Real Estate Information Archive

Blog

Displaying blog entries 1-3 of 3

Beat the Rising Interest Rates!

by Jon Smith, CRB, CRS, GRI

Mortgage Rates have risen to the highest level since 2014, with a likely hood to keep increasing through out the year. What does this mean for you? Acting sooner than later will make sure that you are locking in a lower rate.

Rates have already passed 4% in the last months, property economists have predicated that mortgage rates may rise to as high as 5.5% by 2018. This small percentage difference may not seem like a lot, but over the life of a mortgage, this can mean tens of thousands of dollars to the buyer. 

Following the increase in mortgage rates, home prices are predicted to see an equal increase in 2017. This means that home buyers will see a double hit in the cost of owning a home in the next year. Combining higher mortgage rates with home values going up, it will become more difficult to buy that home you are looking for. So beat the increase, go find your future home! 

The Benefits of a Pre-Approval

by Jon Smith, CRB, CRS, GRI

Whether you are looking to buy a house soon, or buy a house in the near future, applying for a pre-approval is a great way to prepare for the right house at the right time. By getting pre-approved, possible buyers can have all their financial concerns and questions answered before the special time comes to buy a new home. There are many reasons to get pre-approved:

  • Understanding total monthly costs, not just a monthly mortgage cost. Including tax rates, insurance, mortgage cost, possible HOA, property tax, and (depending on down payment) Private Mortgage Insurance. This will help the buyer narrow down a price range of a home they feel comfortable buying. 
  • Planning for down payment, closing costs, and any fees that are involved in buying a home. There is more than just the down payment on a house, and being prepared for all the cots makes the real estate purchasing process that much more stress free. 
  • Getting all the paperwork needed to apply for a mortgage together. Buying a house can be time sensitive, and the last thing you want to do is not be able to provide the correct paperwork needed to buy a home. 
  • Helps the seller know that they are choosing a serious buyer who already knows they are ready to purchase a home. 

Among the listed reasons, pre-approval to a home mortgage makes sure you are serious buyer! 

Housing Bill Signed Into Law

by Jon Smith, CRB, CRS, GRI

Congress passed a housing bill at the end of July and it was signed into law by President Bush. The new law will make many needed changes. It will provide mortgage relief for more than 400,000 US homeowners facing foreclosure.  The law will also provide $300 billion in federal guarantees to help refinance problem mortgages and will also assist US mortgage giants  Freddie Mac and Fannie Mae.   The bill will give the Federal Housing Administration the authority to help homeowners refinance with mortgages backed by the federal government.  Current lenders, however, will have to agree to take a loss on their loans. 

Those who opposed the bill have said it will end up taking money out of the pockets of the taxpayers and putting it in the pockets of the stockholders.  At this time there is no limit to the amount of help Freddie Mac and Fannie Mae will receive.  The two companies own or back nearly half of the country's total mortgages.  The bill puts a cap of $625,500 on Freddie Mac and Fannie Mae in certain higher priced markets and up to 15% over median prices in other areas.

In addition to FHA-insured mortgages the bill will offer a number of other incentives.  One such incentive is the $15 billion in tax breaks such as a $7500 tax credit for first time homebuyers.  This credit is retroactive to April 9, 2008 and is valid until July 1, 2009.  Another incentive is $3.9 billion in grants for communities with the highest foreclosure rates.

Although there are some very good things in the bill there is one major item that will affect many new Homeowners. This bill will totally eliminate down payment assistance as of Sep .30 2008.

With that said several people in Congress have pledged to do everything the can to keep these programs.  It’s estimated that the down payment assistance programs have helped over 700,000 Americans purchase a home.  Many consumers would not be able to get a Home Loan without down payment assistance.

Displaying blog entries 1-3 of 3

Share This Page

Contact Information

Photo of Jon Smith, CRB, CRS, SRES, SFR Real Estate
Jon Smith, CRB, CRS, SRES, SFR
Iowa Realty
3521 Beaver Ave.
Des Moines IA 50310
515-240-2692
Fax: 515-453-6404
 

 

 

Licensed in the State of Iowa