estar mortgage alameda: Why You're in Danger of Closing Delays (and how to avoid them)
- 07/02/19 08:40 AM
Closing delays are one of the many unintended consequences of recent government regulation. Mortgage lenders are required to prepare a "Closing Disclosure" and adhere to the timelines illustrated below. Any last-minute changes to your deal structure could cause delays of up to a week on purchase transactions, and up to two weeks on refinance transactions. Delays can be even longer if your transaction takes place anytime close to a federal holiday.
Here are five things you should consider doing in order to avoid unnecessary delays: Write a longer timeline into your purchase agreement so that you don't … (2 comments)
estar mortgage alameda: Summer 2019 Guide to Mortgage Rates
- 06/03/19 09:20 AM
Mortgage rates are determined by the supply and demand for mortgage bonds in the bond market. Why Mortgage Bonds? When you get a mortgage in the US, your mortgage company is getting the money from Fannie Mae, Freddie Mac, or other "securitizers". These "securitizers" get their money by issuing bonds to bond market investors. These bonds are called "mortgage bonds" or "mortgage-backed securities". Therefore, the mortgage rate you pay is really determined by the supply and demand for mortgage bonds in the bond market.
The Role of the Federal Reserve As you can see from the chart, the Fed owned … (1 comments)
estar mortgage alameda: Two Ways to Be More Strategic with Your Credit
- 05/20/19 11:12 AM
Your length of credit history looks at how long your accounts have been opened. This has a 15% impact on your score. The longer your accounts have been opened, the higher your score will be; newly opened accounts will bring your score down. Here are three practical steps for you to improve your score in this area:
Don't close your credit accounts. If you must, close the newest ones instead of the oldest ones. Your score will improve over time if you keep accounts open and use them every once in a while. Think twice before jumping on … (1 comments)
estar mortgage alameda: 3 Reasons to Finance Your Home Improvements
- 05/13/19 07:56 AM
If you’re thinking of paying cash for home improvements, you may want to think twice. Here are three reasons why you may want to consider a cash-out mortgage refinance or home equity loan instead: 1 – Preserve your cash: a large home improvement project could quickly deplete your savings. Think about this project in the context of the next 3-5 years. What other large expenses could crop up during that time period, and would it be useful to keep your savings on hand for those items? 2: Opportunity Cost of Money: would it more useful to invest that money in a college savings plan or … (1 comments)
estar mortgage alameda: How to Successfully Get a Mortgage in 2019
- 04/01/19 09:23 AM
If you've traveled in an airplane recently, you probably went through a security check at the airport. These security checks are required by a federal law called the USA Patriot Act. This very same law has a provision that requires mortgage companies, banks, and financial institutions to document your source of funds when you buy a house or refinance a mortgage. In short, the US government has recruited mortgage lenders in its fight against terrorism! In fact, lenders are required by law to ask you for: The exact source of funds used for your down payment and earnest money deposit. … (2 comments)
estar mortgage alameda: Two Ways to Benefit from Rising House Prices
- 03/18/19 10:22 AM
House prices have gone up in many markets across the country. This chart illustrates what rising house prices could mean for you based on your home value and the rate of appreciation in your neighborhood. Here are two ways you may be able to benefit if your home has gone up in value: 1 – Cash-out Mortgage Refinance You may be able to access some of your newly created home equity by refinancing your mortgage into a higher-balance loan. Cash-out proceeds may be used for: Debt consolidation – pay off other debts with higher interest rates Home improvements – make new indoor … (1 comments)
estar mortgage alameda: How Payment History Impacts Your Credit
- 03/11/19 09:22 AM
Your timely payment history has a 35% impact on your credit score. Paying debt on time and in full has a positive impact. Late payments, judgments, charge-offs, collection accounts, and bankruptcies have a negative impact. If you have had any bankruptcies within the last 7 years, it will seriously affect your ability to borrow or establish new credit accounts. If you have had any judgments within the last several years, it is very important that you pay off the judgment and get a "satisfaction of judgment" from the court. Any unsatisfied or recent judgments will make a bad dent in your … (1 comments)
estar mortgage alameda: 3 Ways to Get Prepared for Home Ownership
- 02/25/19 09:20 AM
1: Prepare Your Credit Mortgage lenders typically require at least 24 months of good credit history in order for you to qualify for a mortgage. It's normally a good idea to have a few credit cards, a few installment loans, and 24-month history of making rent payments on time.
