To ensure a smooth loan process from pre-approval to closing, beware of these common mistakes:
Don't make expensive purchases. It may be tempting to order a new sofa for your soon-to-be living room, but its best to avoid making major purchases until after closing. Financing with a store credit card or even existing credit cards could jeopardize credit scores or debt to income ratios. Even using cash to purchase big ticket items can create issues as many lenders take cash reserves into consideration when approving a loan.
Don't switch banks or transfer money around. To avoid a lot of extra paperwork and explanation, don’t move money around during the loan process. The lender will ask for 2 months bank statements to document funds for closing and cash reserves. If there are any transfers or non payroll deposits, a paper trail must be provided to show the source of funds.
Don't Change Jobs. Lenders like to see a consistent job history. Generally, changing jobs will not affect a borrower’s ability to qualify for a loan, especially if income is increasing. However, if the pay contains commissions, bonus or overtime, likely this portion of income will not be used for qualifying as there is not sufficient history of receiving the income.
Don't disregard lenders requests. Pre-approved may have been granted, but the work on the loan is far from over. Prior to closing, the lender may ask for updated documents such as pay stubs, bank statements or even a new credit report. Keep records handy and credit in good shape while your loan is in process and always respond quickly to lender requests!
~ Courtesy of Wendy Charles, LoanCentral LLC, 425.468.9321, WendyC@LoanCentral.com
Saturday, October 24, 2009
Monday, October 19, 2009
National Real Estate News
For the third week in a row, rates on 30-year fixed-rate mortgages remained below 5% in Freddie Mac's Primary Mortgage Market Survey. The average for conforming mortgages was 4.92% with an average of 0.7 point (including the origination fee) for 80% loan-to-value ratio loans to borrowers with good credit.
The Mortgage Bankers Association reported applications down 1.8% for the week, although re-financings were up, as more people took advantage of historically low mortgage rates. The MBA also projected double-digit growth for home sales next year. They see 2010 existing home sales up 11.2% to 5.57 million and new home sales up a healthy 21% from 2009 levels. Another encouraging stat came from the National Association of Realtors which reported 3.6 million existing homes for sale at the end of August, nicely down from 4.3 million 12 months ago.
First time buyers may still be able to get the $8,000 tax credit expiring at the end of November. That's six weeks away, which is not a lot of time, but not impossible. Fence-sitters should get pre-qualified now.
~ Courtesy of Chuck Chrobak, Golf Savings Bank, 425.330.9657, CChrobak@GolfSavingsBank.com
The Mortgage Bankers Association reported applications down 1.8% for the week, although re-financings were up, as more people took advantage of historically low mortgage rates. The MBA also projected double-digit growth for home sales next year. They see 2010 existing home sales up 11.2% to 5.57 million and new home sales up a healthy 21% from 2009 levels. Another encouraging stat came from the National Association of Realtors which reported 3.6 million existing homes for sale at the end of August, nicely down from 4.3 million 12 months ago.
First time buyers may still be able to get the $8,000 tax credit expiring at the end of November. That's six weeks away, which is not a lot of time, but not impossible. Fence-sitters should get pre-qualified now.
~ Courtesy of Chuck Chrobak, Golf Savings Bank, 425.330.9657, CChrobak@GolfSavingsBank.com
Saturday, October 17, 2009
Last Chance for Low Rates?
According to Freddie Mac, interest rates recently dropped to all-time lows in some categories, and within a hair of all-time lows in others. We will likely never see rates at these levels again. If you missed the chance to purchase or refinance earlier this year, you just got a do-over. Don't miss out a second time!
The Federal Reserve implemented a mortgage-backed securities buying program to artificially lower rates and that program is nearing its end. The originally scheduled end date was December 31, 2009. While this deadline has been extended, the amount of purchases remains the same, which means the level of participation will wane, decreasing by half as much. It is expected that mortgage rates will soon return to levels seen before the program started, near 6.50%.
Inflation, while currently contained, is likely to show its ugly head as all the stimulus from Washington continues to pour into the system. The end result will be increasing inflation pressure across the board, which will cause all interest rates to rise.
