Blog – Page 583 of 790 – Mike Pfefferman

08

Nov

Home Mortgage Tips

Reverse Mortgages 101: How This Unique Financial Product Can Make Your Life Easier

Reverse Mortgages 101: How This Unique Financial Product Can Make Your Life Easier If you’ve been in your home for a while and have considered other loan options, you may have heard the term reverse mortgage without being aware of how this product can benefit you. While this type of mortgage works for those who have a high amount of equity in their home, here are the details on reverse mortgages and how this product may work for you.

What’s A Reverse Mortgage?

The reverse mortgage was created in 2009 as the Home Equity Conversion Mortgage for Purchase (HECM) and is something that can be used by those who are older than 62. As this type of mortgage does not require the homeowner to pay monthly mortgage payments, it enables those who use it to repay their loan after they move out or pass on. If the cost of maintaining your home is manageable and you don’t plan on moving, this can be a useful option.

The Requirements For Reverse Mortgages

Beyond the age requirement, those who want to utilize this product need to own their current property or have a high amount of equity in it. They must have the ability to pay any insurance and property tax on the home, and they must comply with the standards that are set by the Federal House Administration (FHA). This means that applicants may require documentation like bank statements to confirm their financial security, or even pay stubs if they are still receiving a monthly income.

The Pros And Cons

A reverse mortgage can be an option for those who don’t want to make a regular monthly payment on their home and would like to turn it into a source of additional funds while still owning it. While this can be an option to for those who want to stabilize their monthly expenditures, it’s also important to be aware that there can be higher costs associated with a reverse mortgage. In addition to a higher interest rate, reverse mortgages incur a higher overall interest payment since monthly payments are deferred until the loan is paid in full.

There are many types of mortgage products out there on the market, but you may not be aware that a reverse mortgage or the Home Equity Conversion Mortgage for Purchase (HECM) can be a useful option for many seniors. If you are wondering if this option is right for you, contact your trusted mortgage professional for more information.

07

Nov

By support

Mortgage Rates

What’s Ahead For Mortgage Rates This Week – November 7, 2016

Last week’s economic news included reports on inflation, construction spending, the Federal Reserve’s announcement regarding interest rates and several labor and employment related releases. Weekly reports on new jobless claims and Freddie Mac’s survey of interest rates were also released.

Construction Spending Rises, Fed Holds Steady on Interest Rates, Suggests December Increase

Construction spending remained in negative territory for September according to the Commerce Department. The month-to-month reading decreased by 0.40 percent against the expected reading of +0.40 percent and August’s reading of -0.50 percent. Approaching winter weather is a likely reason for less spending, but ongoing challenges with shortages of buildable lots and labor are also factors. Spending on residential construction rose 0.50 percent, which is good news in terms of a persistent shortage of available homes.

The Federal Open Market Committee of the Federal Reserve announced that it would hold federal interest rates in the target range of 0.25 percent to 0.50 percent. Analysts have been monitoring Fed policymaker pronouncements in anticipation of a rate increase. With strengthening labor markets and other economic indicators, policy makers hinted at raising the Fed target rate in December.

Labor Data: Slower Job Creation, Lower Unemployment

ADP payrolls showed that only private-sector jobs 147,000 jobs were created in October as compared to September’s reading of 202,000 jobs created. The Labor Department reported 161,000 government and private-sector jobs were added in October as compared to an expected reading of 175,000 jobs added and September’s reading of 191,000 jobs created. Healthcare, professional jobs and financial sector jobs showed the highest job gains.

National Unemployment met expectations with an October reading of 4.90 percent. September’s reading was 5.00 percent Unemployment readings are reported as a percentage of workers seeking work and do not include workers who’ve left the workforce. New jobless claims rose last week to 265,000 as compared to expectations for 258,000 new jobless claims and the prior week’s reading of 258,000 new jobless claims.

Mortgage Rates Rise

Freddie Mac reported higher average mortgage rates last week. 30-year fixed rate loans had an average rate of 3.54 percent, an increase of seven basis points. The average rate for a 15-year fixed rate mortgage rose six basis points to 2.84 percent. The average rate for a 5/1 adjustable rate mortgage was three basis points higher at 2.87 percent. Discount points for fixed rate mortgages averaged 0.50 percent; discount points for 5/1 adjustable rate mortgages held steady at 0.40 percent.

Low mortgage rates have helped to offset the effects of high demand for homes and rapidly rising prices; if mortgage and refinance rates continue to rise, affordability and mortgage qualification issues are likely to arise for some home buyers.

What’s Ahead

This week’s scheduled economic reports include job openings, consumer sentiment and weekly reports on mortgage rates and new jobless claims.

04

Nov

By support

Home Buyer Tips

Buying a New Home? Use This Checklist to Ensure Your Finances Are in Order

Buying a New Home? Use This Checklist to Ensure Your Finances Are in Order Buying a home is a significant expense. It doesn’t matter whether you’re a first-time buyer or have experience. Unless you have a large pile of cash, you’ll need to ensure your finances are in order before closing. In this post we’ll explore four financial items you’ll want to check off before buying a new home.

Figure Out Your Current Monthly Budget

First, you’re going to want to sort out your monthly budget. If you’ve never done a budget before, start with something basic. Open up a spreadsheet or take out a piece of paper. Make two columns: ‘income’ and ‘expenses’. Fill in each column with the amounts that you make or spend each month. Bank, credit card and other statements can help with this process. It’s a good idea to go back at least 3 months to ensure you’re capturing your true spending.

Make A Debt Management Plan

Do you have any debts? If so, you’ll want to make a plan for how you’re going to manage these when you buy a new home. For example, you may have a car payment, student loans, a line of credit or credit card debt. Write down your debts, how much you owe and when payments are due. If any debts are due monthly, make sure you include those in your budget.

Keep in mind that your outstanding debts may impact your ability to borrow for a mortgage as well. If you plan on taking out a mortgage to pay for your new home, it’s best to get your debts figured out beforehand.

Understand All Your Real Estate Costs

Next, you’ll want to determine what all your real estate costs are going to be. If you’re not yet close to the bidding or closing process, this might be a bit challenging. But ask your real estate agent for a breakdown of what you can expect to pay for a home in your price range.

Set Up An Emergency Savings Cushion

Finally, you’ll want to set up a financial cushion in case of emergencies. It’s not much fun to think about, but losing a job or having a health event is possible. Most financial experts recommend having at least six months of expenses saved up. Of course, this is always easier said than done. What’s important is that you have at least some cash tucked away, just in case. If you can, save a bit extra each month or from each pay check and add to this emergency fund.

When you’re ready to buy a new home, your trusted mortgage professional is your best bet for success. Reach out to us today and learn more about how affordable a new home in your community will be!