Image source: Marisol Casben
Its that time of year again when everyone is setting their sights on new goals. From being healthier to save money to try new things, January 1st is when we all want to set ourselves up for a successful year.
One major goal many people have is to become a homeowner. This is a huge goal but very attainable. With Hall Financial, we can make it very simple and easy for you to obtain a mortgage.
Here is a step by step list of everything you need to make your homeownership dreams come true:
- Obtain preapproval from Hall Financial, you will need:
- Two years of W2s
- Your most recent pay stub
- Two months of bank statements
- Copy of driver’s license
- Credit Report
- Start house shopping
- Need a realtor? No problem, Hall Financial has preferred partners.
- Find a house. Put an offer in, and get it accepted!
- Loan documents
- Sign all documents
- Obtain homeowner’s insurance and provide to your processor.
- Review closing documents.
- Schedule closing with your processor.
- Confirm closing date, time, and place with your realtor and processor.
- Sign all final documentation.
Enjoy your new home!
Mortgage Bankers Association is forecasting that we will see a three-year-high in mortgage originations since 2016. In 2016 the industry saw $2 trillion and in 2019 MBA is predicting that we will land around $1.9 trillion.
Since the FED cut rates not once, but twice this year we have seen an increase in refinances. MBA is predicting that 35% of that $1.9 trillion will be attributed to those refinancing; which reflects Fannie Mae’s projection of refinances also being at a three-year-high.
If you are someone who follows along and have been on the fence about refinancing keep in mind that your credit score will affect the rate you get locked in to. The industry has been seeing a wide range of interest rates for credit scores of 620 through 639; anywhere around 1.33% in difference. However, if you can, you can buy down your interest rate.
Not sure what buying an interest rate means? Click here to talk to someone today!
In other news, we have been seeing an increase in home prices. Before, you cringe right now this news is good. With rates remaining low you still have the ability to get more house than you may have planned for and we are seeing an increase in inventory. Right now Detroit is sitting in the top six areas at 4.1% in year-over-year strength.
The mortgage industry has been experiencing an amazing year so far. The Federal Reserve (FED) has continued to cut rates. Need proof? Last week the FED dropped rates another quarter percent, we are currently hovering at a 2-2.25% rate.
What does that mean for you?
Well if you are looking to purchase you have the ability to buy more home for your money; however, if you are looking to refinance you are looking at saving money over the life of your loan, on top of potentially being able to lower your term.
Refinancing is one of the various ways you can utilize to help save money overall; however, if you find yourself needing alternative options and are looking to be proactive in your home financing needs, here are a few out-of-box ideas.
- Buy a Cheaper House – this is self-explanatory, learning to live below your means is a valuable lesson to learn and helps you budget more efficiently.
- Choose a Bi-Weekly Payment Option – Most loan servicers provide this option. When you choose to go this route, you end up making 26 payments a year; which adds up to you paying 1 extra payment towards your principle each year.
- Choose an ARM – this option is great if you don’t plan on living in your home very long. What’s the point of fixing yourself in a 30-year term if this isn’t your forever home?
- Extend Your Repayment Term – Example if you are in a 15-year term you can switch to a 30-year; this doesn’t change the amount of your loan but will overall lower your payments because you are extending the term.
- Make a Larger Down Payment – This option would make your parents feel like you are listening to them. You grew up with them harping you to save for a 20% down payment and there is a good reason why: it helps keep your monthly mortgage payment LOW.
- Get Rid of Your PMI – this option takes some time if your purchasing and your sellers don’t want to pay this off while negotiating. To be able to get rid of your PMI you must gain at least 20% equity in your home; once you achieve that you can request that your lender drop PMI.
- Pay for Points – when you pay for points you are paying for a lower interest rate. There may be more you pay for upfront in closing costs; however, over the term of your loan you aren’t acquiring unnecessary interest.
Refinances are finally making a comeback after last year’s drought. Black Knight revealed that an estimated 3.27 million homeowners could benefit from refinancing. This is an increase year-over-year by 16% from 2018. This means a jump of candidates around 75%, with rates at a current 10-month low.
Various areas throughout the country give low-income families a chance at the American Dream. Being a homeowner gives people a chance to benefit from their communities, as well as gain wealth from their home equity. With metros becoming more expensive and having a lack of affordable starter homes, low-income residents aren’t typically able to share in the prosperity of home ownership
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. To escape the high costs of homes, buyers are looking to relocate to inland markets.
With perks such as no down payment, it’s no surprise that VA loans have become increasingly more popular for first-time home-buyers. Benefits such as no mortgage insurance and strong loan servicing protections accompany this loan as well. Both prime and non-prime home-buyers using VA loans are reporting less early delinquency rates.
With a confident forecast of 2% economic growth for the next year, JP Morgan Chase chief economist Anthony Chan is dismissing concerns over a looming recession. During the Chicago Agent Magazine’s Accelerate Summit at the Chicago Merchandise Mart last Tuesday, he predicted that while it won’t be as exponential as last year, the economy will still see growth.
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Credit access expansion could be on the horizon for millions of Americans as Experian, FICO, and Finicity announced a new credit scoring model: UltraFICO. This new model would reward the consumer on positive financial behavior and would take a deeper look at how the consumer manages their money. The three companies are excited over what this change could bring to the lending world, however, we should still note that in pulling credit, lenders look at Experian, TransUnion, and Equifax.
It’s October which means Pumpkin Spice has graced our lips since mid-September and if you are on the ball you have been thinking about your Halloween costume for weeks but if you are a die-hard Halloween junky who bleeds orange, black, and everything spooky we may have found something just for you.
Derek Miller of Smart Asset collected data based on vacant homes, cemeteries, and costume shops within an area and found that, Salem has nothing on the Mid-West. Detroit ranks in the top 5 of spooky cities; tying with Pittsburgh, having the most vacant single-family homes. Coming at eighth is Cincinnati, Ohio, where you can run around in the abandoned Subway tunnels and find the best mortgage rates if you are looking to shop around.
If you want Halloween 365 days a year you should look at these towns. Yes, you read that right, towns that are up for sale where you can literally dig for gold. Oregon King Mine in Ashwood, OR has 200 acres for sale that has abandoned homes, the mine, and all the old structures perfect to turn into a Halloween getaway all for about $2 million dollars. And if you are looking for somewhere a little warmer, Gold Mine Ghost town in Wikieup, AZ is up for $100,000 and is perfect for horseback riding, ATV trails, and hiking. Both places give you the option to create something different than just your typical apple orchard.