It is likely that interest rates at these levels will never be seen again in our lifetime. Take advantage of them today while you still can so you'll never have to look back and say, "I wish I had...."
~ Courtesy of Wendy Charles, LoanCentral LLC, 425.468.9321, WendyC@LoanCentral.com
The Federal Reserve implemented a mortgage-backed securities buying program to artificially lower rates and that program is nearing its end. The originally scheduled end date was December 31, 2009. While this deadline has been extended, the amount of purchases remains the same, which means the level of participation will wane, decreasing by half as much. It is expected that mortgage rates will soon return to levels seen before the program started, near 6.50%.
Inflation, while currently contained, is likely to show its ugly head as all the stimulus from Washington continues to pour into the system. The end result will be increasing inflation pressure across the board, which will cause all interest rates to rise.
It is likely that interest rates at these levels will never be seen again in our lifetime. Take advantage of them today while you still can so you'll never have to look back and say, "I wish I had...."
~ Courtesy of Wendy Charles, LoanCentral LLC, 425.468.9321, WendyC@LoanCentral.com
Tuesday, October 13, 2009
Eastside Statistics - September, 2009
Current Residential & Condo listings - 4,780 (down 13.58% from last year)
New listings taken this month - 1,224
Pending sales this month - 908 (up 32.36% from last year)
Percent of listings that sold this month - 18.99%
Median closed sales price - Sep. ‘08, $481,950
Median closed sales price - Sep. ‘09, $468,500
Rate of appreciation = -2.79%
~ Courtesy of NWMLS
New listings taken this month - 1,224
Pending sales this month - 908 (up 32.36% from last year)
Percent of listings that sold this month - 18.99%
Median closed sales price - Sep. ‘08, $481,950
Median closed sales price - Sep. ‘09, $468,500
Rate of appreciation = -2.79%
~ Courtesy of NWMLS
King County Statistics - September, 2009
Current Residential & Condo listings - 12,912 (down 16.36% from last year)
New listings taken this month - 4,052
Pending sales this month - 2,927 (up 27.54% from last year)
Percent of listings that sold this month - 22.67%
Median closed sales price - Sep. ‘08, $380,315
Median closed sales price - Sep. ‘09, $349,000
Rate of appreciation = -8.23%
~ Courtesy of NWMLS
New listings taken this month - 4,052
Pending sales this month - 2,927 (up 27.54% from last year)
Percent of listings that sold this month - 22.67%
Median closed sales price - Sep. ‘08, $380,315
Median closed sales price - Sep. ‘09, $349,000
Rate of appreciation = -8.23%
~ Courtesy of NWMLS
Snohomish County Statistics - September, 2009
Current Residential & Condo listings - 5,445 (down 22.98% from last year)
New listings taken this month - 1,551
Pending sales this month - 1,222 (up 50.31% from last year)
Percent of listings that sold this month - 22.44%
Median closed sales price - Sep. ‘08, $318,000
Median closed sales price - Sep. ‘09, $282,000
Rate of appreciation = -11.32%
~ Courtesy of NWMLS
New listings taken this month - 1,551
Pending sales this month - 1,222 (up 50.31% from last year)
Percent of listings that sold this month - 22.44%
Median closed sales price - Sep. ‘08, $318,000
Median closed sales price - Sep. ‘09, $282,000
Rate of appreciation = -11.32%
~ Courtesy of NWMLS
Northwest MLS brokers agree "there's a lot to be optimistic about"
"There's a lot to be optimistic about," according to one director of the Northwest Multiple Listing Service upon reviewing summary statistics for September's housing activity. The report shows a big jump in pending sales compared to a year ago (up almost 27 percent), continued drops in inventory (down 17.7 percent versus a year ago) and brisk demand for homes at the lower end of the price spectrum.
Distressed properties in the system continue to be a drag on prices – median prices for last month's sales were down about 7.5 percent from a year ago – and brokers continue to voice frustration with slow response time by lenders. (Banks are taking 9.5 weeks to respond to short-sale requests, versus 4.5 weeks a year ago, according to research by Campbell Communications of Washington, D.C.)
