How will the Federal Reserve Raising Interest Rates Impact You?

On December 16^th,  2016 Chairman Janet Yellen announced that The Board of Governors of the Federal Reserve (Head of the Bank of the Banks) were raising interest rates. 

http://www.federalreserve.gov/newsevents/press/monetary/20151216a.htm

Chairwoman Janet Yellen is the first woman to hold this position. Chairwoman Yellen took over the position from Ben Bernanke and was sworn into her office on February 3^rd, 2014 after the senate confirmation in January 2014.

The Prime Rate adjusted in sync with the announcement.  However, most of the loan market already expected this and mortgage interest rates had risen about 0.25% in the 10-14 days before the announcement in anticipation, so there was actually little movement in long terms rates at the time of the announcement.

But, what does this mean for you? What does this mean for your clients? What is the actual cost?

The Federal Reserve has already raised interest rates by 0.25% and plan to continue raising rates 0.25% until next December so there will be a full 1% increase in interest rates. That doesn't sound like much, but for most people it actually adds up. Take a $300,000 home for instance. For each 0.25% increase in the interest rates on a $300,000 loan, that's an extra $43.56 a month. So over, the next year, if you are buying a $300,000 and the interest rates go up by 1%, that's an extra $174.24 a month in interest you'll be paying. That's easily a student loan payment, a car payment or a nice dinner out. If you look at it on an annual basis, it's over $2,090 a year in additional interest costs, which is over $10,400 over the next five years!!  Now, you may think, well, that’s more of a tax deduction for me since it’s interest. Be sure to check with your CPA to see how that change will really impact your bottom line. But I say, a penny earned is a penny save, and even more important, $2,000 saved is by buying now is free money!

So, if you are considering buying a home, do it now! Get pre-approved and start planning now.

These interest rates are for the purposes of example only.  You are not guaranteed these rates, you may or may not qualify for a loan.

For more information, pick up my #1 Best Selling Book at ElysiaStobbeBooks.com

For more mortgage tips check out our website www.bestmortgagebook.info

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July's Real Estate Market

Welcome to July.  It seems that it is a seller’s market, with about 5 months of inventory available.  Once this surpasses 6 months supply we may see a transition to a buyer’s market. But for now, the sellers have the upper hand.

What does this mean for you? Well, it could mean higher sales prices, bidding wars and less contingencies. What’s the best way you can be prepared?

As always, I recommend getting pre-approved instead of pre-qualified. This lets you know your true buying power. Also, a pre-approval is stronger than a pre-qualification.  In some markets, usually the hotter markets, Realtors ® and sellers won’t accept pre-qualification letters, they will only accept pre-approval letters.

In addition, select your team ahead of time so once you are under contract you are not scrambling to put together the pieces.  By team, I mean your Real Estate Agent, your lender, your title company, your home owner’s insurance agent and your home inspector. Take the time to ask questions of each and make sure you are comfortable with their answers. Once you are under contract you will have limited time to make decisions and that’s no fun if you are stressed out.

Here are Key Considerations when Selecting a Real Estate Agent

·        Look for Success and Experience

·        Look for a Listener that Hears YOU

·        Choose Team Sports Over King of the Hill – Look for a Real Estate Agent that works well with Others

·        Are there specialties that are relevant to YOU?  Such as MRP- Military Relocation Professional.  For a complete list of the National Associations of Realtors ® Certification, check out www.realtor.org/designations-and-certifications

For questions to ask your lender, check out my free download, Top 10 Questions to ask your Lender at www.BestMortgageBook.com

All of this information can be found in much more detail in my book on Amazon

To grab my new book, How To Get Approved for the Best Mortgage Without Sticking a Fork in Your Eye™, click here: elysiastobbehomeloans.com

For more mortgage tips check out our website www.bestmortgagebook.info

For video mortgage tips and tools subscribe to our YouTube

Channel: https://www.youtube.com/watch?v=YsL6BuJ8b-M

For sponsorship opportunities go to:  sponsorbestmortgagebook.info

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Common Questions Asked By First Time Home Buyers

Wow!  What a ride!  I cannot thank you enough for your support. My book launched on Friday and became the #1 New Release in Mortgage Books on Amazon. Amazon likes it so much they just reduced the paperback price to $8.99!  Grab your copy here: www.elysiastobbehomeloans.com
I consider it a privilege to share this information with you.

