Michael Santos

MLB Residential Lending

A Few Creative and Effective Ways to Save Money for a Down Payment

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A Few Creative and Effective Ways to Save Money for a Down PaymentFor those who are looking to buy a home, they know that this is one of the most exciting experiences in the world. There is something special that comes with looking at a bunch of homes and envisioning a life there. On the other hand, the prospect of saving 20 percent of the home’s value to put down might seem overwhelming. Fortunately, there are a few creative ways that people can save up enough money to purchase their starter dream home.

Talk To The Seller

One of the first tips that people need to keep in mind involves talking to the seller. There are a bunch of items that need to be negotiated between the buyer and the seller. One of the most important is the closing costs. Ask the real estate agent to speak with the seller. Even if the seller is able to take half of the closing costs, this could amount to a few thousand extra dollars that could be put toward the down payment.

Crowdsource The Down Payment

Another creative option involves asking the crowd to help with the down payment. It is not unusual to see people try to go the crowdfunding route for everything from medical bills to student loans. Why not give it a shot with a down payment as well? First, anyone who has a wedding coming up should add “money for a down payment” to their wish list, as this is becoming more common. Second, think about exploring platforms like Feather the Nest to try to raise money for a down payment.

Check With The Employer

Finally, it is also critical to look at your Employer Assisted Housing Program(EAH). While not everyone is going to qualify, those who work for an employer who falls under this category might qualify for a substantial loan for the down payment and closing costs. The best part is that this loan comes without interest. 

Save For A Down Payment

These are a few of the top ways to save money for a down payment. Using these tips, everyone can get over that last hurdle and buy their home.

What’s Ahead For Mortgage Rates This Week – December 28, 2020

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Last week’s economic news included readings on sales of new and previously-owned homes and consumer sentiment. Weekly average mortgage rates were also released, but readings for jobless claims were not released due to the Christmas holiday. Single-Family Home Sales Fall in November Sales of new and previously owned homes were lower in November. Fear of rising covid-19 cases and the usual slump in home sales during the winter holidays contributed to fewer home sales. Rapidly rising home prices cooled buyer interest; short supplies of pre-owned homes for sale drove prices of new homes higher as demand increased. Inventory of new homes increased by 14 percent as the median price of a new single-family home rose to $335,000, which was five percent higher year-over-year. George Ratiu, a senior economist with Realtor.com, said that would-be homebuyers were dealing with an increased divide between their home-buying preferences and affordability. Rising materials costs continued to drive new home prices up; builders faced challenges in constructing affordable homes due to higher materials costs and lower profit margins. November sales of previously-owned homes were lower with 6.69 million sales reported on a seasonally-adjusted annual basis as compared to October’s reading of 6.86 million sales. Short inventories of available pre-owned homes caused a dip in sales as buyers competed for fewer available homes. Shortages of available homes are expected to persist into 2021 and to drive home prices higher. Affordability will challenge many buyers even as mortgage rates remain at or near record lows. Mortgage Rates Lower Rates for fixed-rate mortgages dipped last week according to Freddie Mac. The average rate for a 30-year fixed-rate mortgage was one basis point lower at 2.66 percent; rates for 15-year fixed-rate mortgages averaged 2.19 percent and were two basis points lower. The average rate for 5/1 adjustable rate mortgages was unchanged at 2.79 percent. Discount points averaged 0.70 percent for 30-year fixed-rate mortgages, 0.50 percent for 15-year fixed-rate mortgages, and 0.20 percent for 5/1 adjustable rate mortgages. The University of Michigan reported a lower index reading of 80.7 for December as compared to an expected reading of 81.0 and November’s reading of 76.9. A post-Thanksgiving surge in Covid-19 cases caused consumer sentiment to fall. What’s Next This week’s scheduled economic readings include Case-Shiller’s Housing Market Indices, pending home sales, and weekly readings on mortgage rates and jobless claims. Last week’s economic news included readings on sales of new and previously-owned homes and consumer sentiment. Weekly average mortgage rates were also released, but readings for jobless claims were not released due to the Christmas holiday.

Single-Family Home Sales Fall in November

Sales of new and previously owned homes were lower in November. Fear of rising covid-19 cases and the usual slump in home sales during the winter holidays contributed to fewer home sales. Rapidly rising home prices cooled buyer interest; short supplies of pre-owned homes for sale drove prices of new homes higher as demand increased.

Inventory of new homes increased by 14 percent as the median price of a new single-family home rose to $335,000, which was five percent higher year-over-year. George Ratiu, a senior economist with Realtor.com, said that would-be homebuyers were dealing with an increased divide between their home-buying preferences and affordability.