2: Prepare Your Cash Flow Mortgage lenders typically require less than a 43% debt-to-income ratio in order to qualify for a mortgage. This means that your total monthly debt payments (including the new mortgage payment) should be no more than 43% of your monthly income.
3: Prepare Your Savings Mortgage lenders typically require … (2 comments)
What will cause the Prime index to go up? The interest rate on your HELOC is determined by adding a margin to the Prime rate. This means that your interest rate will go up when the Prime rate goes up. The Prime rate changes whenever the Federal Reserve change its Federal Funds rate. The Fed has indicated that they'll be increasing the Fed Funds rate as the economy improves. This means that as the economy continues to get better, the interest rate on your HELOC … (1 comments)
estar mortgage alameda: Two Reasons Why You Should Keep Your Home Improvement Receipts
- 01/21/19 08:49 AM
1: Ability to Deduct Your Mortgage Interest: If you take out a mortgage for home improvement purposes, the IRS may ask you to prove the project was a "substantial improvement" that: Adds to the value of the home, Prolongs the home’s useful life, or Adapts the home to new uses. For example, painting a room may not qualify, but an addition or a new kitchen may qualify. Keeping the receipts from your home improvement project would go a long way toward proving this. Also, keep in mind that the IRS gives you 24 months to reimburse yourself for improvements made in the past, or … (0 comments)
estar mortgage alameda: 3 Ways to Avoid Getting Outbid on Your New Home
- 01/14/19 09:14 AM
Bidding for a new home can get pretty fierce in today's market. Here are three potential solutions to avoid getting outbid on your new home: Turn in your loan paperwork BEFORE you place an offer. In many cases, you are bidding against cash buyers who don't need to wait for financing approvals. Look at it this way: if you were the seller, would you prefer to do business with a buyer who needs to wait for financing approvals or a cash buyer who can close the deal quickly? With that in mind, it's important to be proactive and provide your mortgage … (1 comments)
estar mortgage alameda: Two Approaches to Consider When You Invest in Real Estate
- 01/02/19 07:36 AM
1 – Buy and Flip This strategy involves buying a house with the intention of selling it for a short-term profit. Typically, investors who take this approach look for homes that need improvements and renovations. Here are three questions to ask yourself before you take the leap with this strategy: How much will the investment cost you? This includes all the costs of renovations as well as the “carry costs” of paying the property taxes, home insurance, and maintenance on the property while you own it. What is a reasonable sales price? A real estate agent or appraiser should be … (2 comments)
estar mortgage alameda: How the Fed Impacts Mortgage Rates
- 12/17/18 09:36 AM
The Federal Reserve Open Market Committee (FOMC) meets at least eight times per year to discuss and vote on US monetary policy. The Fed controls the Fed Funds rate, which is essentially a bank's cost of money. When the Fed increases the Fed Funds rate, short-term interest rates such as the Prime rate and LIBOR go up. These are often used to determine interest rates on adjustable rate mortgages, home equity lines of credit, credit card balances, and business loans. However, interest rates on fixed-rate mortgages are not tied to changes in the Fed Funds rate. Mortgage rates are determined by the supply and demand for mortgage bonds in … (2 comments)
estar mortgage alameda: How to Improve Your Balance-to-Limit Ratio
- 12/10/18 09:39 AM
Your balance-to-limit ratio looks at the balance you owe vs. your available credit lines. This has a 30% impact on your score. Keeping your credit balances below 50% of your available limit is very important. Keeping your balances below 30% of your available credit is even better. For instance, if you owe $10,000, and you have $100,000 of credit available to you, you are only using 10% of your available credit line. On the other hand, if you owe $10,000 and you only have $10,000 available to you, you have "maxed out" your available credit and your credit scores will be … (1 comments)
Why Do Appraisals Matter? Mortgage lenders base your loan amount on the LESSER of the appraised value or the purchase price. Here's an example: You sign a contract for a $200,000 home with a $10,000 (5%) down payment. Your loan amount, in this case, would be $190,000 (95% of the purchase price). The appraisal comes back at a value of $190,000 The mortgage lender is no longer willing to lend you $190,000 because that would … (2 comments)
$15,000 Annual Exclusion The federal government gives each of us an allowance to gift anybody $15,000 per year without incurring any gift tax. This $15,000/year replenishes every year, and it’s $15,000 per person. So, theoretically, I could gift every person that I know $15,000 today, and then another $15,000 next year and the year after, and there would be NO gift tax.
