Blog – Page 61 of 865 – Mike Pfefferman

09

Jul

Homeowner Tips

Green Mortgages Financing Energy Efficient Homes

What is a Green Mortgage?

A green mortgage is a type of home loan designed to incentivize energy-efficient building practices. These mortgages are specifically tailored for properties that meet certain environmental standards, encouraging homeowners and buyers to consider energy efficiency as a key factor in their purchasing decisions.

Benefits of Green Mortgages

Lower Energy Bills

One of the most immediate benefits of investing in an energy-efficient home is the reduction in utility costs. Homes that meet green mortgage criteria often feature advanced insulation, high-efficiency HVAC systems, and energy-saving appliances, all of which contribute to significantly lower energy consumption and, consequently, lower energy bills.

Improved Home Value

Homes with green certifications tend to have higher resale values. As awareness of environmental issues grows, more buyers are looking for properties that are not only comfortable but also sustainable. This makes green-certified homes a valuable asset in the real estate market.

Healthier Living Environment

Green homes often use non-toxic materials and provide better air quality, leading to a healthier living environment. Features like improved ventilation systems and moisture control can reduce the presence of allergens and other pollutants, creating a more comfortable and healthy home.

How to Qualify for a Green Mortgage

Energy Assessment

The first step to qualifying for a green mortgage is to have an energy assessment conducted on your home. This assessment will evaluate the property’s energy efficiency and identify areas for improvement. The results will help determine whether your home meets the criteria for a green mortgage.

Meeting Standards

There are several green building standards that homes can meet to qualify for a green mortgage, including LEED (Leadership in Energy and Environmental Design), Energy Star, and the Home Energy Rating System (HERS). These standards cover various aspects of energy efficiency, from insulation and windows to heating and cooling systems.

Financing Options

FHA Energy Efficient Mortgage (EEM)

The Federal Housing Administration (FHA) offers an Energy Efficient Mortgage program that allows borrowers to finance energy-saving improvements as part of their home loan. This program is designed to make it easier for homeowners to afford the upfront costs of energy-efficient upgrades.

Fannie Mae Homestyle Energy Mortgage

Fannie Mae’s Homestyle Energy Mortgage allows homeowners to finance energy-efficient improvements, renewable energy systems, and water efficiency upgrades. This mortgage can be used for new purchases or refinances and provides up to 15% of the property’s as-completed appraised value for these upgrades.

Making the Switch

Transitioning to a green mortgage can seem daunting, but the long-term benefits make it worthwhile. Not only can you enjoy lower energy bills and a healthier living environment, but you’ll also be contributing to a more sustainable future. Whether you’re buying a new home or upgrading your current one, exploring green mortgage options can be a smart financial and environmental decision.

Green mortgages represent a growing trend in the housing market, reflecting the increasing importance of sustainability. By investing in energy-efficient homes, you’re not just saving money; you’re also making a positive impact on the planet. If you’re in the market for a new home or considering refinancing, a green mortgage might be the perfect fit for you.

08

Jul

By Mike Pfefferman

Financial Reports

What’s Ahead For Mortgage Rates This Week – July 8th, 2024

With the FOMC Minutes coming precisely within expectations, there is once again a lot of optimism that the Federal Reserve may cut rates this year. Much of the Q2 data reports show favorable amounts of reduction in inflation as well as a more stable economic outlook for the rest of the year. With the larger reports in PMI Manufacturing numbers and Non-farm Payroll figures, the overall outlook seems to align with the rest of the data points, justifying the more recent optimism about potential rate cuts. This week should give the final results on Q2 inflation results with the new releases of CPI and PPI data reports.

Global US Manufacturing PMI

A key barometer of U.S. factories fell in June for the third month in a row, signaling that an ongoing slump in the industrial side of the economy shows no sign of ending. The Institute for Supply Management’s manufacturing index slipped to 48.5% in June from 48.7% in the prior month. Numbers below 50% signal that the manufacturing sector is shrinking.

