Real Estate by Pam: Low interest rates - now closing costs help for bu...

Real Estate by Pam: Low interest rates - now closing costs help for bu...: "Fannie Mae is once again offering closing-cost assistance for buyers who close on a home in the mortgage giant's real-estate owned (REO) inv..."

Buying versus renting - reasons why you should buy a home instead of renting

Forget the finances for a minute. Why did you even begin to consider purchasing a home? The Fannie Mae National Housing Survey shows that four of the biggest reasons people buy a home have nothing at all to do with money. They want a place to raise and educate their children, a place where their family will feel safe, to have plenty of living space, and to have control over the space. What non financial benefits will your family gain from owning a home? Yours answers to that question should be the reason you decide to purchase or not. The bottom line is that the cost of a home will probably remain relatively unchanged even if prices continue to depreciate. Don't allow money to be the only factor in making the decision that's right for you.

If it's possible that prices will continue to fall, why should you buy now?

While price is the major concern for anyone selling a home, cost should be your primary concern as a buyer. That means you have to take into account what your monthly payment will be, considering not only the price of the home but also the interest of your mortgage. Waiting for prices to bottom out while rates are increasing can wind up costing more over the life of the mortgage. Fannie Mae, Freddie Mac, the National Association of Realtors, PMI, and the Mortgage Bankers Association are all projecting interest rates will increase over the next several quarters. It's best that you meet with your mortgage professional to help you determine what an interest rate increase will cost you based on the expected size of your loan. That will help you make a decision.

Low interest rates - now closing costs help for buyers

Fannie Mae is once again offering closing-cost assistance for buyers who close on a home in the mortgage giant's real-estate owned (REO) inventory, but in most states will not bring back cash bonuses it previously paid to buyers' agents.

Buyers who put in initial offers on or after April 11, and close on the sale of a Fannie Mae HomePath property by June 30, will be eligible to receive up to 3.5 percent in closing-cost assistance.

The offer is only good for buyers who intend to occupy the home they are purchasing as their primary residence -- second homes and investor properties are not eligible.

Offers submitted before May 15 have the best chance of qualifying, Fannie Mae said, as offers submitted after that "are particularly questionable for closing" by the June 30 deadline.

Mortgage interest rates and credit scoring.

Credit scoring was developed in the 1960s as a means to determine whether or not consumers were likely to repay their loans. The score ranges from 350 to 850 with a higher score being extremely favorable. Essentially, a high credit score translates into lower interest rates for the borrower.

There are five factors that comprise the credit score. Payment history accounts for 35% of the score; outstanding credit balances have a 30% impact; credit history makes up 15%, type of credit factors at 10%; and inquiries influence the score by 10%. This gives the lender a snapshot of an individual's sense of financial responsibility and ability to pay back loans.

There are many quick tricks to improve the credit score, and I can provide borrowers with more information on this subject. If necessary, I guide them to a reliable resource for credit remediation. If a borrower has to pay a higher interest rate to close a loan, the tarnished credit rating will begin to improve once mortgage payments are made on time and in full. If that is the case, my team and I will be on the watch to alert the borrower when an opportunity arises to refinance and get a lower interest rate.

Mortgage Interest Rates for Fixed Rate Mortgages are low. Call me to find out more...

Financing for your first home

Are you getting ready to buy your first home? It is important to know how much you can afford before you begin looking at properties. Talking with a lender and getting pre-approved for a loan puts you in a stronger negotiating position with sellers.

As a rule, your monthly housing costs should not exceed 28% of your monthly pre-tax income. These costs include the mortgage payment, real estate taxes, and insurance. If you have long-term debts, such as student loans or car payments, your monthly payments, including your housing costs, should be less than 36% of your pre-tax monthly income. Some loans, such as VA and FHA loans, are more flexible with these basic guidelines.

Depending on which type of mortgage you select, you can consider houses in various price ranges. An adjustable-rate mortgage will usually enable you to qualify for a higher loan amount. Your real estate agent can help you make the basic calculations. Remember that buying at the top end of your price range gives you more time to outgrow your home, and can save you money over the long term.

C

Help someone avoid foreclosure.

Many people have the impression that most real estate agents only care about themselves and their commissions. I'm here to help you avoid foreclosure if possible. For example, if you are facing a foreclosure sale, you can ask me about the "ask for the note strategy" to delay or stop the foreclosure. I can also refer you to an organization such as NACA.net. NACA.net who does forensic loan audits to determine if the lender violated any RESPA or other requirements. If the lender did so, then you have more leverage to work out a loan modification, a short sale, or some other solution.

Give me a call today. I can help.