Category Archives: Mortgage

Want an Edge on Rising Mortgage Rates? Buy NOW!

Mortgage rates are still at historic lows, but they’re quickly on the rise once again. They are expected to reach numbers that are higher than they’ve been in a few years, and are climbing fast. Rates have gone up to 4.28% in recent weeks, and appear to continue to progress upwards.

This sort of information can be scary if you’re considering buying a home in the future. How should you translate numbers like that for your family’s needs? What does this mean for your dreams of purchasing a new home?

The best way for you to jump ahead of the mortgage rate increases is to buy NOW!

A Steady Increase

Rates will continue to rise, according to the Federal Reserve. There’s no sign that they’ll be dropping again for a while. These rising rates mean that waiting will cause your interest rates to rise substantially versus what you could find right now. By pulling the trigger now, you can avoid a much higher rate in the future. You’ll lock in a rate that will be substantially lower than your friends who will wait a year or more to purchase.

While the temptation to “wait it out” is strong,  there’s no indication that waiting will mean rates will be any lower. In fact, the trends indicate that the rates will only continue to climb higher than they’ve been in several years. By purchasing now, you can lock in a rate that will cost you less and give you an edge over the higher rates on the horizon.

Beat the Competition

The Spring housing market is just around the corner. Spring is historically the busiest time for buyers. By speeding up your purchase timeline, you can avoid the competition and secure your new home before the market goes berserk. You can save yourself from potential bidding wars and lock in a lower interest rate before they climb further.

Shopping for a home now makes sense for several reasons. You’ll be able to find the home your family has dreamed of without the competition brought by other buyers. You can purchase now free from the added stress of the spring season in real estate, all while locking in a rate you’ll be glad you secured a few months from now.

How to Make Your Move

It’s clear that now is the best time to go ahead with the purchase of your next home. But where do you start? Give us a call here at The Silva Group. We’d love to guide you along this journey. We can help you find the home of your dreams in record time so that you can reap the benefits of this exciting time in the market and get ahead of these rate increases. Give us a call today!

One of the Best Moves You Can Make Before Buying Your Next Home

The time has come for you to find your next home. There are plenty of points on a to-do list that you’ll check off. You’ll find the right agent, choose your perfect neighborhood, and make a list of the features you want in a home. All of these are great steps!

While the best move you can make toward your next home purchase may not sound extremely exciting, but it’s arguably one of the most important.

Get preapproved for your home loan.

Today’s market is becoming more and more competitive. Buyers are learning they need to stand out. Often, multiple buyers will vie for the same home. Mortgage preapproval gives you, as a buyer, an edge.

Preapproval shows sellers that you are a serious buyer. It can make your offer stand out from other, less serious, potential buyers. It shows that you have done the work and secured the money to move forward with a purchase.

Not only will preapproval give you an edge as a buyer, it can also give you a more realistic idea of your home budget. Knowing exactly how much money you’ll be able to spend on a home will manage any expectations you have going into the home buying process. It can eliminate wasted time viewing homes that are outside of your actual budget.

In order to start the process of preapproval, you’ll need to decide upon a lender. By working with experienced agents like us here in The Silva Group, you can get matched with a tried and trusted lender. Seeking out a lender is a scary prospect for most people, and working with your agent’s trusted lender can give you some peace of mind.

A lender will determine just how much money you’re preapproved for by looking at the 4 C’s: capacity (if you’ll be able to make payments), capital (what you have that can translate into cash), collateral (the type of home you’re looking to buy), and credit (your credit score). These factors are the equation a lender will use to determine what type of mortgage you can qualify for.

Once you’ve got your preapproval in hand, you can set forth on the more exciting parts of the home buying process. You will have confidence that many other buyers won’t have. You’ll be able to walk into homes knowing exactly what you can and cannot spend. It will speed up the process and make you more attractive to sellers.

Preapproval may not sound exciting at first, but it is arguably the best move you can make to start the exciting process of your next home purchase.