Joe Spencer, president and COO of John L. Scott Real Estate, estimates up to 10 percent of pending sales do not close because they're caught in the short sale cycle. Still, he comments, "There is a lot to be optimistic about." He cites interest rates that are now in the high four percents as bordering "on being epic" and the federal tax credit as stimulants to the market.
Northwest MLS brokers reported 7,581 pending sales (offers made and accepted but not yet closed) during September, outgaining the same period a year ago by 1,599 transactions for a 26.7 percent increase. Last month's condominium sales surged, with pending sales up nearly 25 percent from a year ago after languishing in negative year-over-year figures for the first five months of 2009 and only modest gains over the past three months.
"Our market has certainly come a long way since this time last year," said Ron Sparks, managing vice president of Coldwell Banker Bain, who said demand is at its highest level in two years. "For all the challenges that remain, it would be difficult to not appreciate the reemerging market vitality that continues to build even as the summer buying season closes," he added.
Brokers also credit improved affordability, incentives and the looming deadline for the $8,000 tax credit for first-time home buyers as boosting activity. "Because there are so many short sales and bank owned property sales, it was inevitable that prices would fall slightly," explained NWMLS director Dick Beeson, the broker/owner of Windermere Commencement Associates in Tacoma. Beeson described the price drops as "a necessary adjustment given the number of short sales and bank owned property sales in the mix. (A survey by the National Association of REALTORS indicates distressed homes accounted for 31 percent of transactions in August and July.)
On a brighter note, Beeson said activity is brisk for lower priced homes in many areas. "Multiple offers are occurring on a regular basis and many buyers have to make two or three offers on different properties just to secure one," he reports.
Sparks echoed that report, saying, "Describing much of the current market as 'lively' is probably a bit of an understatement," adding, "I've heard agents describe open houses as 'mayhem' and 'chaos." Modestly priced homes in good condition and in popular neighborhoods can certainly draw more than one offer, according to Sparks, who also noted, "This is not to say that all neighborhoods and price points are rebounding at the same pace, but there is an awful lot of economic momentum in our region, including our housing market, that can't be ignored."
Emphasizing recovery comes in stages, Beeson acknowledged some "hard adjustments" are being made in higher priced homes where inventories remain high, but expects that segment to recover.
~ Courtesy of NWMLS
Distressed properties in the system continue to be a drag on prices – median prices for last month's sales were down about 7.5 percent from a year ago – and brokers continue to voice frustration with slow response time by lenders. (Banks are taking 9.5 weeks to respond to short-sale requests, versus 4.5 weeks a year ago, according to research by Campbell Communications of Washington, D.C.)
Joe Spencer, president and COO of John L. Scott Real Estate, estimates up to 10 percent of pending sales do not close because they're caught in the short sale cycle. Still, he comments, "There is a lot to be optimistic about." He cites interest rates that are now in the high four percents as bordering "on being epic" and the federal tax credit as stimulants to the market.
Northwest MLS brokers reported 7,581 pending sales (offers made and accepted but not yet closed) during September, outgaining the same period a year ago by 1,599 transactions for a 26.7 percent increase. Last month's condominium sales surged, with pending sales up nearly 25 percent from a year ago after languishing in negative year-over-year figures for the first five months of 2009 and only modest gains over the past three months.
"Our market has certainly come a long way since this time last year," said Ron Sparks, managing vice president of Coldwell Banker Bain, who said demand is at its highest level in two years. "For all the challenges that remain, it would be difficult to not appreciate the reemerging market vitality that continues to build even as the summer buying season closes," he added.
Brokers also credit improved affordability, incentives and the looming deadline for the $8,000 tax credit for first-time home buyers as boosting activity. "Because there are so many short sales and bank owned property sales, it was inevitable that prices would fall slightly," explained NWMLS director Dick Beeson, the broker/owner of Windermere Commencement Associates in Tacoma. Beeson described the price drops as "a necessary adjustment given the number of short sales and bank owned property sales in the mix. (A survey by the National Association of REALTORS indicates distressed homes accounted for 31 percent of transactions in August and July.)