U.S. Hourly Wages

Wage growth for the last 12 months ending in June slowed to 3.9% from 4.1%, marking the smallest increase seen since August 2021. At one point, yearly wages were rising as fast as 5.9%. A shortage of labor prompted millions to change jobs in pursuit of better pay, particularly to cope with significant inflation.

Primary Mortgage Market Survey Index

15-Yr FRM rates are seeing an increase by 0.09% with the current rate at 6.25%
30-Yr FRM rates are seeing an increase by 0.09% with the current rate at 6.95%

MND Rate Index

30-Yr FHA rates are seeing a decrease by -0.01% for this week. Current rates at 6.50%
30-Yr VA rates are seeing no change for this week. Current rates at 6.52%

Jobless Claims

Initial Claims were reported to be 238,000 compared to the expected claims of 233,000. The prior week landed at 234,000.

What’s Ahead

CPI and PPI are the most relevant reports coming up, with the rest of the week having an extremely light release schedule.

05

Jul

By Mike Pfefferman

Mortgage

The Pros and Cons of Mortgage Life Insurance

Mortgage life insurance is a type of policy designed to pay off your mortgage in the event of your death. As with any financial product, it has its pros and cons. Understanding these can help you determine whether it makes sense for your situation.

What is Mortgage Life Insurance?

Mortgage life insurance, sometimes called mortgage protection insurance, is a policy that pays the remaining balance of your mortgage if you pass away before it is fully paid off. The benefit is directly linked to the amount you owe on your home loan and decreases as your mortgage balance decreases.

Advantages of Mortgage Life Insurance

Peace of Mind: Knowing that your mortgage will be paid off if you pass away can provide significant peace of mind for you and your loved ones.
Financial Security for Loved Ones: This type of insurance ensures that your family can stay in the home without the burden of mortgage payments.
Simplified Underwriting: Unlike some other types of life insurance, mortgage life insurance often has simplified underwriting processes, which means fewer medical exams and quicker approval times.

Drawbacks of Mortgage Life Insurance

Decreasing Benefit: The payout decreases as your mortgage balance decreases, meaning the value of the policy diminishes over time.
Lack of Flexibility: The benefit goes directly to the mortgage lender, not to your beneficiaries, limiting how the funds can be used.
Potentially Higher Costs: Mortgage life insurance can be more expensive compared to term life insurance for the same amount of coverage.
No Coverage for Other Expenses: It only covers the mortgage, so other financial needs of your family, such as living expenses, education, or other debts.

When Does Mortgage Life Insurance Make Sense?

Health Issues: If you have health conditions that make it difficult or expensive to qualify for traditional life insurance, mortgage life insurance might be a more accessible option.
Simplified Needs: If your primary concern is ensuring that your mortgage is paid off and you are not as worried about leaving additional financial support for your family, this type of policy could be suitable.
Elderly Homeowners: Older homeowners who may face higher premiums for traditional life insurance might find mortgage life insurance a more affordable way to protect their mortgage.

When Should You Avoid Mortgage Life Insurance?

Better Alternatives: If you can qualify for a term life insurance policy, it often provides more flexibility and can be more cost-effective. Term life insurance can cover more than just your mortgage, providing your beneficiaries with funds to use as they see fit.
Stable Financial Situation: If you have significant savings or other forms of life insurance that can cover your mortgage, additional mortgage life insurance may be unnecessary.
High Premiums: If the premiums for mortgage life insurance are significantly higher than other options available to you, it may not be worth the cost.

Mortgage life insurance can be a valuable tool for some homeowners, providing peace of mind and ensuring that their family can remain in the home. However, it is not the best choice for everyone. Evaluating your overall financial situation, the costs, and the benefits compared to other insurance options will help you make an informed decision.

By considering your unique circumstances, you can determine whether mortgage life insurance makes sense for you and your family.