With a high volume of millennials set to enter the real estate market this year, it may seem like all the available options out there were created to snag new home buyers. However, there are products available on the market that cater to those who are in their golden years too. If you’re older than 62 and are currently weighing the options with your mortgage, here are the basics on reverse mortgages and why they might positively benefit you.
The Scoop On Reverse Mortgages
It may seem like this mortgage option hasn’t been around that long, but it was actually created in 2009 following the recession. Known as the Home Equity Conversion Mortgage for Purchase (HECM), this product is specifically directed at those who are retired or close to retirement that want to tap into the equity in their home. This option is only beneficial for those who plan on staying in their home long term, the loan is paid off at the time the homeowner moves out or passes on.
What Are The Requirements?
Because a reverse mortgage enables the homeowner to tap into the equity they’ve already paid into their home, there are many requirements involved in using this type of mortgage product. In addition to being 62 or older, the homeowner will have to have a high amount of equity in their home. They will also have to prove that they have the financial ability to make their monthly payments, in addition to being able to pay the insurance and property taxes on the property. The homeowner will also have to comply with the requirements set out by the Federal Housing Administration.
Is It The Right Choice?
Like any mortgage product, it’s important to determine before choosing this mortgage product that it’s right for you. While a reverse mortgage gives the benefit of providing access to cash and allows you to put your money elsewhere, it can end up costing more down the road since interest will continue to accrue on the principal amount owing. Before diving in, ensure that you do the calculations and consult with a professional to ensure it’s going to be a financial benefit in the end.
A reverse mortgage can be a great means of accessing cash for homeowners who are 62 or older, but it’s important to weigh all the financial aspects before making a final decision. If you’re currently looking into your mortgage options, please reach out to one of our Mason-McDuffie Mortgage professionals.
Along with the family vehicles, the garage may be the place where all of the things you don’t want in your house go to disappear. However, you might not be aware that there are a number of DIY hacks you can use for your garage that will instantly make it a more useable space. If you’re wondering how you can fit more in while improving the aesthetic appeal of your garage, here are some tricks to test out.
Give Your Garden Tools Space
The pile of garden tools that often sit in the corner of the garage is generally unpleasant to look at and potentially dangerous, so instead of leaving them around to trip on, try out a wall rack to secure them properly. All that’s required to make this rack is two boards and a saw in order to make the proper cuts. Once all is said and done, you can screw the boards into the garage wall and place your tools in the cut grooves for a more organized look that will clear away the extra clutter.
Consider Ceiling Storage
If you already struggle with a small garage, it doesn’t mean that you don’t have the extra space for storage. Instead of the floor, try putting your storage on the roof! By using plastic carriages installed into the roof of your garage, you can easily slide totes full of storage items into place. While you won’t want to store heavy items in the bins, they can be a great place for infrequently used items like Christmas decorations or old mementos.
Make Your Own Rec Room
If you have a two-car garage and only one car, there’s always the fun possibility that you may be able to use your garage for a less traditional purpose. Whether you decide to go with a makeshift office or a den the whole family can enjoy, adding a desk or couch, a few tables and even some wall art can be a great means of getting extra space. It can also be a great place to throw a party for your neighbors and your friends. If you’re currently perusing your mortgage options, please reach out to one of our Mason-McDuffie Mortgage professionals.
Case-Shiller’s National Home Price Index indicated slower home price growth in April. Year-over-year, home prices rose 5.50 percent in April as compared to 5.60 percent in March. Year-over-year readings are calculated on a seasonally-adjusted annual basis.
Case-Shiller’s 20 City Home Price Index was also lower with a seasonally-adjusted year-over-year reading of 5.70 percent gain in April as compared to the year-over-year March reading of 5.90 percent. Seattle, Washington held on to its lead for home price growth with a year-over-year reading of 12.90 percent; Portland Oregon followed with a year-over-year reading of 9.30 percent, and Dallas, Texas maintained third place in the 20-City Home Price Index with a year-over-year reading of 8.40 percent.
Month–to–Month Home Prices Rise in 19 of 20 Cities
Seattle also led in home price growth with a rate of 2.60 percent from March to April. Portland followed with home price growth of 1.60 percent, and Denver, Colorado reported month-to-month home price growth of 1.30 percent, which edged Dallas Texas out of third place in month-to-month home price growth rates.
Analysts have been watching housing markets carefully due to a prolonged shortage of homes for sale against high demand for homes in many areas. David M. Blitzer, Chair and Managing Director of the S&P Indices Committee, noted that skyrocketing growth in home prices must slow and eventually decline. During a press conference, he asked,” Will home price gains gently slow, or will they crash and take the rest of the economy with them?”
