The Fed hiked interest rates by .25 percent this week and expect continued increases in 2017. With rising interest rates and prices already putting pressure on affordability, what’s in store for the future? Here are predictions from eight real estate experts.
Category Archives: Mortgage
November 2016 San Diego County Real Estate Report and Interest Rates
Now that the election is finally over, what will Trump’s presidency mean to San Diego County real estate? No one really knows, but The San Diego Union-Tribune published an interesting article today citing higher mortgage interest rates and possible regulation cuts.
Selecting a Lender
Finding a mortgage lender for a purchase loan or refinance is not a problem. Selecting someone who will help you find the best loan product for your situation even if it means sending you to another lender, is paramount.
There is a huge advantage to be able to sit across the table from someone you’re doing business with and look them straight in the eye. It’s difficult to make an informed decision based on a website and a phone call.
Continue reading Selecting a LenderC.A.R. 2015 California Housing Market Forecast
The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) recently published its California housing market forecast for 2015. They are predicting something we are already seeing happen in San Diego County – moderate price increases and a return to a more traditional market.
Reverse Mortgage
With all of the encouragement from celebrity spokespersons like Fred Thompson, Robert Wagner and Henry Winkler, there is a growing awareness of reverse mortgages. The fact is that our population is getting older and more than 25 million homeowners meet the age requirement.
A reverse mortgage will allow homeowners age 62 or older currently living in their home to tap into their equity. The amount available is determined by the borrower’s age, the home’s current value and current interest rates. The loan proceeds can be received in a single, lump-sum or periodic payments. The closing costs can be paid in cash or rolled into the loan amount.
Three Reasons to Choose a 15 Year Loan
Freddie Mac chief economist, Frank Nothaft, says that affordability, stability and flexibility are the three reasons homebuyers overwhelmingly choose a 30 year term. However, for those who can afford a higher payment, there are three additional reasons to choose a 15 year term: save interest, build equity and retire the debt sooner.
The Question Every Cash Buyer Should Answer
Paying cash for a home seems like a huge advantage to qualifying for a mortgage and an appraisal. However, for the fortunate few who don’t need a mortgage and are cash buyers, there is a question they should answer before they make that decision: Do you think at any point in the future, you might put a mortgage on this property?
It’s important because paying cash for a home could affect the ability to deduct the interest if the homeowner should place a mortgage on the home at a later date.
Continue reading The Question Every Cash Buyer Should Answer
Should You Opt for a Fixed-Rate Mortgage?
94% of purchasers last year opted for a fixed-rate mortgage at some of the lowest rates in home buying history. Yet, some of them will pay more in interest than necessary based on the time they’ll own the home.
If a person only plans to be in the home a few years, the adjustable-rate can offer significant savings.
Not only is the interest rate on the adjustable-rate lower than the fixed in the initial period, amortization on a lower interest rate amortizes faster than a higher interest rate.
Is the Window Closing?
With interest rates lower than they’ve been in over 40 years, it may be difficult to think of a “window of opportunity” closing. However, it isn’t difficult to understand that it may very probably cost more to live in a home in the near future due to rising interest rates and prices.
Zillow recently reported results from a nationwide study that home values are expected to appreciate by 4.5% through the end of the year. Coupled with Freddie Mac’s projection that rates are going up, the cost of housing for buyers by the end of the year will be higher than it is now.
Expect Increases in Mortgage Rates and Housing Prices
The two most frequently quoted constants in life are death and taxes. Two more things would-be homeowners can expect in the near future are increases in mortgage rates and housing prices.
Interest rates have been kept artificially low for several years by the Federal Reserve in an effort to strengthen the economy. Policy is shifting to allow them to seek their own natural level and that will surely result in higher mortgage rates. Rates on 30 year fixed mortgages are up over 1% from January, 2013.
Continue reading Expect Increases in Mortgage Rates and Housing Prices