5 Tips For Buying in a Hot Housing Market

It is a hot housing market right now.  Here are 5 quick tips to help you get your offer accepted in a hot housing market.

Tips to Make the Home Buying Process Smoother

The home buying process can be complicated.  So, please find these few tips to make life a little easier for you as you proceed.

Happy Easter From the Lester Wilkins Mortgage Team

I hope you and your family have a blessed and Happy Easter!

Possible Tax Deductions

Check out this short video for possible deductions when you do your taxes.

Time to Update Your Info

I hope your 2015 is starting off well.  With the new year here we need to update some of your information.  Please call my staff today to see what you need to update 810-987-1200.

Merry Christmas!

Everyone on the Lester Wilkins Mortgage Team would like to wish you a very Merry Christmas and a prosperous 2015!

I am grateful for you!

Happy Thanksgiving!

Is it Time to Refinance?

Is it Time to Refinance?  More Homeowners Are Doing Just That, and Here's 4 Reasons Why In late July, the Mortgage Bankers Association reported that applications for home loan refinances have not only been holding steady, but are also on the rise. This after home loan rates hit their lowest levels of the year, many homeowners may be ready to refinance—and there are a variety of good reasons to do so. For instance, you could: Lower your interest rate, making a big difference in your monthly out-of-pocket costs for housing, meanwhile saving money on financing fees over the life of your loan.  Build equity faster. On the flip side, homeowners who are in a position to make higher monthly payments could switch from a longer to shorter term mortgage, where available.  Change your loan program from an adjustable rate mortgage (ARM) to the stability of a fixed rate mortgage, taking advantage of today's low rates and loan programs. Cash out on equity you've already established for home improvement projects you've wanted to tackle, to pay off debt, or send your child to college. If you or anyone you know would like to discuss whether refinancing makes sense at this time and all available opportunities, please get in touch. I'm happy to help.

Some Productive Ways To Use Your Free Time

On rare occasions you might find yourself with a little extra time on your hands.  You can actually prepare yourself to really productive when this occurs.  Avoid the guilt of wasting this precious free time by applying the following tips.

1. Create a "To Read" File
Clip magizine articles you want to read.  Print the interesting email or report you received, but don't have time for now.  Place them in a folder called "Reading File."  Keep it with you and whenever you have a chunk of time, such as in the waiting room at the Dr. Office, you will have some quick reading.  How cool is that?

2.  Create a Calls List
Create a list with non-urgent phone calls you need to make.  Take it with you everywhere. Whenever, you have a free minute you can check off a bunch of those calls in a short amount of time.  As a bonus tip, include the contacts' phone numbers on your list.  Look at you.  You are a productivity machine!

3.  Create an Emails List
Most of us have smart phones.  If you don't call me and I will introduce you to 2003 over a dram of Scotch.  If you take the time to make a list of emails you need to make and keep the list with you, it will prove to be extremely useful.  You can knock out quite a few emails with little effort while you are waiting for your oil to be changed, or in the line at the super market.

4.  Create a "To Listen" File
I store MP3's and voicemails in here for later review. I love this for the commute to work.  You will too.  I don't care for pop music anyhow!

Bonus Tip:
In our digital world this can all be done on your smart phone.  I suggest using Evernote.  If you need any help with this please do not hesitate to give me a call and I will be glad to get you set up.

Bumpy Road Ahead for First-time Buyers

Winter weather pummeled housing across much of the nation last quarter. As spring weather brings a thaw for busier months, the focus is now on whether there is enough inventory to satisfy demanding buyers, particularly first-timers. Low housing supply, tightened credit guidelines, increasing rates and rising prices are all stacking up against first-timers' odds at calling a place their own. No answer on when new Building Permits, which rose 7.5 percent to just over 1 million in March, will be approved for new home construction to meet demand.

Homebuyers in general are reportedly less confident about the market. Following January to February's 10 point drop in the monthly builder sentiment index from the National Association of Home Builders (NAHB), it rose 1 point (from 46 to 47) in March. Readings below 50 indicate that more builders view housing market conditions as poor, rather than good. This reflects builders' inabilities to find lots and labor, according to Kevin Kelly, NAHB Chairman. More than ever, buyers will be requiring the help of skilled real estate professionals to represent them in what could be competitive purchase transactions this season.

