Western Montana & Missoula Real Estate Blog & Area Information

 

How many of you feel lost out there or even get help from someone such as a realtor letting you know that they can have their mortgage loan officer help you with your loan, yet you could still be lost. Not all referrals are good ones, just food for thought. I know this, because I have seen it happen more than it should, after a borrower comes to me after they had used someone else that was recommended. No, I am not perfect. But there is a lot more than just telling a borrower a rate and costs after looking at a credit score.

This post is not to point fingers, but to educate not only the borrower/consumer, but the realtor and some loan officers that might just do the basics. What do I mean about the basics?

Example :

Borrower : I am looking for the cheapest mortgage with no points. What can you do for me.

    Loan Officer : What is your credit score?

Borrower : 659

    Loan Officer : I could do 5.25% with zero points.

Borrower :  Sounds great.  Thanks and I will get back to you.

 

 

 

Important Update (example above) :

You should have received a Good Faith Estimate when someone gave you a quote.  To show rate, points, and fees. And that loan officer should have asked about 10 basic questions, which I will talk about below. Important news now on this….  As of January 1^st, 2010, there is now a new law in regards to RESPA and new disclosures. Please read below…

 

 

 

As of January 1st, 2010, no loan officer and or lender will be able to give you a Good Faith Estimate upfront when shopping for a mortgage. There will be about 6 triggers that have to take place for them to offer the good faith estimate.  I think this will hurt shopping for a mortgage now more than ever before.

What has always been a pet peeve of mine is that many loan officers just give you what you want to hear. Yet they don't ask you some very important questions. One of those main questions should be about your goals, no matter if you are buying or refinancing. What questions should they be asking?

1. My first and biggest question. How much of a mortgage payment would you be comfortable with?  A payment range, to include taxes & homeowners insurance.

2. How long do u plan on staying in the house. Yes, the borrower doesn't have a crystal ball, but many still have an idea. And this question should be broken down to 3 years, 5 years, and 7 years. Please read : My 10 top questions when interviewing a borrower.

 

 

 

2 very important mortgage tips :

1. Credit Scores - There are still some lenders that can do credit scores under 620, down to 550. Beware, they are almost impossible to close. I am getting about 2 e-mails a week now from borrowers that were told no problem, and the lender can't close. There are many reasons for this.

2. Making offers - I am also getting e-mails from those that just put an offer in on a house and now want to see about getting a mortgage. First and fore most, speak to a well qualified loan officer. And even though this loan officer should be interviewing you, interview them. Truly understand who you are dealing with and the company that they work for, no matter how you got their name. I can't stress this enough. SO much can be found on the internet about individuals and companies now.

 

 

 

Summary : Overall, there are going to be more issues when moving forward in 2010. Any loan officer that gives a true Good Faith Estimate upfront, could very well be out of compliance. Yet, if we aren't allowed to do this, how can a borrower shop effectively?  What, just give the borrower a rate over the phone?  That use to get under my skin from day one in this business, because anyone could do that. Rates change daily also. In any case, I will be talking about the new RESPA laws and breaking down the importance of this in Part 2. For a quick example to a negative impact on this new compliance, Gerry Suarez gives a good example of this. The Road to Hell and the new mortgage disclosures.

 

For some more good reading :

The Basics of FHA Loans - Mortgage 101 for FHA Mortgages - 08/24/09

Credit scores - FICO scores for mortgages - I need a 700 credit score?

 

 

 

• FHA loan tips & Mortgage Shopping Tips - Don't be caught with your pants down - Part 1 of 2
  

• Mortgage shopping tips - The new Good Faith Estimate, 2010 RESPA compliance issues. - Part 2 of 2
  

 

 

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For more information on FHA loans, please go to this link. The FHA Expert

For more information about the 2009 Tax Credit for First Time Homebuyers : 2009 Tax Credit

For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags!

 

 

Copyright © 2010 by Jeff Belonger of Infinity Home Mortgage Company, Inc

Have you thought about getting that bigger, better house in a better neighborhood?  

NOW IS THE TIME!

Whether you need more space, want to upgrade your location, or for any other reason, the current real estate market presents a unique opportunity to capitalize by trading up! 

5 reasons why this is the best market to trade up!

1. You will make money NOW on the trade!  

Here's how this works. You currently own a condo that was worth $1,000,000 three years ago, and now it's worth $700,000 (that's right, it's gone down 30%!).  You may be thinking, I've lost $300,000, right?  Wrong!  

What you do is go out and sell your condo and purchase the home of your dreams for $1,400,000.  That house, three years ago, was worth $2,000,000 and you probably couldn't have afforded it.  By buying it now, what you've just done is bought your new home at a $600,000 discount!  Just like that, on the trade, you've made $300,000!  This doesn't even take into account the money you'll save on property taxes because you're paying taxes on a $1.4M house, and not on a $2M house.

