Rural Development Loans Just Got Better!

Rural Development Loans Just Got Better!

Mortgage Broker, Linda Sinacola (PLB Lending – 248.931.9600) just shared with me that mortgage insurance has dropped drastically on the new RD mortgages!  The upfront guarantee fee is now 1%, that’s down from 2% and the monthly mortgage insurance is now only .35% instead of .85%.

Many areas qualify for this 0 down financing in Oakland, Macomb, Lapeer and Genesee counties. In fact, all of Oxford and Lapeer County qualifies for this type of loan. Linda also stated that if you are a first time buyer, you should definitely check into this loan and see if it is available in your area.

If you have any questions or concerns, please contact myself at the numbers below or Linda Sinacola at the numbers above.

Donald Horne, Team Success Listing
Broker / Owner
Lapeer Office   810-338-0628
teamsuccesslisting@gmail.com
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Quicken Loans In Metamora Quietly Offers 1% Down Loans

so the client has 3 percent equity immediately…”

Quicken Loans has been fairly hush about its latest offering of a super low down payment mortgage, even as rival bank giants like Bank of America, Wells Fargo, and JPMorgan Chase all tout their new 3 percent down mortgage products. But late last year, Quicken Loans quietly began offering 1 percent down payment mortgages.

The program emerged from a partnership between Quicken and Freddie Mac in October 2015 and loans, metamora was structured to be part of Freddie Mac’s Home Possible Advantage program, which requires a 3 percent down payment.

However, Quicken Loans offers its customers a 1 percent down because it grants the extra money to the borrower, Bill Banfield, Quicken Loans’ vice president of capital markets, told HousingWire in an exclusive interview.

“We require 1 percent from consumer and we give the consumer a 2 percent grant, so the client has 3 percent equity immediately,” Banfield told HousingWire.

The 1 percent down-payment loans are available only for those purchasing a home and can only be used on a single-family home or condo (second home and investment properties or co-ops are not included). Borrowers also must have a FICO score of 680 or above and must earn less than the median income for their county. Their debt-to-income ratio must be 45 percent or less.

“We want to try to help people and do it in a smart way,” Banfield told HousingWire. “For us, it was really a question of if you want to provide access to credit, how do you do it responsibly? How can you help people? If first-time buyers are struggling, are there smart ways to help them while still balancing access to credit? … We wanted to have a conventional option to get people into more homes.”
References: RealtorMag, HousingWire 

Donald Horne, Team Success Listing
Associate Broker-Coldwell Banker Shooltz Realty
Oxford Office   248-969-8065
Lapeer Office   810-338-0628
teamsuccesslisting@gmail.com
Team Success Listing Website
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Credit Mistakes Potential Home Buyers In Lapeer Make

“Maintaining a strong credit score is one of the most important things potential buyers can do if they want to qualify for a mortgage” …

Maintaining a strong credit score is one of the most important things potential buyers can do if they want to qualify for a mortgage, since credit scores are used by lenders to measure financial health. A recent study showed that 34 percent of potential buyers believe their current score will hurt their future ability to purchase a home.

1. Don’t be late. Paying bills on time is essential, since a person’s payment history makes up 35 percent of the total credit score. A late bill payment of 30 to 60 days also gets reported to credit bureaus and stays on the credit report for a whopping seven years.

2. Applying for new credit. According the National Association of REALTORS®, applying and being approved for a new line of credit can cause concern with lenders who might take it as a sign that there’s a higher risk of default due to increased spending. Bottom line, if your potential buyers are planning to apply for a home loan in the near future, make sure they don’t apply for anything else around the same time, Yahoo! Finance warns. 

3. Having high balances. Just making minimum credit card payments isn’t good enough for most mortgage companies. People who hold high credit balances are not looked as favorable loan candidates since high balances and maxed out cards raises the debt-to-income ratio, according to lenders.

4. Too much disputing. While it’s a good idea to keep tabs on the credit report and dispute false charges, doing so too-often will be a red flag to lenders who may chalk it up to gaming the score instead.

5. Not having a credit history at all. Credit can’t be established if there’s none to begin with, so if your clients have a thin credit file, let them know they need to start building their history before applying for a home loan.
References: RealtorMag, Yahoo! Finance

Donald Horne, Team Success Listing
Associate Broker-Coldwell Banker Shooltz Realty
Oxford Office   248-969-8065
Lapeer Office   810-338-0628
donaldhorne.realtor@gmail.com
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In Lake Orion, Mortgage Applications Rose 2.3%

The Buyers Are Coming … Mortgage rates may have inched up slightly but that didn’t seem to deter home buyers from shopping for a loan last week.

