-Down Mortgage, Home Construction Loan or VA Home Loan, contact DJ Riley today at 763-276-3960 or via email djriley@unitedfamilymortgage.com

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*Re-posted by: https://www.mykcm.com/2018/07/04/va-loans-making-a-home-for-the-brave-possible/

5 Reasons to Sell This Winter

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Below are five compelling reasons to list your house this winter.

1. Demand Is Strong

The latest Buyer Traffic Report from the National Association of Realtors (NAR) shows that buyer demand remains strong throughout the vast majority of the country. These buyers are ready, willing, and able to purchase, and are in the market right now. More often than not, in many areas of the country, multiple buyers are competing with each other to buy the same home.

Take advantage of the buyer activity currently in the market. VA home loan Elk River, VA home loan Monticello, VA home loan Ramsey, VA home loan Zimmerman, veteran home loan Elk River, veteran home loan Ramsey, veteran home loan Zimmerman, home construction loans Elk River, home construction loans Monticello, home construction loans Ramsey, home construction loans Zimmerman

  1. There Is Less Competition Now

Inventory is still under the 6-month supply needed for a normal housing market. This means in the majority of the country, there are not enough homes for sale to satisfy the number of buyers in the market.

Historically, a homeowner would stay an average of six years in his or her home. Since 2011, that number has hovered between nine and ten years. There is a pent-up desire for many homeowners to move as they were unable to sell over the last few years due to a negative equity situation. As home values continue to appreciate, more and more homeowners will be given the freedom to move.

Many homeowners were reluctant to list their homes over the last couple of years, for fear they would not find a home to move into. That is all changing now as more homes come to the market at the higher end. The choices buyers have will continue to increase. Don’t wait until additional inventory comes to market before you decide to sell.

  1. Buyers Are Serious at This Time of Year

Traditionally, homeowners think about spring as a great time to list their homes, when more buyer traffic may be out there actively searching. In the winter the buyers who are seeking a home, whether for relocation or whatnot, are serious about buying a home. They’re ready to make offers and they’re eager to move, often quickly. Your house may be exactly what they’re looking for, so listing when other potential sellers are holding off may be your best opportunity to shine.  mortgage broker Albertville, mortgage broker big lake, mortgage broker Elk River, mortgage broker Monticello, mortgage broker Otsego, mortgage broker Ramsey, mortgage broker rogers, mortgage broker St. Michael, mortgage broker Zimmerman, veteran home loan Elk River, veteran home loan Ramsey, veteran home loan Zimmerman

  1. There Will Never Be a Better Time to Move Up

If your next move will be into the premium or luxury market, now is the time to move up. There is currently ample inventory for sale at higher price ranges. This means if you’re planning on selling a starter or trade-up home and moving into your dream home, you’ll be able to do that now. Demand for your entry-level home is high, and inventory in the luxury or premium market is too.

According to CoreLogic, prices are projected to appreciate by 5.6% over the next year. If you are moving to a higher-priced home, it will wind up costing you more in raw dollars (both in down payment and in your mortgage) if you wait.

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Look at the reason you decided to sell in the first place and determine whether it’s worth waiting. Is money more important than being with family? Are you ready to go on with your life the way you think you should?

Only you know the answers to these questions. You have the power to take control of the situation by putting your home on the market this winter. Perhaps the time has come for you and your family to move on and start living the life you desire.

That is what is truly important.

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For a Hassle-Free consultation with United Family Mortgage on: Home Refinancing, First-Time Home Buyer Mortgage, Zero-Down Mortgage, Home Construction Loan or VA Home Loan, contact DJ Riley today at 763-276-3960 or via email djriley@unitedfamilymortgage.com.

 

*Re-posted by: https://www.mykcm.com/2019/12/02/5-reasons-to-sell-this-winter-3/

A Rent Payment is Your Landlord’s Mortgage Payment

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What is going to come out our your wallet this year? Your mortgage payment or your landlord’s?

There are some people who haven’t purchased homes because they are uncomfortable taking on the obligation of a mortgage. However, everyone should realize that unless you are living with your parents rent-free, you are paying a mortgage – either yours or your landlord’s.

As Entrepreneur Magazine, a premier source for small business explained in their article, “12 Practical Steps to Getting Rich”:

“While renting on a temporary basis isn’t terrible, you should most certainly own the roof over your head if you’re serious about your finances. It won’t make you rich overnight, but by renting, you’re paying someone else’s mortgage. In effect, you’re making someone else rich.”

With home prices rising, many renters are concerned about their house-buying power. Mike Fratantoni, Chief Economist at MBAexplained:

“The spring homebuying season is almost upon us, and if rates stay lower, inventory continues to grow, and the job market maintains its strength, we do expect to see a solid spring market.”

As an owner, your mortgage payment is a form of ‘forced savings,’ which allows you to build equity in your home that you can tap into later in life. As a renter, you guarantee the landlord is the person building that equity.

As mentioned before, interest rates are still at historic lows, making it one of the best times to secure a mortgage and make a move into your dream home. Freddie Mac’s latest report shows that rates across the country were at 4.46% last week.

Bottom Line

Whether you are looking for a primary residence for the first time or are considering a vacation home on the shore, now may be the time to buy.

For a hassle-free first-time home buyer mortgage consultation, contact DJ Riley today at 763-276-3960  or via email @ djriley@unitedfamilymortgage.com

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One More Time… You Do Not Need 20% Down to Buy a Home

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3% down payment and for some borrowers, ZERO down payment options are available!