2. ... AND you will make money LATER when you sell your new home!

OK you've listened to my advice, bought that new home of your dreams and traded up. YES!  Fast forward five years and the real estate market has gone up 20%.  Let's take a look at what has happened.  Your old condo is now worth $840,000, for a $140K gain over today's value.  Your new home is worth $1,680,000, or $280,000 more than when you bought it today.  Just like that, you've made an extra $140,000 on the trade!

3. You can likely buy a house you otherwise could not have afforded, and may not be able to afford again!

Going back to my example above, you probably couldn't have afforded that $2M house three years ago when you bought your condo.  You also may not be able to afford it again in 3 - 5 years when the market rebounds. If you've been dreaming about a bigger home or one in a nicer area, now is really the time to capitalize.

4. It's much easier to trade up in a down market than in an escalating market!

I've had clients say that they will trade up when the market "goes back up."  Let's take a close look at that.  Let's say that 5 years from now, the market is back up 20% from today's values.  You then sell your condo for $840,000 and your dream home is now worth $1,680,000.  You've gained $140K on your condo (from today's values) BUT your dream home is now worth $280,000 more!  That means that, by waiting, you've now spent an extra $140K to buy that house!

5. You'll probably get a better house by trading up in a down market!

The current market presents some very unique opportunities.  In most areas, inventory is pretty high and buyers have a lot of great choices.  By shopping in this market, you can really get the home of your dreams and take your pick of all the inventory available.  In most cases, you can get a good deal on a great property in a terrific area.

The bottom line is that if you can afford it, now is a terrific time to upgrade!  Interest rates remain at historic lows and there is plenty of financing available.

 

---

DANIEL DIMA BATSALKIN
Principal Broker | C.E.O. | Boulevard Realty
310.933.4281 | dima@blvdrealty.com
www.blvdrealty.com

Specializing in Los Angeles area residential real estate, including Los Angeles, Beverly Hills, Brentwood, Bel Air, Santa Monica, Sherman Oaks, Valley Village, Studio City, Encino, Tarzana and more!

Hire me or send me a referral because I have a defined and proven plan of action that I follow every day to help my clients achieve their real estate goals!

NAR has recently released the 2009 Profile of Home Buyers and Sellers.  The report compiles the results of 9,138 surveys returned by buyers and sellers who sold or purchased a home between July 2008 and June 2009.  The surveys were sent to buyers and sellers based on deed transfers and other public records.  The complete report is available for purchase at www.realtor.org .  Here are some highlights I found interesting:

•·         47% of all buyers were first time buyers.

•·         62% of first time buyers reported that the primary reason for buying a home was the desire to be a homeowner, 35% of all buyers reported that as the number 1 reason.

•·         The median age of all buyers was 39, same as last year.

•·         83% of all first time buyers are under the age 44. 

•·         62% of all buyers are under age 44.

•·         68% of the buyers surveyed in the Northeast make less than $100,000 per year.

•·         63% of all buyers had no children under the age of 18 residing at home.

•·         Buyers in the Northeast moved an average of 10 miles from where they currently lived.

•·         90% of all buyers used the internet to search.

•·         84% of buyers reported the photos to be the most useful information.

•·         The number one action taken after viewing a home online was to drive by or visit the home.

•·         66% of buyers reported that they used a print ad to search, but only between 84% to 90% (depending on the print medium) reported that those sources were "not useful".

•·         36% of buyers found the home they purchased through an agent, 36% found the home they purchased online, less than 3%found the home they purchased in a print ad.

•·         77% of buyers purchased their home with an agent.

•·         85% of sellers sold their home with an agent.

•·         39% of the mortgages were FHA loans.

•·         87% of buyers viewed real estate as a good investment.

So, besides making a handy list, what else does the report tell us?  It tells us specifically who the buyers and sellers are, what they want from us, where they want to go and most importantly, what their priorities are.  Valuable information for any customer service professional!

I'd like you to be part of the conversation, so if you like what you read here please comment, forward The Lancaster Connection.com to your friends, subscribe and as always, if you have questions, need real estate advice or want to buy or sell a home, you can call or text me at 717-371-0557, email me at Jason@JasonsHomes.com or contact me at the office at 717-490-8999!

Your Friend in Real Estate,

Jason Burkholder

Weichert, Realtors - Engle & Hambright

Search for Lancaster County Homes for sale at www.JasonsHomes.com by clicking here!

Want to see what's happening to home prices in your neighborhood?  Go to www.RealEstateCrystalBall.com !