This Month in Real Estate – December 2017

This Month in Real Estate
December 2017 Market Update
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Monthly VideoAccording to the National Association of REALTORS®, existing home sales picked up in October, overcoming ongoing inventory shortages. Healthy job growth and wage increases are fueling continued strong demand in much of the country.
Interest Rates
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Monthly VideoAccording to Freddie Mac, 30-year fixed rates rose from 3.88 percent to 3.90 percent. This rate remains well below the historical average of 8.90 percent.
Home Sales
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Home Sales Graph
The National Association of REALTORS® reported home sales at a seasonally adjusted annual rate of approximately 5.5 million homes during the month of October. This was an increase of 2.0 percent from September and a decrease of 0.9 percent from October of last year.
Home Prices
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Home Price Graph
The median home price decreased to $247,000 in October, which was down 0.2 percent from September and up 5.5 percent from October of last year. The median home price has increased by approximately $12,900 in the past year alone.
Inventory
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Inventory Graph
There was a 3.9-month supply of housing inventory in October, which was a 7.1 percent decrease from September. The total number of available homes for sale has decreased by 11.4 percent compared to October of last year.

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Real Estate Trends

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Home prices have risen nationally three times faster than incomes since the turn of the century, which has made home ownership an impossibility for more Americans than ever before.

In many large cities, home prices have outpaced income. In Miami, for example, incomes have risen 16 percent, while home prices have increased 58 percent since early 1998. New York’s Long Island suburbs have seen just a 14 percent rise in incomes as compared to an 81 percent increase in home prices. Boston home prices have gone up 89 percent, while incomes have increased only 22 percent.

Even with a downturn in the real estate market looming on the horizon, home sales are still headed for another record year.

The first sector to show slowing is the high-end home market. Because of “overpersonalized” big-ticket properties, the pace of house auctions nationwide has surged.

Low interest rates are the only continuing positive trend of the housing market. Low rates average now less than 6 percent for 30-year fixed-rate loans, the lowest since the 1960s.

Real-estate analysts believe that if the housing market stalls, some areas will continue to grow modestly while other markets gradually go soft, rather than pop.

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Brought to you by KW Research. The opinions expressed in This Month in Real Estate are intended to supplement opinions on real estate expressed by local and national media, local real estate agents and other expert sources. You should not treat any opinion expressed on This Month in Real Estate as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of opinion. Keller Williams Realty, Inc., does not guarantee and is not responsible for the accuracy or completeness of information, and provides said information without warranties of any kind. All information presented herein is intended and should be used for educational purposes only. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. All investments involve some degree of risk. Keller Williams Realty, Inc., will not be liable for any loss or damage caused by your reliance on information contained in This Month in Real Estate.

 

Beware of These Common Mortgage Mistakes First Time Buyers Make

Mortgage interest rates continue to remain near historic levels, making now the opportune time to buy a home in Eastern Pennsylvania or New Jersey.  However, when buying a home and obtaining a mortgage there are a few common mistakes first-time homebuyers make, and here is what you need to know to avoid them.

  1. Adjustable Rate Mortgages– An adjustable rate mortgage (ARM) usually starts with a low mortgage interest rate for the first few years, which may allow you to be able to afford a more expensive home. However, as the adjustable rate begins to increase, your monthly mortgage payment does as well. As a result, you may no longer be able to afford the high costs of your monthly mortgage. If you plan to live in your home for an extended period of time, consider a fixed-rate mortgage.
  2. Credit– Another common mistake homebuyers make when it comes to obtaining a mortgage is not reviewing their credit report before applying for a mortgage loan. Each of the three major credit reporting agencies allows you to obtain a free credit report once a year. Prior to seeking out a mortgage, obtain your credit report and look for any inaccuracies in the report that may be hindering your overall credit score
  3. Down Payment- Prior to the last economic downturn many lenders were giving borrowers loans with no down payment. With no skin in the game, we found that borrowers were more likely to default on their loans. Too often those who put no money down on their home loan find themselves upside down on their loan. Meaning you owe more on your home loan than what it’s worth.
  4. Employment- If at all possible do not make a job change during the mortgage application process. Lenders want to see your career history and want to see consistency. If you change jobs in the middle of the application process it could result in you not securing the loan or could substantially delay the process.
  5. Not Realizing the Total Cost- Don’t make the mistake of not considering the total cost of owning a home, which is more than just your monthly mortgage payment. Owning a home can become expensive when it comes to maintenance, home insurance, property taxes, utilities, and other expenses.  As a rule of thumb, keep your monthly home expenses at less than 30% of your pre-tax monthly income.

