mortgage: The Dynamics of Home Equity - 03/16/22 09:07 AM
  Appreciation and amortization are key factors in building equity for homeowners with mortgages.  As the home goes up in value due to appreciation and the unpaid balance goes down due to amortization, the equity increases.
Appreciation is the increase in value of a home and is usually measured year over year.  In recent years, appreciation has been robust (19% nationwide in 2021) due to high demand and low inventory.  Many times, the news will quote annual appreciation rates from a national or regional level.
Occasionally, you may see a chart that tracks the annual appreciation over a period, but it is more interesting … (0 comments)

mortgage: Your Home is a Hedge Against Inflation - 01/17/22 07:57 PM
  The concern about inflation is the sustained upward movement in the overall price of goods and services while the purchasing value of money decreases.  Tangible assets like your home consistently become more valuable over time.  In inflationary periods, your home is a good investment and a hedge against inflation.
Money in the bank loses purchasing power due to inflation and the interest you may be earning is almost always less than inflation.
Home prices are going up but so is rent.  With mortgage rates near historic lows, the interest is, generally, less than the appreciation the property is enjoying.  Combine this with the leverage … (0 comments)

mortgage: Homeowner Equity and Wealth Accumulation - 03/30/21 03:22 PM
  National homeowner equity grew in the fourth quarter of 2020 by $1.5 Trillion or 16.2% year-over-year based on a CoreLogic analysis.  The study was done on the six out of ten homeowners who have mortgages on their home.
The fourth quarter of 2020 also saw the number of mortgaged residential homes with negative equity decrease by 8% from the third quarter.  Compared to the same quarter in 2019, negative equity decreased by 21%.
Equity is defined as the value of the home less the mortgage owed.  Negative equity means that the homeowner's debt is more than the value of the … (0 comments)

mortgage: Make Your Best Offer FIRST - 02/09/21 02:59 PM
This strategy is not about trying to negotiate the best price; it is about beating out the competition and buying the home.  It may be difficult to understand until you have lost a few homes to better offers but when the reality of the situation is that there are not that many homes on the market, the competition heats up and different tactics are necessary. 
Sales in December were annualized at 6.76 million, a 22.2% increase year over year according to the National Association of REALTOR®.  The median sales price is $309,800 which is up 12.9% from the previous year.  Inventory for December fell … (0 comments)

mortgage: Where Did the Assumptions Go? - 12/16/20 10:08 AM
  Mortgage assumptions have not been a practical matter for the last 30 years because mortgage rates have been on a steady decline.  Even if the seller had a rate lower than the current rate, the new purchaser must qualify to assume the loan. 
In the case of conventional loans, the lender has the right to increase the rate to the current rate which neutralizes the reason for assuming the loan.  This change took place in the early 1980's when lenders added due on sale provisions so lower rates could not be assumed.
FHA and VA loans can be assumed at the existing … (1 comments)

mortgage: Some Mortgage Interest May Not be Deductible - 11/01/20 11:22 AM

mortgage: REALTORS Thoughts on the Recovery - 07/21/20 03:58 PM
The National Association of REALTORS® just released the Market Recovery Survey of a random sampling to close to 100,000 members conducted June 24-26, 2020.  The following statements are the members' opinion on various aspects of the recovery to the Covid-19 pandemic as it relates to real estate.
In response to the safety of buyers, sellers and agents, REALTORS® are expecting within the next year to have increased demand for the following technologies used to market properties:
67% - Zoom or other video technology to communicate with clients 66% - virtual tours 63% - live virtual tours conducted by agent using video 60% - virtual … (3 comments)

mortgage: Good Decision for a Second Opinion - 07/06/20 11:18 AM
  You've done your homework, contacted a mortgage company and believe you are pre-approved.  That part of the process is finished and you can concentrate of finding a home and moving...or can you?
Pre-qualified and pre-approved are two different things but some people, including some in the business, use the terms interchangeably.  Pre-qualified is an opinion of likelihood that a borrower will be approved based on preliminary information about their income and credit.  Whereas, in a pre-approval, the borrower's credit report is updated and pulled, income and assets verified and involves pre-underwriting.
Even when you have a highly qualified loan officer, the real decision … (0 comments)

mortgage: The 4 C's of Qualifying - 02/03/20 03:25 PM
  Qualifying for a mortgage can be explained with 4 C's.  Capital indicates the borrower has the necessary funds for the down payment and closing costs without exhausting their savings.  Capacity shows that the borrower has the ability from income to pay back the loan.  Credit history reveals the borrowers FICO score, which is a composite of payment history, amounts owed, length of credit, new accounts and the different types that are open.  The final C is for collateral proving that the home's value will secure the loan.
To protect consumers and the lending market, the Dodd Frank Reform Act became law in January 2014.  The … (0 comments)

mortgage: Steps in Home Buying Process - 08/27/19 07:00 PM
Steps in Home Buying Process The process of buying a home can be different based on the price range and whether a mortgage is needed.  While some things are different, others are similar regardless of price, financing or local customs.
Each year, the National Association of REALTORS® surveys buyers and sellers who have purchased or sold in the previous twelve months in order to identify the process and steps taken.  It provides a lot of information for the people who will be going through the process now and in the near future.
44% of all buyers looked online for properties for sale.  This might … (2 comments)