Rising materials costs continued to drive new home prices up; builders faced challenges in constructing affordable homes due to higher materials costs and lower profit margins.

November sales of previously-owned homes were lower with 6.69 million sales reported on a seasonally-adjusted annual basis as compared to October’s reading of 6.86 million sales. Short inventories of available pre-owned homes caused a dip in sales as buyers competed for fewer available homes. Shortages of available homes are expected to persist into 2021 and to drive home prices higher. Affordability will challenge many buyers even as mortgage rates remain at or near record lows.

Mortgage Rates Lower

Rates for fixed-rate mortgages dipped last week according to Freddie Mac. The average rate for a 30-year fixed-rate mortgage was one basis point lower at 2.66 percent; rates for 15-year fixed-rate mortgages averaged 2.19 percent and were two basis points lower. The average rate for 5/1 adjustable rate mortgages was unchanged at 2.79 percent. Discount points averaged 0.70 percent for 30-year fixed-rate mortgages, 0.50 percent for 15-year fixed-rate mortgages,  and 0.20 percent for 5/1 adjustable rate mortgages.

The University of Michigan reported a lower index reading of 80.7 for December as compared to an expected reading of 81.0 and November’s reading of 76.9. A post-Thanksgiving surge in Covid-19 cases caused consumer sentiment to fall.

What’s Next

This week’s scheduled economic readings include Case-Shiller’s Housing Market Indices, pending home sales, and weekly readings on mortgage rates and jobless claims.

Working From Home Could Mean A New Home

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Working From Home Could Mean A New HomeThere are a lot of people who are working from home for the first time. There are a lot of advantages that come with working from home, such as the opportunity to develop stronger relationships with family members, the chance to save money on gas, and more autonomy over the work schedule. In addition, this could also mean a new home.

With many people spending more time at home than they did in the past, they might be thinking about investing in new floorplans, renovating cabinets, and adding a dedicated home office. This could also provide the opportunity to move.

Why People Are Thinking About Upgrading Their Homes

For those who continue to commute to work, they might not spend that much time in their homes. As a result, they may not be that invested in the overall layout of the home. As long as the home meets their needs when they are present, this is enough.

On the other hand, when people work from home, their needs change. For example, many people have their kids home from school right now. Their kids might distract them when they are trying to work. By renovating the home and creating a dedicated space for a home office, this could allow someone to be more productive. Renovating the home is about meeting people’s needs as they change.

The Prospect Of Moving Entirely

On the other hand, some people might be thinking about moving to a new home entirely. The vast majority of people end up purchasing a new home because they have recently obtained a new job and need to live close to work. When someone works from home, they can live just about anywhere they choose. While many people still choose to live relatively close to their current location, working from home provides people with more flexibility than they had in the past. Therefore, many families are taking advantage of it.

Working From Home Will Become More Common

In the future, working from home is going to become more common. As technology continues to improve, people are going to have the opportunity to work from home for the foreseeable future. This represents a lifestyle shift that many people are going to embrace.

How To Finance Your Home Improvement Project

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How To Finance Your Home Improvement ProjectIf you have been spending a lot of time at home recently, then you might be getting tired of staring at the same four walls. Fortunately, there are plenty of ways for you to switch it up by financing a home improvement project. At the same time, home improvement projects can be expensive, particularly if you are targeting the kitchen. Therefore, you might be wondering how you are going to be able to pay for them. There are plenty of ways that you can finance a home improvement project, so take a look at a few of the options below. 

Consider Taking A Cash-Out Refinance

One way that you can free up some extra cash is to carry out something called a cash-out refinance. Right now, due to the coronavirus pandemic, mortgage rates are at historic lows. Therefore, you might be able to complete a refinancing plan that can free up some cash for the home improvement project. When you refinance your loan, you essentially change the terms of your mortgage to free up some of the equity that you already have in your home. Then, you can put this equity toward your home improvement projects. 

Take Out A Home Equity Line Of Credit

You might also be able to tap into the equity you have in your home directly by creating a line of credit. This is a common option when it comes to home improvement financing. The money that you receive from this home equity line comes directly from the equity in your home. If you have been paying into your mortgage for several years, then there is a high chance that you have built up an equity line of credit. At the same time, remember that this is very much like a second mortgage, so you are essentially putting up your house as collateral.

Finance Your Home Improvement Project

Even though you can always put your home improvement project on a credit card or take out a personal loan, it might be better for you to tap into the equity in your home. By accessing a lower interest rate, you might be able to save a significant amount of money while still accomplishing your home improvement project goals.