If you are buying your first home in Eastern Pennsylvania or New Jersey do not be a victim of these common mortgage mistakes.

If you are looking to sell your Eastern Pennsylvania home or to buy your dream home in 2016, the Silva Group is here to help. The Silva Group is comprised of Eastern Pennsylvania and New Jersey’s best and brightest in the real estate industry.  If you are considering buying or selling your home we would love to help. Our team is more than a bunch of real estate agents packed into an office – we are friends and family members who all have one passion – to provide the very best real estate experience possible to our clients.

Don’t Be Fooled By These 4 Common Refinance Misconceptions

Refinancing your current home mortgage more than likely will save you money on your monthly mortgage payments, and could potentially reduce the length of your loan if you so choose. When it comes to refinancing a current mortgage loan there are many misconceptions out there.  Here are a few of the top misconceptions that you don’t want to be fooled by.

  1. Most People Don’t Qualify- When mortgage lenders tightened their lending standards as a result of the recent housing financial crisis it did became difficult for many borrowers to obtain a mortgage or refinance their current mortgage. However, those days are gone and lending standards are once again more lenient. Many home owners fear they won’t qualify to refinance their loan and as a result they don’t even try. The thought that you may not qualify is a major misconception, as many people have found they qualify when they thought they wouldn’t. If you own a home and your credit is not the best, let a lender help you, and you may be surprised to find you are eligible to refinance your home mortgage and could save a great deal of money
  1. Speaking To One Lender Is Enough- Don’t fall for the misconception that you need to use the first lender you speak with. Prior to refinancing your current mortgage loan you should shop around for the best rate and service among various lending companies.
  1. My Home’s Appraisal Rate Doesn’t Matter- During the refinance process your home will need a new appraisal, and the result of that appraisal will be have a large impact on the results of your mortgage refinance. Your new interest rate will be highly impacted by your appraisal as it determines your loan-to-value. When you obtained your original home loan, if you had less than 80% down then you are paying Private Mortgage Insurance (PMI), and a higher rate. If you have built up enough equity in your home, refinancing can rid you of PMI and provide you with a lower rate.
  1. Interest Rates Are On The Rise- The Federal Reserve recently raised the key interest rate for the first time in nearly a decade leaving many home buyers and those looking to refinance to fear that mortgage interest rates would soon be increasing. However, according to Paul Zgalich at Guaranteed Rate, “Rates are at historic lows again. If you have not refinanced now is the time.”
  1. Not Enough Time To Raise Credit Score- There is a misconception among homeowners with less than ideal credit that it would take them too long to raise their credit score, and by the time they do so rates would once again be too high. If your credit score is suffering from a long list of missed monthly payments it is not something that can be fixed overnight. However, a mortgage lender can perform a “Rapid Rescore” to fix any issue that temporarily caused your score to decrease.

Don’t be fooled by the many of the misconceptions that are out there when it comes to refinancing your Eastern Pennsylvania or New Jersey home mortgage loan.  Contact Paul Zgalich at Guaranteed Rate today with any questions you may have regarding refinancing your current mortgage loan and start saving money today.

If you are looking to sell your Eastern Pennsylvania home or to buy your dream home in 2016, the Silva Group is here to help. The Silva Group is comprised of Eastern Pennsylvania and New Jersey’s best and brightest in the real estate industry.  If you are considering buying or selling your home we would love to help. Our team is more than a bunch of real estate agents packed into an office – we are friends and family members who all have one passion – to provide the very best real estate experience possible to our clients.