Analysts questioned how long home prices can continue to grow and remain sustainable. Affordability is a significant aspect of home price growth as first-time and moderate-income home buyers provide opportunities for present homeowners to sell and move up to larger homes. Mr. Blitzer eased fears of an imminent housing market crash and said, “For the moment, conditions appear favorable for avoiding a crash.”
Mr. Blitzer said that more housing starts and an expected increase in home buyers were positive signs for sustaining current home prices. Upcoming readings on consumer confidence and sentiment, new home sales and mortgage rates will support estimates of when and how much home prices will continue to increase. If you’re currently perusing your mortgage options, please reach out to one of our Mason-McDuffie Mortgage professionals.
In today’s competitive housing market where many areas nationwide are seeing a far-leaning seller’s market with limited inventory, it’s important for buyers to put their very best foot forward and have all their t’s crossed and i’s dotted before they find “the one”.
Most buyers don’t consider just how much their mortgage lender can help them land their
dream home, but aside from a buyer’s real estate agent, the lender is the next most important asset a buyer has when putting together an offer. Using these 5 tips will help ensure you’ve got yourself in the best position to get an offer accepted.
Work with a Reputable Lender
One of the things a listing agent will consider when advising their seller whether or not an offer is a good one is the name of the mortgage company on the pre-approval letter. Especially in a multiple offer situation, a seller is likely to choose the offer that’s most likely to make it to the closing table on time and with no headaches or financial harm. That means if your competition is working with a reputable lender and you’re pre-approval is from anonymousmortgage.com or ABClowestrateXYZ Mortgage, you’ll be at a disadvantage with all other things being equal.
It’s a bonus if the listing agent knows the company and has had a good experience in the past. If the seller asks for their input, reassurance and a seal of approval from their agent can help an offer in getting accepted. On the flip side, if a listing agent has had a terrible experience with the lender, the seller will likely hear all about it before making a decision. Choose your lender wisely, and be wary of internet refinance lenders.
Have a Responsive Loan Officer with Stellar Communication
Sometimes that dream home is viewed at 7pm, or 10am on a Saturday. Sometimes, that dream home will be slightly above the amount on your pre-approval (or maybe you have a pre-approval, but need one for a different amount). In a competitive market, if you need an update from your loan officer and their business hours are 9-5 Monday-Friday, or if they take days to respond to your questions or voicemails, you’ll be at a serious disadvantage if other offers are going in ahead of yours.
Your loan officer shouldn’t be available 24/7, but a good loan officer is always responsive, always returns phone calls, and has an eye on their email in the evenings and on weekends – after all, the real estate business doesn’t stop in the evenings and weekends. Your loan officer shouldn’t, either.
Get Pre-Underwritten (and DON’T get “prequalified”)
If your lender hasn’t reviewed your application, your credit, and supporting documentation, then you’re not pre-approved regardless of what they tell you. A ‘prequalification’ is a flimsy notice that you may qualify for a loan, but it’s not nearly as assuring as a pre-approval, which involves a complete application, credit, automated underwriting, and supporting documentation reviewed by the loan officer.
Better yet, work with a lender that offers a pre-underwriting program to let the seller and their agent know that if they choose your offer, there won’t be any surprises. With pre-underwriting, your mortgage lender will put together a full file and submit it to underwriting before a property is found. This way, once an offer is accepted, all that’s left to do is the property-related work – inspections, appraisal, and insurance – giving a buyer the same strength as a cash buyer. Pre-underwriting says to a seller “we’re better than pre-approved, we’re fully approved pending you accept our offer”.
Your Loan Officer Should Explain Your Pre-Approval ON Your Pre-Approval
Put yourself in a seller’s shoes and consider what looks better:
“Mr/s Seller, this buyer is preapproved” OR “Mr/s Seller, we have reviewed this buyer’s credit, income documents, proof of funds needed to close, and have received an approval through automated underwriting.”
Of course letting the seller know that the loan officer completed a thorough review of a buyer’s loan application is the better way to go – but few mortgage lenders do this. Make sure you work with a loan officer that does.
Make Sure Your Lender Calls the Listing Agent
Your loan officer should act as a huge advocate when you’re putting an offer in on a house. Calling the listing agent offers the opportunity to explain your strengths as a buyer, but just as importantly shows the listing agent that the lender you’re working with is professional and a good communicator (one of the biggest complaints of real estate agents is that lenders lack proper communication skills).