On a brighter note, Beeson said activity is brisk for lower priced homes in many areas. "Multiple offers are occurring on a regular basis and many buyers have to make two or three offers on different properties just to secure one," he reports.
Sparks echoed that report, saying, "Describing much of the current market as 'lively' is probably a bit of an understatement," adding, "I've heard agents describe open houses as 'mayhem' and 'chaos." Modestly priced homes in good condition and in popular neighborhoods can certainly draw more than one offer, according to Sparks, who also noted, "This is not to say that all neighborhoods and price points are rebounding at the same pace, but there is an awful lot of economic momentum in our region, including our housing market, that can't be ignored."
Emphasizing recovery comes in stages, Beeson acknowledged some "hard adjustments" are being made in higher priced homes where inventories remain high, but expects that segment to recover.
~ Courtesy of NWMLS
Monday, October 12, 2009
National Real Estate News
At the end of September, the supply of homes for sale was reported down 1.8% from the previous month in 27 major metropolitan areas. We all know the factors. Home prices are very affordable, mortgage rates are very favorable and first-time homebuyers are taking advantage of the $8,000 tax credit set to expire at the end of November, now just seven weeks away.
The Mortgage Bankers Association saw loan applications for home purchases rise 13.2% last week, as the MBA's Purchase Index hit its highest level since last January. The average rate on 30-year fixed rate mortgage slid to 4.89% with an average 1.13 points (including the origination fee) for 80% loan-to-value ratio loans to borrowers with good credit. Freddie Mac's weekly survey of conforming mortgage rates put the average 30-year fixed rate mortgage at 4.87% with an average 0.7 point for 80% loan-to-value ratio loans to borrowers with good credit.
~ Courtesy of Chuck Chrobak, Golf Savings Bank, 425.330.9657, CChrobak@GolfSavingsBank.com
The Mortgage Bankers Association saw loan applications for home purchases rise 13.2% last week, as the MBA's Purchase Index hit its highest level since last January. The average rate on 30-year fixed rate mortgage slid to 4.89% with an average 1.13 points (including the origination fee) for 80% loan-to-value ratio loans to borrowers with good credit. Freddie Mac's weekly survey of conforming mortgage rates put the average 30-year fixed rate mortgage at 4.87% with an average 0.7 point for 80% loan-to-value ratio loans to borrowers with good credit.
~ Courtesy of Chuck Chrobak, Golf Savings Bank, 425.330.9657, CChrobak@GolfSavingsBank.com
Saturday, October 10, 2009
Bernanke’s Words Cause Rates to Rise
The power of Fed Chairman Bernanke’s words was felt on Wall Street this morning as mortgage bonds sold off in reaction to his speech on Capitol Hill Thursday evening. He said that the low interest rate environment will likely be needed for a while. However, he went on to say that as the economy heals, the Fed will hike rates quickly to ward off inflation. There is no doubt that rates will rise in the future, the question is not if but when.
It is unlikely that rates will be able to move any lower than levels seen in the past 2 weeks. Over supply of bonds continues to be an issue as yesterday's 30-year Treasury Bond auction was poorly received, as investors are searching for more yield. The Fed won’t be able to “sop up” this over supply much longer as their program for purchasing Mortgage Backed Securities winds down in 2010.
Next week brings us the release of a couple of very important economic reports and the release of the minutes from the last FOMC meeting. The bond market will be closed Monday in observance of Columbus Day, but the stock markets will be open for trading.
~ Courtesy of Wendy Charles, LoanCentral LLC, 425.468.9321, WendyC@LoanCentral.com
It is unlikely that rates will be able to move any lower than levels seen in the past 2 weeks. Over supply of bonds continues to be an issue as yesterday's 30-year Treasury Bond auction was poorly received, as investors are searching for more yield. The Fed won’t be able to “sop up” this over supply much longer as their program for purchasing Mortgage Backed Securities winds down in 2010.