mortgage: Show Them You Are Serious - 06/17/19 06:35 PM
Show Them You're Serious6/19/2019 June and July are the busiest home sale months of the year. When inventory is in short supply and you may be competing with other offers, it is important to show the seller you're serious. Make your offer look as good as possible because you may not get the chance to make or accept a counter-offer.
Put yourself in the seller's shoes.  Your home has just gone on the market.  There is lots of activity and suddenly, there is more than one offer to purchase.  The seller's first consideration may be to accept the highest offer but there are many other … (2 comments)

mortgage: Auto Pay your Mortgage Payment - 04/03/19 09:28 AM
  In the time that it takes to write one check, you can set it up with your bank and never have to do it again.  You won't have to write checks, envelopes or buy stamps anymore.  You'll save time, money and benefit in other ways too.
Never be late ... avoid late fees and protect your credit Schedule additional principal contributions monthly to save interest, build equity and shorten the mortgage term. 
An extra $200 a month applied to the principal on a $200,000 mortgage at 4.5% for 30 years will result in shortening the loan by 8.5 years.  If the loan was paid … (0 comments)

mortgage: Owning? Renting? Rent VS. Own - 03/04/19 09:21 PM

For a short time after the housing crisis a decade ago, some homeowners thought the value of home is a place to live rather than an investment.  A home certainly has an appeal as a place to call your own, raise your family, share with your friends and feel safe and secure.  It can be more than an address; it can also be one of the largest investments homeowners have.
Most mortgages apply a portion of the payment toward the principal amount owed in order to pay off the loan by the end of the term.  This acts like a forced savings for the homeowner … (0 comments)

mortgage: When It's Important...Find the Facts - 02/13/19 07:27 AM
When It's Important...Find the Facts2/13/2019 Most parents don't put a lot of credence in the statements "Everyone is doing it" and "No one does that anymore." They'll dig a little deeper and get the facts of the situation.  Interestingly, when it comes to buying a home, similar common myths continue to prevail surrounding what it takes to buy a home.
One of the most common myths is that it takes 20% down payment to get into a home.  Certainly, an 80% mortgage might have the most favorable interest rate. It won't require mortgage insurance and qualifying requirements might be a little less but there are … (3 comments)

mortgage: Your Real Estate Resource - 01/08/19 08:01 PM
12/26/2018 Being a better homeowner is a full-time job.  It's not just about making better decisions when you buy and sell; it's making better decisions throughout the time you own the home.
It takes good information to make good decisions.  Think of times when you need advice on financing, taxes, insurance, maintenance, finding reasonable and reliable contractors and lots of other things.  Imagine how nice it would be to have a real estate information line you could call whenever you have a question.
During the purchase or sale, the obvious place to get real estate answers is your agent but where do you go … (2 comments)

mortgage: Do You Know the Why? - 11/20/18 07:31 PM
11/21/2018 It may be natural for first-time buyers to be unsure of the process of buying a home because they haven't been through it before but even repeat buyers need to know changes that have taken place since the financial housing crisis.
The steps in the home buying process are predictable and generally follow the same pattern.  It certainly makes the move stay on schedule when you know all the different things that must be done to get to the closing.
In the initial interview with your real estate professional, you share the things you want and need in a home, discuss … (2 comments)

mortgage: Reduce Refinancing Costs - 08/29/18 07:25 AM
      There is much more than a lower rate and payment to determine whether to refinance a mortgage.  Lenders try to make refinancing as attractive as possible by rolling the closing costs into the new mortgage so there isn't any out of pocket cash required.
The closing costs associated with a new loan could add several thousand dollars to your mortgage balance.  The following suggestions may help you to reduce the expense to refinance.
·         Tell the lender up-front that you want to have the loan quoted with minimal closing costs.
·         Check with your existing lender to see if the rate and … (0 comments)

mortgage: Waiting Will Cost More - 06/22/18 05:31 PM

An economist responded when asked how interest rates would change: “They may fall some and then, rise and after that, they’ll fluctuate.”
Just because interest rates have been low for ten years doesn’t mean they are supposed to be low. The Federal Reserve has raised interest rates twice this year and are expected to go up twice more plus three times next year.  Mortgage rates have risen from 3.95% to 4.62% since the first of January.
Increased rates directly affect the payments on homes but so does the price. With inventory levels remaining low, the prices will continue to go up. … (3 comments)

mortgage: Case Study - Housing Decision During Retirement - 04/17/18 05:50 PM
A couple is planning to tour the United States in a travel trailer during their first few years of retirement. They are going to sell their current home now and purchase another home when they finish their travels.
An interesting exercise is to determine the optimum time of selling the home: now or when they're ready to buy their replacement home.
If they intend on traveling for more than three years, then, it may be a good decision to sell prior to the sojourn to avoid paying taxes on the gain in their home. IRS allows for a temporary rental of a principal … (1 comments)

mortgage: Fair Skies on Horizon - 02/28/18 04:43 PM
Buyers who have been concerned about what might happen to the tax laws affecting home ownership should feel more comfortable about moving forward with their decision to purchase. The 2017 Tax Cut and Jobs Act passed by Congress and signed by the President continues to treat real estate as a favored investment.
Whether it is for a home to live in as your principal residence or to use as rental property, the tax laws are in place but other dynamics to be concerned with are not; mortgage rates are expected to rise as well as prices.
Reasons to buy now:
The mortgage interest … (0 comments)

Patty Clark, Helping Families Move with Care (Morningside Homes, LLC 720-231-5200)

Patty Clark

Helping Families Move with Care

Denver, CO

More about me…

Morningside Homes, LLC 720-231-5200

Mobile: (720) 231-5200

Email Me




RSS 2.0 Feed for this blog