I wanted to share with you some of the questions I got yesterday at the FL Times Union Home Buyers Expo. Over 1500 people attended, it was a huge success!  I was honored to be asked to speak to their audience.

I did two presentations.  Each presentation gave a quick overview of two topics.  The first presentation was 3 Monumental Money Mistakes To Avoid & Why Shopping for the Best Interest Rate can Cost you Money. Common questions pertained to the differences in FHA and Conventional Loans and the different mortgage insurance rates for each as well as the funding fees for government loans.

The second presentation covered 7 Massive Mortgage Mistakes to Avoid & VA, FHA & Conventional Financing Highlights. A common question was, "What if I have a 640 credit score and I am a first time home buyer, can I put down only 3%?"  Yes, if you are a first time home buyer and qualify for conventional loan financing, you can put down as little as 3% with a 640 credit score. However, the monthly mortgage insurance will be more expensive due to the 640 credit score. Here are some highlights from the 2nd half of this presentation.  I hope you find this information useful.

Here are some VA Loan Highlights:

•Minimum Down Payment 3.0% for first time home buyers, otherwise 5%

•No Funding Fee

•Monthly MI varies based on down payment, credit score, type of residence, varies from 0.22%-0.74%

•MI is automatically removed at 22% equity

•Minimum Credit Score 620 with 20% down payment or 640 with 5% down payment

***Veterans, THANK YOU for your Service!!

Here are some FHA Loan Highlights:

•Minimum Down Payment 3.5%

•FHA Funding Fee of 1.75%

•Monthly MI of 0.85% with 3.5% down or .80% with 5% down payment

•MI is for the life of the loan

•Minimum Credit Score 580

Here are some Conventional Loan Highlights:

•Minimum Down Payment 3.0% for first time home buyers, otherwise 5%

•No Funding Fee

•Monthly MI varies based on down payment, credit score, type of residence, varies from 0.22%-0.74%

•MI is automatically removed at 22% equity

•Minimum Credit Score 620 with 20% down payment or 640 with 5% down payment

***Please keep in mind this is only an example for illustration purposes.  These interest rates may not be available and/or you may not qualify for this loan type.

All of this information can be found in much more detail in my #1 Best Selling Book on Amazon

To grab my new book, How To Get Approved for the Best Mortgage Without Sticking a Fork in Your Eye™, click here: elysiastobbehomeloans.com

For more mortgage tips check out our website www.bestmortgagebook.info

For video mortgage tips and tools subscribe to our YouTube

Channel: https://www.youtube.com/watch?v=YsL6BuJ8b-M

For sponsorship opportunities go to:  sponsorbestmortgagebook.info

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Top 3 Reasons Why Mortgages are Sexier Than Caitlyn Bruce Jenner

1. If you qualify for a mortgage you don't have to use your hard earned cash to buy your new home. Now that's sexy!

Why use your cold hard earned cash to buy your next home when you can use the bank's money?  First Time Home Buyer's can put down as little as 3% for a down payment now.  For example, if you are buying a $300,000 home, 3% is $9,000. Spending $9,000 sounds a whole lot better than spending $300,000, right?

2. Mortgage Interest Can Be Tax Deductible. Now that's really sexy! 

What better benefit to being a home owner and using someone else's (the bank's) money than to get to write off the interest expense? This just keeps getting better and better! When you get a loan, your repayment schedule usually consists of principal & interest.  That interest you pay every month can be tax deductible. Consult your CPA for details.

3. There's more than enough paperwork in the mortgage process to cover up every inch of Caitlyn you didn't really want to see in Vanity Fair.

I'm very excited for our Olympic Hero and her quest for happiness. The Vanity Fair spread is eye catching to say the least. In addition to covering up parts of Caitlyn you didn't want to see mortgage paperwork can be recycled for later use as a toga, paper skirt or those weird flip flops they give you when you get a pedicure. Just be sure to shred the documents that have all your pertinent info such as your name, social security #, address, bank account #'s, etc.

For more info about and pictures of Caitlyn Jenner and what his/her ex Kim Kardashian has to say, click here:  http://www.dailymail.co.uk/tvshowbiz/article-3107508/Kim-Kardashian-defends-Caitlyn-Jenner-s-choice-dress-sexy-clothes-reveal-cover-Vanity-Fair.html

***Please keep in mind this is only an example for illustration purposes.  These interest rates may not be available and/or you may not qualify for this loan type.

