Wait, that’s all I need to buy a home???
Our world is evolving, advancing and surging forward at a rapid pace. Are mortgage loans the same as they used to be? Believe it or not, many buyers today still believe they need 20% down to purchase a home, but as our world evolves so do loans. Today, there is an arsenal of loan programs with down payment options less than 20%! For instance, if you’re serving, or served in the military, it’s possible you can get into a home with 0% down (VA Loan). If you’re a first-time home buyer, it’s possible you can get conventional financing with as low as 3% down (conventional loan) and if you’re a repeat buyer you can buy a home with as little as 3.5% down using an FHA loan or 5% down with a conventional mortgage loan! There are two main categories which impact how much cash a buyer needs for closing: down payment and closing costs. How much are closing costs? Generally, a good rule of thumb for estimating closing costs is between 3 – 3.5% of the purchase price. If you’re a repeat buyer and are going with a down payment option of 3.5%, you’ll need to add roughly another 3.5% for closing costs bringing the total to 7% of the purchase price. However, if there is something nice about closing costs, it’s that the buyer doesn’t necessarily have to pay for them. It’s possible for a buyer to negotiate in an offer that the seller will pay for all, or a portion of closing costs. On an FHA loan, the seller can pay for up to 6% of...Breaking News: FHA Suspends Plan to Lower Mortgage Insurance Premiums
The United States Department of Housing and Urban Development (HUD) announced today, January 20, 2017, that they have suspended the plan to lower the mortgage insurance premiums on loans insured by the Federal Housing Administration (FHA). This reversal came immediately after President Donald Trump’s inauguration; an explanation as to why has not yet been provided. The Federal Housing Administration announced on January 9th, 2017 that they would reduce the annual mortgage insurance by a quarter percent for all loans closing on or after January 27, 2017 saving the average borrower approximately $500 per...How Did Residential Sales in 2016 Compare to Years Past?
Residential sales volume in 2016 totaled $5.3 billion with 19,264 sales in Lee County. Over the last six years reviewed, this was only second to 2015 which reported both higher volume and more transactions at $5.6 billion and 21,103 respectively. Second to 2015 in volume and transactions, 2016 recorded the highest average sales price over the six years reviewed at just over $276,000; this was an increase of 4% from 2015, 16% from 2014 and 25% from 2013. The average sales price has increased nearly $100,000 from 2011. Is it true that season brings more activity and higher sales prices? Well based on data over the last three years (provided below), the answer is clear. Now, June is not considered by most to be season, but the numbers below are based on a closing date, not the date which a property went under contract. So, using a one month average close, the months with the most executed contracts would be February to May; this time period also recorded a higher average sales price anywhere from 1% – 4% higher than the average annual sales price. This trend also held true for the six-year window observed (back to 2011). *Above numbers are from local MLS and are subject to change as local MLS updates, corrects or edits...FHA Lowers Mortgage Insurance Premiums
The United States Department of Housing and Urban Development (HUD) announced Monday that the mortgage insurance premiums on loans insured by the Federal Housing Administration (FHA) will be reduced by 25 basis points for loans closing on or after January 27, 2017. The most popular down payment for an FHA mortgage loan is 3.50%, which currently carries MIP of .85% annually. With the new change, MIP will be reduced to .60%, saving someone with a $200,000 mortgage approximately $500 annually. This will result in huge savings for FHA borrowers and will also help lower debt-to-income ratios, ultimately leading to higher affordability for FHA...Fox 4 Morning Blend Part 2
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