$11,180,000 Lifetime Exclusion What most people don’t realize, is that there’s a second allowance of $11.18mm! In other … (1 comments)
estar mortgage alameda: Three Ways to Increase Client Referrals
- 11/12/18 05:43 AM
Many clients today have indicated a willingness to refer you business, but very few actually follow through. Here are three potential solutions that we can explore together:
How to Be More Relevant to Your Clients. Many financial advisors don't spend any time on database marketing. Other advisors blast their clients with generic newsletters. What if you could be different? Here's an idea to consider: personally call just one of your clients per day... every day for the next 100 days. During the conversation, discover your clients' current life priorities and give them something of tangible value that … (4 comments)
estar mortgage alameda: 3 Trends that Could Impact Real Estate Investors
- 11/05/18 06:10 AM
1 - Less new construction of homes at lower price points Home builders across the country are reporting that the high-costs of lumber, and the increasing costs of getting building permits approved, have lowered their profit margins and reduced their incentive to build starter houses at lower price points. This means that first-time homebuyers have less inventory to choose from when it comes to buying their first home. Less supply means higher prices, and this could be a good thing for real estate investors who jump into the market now.
2 - Investors are less likely to rebuild after … (2 comments)
estar mortgage alameda: 3 Reasons Why Homebuyers Should Consider Seller-Paid Points
- 10/29/18 04:49 AM
"Seller-paid points" are where the seller pays points to reduce the interest rate on your mortgage. Consider a home where the list price is $300,000 and the seller is willing to accept a bottom line of $291,000. If the seller reduces the price by $9,000, you would be able to purchase the home for $291,000. Both you and the seller would be happy. However, what if you purchase the home for $300,000 and ask the seller to contribute $9,000 toward your closing costs? The seller still walks away with his/her bottom line of $291,000. However, there are three extra benefits … (1 comments)
estar mortgage alameda: How to Get the Primary Residence Capital Gains Tax Exclusion
- 10/23/18 07:30 AM
In order to understand capital gain, we first need to understand tax basis. Your tax basis is the cost of buying, building or improving a property. Assume you pay $200,000 for a property. You incur $5,000 in closing costs. Then you spend $45,000 on home improvements. In that case, your tax basis would be $250,000. That’s what it cost you to buy and improve the property. Assume you later sell the property for $500,000. You incur $50,000 in sales commissions, transfer taxes, and other sales expenses. You then subtract your $250,000 basis. Your capital gain would be $200,000. Once you … (2 comments)
Closing delays are one of the many unintended consequences of recent government regulation. Mortgage lenders are required to prepare a "Closing Disclosure" and adhere to the timelines illustrated below. Any last-minute changes to your deal structure could cause delays of up to a week on purchase transactions, and up to two weeks on refinance transactions. Delays can be even longer if your transaction takes place anytime close to a federal holiday.
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