 

What’s Ahead For Mortgage Rates This Week – December 21, 2020

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What's Ahead For Mortgage Rates This Week - December 21, 2020Last week’s scheduled economic reporting included readings from the National Association of Home Builders and a statement from the Federal Reserve’s Federal Open Market Committee. Weekly readings on mortgage rates and jobless claims were also released.

NAHB: Builder Confidence Falls In December

Homebuilder confidence in market conditions for single-family dropped by four points in December to an index reading of 86.  December’s reading was the second-highest on record after November’s reading. Component readings of the Housing Market Index also dropped. Builder confidence in current market conditions fell to 92 as confidence in single-family home sales within the next six months fell to an index reading of 85. Homebuilder confidence in buyer traffic in new single-family developments dropped to 73; buyer traffic readings rarely exceeded 50 until recent months.

Regional Housing Market Index readings were also lower than in November. The Northeast, Midwest, and South reported readings three points lower than in November. The Western region’s reading dipped by two points month-over-month.

Fed Holds Key Rate Steady

The Federal Open Market Committee of the Federal Reserve announced no change to the current federal funds rate range of 0.00 to 0.25 percent. Citing severe economic challenges caused by the Covid-19 pandemic, the FOMC statement indicated that economic forecasts would be subject to the course of the virus and related impacts on public health, the economy, and labor markets.

The Committee stated its monetary policy would be flexible in response to the pandemic and the Federal Reserve’s dual mandate of achieving maximum employment and an inflation rate of two percent. The inflation rate has fallen short of the Fed’s objective of two percent; FOMC members amended the inflation rate goal to two percent or higher to compensate for the impact of repeated readings under the two percent mandate.

Mortgage Rates Hit Record Low; Jobless Claims Mixed

Freddie Mac reported new record lows for average mortgage rates last week. Rates for 30-year fixed-rate mortgages averaged four basis points lower at 2.67 percent. Rates for 15-year fixed-rate mortgages averaged 2.21 percent and were five basis points lower. The average rate for 5/1 adjustable rate mortgages was unchanged at 2.79 percent. Discount points averaged 0.70 percent for 30-year fixed-rate mortgages, 0.60 percent for 15-year fixed-rate mortgages, and 0.30 percent for 5/1 adjustable rate mortgages.

New jobless claims rose to 885,000 first-time claims filed as compared to 862,000 new claims filed the prior week. 5.51 million ongoing jobless claims were filed; last week’s reading was lower than the prior week’s reading of 5.78 ongoing jobless claims filed.

What’s Ahead

This week’s scheduled economic news includes readings on sales of new and previously-owned homes, inflation, and consumer sentiment. Weekly reports on mortgage rates and jobless claims will also be released.

Remove The Flood Insurance Risk From The Closing Process

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Remove The Flood Insurance Risk From The Closing ProcessMany homeowners do not realize that the risk of a flood is a significant factor that plays a role in not only homeownership but also the closing process. Even though flooding is a major risk, many homeowners do not carry enough coverage. Without proper flood insurance, homeowners risk losing millions of dollars. Therefore, it is prudent for those who are looking for a home to factor flood insurance into their home search. This can streamline the closing process down the road.

Exploring Options For Flood Insurance

When homeowners think about flood insurance, they are often directed to the National Flood Insurance Program (NFIP). While this is one option, there are also private options available that could provide better prices and more favorable terms. Private options exist in all 50 states in addition to the Washington DC area. They can be used to satisfy the requirements of banks, credit unions, and lenders at the time of closing.

Calculate The Risk Of Flooding

While a flood can happen at any time, some homes are in riskier locations than others. Therefore, homeowners need to take a look at the individual risk of flooding at a specific property in which they might be interested. In some cases, homes might be located in high-risk areas where flood insurance still might not be required. Homeowners need to make sure that they understand the risk of flooding of a potential property and protect it accordingly. Homeowners’ insurance usually does not cover flood events, so a separate policy is typically needed.

The Requirements Of The Lender

There are some situations where homeowners might have their closing process delayed purely because they did not realize that the lender required flood insurance. During the preapproval process, it makes sense for homeowners to ask the lender if they require flood insurance. That way, homeowners will be able to factor the cost of flood insurance into the search process and expedite their closing later.

Invest In Quality Home Insurance

For many homeowners, their home is the most valuable investment they will ever make. Therefore, it has to be protected appropriately. This includes flood insurance. Check out flood insurance options ahead of time to streamline the closing process later.