When buying a home, it’s a team sport. Buyers want to buy a home, and sellers want to sell. A loan officer should let a seller and their agent know that they’re a part of the team, and that they’ll do everything they can to make everyone’s life easy, not just the buyer. A quick phone call also gives the loan officer a chance to explain the pre-approval process, and gives the listing agent a chance to ask any questions they may have. Communication is very important in the home buying process, having a lender that’s proactive in this area is a major bonus. If you’re currently perusing your mortgage options, please reach out to one of our Mason-McDuffie Mortgage professionals.
Whether you’re finally prepared to get into the real estate market or you want to know how you can make a deal quick, there are a few necessary documents you’ll need to prove your reliability to a mortgage lender. If you’re wondering what will be involved in getting the application approval you’re looking for, here are the documents you’ll want to have on hand when the time comes.
Previous Tax Returns
In order to ensure the earnings information you’ve provided to the lender, you’ll have to have your tax returns for the two years prior to your mortgage application. In addition, you may also be required to provide your W-2s as backup documentation.
To make sure you’re a solid bet who will be able to make your down payment, you’ll need to present bank statements to ensure you have a cushion in the case that interest rates increase. If you do get money gifted to you for your down payment, you’ll need a letter to prove you’re not indebted to the provider.
It can be much more difficult to get approved for a mortgage if you have a patchy work history or happen to be self-employed, so you’ll need 2 months of recent pay stubs to prove consistent employment. The paystubs provided should also be an accurate reflection of the salary you’ve provided on your application to ensure no discrepancies.
It’s certainly a good sign to the lender if you have a healthy balance in your checking and savings accounts, but you’ll also need to provide any statements for mutual funds and other investments. While they may not be necessary to prove financial soundness, they will help with approval if you have a lot of money squirreled away.
A Listing Of Debts
While it may be the least popular of the pile, a lender will also want to know about any outstanding debts like auto loans, credit card payments or student loans. It may be tempting to forego these documents, but it will give the lender a good sense of your honesty and your ability to manage your mortgage.
Mortgage approval may seem like a time-consuming process with no certain end, but by having the appropriate documentation and being upfront about your debts, you may be able to speed up the timeframe. If you’re currently perusing your mortgage options, please reach out to one of our Mason-McDuffie Mortgage professionals.
Last week’s economic news included readings on sales of new and previously owned homes. Despite expectations of lower sales in both categories, sales surpassed expectations and April sales. Analysts were concerned about extremely tight inventories of available homes limiting home sales and did not expect May home sales to increase.
May Home Sales Surpass Expectations
Sales of new homes increased to a seasonally-adjusted annual rate of 610,000 sales as compared to expectations of 590,000 sales and an annual sales pace of 593,000 homes in April. Home builders have repeatedly cited a lack of buildable lots and skilled labor, but growth in new home sales could prompt more housing starts. Real estate industry pros insist that building more homes is the only way to ease tight inventories and high demand for homes.
Existing Home Sales, National Median Home Price Rise
Sales of previously-owned homes also increased in May according to the Commerce Department. Pre-owned homes were sold at a seasonally-adjusted annual pace of 5.62 million sales as compared to expectations of 5.51 million sales and April’s reading of 5.57 million sales. The National Association of Realtors® said that the current sales pace is “unsustainable” and that “would-be buyers are having to delay or postpone their home search due to short supplies of homes for sale.” The national median home price rose 5.80 percent to $252,800 year-over-year.
Regional readings for existing home sales were mixed. Sales of existing homes were 6.88 percent higher in the Northeast while the Midwest was -5.90 percent. Existing home sales increased by 2.20 percent in the South and 3.40 percent in the West.
Mortgage Rates Hold Steady, New Jobless Claims Rise
Freddie Mac reported slightly lower mortgage rates last week as the average rate for all three mortgage types: The average rate for a 30-year fixed rate mortgage was 3.90 percent. Rates for a 15-year fixed rate mortgage averaged 3.17 percent and rates for a 5/1 adjustable rate mortgage averaged 3.14 percent. Discount points were unchanged at 0.50 percent across the board.
New jobless claims reported week rose to 241,000 and exceeded expectations of 240,000 new claims based on the prior week’s reading of 238,000 new claims. Week-to-week fluctuations can be volatile; the four-month rolling average of new jobless claims rose by 1,00 claims to 244,750 new jobless claims filed. New claims have remained below the benchmark reading of 300,000 new claims for 120 weeks, which is the longest consecutive run since the 1970s.
Analysts said that while job markets remain strong, employers continue to have difficulty in finding skilled candidates for jobs offered.
This week’s economic news releases include Case-Schiller Housing Market Index reports, pending home sales and inflation. Mortgage rates and new jobless claims will also be released. If you’re currently in the market for a new home, please reach out to one of our Mason-McDuffie Mortgage professionals.