To get on our waiting list for my new book, How To Get Approved for the Best Mortgage Without Sticking a Fork in Your Eye™, go to our website www.bestmortgagebook.info

For video mortgage tips and tools subscribe to our YouTube

Channel: https://www.youtube.com/watch?v=YsL6BuJ8b-M

For sponsorship opportunities go to:  sponsorbestmortgagebook.info

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Is Now a Good Time to Buy a Home?

We are in the midst of Spring Home Buying season and there are quite a few positive indicators that it’s a good time to buy a home. There are many factors to consider before deciding if it’s a good time to buy a home, such as the economy, interest rates, supply & demand, the cost of renting vs. buying and your own personal situation.

Where are interest rates?

Interest rates are hovering around all time lows (again!) right now, so that’s one important factor to take into account when considering buying a home.  What does this mean to you in real numbers? Well, let’s say you are considering purchasing a home with a sales price of $300,000.  In a perfect world, you put down 20%, which is $60,000. That leaves you with a loan amount of $240,000. Don’t worry; there are many other loan programs available with much smaller down payments, such as 3% and 3.5%, which would be $9,000 and $10,500 respectively.

If your interest rate is 4.0% for a 30 year fixed mortgage with a loan balance of $240,000, your monthly principal and interest payment would be $1145.80.

Let’s say your interest rate is 5.0% for a 30 year fixed mortgage for the same $240,000 mortgage; your monthly principal and interest payment would be $1288.37.

See the difference? That’s $142.57 a month you save on interest alone! Let’s look at it over the long haul…$1710.84 a year = $51,325.20 over the course of a 30 year loan!

Now, of course there’s more than one way to look at this.  That same $142.57 could also be a tax deduction for you.  Be sure to check with your CPA for interest deductions. The $142.57 a month could also be the same amount as one of your student loans. Only you know what’s comfortable for you when it comes to a monthly payment and what makes sense. Keep in mind that you are also responsible for home owners insurance, property taxes and any monthly home owners or condo association fees in addition to the principal and interest on your loan.

If you are a first time home buyer, you can save yourself time and money with my first time home buyer video tips at https://www.youtube.com/watch?v=YsL6BuJ8b-M

See what DS News has to say about buying a home now, "Analyst Says Buying a HomeNow Is a Solid Investment"

How long do you plan on staying in your area?

I think your own personal situation is the most important thing to consider when buying a home. Do you like the area? How long do you think you’ll be there? How long do you think you’ll be at your job? I bought my first home about two years after I graduated from college. My Mom was so nervous for me, but I wasn’t scared at all. I knew I liked the area (dear old Baltimore, MD my heart goes out to you) and wanted to be there for a while. I had moved around quite a bit in my early years and was looking forward to growing roots in the Baltimore community. I ended up living in that house for eight years. I rented out my house for the last two years I owned it when I moved down the road to Arlington, VA before I sold it. It became my first rental property. Since then I have owned and rented homes as I moved around the East Coast. Whether I bought or rented depended on all the factors I am sharing with you here; the economy, interest rates, the cost of renting vs. buying and my own personal situation.

CNN Money also says it’s a good time to buy, "Home Buyers In These Markets Have the Upper Hand"

What’s the cost of renting vs. buying?  

Does it cost more or less to rent than to buy? Any licensed loan originator as well as real estate agent should be able to help you with this calculation in your local area. Basically you take your total estimated monthly mortgage payment including property taxes, home owners insurance and any monthly home owners association or condo fees and compare it to the cost to rent something similar in location and size. To make it more complex, factor in your down payment and estimated closing costs spread over the time you think you will be in that location as well as any interest deduction your CPA thinks you would benefit from by owning. Other factors to consider are leverage and appreciation. For more help with this calculation feel free to contact me at bestmortgagebook@gmail.com.

Julian Castro, the Director of Housing and Urban Development is positive about buying a home in 2015.

***Please keep in mind this is only an example for illustration purposes.  These interest rates may not be available and/or you may not qualify for this loan type.