Mortgage application volume rose 2.3 percent week-over-week on a seasonally adjusted basis, driven by an uptick in home purchase applications, the Mortgage Bankers Association reports. Mortgage applications are nearly 24 percent higher than they were a year ago.

lake orion mortgages After a short dip, mortgage applications for home purchases reversed course last week and rose 5 percent. Purchase applications are 17 percent higher than a year ago.

Purchase applications got back on track last week, resuming the level of activity observed throughout most of April and May,” says Lynn Fisher, MBA vice president of research and economics. MBA also reported that the average loan size for purchase applications rose to a survey high last week, reaching $307,700.

Meanwhile, applications for refinancings mostly held flat last week, budging just 0.4 percent during the week. MBA reports the average on a 30-year fixed-rate mortgage rose to 3.85 percent last week, up from 3.82 percent the prior week.
References: RealtorMag, CNBC

Donald Horne, Team Success Listing
Associate Broker-Coldwell Banker Shooltz Realty
Oxford Office   248-969-8065
Lapeer Office   810-338-0628
donaldhorne.realtor@gmail.com
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Mortgage Rates Drop To 3 Year Lows

The 30-year fixed-rate mortgage averaged 3.57 percent in the most recent week, the lowest average in three years, Freddie Mac reports in its weekly mortgage market survey.

“Disappointing April employment data once again kept a lid on Treasury yields, which have struggled to stay above 1.8 percent since late March,” says Sean Becketti, Freddie Mac’s chief economist. “As a result, the 30-year mortgage rate fell 4 basis points to 3.57 percent, a new low for 2016 and the lowest

mark in 3 years. Prospective home buyers will continue to take advantage of a falling rate environment that has seen mortgage rates drop in 14 of the previous 19 weeks.”

Freddie Mac reports the following national averages with mortgage rates for the week ending May 12:

  • 30-year fixed-rate mortgages: averaged 3.57 percent, with an average 0.5 point, dropping from last week’s 3.61 percent average. Last year at this time, 30-year rates averaged 3.85 percent.
  • 15-year fixed-rate mortgages: averaged 2.81 percent, with an average 0.5 point, falling from last week’s 2.86 percent average. A year ago, 15-year rates averaged 3.07 percent.
  • 5-year hybrid adjustable-rate mortgages: averaged 2.78 percent, with an average 0.5 point, a decrease from last week’s 2.80 percent average. Last year at this time, 5-year ARMs averaged 2.89 percent.
    References: RealtorMag, Freddie Mac

Donald Horne, Team Success Listing
Associate Broker-Coldwell Banker Shooltz Realty
Oxford Office   248-969-8065
Lapeer Office   810-338-0628
donaldhorne.realtor@gmail.com
Team Success Listing’s
Find Out Your Home’s Value

Closing Times Are Speeding Up

Closing Times Are Speeding Up

The average time to close on all mortgage loans dropped to 44 days in March, the shortest amount of time in a year, according to Ellie Mae’s latest Origination Insight Report.

New mortgage rules went into effect last October, pushing closing timelines from 46 days in October to 48 days in November and December, and then to 50 days in January. But lenders and real estate professionals have had time to adjust to the new rules, and closing times are speeding up again.

timeThe average time to close on a loan for a home purchase fell to 45 days in March, while closing times for refinancings dropped to 41 days. Times to close on FHA loans also fell to 44 days in March, while VA loans averaged 48 days to close.

What’s more, Ellie Mae’s report shows that the average closing rates for all loans continued to rise to the highest level since tracking began in 2011. Closing rates for all loans rose to 70.6 percent in March (closing rates on purchase loans was slightly over 75 percent). Ellie Mae calculates the closing rate on a 90-day cycle, since most loan applications require one-and-a-half to two months from application to close.

Sixty-seven percent of all closed loans had FICO scores above 700. The average credit score was 722. Only 12 percent of the closed loans had scores below 650, according to Ellie Mae’s report. The average loan-to-value ratio was 80 percent, and the average debt-to-income ratio remained constant at 25/38.
References: Mortgage News Daily, RealtorMag 

Donald Horne, Team Success Listing
Associate Broker-Coldwell Banker Shooltz Realty
Oxford Office   248-969-8065
Lapeer Office   810-338-0628
donaldhorne.realtor@gmail.com
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Surprising Ways To Save For A Down Payment

5 Surprising Ways To Save For A Down Payment

Saving for a down payment does not have to be an impossible feat for your would-be buyers. HouseLogic recently featured several resourceful ideas to help them save up for a down payment on a home.

Crowdsource

blogMaybe instead of a traditional wedding registry, your buyers use a site geared to saving up for their future home. Sites like Feather the Nest and Hatch My House can be sites used to raise funds for a down payment. Hatch My House says it’s helped raise more than $2 million in down payments on home purchases.

Ask for the sellers help.