The largest obstacle renters face when planning to buy a home is saving for a down payment. This challenge is amplified by rising rents, which has eaten into the amount of money renters have leftover for savings each month after paying expenses.

In combination with higher rents, survey after survey has shown that non-homeowners (renters and those living rent-free with family or friends) believe they need to save upwards of 20% for their down payment!

According to the “Barriers to Accessing Homeownership” study commissioned in partnership between the Urban Institute, Down Payment Resource, and Freddie Mac, 39% of non-homeowners and 30% of those who already own a home believe they need more than a 20% down payment.

The percentage of those who are aware of low down payment programs (those under 5%) is surprisingly low at 12% for non-homeowners and 13% for homeowners.

In a recent Convergys Analytics report, they found that 49% of renters believe they need at least a 20% down payment.

The median down payment on loans approved in 2018 was only 5%!  Those waiting until they have over 20% may already have enough saved to buy now!

There are over 45 million millennials (33%) who are mortgage ready right now, meaning their income, debt, and credit scores would all allow them to qualify for a mortgage today!

Bottom Line

If your five-year plan includes buying a home, let’s get together to determine what it will take to make that plan a reality. You may be closer to your dream than you realize!

For a hassle-free first-time home buyer mortgage consultation, contact DJ Riley today at 763-276-3960  or via email @ djriley@unitedfamilymortgage.com

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Paying Rent = Paying Your Landlord’s Mortgage

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What is going to come out our your wallet this year? Your mortgage payment or your landlord’s?

There are some people who haven’t purchased homes because they are uncomfortable taking on the obligation of a mortgage. However, everyone should realize that unless you are living with your parents rent-free, you are paying a mortgage – either yours or your landlord’s.

As Entrepreneur Magazine, a premier source for small business explained in their article, “12 Practical Steps to Getting Rich”:

“While renting on a temporary basis isn’t terrible, you should most certainly own the roof over your head if you’re serious about your finances. It won’t make you rich overnight, but by renting, you’re paying someone else’s mortgage. In effect, you’re making someone else rich.”

With home prices rising, many renters are concerned about their house-buying power. Mike Fratantoni, Chief Economist at MBAexplained:

“The spring homebuying season is almost upon us, and if rates stay lower, inventory continues to grow, and the job market maintains its strength, we do expect to see a solid spring market.”

As an owner, your mortgage payment is a form of ‘forced savings,’ which allows you to build equity in your home that you can tap into later in life. As a renter, you guarantee the landlord is the person building that equity.

As mentioned before, interest rates are still at historic lows, making it one of the best times to secure a mortgage and make a move into your dream home. Freddie Mac’s latest report shows that rates across the country were at 4.46% last week.

Bottom Line

Whether you are looking for a primary residence for the first time or are considering a vacation home on the shore, now may be the time to buy.

For a hassle-free first-time home buyer mortgage consultation, contact DJ Riley today at 763-276-3960  or via email djriley@unitedfamilymortgage.com

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NO MONEY DOWN VA MORTGAGE FOR VETERANS

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Buying Is Now 26.3% Cheaper Than Renting in the US

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The results of the latest Rent vs. Buy Report from Trulia show that homeownership remains cheaper than renting, with a traditional 30-year fixed rate mortgage, in 98 of the 100 largest metro areas in the United States.

In the six years that Trulia has conducted this study, this is the first time that it was cheaper to rent than buy in any of the metropolitan areas.

It’s no surprise, however, that those two metros are San Jose and San Francisco, CA, where median home prices have jumped to over $1 million dollars this year. Home values in San Jose have risen 29% in the last year, while rents have remained relatively unchanged.

For the 98 metros where homeownership wins out, 97 of them show a double-digit advantage when buying. The range is an average of 2.0% less expensive in Honolulu (HI), all the way up to 48.9% in Detroit (MI), and 26.3% nationwide!

Below is a map of the 100 metros that were studied. The darker the blue dot on the metro, the cheaper it is to buy there.

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In order to calculate the true cost of renting vs. buying, Trulia includes all assumed renting costs, including one-time costs (like security deposits), and compares them to the monthly costs of owning a home (insurance, mortgage payments, taxes, and maintenance) including one-time costs (down payments, closing costs, sale proceeds). They also assume that households stay in their home for seven years, put down a 20% down payment, and take out a 30-year fixed rate mortgage. The full methodology is included with the study results here.

Below is a chart created with the data from the last six years of the study, showing the impact of the median home price, rental price, and 30-year fixed rate interest rate used to calculate the ‘cheaper to buy’ metric.

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In 2016, when buying was 41.3% less expensive than renting, the average mortgage rate was the driving force behind the difference. Rates this year are the highest they have been in six years which has narrowed the gap, all while home price appreciation has also been driven up by a lack of homes for sale.

Cheryl Young, Trulia’s Chief Economist, had this to say,

“One point deserves emphasizing: The ultra-costly San Francisco Bay Area is not a harbinger for the nation as a whole. While renting may outweigh buying in San Jose and San Francisco, it is unlikely that renting will tip the scales nationally anytime soon.”

Bottom Line

Homeownership provides many benefits beyond the financial ones. If you are one of the many renters out there who would like to evaluate your ability to buy this year, let’s get together to find your dream home.

To schedule a hassle-free mortgage consultation, contact DJ Riley today at 763-276-3960, or via email @ djriley@unitedfamilymortgage.com.

The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. Keeping Current Matters, Inc. does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. Keeping Current Matters, Inc. will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.