To get on our waiting list for my new book, How To Get Approved for the Best Mortgage Without Sticking a Fork in Your Eye™, go to our website www.bestmortgagebook.info

For video mortgage tips and tools subscribe to our YouTube Channel: https://www.youtube.com/watch?v=YsL6BuJ8b-M

For sponsorship opportunities go to:  sponsorbestmortgagebook.info

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Getting the Best Mortgage may help you financially in the long run

Cash is King. Well, maybe not if you want to buy a home. According to the recent Washington Post article, The case for not paying off yourmortgage by retirement by Jonnelle Marte there’s good debt and bad debt.  Jonnelle considers a mortgage good debt. Cash is liquid and you can’t access your cash if it’s tied up in your home. Of course, there’s also the added benefit of deducting the mortgage interest on your home. There are quite a few mortgage options now that allow you to put down a small down payment. If you are a first time home buyer you can put down as little as 3% if you qualify for a conventional loan.  FHA currently allows for down payment of 3.5%.  For all you veterans (thank you for your service!) if you qualify, you don’t have to put anything down.  Yes, VA loans allow for $) down payment, which means 100% financing. The USDA loan also allows for $0 down payment. So, as you can see, there are many loan options available right now. However, it’s important to know the different features of each. For example, VA has $0 monthly mortgage insurance fee.  USDA has .30% monthly mortgage fee.  FHA’s monthly mortgage insurance is .85%. The VA, USDA & FHA loans are government loans and they ALL have up front funding fees, so be sure to discuss those with your mortgage lender. Also, FHA now has monthly mortgage insurance for the life of the loan. It’s not removed once you have over 20% equity in your home like other loan products. Ask your lender all the questions you can about the differences in all the parts of your monthly mortgage payment as well as the costs of the loan, such as the funding fees.

***Please keep in mind this is only an example for illustration purposes.  These interest rates may not be available and/or you may not qualify for this loan type.

For more mortgage tips, tools and info check out bestmortgagebook.info

For quick & easy mortgage video tips check subscribe to our YouTube Channel:
https://www.youtube.com/channel/UClqbHsnbsMWVJqw674g9y-Q

Lowest Rates Today?

Spring is here and there's interesting home advice out there. I have helped clients with several purchases this week - watch those bidding price wars! Holly cow those can be rough! After an uptick in rates, they have dropped back down so refinances are keeping us busy too. What's all that mean to you? Well, with Spring comes home buying advice. The Consumer Report article shaking up the mortgage brokers by telling consumers to go to a direct lender is not a shock. However, there's so much more than just shopping the rate. I can't emphasize this enough. Shopping the rate misses the mark in so many aspects. If you call lenders and ask for their best rate, it doesn't take into account the variety of loan programs as well as the cost of mortgage insurance. I'm not a fan of Bankrate as it is very misleading to the consumer; the rates are with fee and many people don't click on the fine print to see exactly how many points they are being charged. Shopping for the best rate or lowest rate misses the mark on so many important pieces of your mortgage, such as funding fee (or not), how down payment affects your interest rate and of course, last, but not least credit score. What if you are interested in one loan with mortgage insurance or a 1st loan with a 2nd loan? That affects interest rate too. What if you ask for the lowest rate, but you don't qualify for it? In order to get the best rate, you need the best lender, who will find you the best loan program. That's how you get the best mortgage. If you get the lowest interest rate, but it has the highest mortgage insurance, your total monthly payment could be more than if you had a higher interest rate and lower mortgage insurance.  How long do you need to keep the mortgage insurance? Good question. FHA now requires you keep the mortgage insurance for the life of the loan! FHA also has an up front funding fee. If you can get a lower interest rate with an FHA loan, but you don't take into account the other fees, can you see how you could have a higher monthly mortgage payment AND payout wasted thousands of dollars over the life of the loan? Is there a better loan for you?  The best lender will help you get the best loan for YOU. Here are 10 questions to help you get started on your search for the best lender.
1. Are you a direct lender or a broker?  How does that affect me?
2. Can you issue a conditional approval on my loan within 2 business days?
3. Can you guarantee you will close my loan in 30 days or less?
4. Do you have any written references? Do you have client surveys you can share with me?
5. What is your closing ratio?
6. What are the upfront costs I will incur during the loan process before I close?
7. Do you attend the closing?
8. How long has your company been in business?
9.Are you a licensed Loan Officer?
10. How long have you been in mortgage industry?

There's a lot more to shopping banks than the rate. I always find that an educated consumer makes for a great client.

***Please keep in mind this is only an example for illustration purposes.  These interest rates may not be available and/or you may not qualify for this loan type.

For more mortgage tips, tools and info check out  bestmortgagebook.info

For quick & easy mortgage video tips subscribe to my youtube channel:
https://www.youtube.com/channel/UClqbHsnbsMWVJqw674g9y-Q