The home seller may be willing to help buyers with the closing costs, via seller concessions. However, realize that lenders do limit concessions, depending on the mortgage type. For example, the FHA’s mortgages have a cap of 6 percent the sales price; Fannie Mae-backed loans have caps between 3 percent and 9 percent.

Explore government options.

Some home buyers may find down payment help from state, local, or even national programs. For example, the U.S. Department of Housing and Urban Development offers several programs, such as assistance with down payment and closing costs. Most HUD programs are geared to individuals who meet certain income or location requirements. Check out links by state. HUD also offers assistance through its Good Neighbor Next Door Sales Program for law enforcement officers, firefighters, teachers, or EMTs. For veterans, the VA offers loans that often require zero down payment or private mortgage insurance.

See if your employer will help.

Employer Assisted Housing (EAH) programs can assist low- to moderate-income employees with a down payment through their employer. Ask the human resources or benefits personnel at your employer if your company participates in an EAH program.

Look into special lender programs.

Some lenders offer specialized programs to help too. With FHA mortgages, borrowers may need just 3.5 percent for a down payment (but make sure they take into account mortgage insurance, which could add another $300 to a monthly mortgage payment). Some lenders, such as TD Bank, offer a 3 percent down payment with no mortgage insurance program. Check with your regional bank for possible down payment assistance or first-time buyer programs.
References: HouseLogic, RealtorMag, Daily Real Estate News

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Mortgage Closing Times Lengthen Again

The time to close on a mortgage loan is once again increasing. The average time in January climbed to 50 total days, up four days since the “Know Before You Owe” mortgage disclosure rules took effect in October, shows a new report released by Ellie Mae.

Over the past year, the average time to close on a loan has grown 10 days longer. In January 2015, the average time to close was 40 days, according to Ellie Mae’s report.

mortgage closing times lengthen againThe report also broke down average close times by type of loan:

  • Purchase loans: 51 days (up from 50 days)
  • Refinance loans: 48 days (up from 47 days)
  • Federal Housing Administration loans: 51 days (up from 49 days)
  • Conventional loans: 49 days (same)
  • Department of Veteran Affairs loans: 53 days (up from 52 days)

Ellie Mae’s report also showed that despite closing times climbing, conventional purchase closing rates reached a new high in January. Conventional purchase closing rates increased above 73 percent for the first time since Ellie Mae began its tracking in August 2011.

Also, Ellie Mae’s report showed the average FICO score was down last month, averaging 719 on closed loans (down from 722 in December). That is also the largest month-to-month drop in FICO scores since mid-2015, Ellie Mae notes.
References: HousingWire, RealtorMag, Daily Real Estate News

Donald Horne, Team Success Listing
Associate Broker-Coldwell Banker Shooltz Realty
Oxford Office   248-969-8065
Lapeer Office   810-338-0628
donaldhorne.realtor@gmail.com
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Home Buyer Rush? Mortgage Applications Surge!

Borrowers were undeterred by the highest interest rates in five months as mortgage applications for home purchases surged 12 percent in the latest week. Home purchase applications are now 19 percent higher than one year ago, the Mortgage Bankers Association reports.

“This was despite the fact that mortgage rates reached their highest level since July,” says Michael Fratantoni, chief economist for the MBA.

home buyer rushApplications for refinancings were also up for the week ending Nov. 13, with refinance applications rising 2 percent week-to-week. “What we are seeing is refinances increasing as we anticipate interest rates going up. It’s a great accelerator and motivator for many people,” says Jonathan Corr, CEO of Ellie Mae. “This month we saw the third consecutive month of refinance volume increases.”

Overall, MBA’s index measuring mortgage applications for refinancing and home purchases rose 6.2 percent on a seasonally adjusted basis last week.

MBA reports that the average rate on the 30-year fixed-rate mortgage was 4.18 percent last week, up from 4.12 percent the prior week.
References: Cnbc, RealtorMag, Daily Real Estate News

Donald Horne, Team Success Listing
Associate Broker-Coldwell Banker Shooltz Realty
Oxford Office   248-969-8065
Lapeer Office   810-338-0628
donaldhorne.realtor@gmail.com

Buying And Selling A Home At The Same Time

Ah, to be a first-time home buyer again: How easy it was to buy a home when you weren’t carrying another mortgage on your back!

If you’re looking to graduate from first-timer to repeat buyer, you know things are about to get much trickier. Unless you’re a bona fide house collector, you’ll have to sell your home in order to buy anew—adding a whole separate layer of anxiety to what you already know is a stressful home-buying process.

In an ideal world, you’d buy a new home, move, and then, and when all the dust settles, deal with the how to buy and sell a home at the same timeturmoil of selling. But for most people, that’s totally unrealistic. Not only does it cost significantly more, since you’ll be paying two mortgages, but sellers might be quick to judge if you’re holding on to your current home.