Fannie and Freddie on the Chopping Block?
Late last quarter, the Senate Banking Committee said it would introduce a bill to reform the U.S. housing finance system by scaling back and possibly eliminating Fannie Mae (FNMA) and Freddie Mac (FHLMC). The government-backed enterprises oversee the secondary mortgage market. By purchasing home loans from lenders, packaging them up, and selling them to investors as mortgage backed securities, they free up liquidity for lenders to continue financing homes. Both regulate home loan guidelines with the goal of making home ownership more attainable for Americans.

Fannie and Freddie were largely criticized for securitizing bad loans which contributed to the subprime crisis. This story will be watched closely for its impact on housing and potential future housing reforms for many years to come.

Productivity Tip: Manage You, Not Your Time.

We have the same amount of time in a day as Thomas Edison and Albert Einstein. How did they do it. The key is to manage you, not your time.

New Qualified Mortgage Rule Now in Effect

What Does This Mean to You?

You may have heard about a new rule that may impact people looking to purchase or refinance a home.

What is This Rule? 
As of January 10, 2014, lenders are required to more thoroughly assess a borrower's "ability to repay" a loan, so that he or she can receive a "Qualified Mortgage" (QM).

Why was it Enacted? 
The rule is part of the Dodd-Frank Consumer Protection Act, which made banks and mortgage lenders legally liable for determining borrowers' abilities to repay their mortgages. It was enacted to help ensure borrowers get a home loan they can afford to repay, and to help prevent people from going into foreclosure and losing their homes.

What is the Bottom Line?
While new guidelines are now in effect related to loan limits, a borrower's debt-to-income ratio, fees and other items, the good news is that the Consumer Financial Protection Bureau (CFPB) estimates that 95 percent of all mortgages made in 2013 already met the new rule. So there's a good chance the new rule won't impact the majority of borrowers.

If you're thinking of purchasing or refinancing a home this year, or if you know someone who is, I'm here to help. Give me a call or send me an email, and I'm happy to answer any questions you may have.

When FHA Requires Lead-Based Paint Repairs

If you're interested in working with HUD REO properties and buyers who need FHA financing, you may come across appraiser-required conditions to perform lead-based repairs.

The only time lead-based repairs are required for an FHA-financed HUD REO property is when the property was built prior to 1978.

Lead-based paint removal, however, falls under EPA regulations. A contractor or investor may cure the paint issues, but an FHA underwriter will require a copy of the contractor's Certificate of Completion from an EPA or state provided lead-based paint training program. Repairs completed by owner-occupants do not require this training certificate, but do require documentation of the repairs.

And remember, the FHA appraiser's final inspection will only certify the repairs are completed, not that they were performed according to EPA guidelines.

This rule is required by FHA because renovation, repair, and painting activities such as cutting and sanding can disturb lead-based paint, creating hazardous lead dust, which even in small amounts, is enough to poison children and put adults at risk.

Don't forget to let your renovation-minded clients know!

8 Steps To Reduce Property Taxes

As the sluggish economy drags on, county boards everywhere are looking for ways to replace lost income, and re-assessments of residential real estate taxes is just one of those ways. Sometimes it's fair, other times it avoids belt-tightening. If your property taxes have been raised and you feel it's unfair, here is how to prepare to meet your assessor for a review to lower them:

1. Look for reporting mistakes. Examine the assessor's entire property description. Note discrepancies and document them with blueprints, surveys, photos or other inspection reports.

2. Compare neighborhood assessments. Are other homes in your neighborhood assessed similar to yours? Check the web first; some counties post assessments online.

3. Compare current sales. Talk to a local real estate agent (if you need a referral, I'm glad to help) and get a report of comparables sold within the last 6 months. Sold homes count, listings don't.

4. Take pictures. Document where your home needs repair compared to other homes in better shape in your neighborhood.

5. Get a new appraisal. If your home is unusual or hard to "comp" this is the one time it can work in your favor. If you recently refinanced and the value is lower, use that report instead.

6. Get your contract. If your taxes increased soon after you purchased, values probably haven't changed that much. Document with your purchase agreement.

7. Are you exempt? There are many special exemptions: homestead, mortgage, senior citizens, veterans, disabled persons, and even energy-efficiency. Check with your county and check them all.

8. Prepare your case. In writing, briefly and professionally describe why you are entitled to the reduction, followed by documentation of your reasons. Make sure you have any required forms completed and know all deadlines for your appeal.

FHA Credit Policy Change Makes it Easier to Qualify "Economic Events" Recognized as Isolated

 

Effective immediately, policy changes in the way the Federal Housing Administration (FHA) views certain derogatory credit will make it easier for some borrowers to qualify for purchasing a home. Allowances will be made for certain "Economic Events" resulting in poor credit ratings, which previously would cause borrowers to be ineligible.