Next week brings us the release of a couple of very important economic reports and the release of the minutes from the last FOMC meeting. The bond market will be closed Monday in observance of Columbus Day, but the stock markets will be open for trading.
~ Courtesy of Wendy Charles, LoanCentral LLC, 425.468.9321, WendyC@LoanCentral.com
Monday, October 5, 2009
National Real Estate News
Another good week for the housing market. The S&P/Case Shiller home price index was up for the third month in a row and the rate of annual decline fell for the sixth month in a row! Price increases were reported in 18 of 20 metro areas measured. Many now feel this data indicates the worst of the price declines are behind us. D avid M. Blitzer, chairman of the index committee at Standard & Poor's, said: "These figures continue to support an indication of stabilization in national real estate values."
Later in the week, Pending Home Sales came in UP 6.4% for August, their seventh straight monthly gain, UP 12.4% from a year ago and at their highest level since March 2007. Many see this boost in sales coming from first-time homebuyers rushing to make the deadline for their $8,000 tax credit which expires at the end of next month!
On the mortgage front, Freddie Mac's weekly survey showed the 30-year fixed-rate mortgage below 5% for the first time since May. The average rate was 4.94% with an average 0.7 point (including the origination fee) for 80% loan-to-value ratio loans to borrowers with good credit. Finally, residential construction spending also rose in August, UP 4.7%!
~ Courtesy of Chuck Chrobak, Golf Savings Bank, 425.330.9657, CChrobak@GolfSavingsBank.com
Later in the week, Pending Home Sales came in UP 6.4% for August, their seventh straight monthly gain, UP 12.4% from a year ago and at their highest level since March 2007. Many see this boost in sales coming from first-time homebuyers rushing to make the deadline for their $8,000 tax credit which expires at the end of next month!
On the mortgage front, Freddie Mac's weekly survey showed the 30-year fixed-rate mortgage below 5% for the first time since May. The average rate was 4.94% with an average 0.7 point (including the origination fee) for 80% loan-to-value ratio loans to borrowers with good credit. Finally, residential construction spending also rose in August, UP 4.7%!
~ Courtesy of Chuck Chrobak, Golf Savings Bank, 425.330.9657, CChrobak@GolfSavingsBank.com
Rates Take Another Dip!
The Labor Department reported today that 263,000 jobs were lost in September. This is much worse than the expectations of 175,000. Unemployment is now at 9.8%...the highest level in 26 years. Analysts are concerned the recession will be much slower to recover from than many previously thought.
All of this has led to lower mortgage rates for the week. These low rates may not stay around for long though. The Fed has recently announced they will be backing out of buying mortgage backed securities in the first quarter of 2010. The Fed purchasing of mortgage backed securities has been one of the biggest forces keeping mortgage rates down at record low levels over the past year. Most analysts agree that when the Fed stops buying mortgages, rates will go up.
Next week the Fed is auctioning off a record level of Treasury notes. Since Treasuries compete for the same investment dollars as mortgage backed securities, this can cause an oversupply in the market, which ultimately can lead to higher mortgage rates.
Now is the time to lock into a great long term interest rate. Don’t miss out!
~ Courtesy of Wendy Charles, LoanCentral LLC, 425.468.9321, WendyC@LoanCentral.com
All of this has led to lower mortgage rates for the week. These low rates may not stay around for long though. The Fed has recently announced they will be backing out of buying mortgage backed securities in the first quarter of 2010. The Fed purchasing of mortgage backed securities has been one of the biggest forces keeping mortgage rates down at record low levels over the past year. Most analysts agree that when the Fed stops buying mortgages, rates will go up.
Next week the Fed is auctioning off a record level of Treasury notes. Since Treasuries compete for the same investment dollars as mortgage backed securities, this can cause an oversupply in the market, which ultimately can lead to higher mortgage rates.
Now is the time to lock into a great long term interest rate. Don’t miss out!
~ Courtesy of Wendy Charles, LoanCentral LLC, 425.468.9321, WendyC@LoanCentral.com
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