Drew Snyder, a Realtor® with Snyder Sutton Real Estate in Topanga, CA, says one of his clients had difficulty getting sellers to “take them seriously unless the house was on the market or in escrow. As soon as we put it on [the market], they were considered as serious buyers.”

You can do this! If selling and buying simultaneously is the only way to go, here’s what you need to know to make sure both processes go as smoothly as possible.

Know the market first

Before you start seriously searching for a new home—or put your current home on the market—make sure you have a solid understanding of the housing market in your area (and the area where you’re planning to buy). Is the market weighted toward buyers or sellers?

Only then will you be able to fully strategize. As is so often the case, the best plan of action may differ depending on exactly who has the power.

That doesn’t mean to find one house you like and call it a day: Find multiple suitable options. That way, you’re less likely to find yourself in trouble if your purchase falls through—your newly sold home won’t leave you stranded.

Similarly, make sure to hire an appraiser and price your old home fairly. Now is decidedly not the time for delusions of grandeur: Two extra months on the market because you couldn’t humble yourself to lower the price means two months you’ll be paying double mortgages. Two very long months…

Plan your schedule carefully…

Should you buy first, then sell—or vice versa? Both have their risks and rewards. Selling first makes getting a mortgage easier, but it also means you’ll need to find a temporary place to live. Buying first means moving will be easier, but it also skews your debt-to-income ratio, making it harder to qualify for a new mortgage—not to mention the difficulty of juggling two monthly house payments.

“It’s walking a tightrope,” says Gary DiMauro, a Realtor in New York’s Hudson Valley. And he’s not just talking about scheduling: Your finances will be on the highwire, too. When determining whether you should sell or buy first, think beyond “How can I make the move as easy as possible?” Instead ask: “Can I handle two mortgages? What if my home sells for less than its listing?”

Whichever option you choose, make sure you’re prepared to accept the consequences: having to store your stuff and rent temporarily, or undergoing the financial burdens of dual mortgages.

… but don’t rely on timing

When buying and selling a home simultaneously, “there are so many external circumstances,” says DiMauro. “I’ve yet to see it really work smoothly and efficiently.”

Remember: You’re not the only party in this equation. For every seller there’s a buyer, for every buyer a seller. While things might appear to be working smoothly when viewing your master plan from above, that doesn’t take into account the variabilities of other people. Closings are rife with delays. Your buyers might have difficulty securing their mortgage; your home inspector may bring up issues that need to be fixed before you can move in.

“You’re relying on the seller of the place that you’re buying to be ready to move in concert with the buyer of your house,” DiMauro says.

So even if you’ve planned to sell your home first and are prepared to rent while buying, know that even the best-laid plans go awry—and you might end up juggling both mortgages. Preparing yourself for this (however remote) possibility ahead of time will ensure a smooth transition.

Know your financial solutions

For those who choose to sell first, the process is relatively straightforward other than the additional cost of a rental between homes. However, there is the option of a rent-back agreement, where you negotiate with the lenders and buyers to be able to remain in the property for a maximum of 60 to 90 days—often in exchange for a lower selling price or rent paid to the buyers. This can relieve some of the pressure of finding a new home, giving you additional time to house hunt.

But if you’re buying first, talk to your Realtor about ways to decrease your financial burden and risk. Here are the two most popular options for buyers:

Contract contingency: Buyers can request that their new home purchase be dependent on the successful sale of their old home. If you’re looking in a competitive market, this may not be a good option; however, if the seller of your intended home has had difficulty attracting interest, this may be a good deal for all parties involved—assuming you can convince them that your home will sell quickly.

Bridge loans: Bridge financing allows you to own two homes simultaneously if you don’t have deep pockets for a second down payment. This option is especially attractive if you’d planned to sell your home first and use the proceeds to buy the second. It functions as a short-term loan, intended to be repaid upon the sale of your original house.

Don’t let fear rush you

If your home has sold but you haven’t found a new place to live, don’t let anxiety push you toward a bad decision. DiMauro usually recommends that his clients pre-emptively plan on a short-term rental “so they don’t feel stressed or pushed into something that they would not normally be interested in,” he says. “They shouldn’t make a purchase because they felt like they were pressured from the time constraints.”

Found the perfect home right on schedule? That’s great. But don’t feel like you have to compromise on things that are important to you just because you need to find a home. Conversely, don’t accept a bid that you feel is too low just because your finances are strained by two mortgages. If you have a temporary apartment set up, you’re less likely to compromise.

Certainly, selling and buying a house simultaneously will be stressful—but carefully considering and planning for the risks and hurdles can mitigate the stress.
References: Jamie Wiebe, Realtor.com, Housing Trends eNewsletter

Donald Horne, Team Success Listing
Associate Broker-Coldwell Banker Shooltz Realty
Search All Properties
Oxford Office   248-969-8065
Lapeer Office   810-338-0628