What do the new rules say? Potential borrowers who experienced a decrease of income by 20 percent or more for at least six months, and that resulted in serious derogatory credit such as a short sale, foreclosure, or bankruptcy, may still be eligible as long as:

1. The loss of employment or income was due to an extenuating circumstance beyond his or her control and can be documented;
2. A satisfactory credit history has been restored for a period of 12 months; and
3. Housing counseling has been completed.

Other changes effective October 15, 2013 include amendments to underwriting guidelines in the area of outstanding, prior judgments and collections, including the exclusion of unresolved medical collections from the underwriting decision.

If you or anyone you know has been previously denied for a home loan based on an isolated credit incident, I may be able to help! And I'm always happy to answer any questions you may have.

After the Shutdown What's in Store for Housing and Home Loan Rates?

The government shutdown has come to an end, but how does the House's last minute deal and the post-shutdown environment impact mortgage rates?

With the debt ceiling stalemate in Washington resolved at least until February 7, 2014, rates could dip in the short term. Home builders stalled by the government shutdown will resume confidence and government-affiliated mortgages such as FHA, VA, USDA and FEMA loans will continue running smoothly.

But over the long term, mortgage rates will rise...

The Federal Reserve is committed to "taper," or reduce its recent purchases of bond buying, which it had started doing to stimulate the economy. As the economy strengthens, tapering will begin. When? Nobody knows for sure, but when it does, rates will rise--and possibly faster than consumers will be able to anticipate.

If you or anyone you know has questions related to the shutdown's impact on home loan rates, or hasn't yet refinanced their Adjustable Rate Mortgage taking advantage of today's historic low fixed mortgage rates, please call or email me today. I may be able to help and I'm always happy to answer questions! 

How Credit Scores Are Calculated

What makes a good credit score? What factors do credit reporting bureaus consider most when generating scores? Unless recent bankruptcies, collection accounts or outstanding tax payments are involved, the following criteria is generally accurate:  35% Payment History– Recent delinquencies bring scores down more than those in the past.  30% Balance– High balances over 75 percent of the available credit limit hurt credit scores. Small balances on multiple cards are more favorable than one maxed-out card.  15% Credit History– 3 to 5 lines of credit, and a loan with a long history is best.  10% Type of Credit– Furniture and appliances stores' "pay later" credit lines are less favorable and considered higher risk.  10% Number of Inquiries– These cost 5 to 15 points off your credit score per inqury. Mortgage inquiries don't count as long as they are within 14 days of each other.

USDA Eligible Properties Saved From 1st Quarter Cut Cities remain USDA Eligible until September 2013

 

There's good news for people living in areas that qualify for USDA loans. A list of 923 communities that were set to be cut from the USDA's list of Rural Development eligible areas will now remain eligible until later this year, on September 30, 2013.

What does this mean? There will be no changes to the communities that are currently eligible for the USDA Section 502 Guaranteed Program. In other words, cities that were included in the previously released "cut list" will continue to be eligible for USDA financing until the new deadline.

USDA Rural Development and its loan program were designed to help improve the economy and quality of life throughout rural America. The program continues to remain a wonderful option for qualifying homebuyers, with zero down payment required.

For a complete list of the Rural Development eligible communities and for information about qualifying loan programs, consult this link. (http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do)

If you or anyone you know is interested in a USDA Rural Development guarantee loan, I would be glad to help and am always happy to answer any questions you may have!

FHA Makes Changes to Mortgage Insurance Premiums

What Does This Mean for Home Buyers?

FHA recently increased monthly mortgage insurance premiums on the most standard FHA loans.

How will this impact home buyers?

This will only slightly increase a home buyer's monthly payment.

For example, on a $175,000 loan amount the payment will increase by about $15 per month, based on the new premiums.

Another change is the length of time the mortgage insurance will remain in effect. This is inconsequential however, since rarely do borrowers keep loans for the full life of the loan.

Even though monthly FHA payments will increase a bit, FHA still remains the most flexible and affordable loan program for buyers with less than a 5% down payment.

The good news is that home loan rates are still at historic lows right now, and it's a great time to purchase a new home. If you have any questions regarding these changes or would like to discuss how I can help you or someone you know get qualified for a mortgage, please feel free to call or email me.

Setting S.M.A.R.T. Goals

When you set goals, remember to make them S.M.A.R.T.  Specific, Measurable, Attainable, Relevant and Time bound.