Investing in a home is a big financial decision, and along with the decision to buy is the question of how much mortgage you’ll be able to afford. While your debt-to-income ratio can be helpful in determining the range for your mortgage amount, a mortgage calculator can be a beneficial tool in coming to a potential price. If you’re curious about how and if this financial tool can benefit you, here are the details about using a mortgage calculator.
What Does It Do?
It’s very important to ensure that you can afford your mortgage before signing on the dotted line, and a mortgage calculator can assist with this. Most calculators utilize the principal amount of the loan, the interest rate and the amortization period in order to find a monthly payment that is foreseeable for you. While a debt-to-income ratio and the advice of a mortgage professional can be helpful, a calculator can be a quick determination of the overall cost involved.
How Accurate Is It?
Some mortgage calculators can utilize a pretty simple formula to come up with an estimate, but some are more complex and can calculate PMI, home insurance, and even property tax to arrive at a sum. The most accurate calculators will utilize the principal, interest, taxes and home insurance in order to determine an estimate that is feasible for you. However, it’s important to understand that you’ll need to enter the information accurately and leave out as little as possible, as this can have a dramatic impact on the calculation’s reliability.
Should You Use One?
A mortgage calculator can be beneficial in providing you with an estimate, but it should not be the be-all-end-all when it comes to making the final decision. It’s important to consider your current lifestyle and your future plans to ensure that your monthly payment will remain do-able down the road. While a calculator is a good place to begin, it’s worth consulting with a lender to get an idea of how much home you can afford. Since they’ll be required to provide a GFE with the fees disclosed, this will be the best means of understanding the costs.
A mortgage calculator can be a good means of estimating your house-buying ability, but it’s important to get the advice of a lender before making the big decision. If you’re currently in the market for a new home, please reach out to one of our Mason-McDuffie Mortgage professionals.
Now that the summer season has arrived, it’s time to enjoy the warm weather and cooler clothes. You might also be thinking about making some design changes to your home to welcome the season and indulge in its brilliance. If you’re looking for some new color schemes and how you can use them to amp up your home, here a few brightly-colored suggestions to try out for yourself.
With the reminder of the sea and the sky, few things are akin to summer like bright blue. Instead of going overboard with this shade, try adding an accent like a side armchair, a throw or even some pillows to be adjusted with the seasons. If you’re really feeling the color, you might even want to try a large floor rug or an accent wall to add more flair.
Orange can be a little bit of a risk, but if you have a love for this color there are ways to use it that will really enhance a room. As a splash against neutrals, it can add a lot of character to an otherwise unassuming space. However, if you want to go all out, consider a smaller space like a bathroom or den where it won’t look too showy.
Much like blue, the color green is reminiscent of the return of the leaves and the grass, which makes it an ideal tone for the months of summer. While this color can be a lot less assuming than many bright colors, it can still provide a very alluring accent around the home. If you’re looking for ideas for this color, consider pairing it with white for a look that is both striking and homey.
The color pink may seem like a risk for any room, but if you’re going for a patio setting or a makeup room, it can be the perfect tone to liven things up. Whether you want to try an accent wall or re-upholster some chairs, hot pink can easily make one think of summer cocktails and warm destinations throughout the season. With the summer months around the corner, there are plenty of great ways and fabulous colors to dress up your home with. If you’re currently getting prepared to dive into the real estate market, please reach out to one of our Mason-McDuffie Mortgage professionals.
Mason Mac is a company known primarily for providing great mortgage loans to our clients and ensuring that anyone who wants to achieve the American dream of home ownership can do so with proper education, planning, and the right financing. While that’s what keeps the doors open and the lights on, another passion we have is in helping others. We like supporting local folks, communities, and businesses.
The event will run from noon til 5pm, and will have the following : Food ($5 adult entry includes meal ticket), beer ($3), wine ($5), live music, dancing, food trucks, a bocce tournament, dunk tank, kids games, cash raffle, and a REALTOR cookie wars bake off!
Your friends from Mason Mac will be there too, including our very own Social Media Guy, our Prime Services group, and your favorite managers and LO’s from our local Irvine, Lake Forest, and Newport Beach branch offices. We’ll be there to answer questions, provide information, and most of all, support the local REALTOR businesses of Orange County. As a bonus, we’ll be offering up a business card raffle with the winner bringing home a brand new Amazon Echo.
If you’re a REALTOR in Orange county be sure to stop out, enjoy the day, have some fun, and join us at booth number 27. Bring a business card for your shot to win the Echo, and we’ll look forward to seeing you there!
What: OCAR Palooza! Where: Aldrich Park at UCI (off Bison Ave, there will be signs directing you to the event) When: Friday, June 23 2017 from 12pm-5pm