Monthly Archives: June 2022

Things To Avoid After Applying For A Home Loan

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applying for a home loan

Once you’ve applied for a mortgage to buy a home, there are some key things to keep in mind. While it’s exciting to start thinking about moving in and decorating, be careful when it comes to making any big purchases. Here are a few things you may not realize you need to avoid after applying for your home loan.

Don’t Deposit Large Sums of Cash

Lenders need to source your money, and cash isn’t easily traceable. Before you deposit any amount of cash into your accounts, discuss the proper way to document your transactions with your loan officer.
Don’t Make Any Large Purchases

It’s not just home-related purchases that could disqualify you from your loan. Any large purchases can be red flags for lenders. People with new debt have higher debt-to-income ratios (how much debt you have compared to your monthly income). Since higher ratios make for riskier loans, borrowers may no longer qualify for their mortgages. Resist the temptation to make any large purchases, even for furniture or appliances.

Don’t Co-Sign Loans for Anyone

When you co-sign for a loan, you’re making yourself accountable for that loan’s success and repayment. With that obligation comes higher debt-to-income ratios as well. Even if you promise you won’t be the one making the payments, your lender will have to count the payments against you.

Don’t Switch Bank Accounts

Lenders need to source and track your assets. That task is much easier when there’s consistency among your accounts. Before you transfer any money, speak with your loan officer.

Don’t Apply for New Credit

It doesn’t matter whether it’s a new credit card or a new car. When you have your credit report run by organizations in multiple financial channels (mortgage, credit card, auto, etc.), it will have an impact on your FICO® score. Lower credit scores can determine your mortgage interest rate and possibly even your eligibility for approval.

Don’t Close Any Accounts

Many buyers believe having less available credit makes them less risky and more likely to be approved. This isn’t true. A major component of your score is your length and depth of credit history (as opposed to just your payment history) and your total usage of credit as a percentage of available credit. Closing accounts has a negative impact on both of those aspects of your score.

In Short, Consult an Expert

To sum it up, be upfront about any changes when talking with your lender. Blips in income, assets, or credit should be reviewed and executed in a way that ensures your home loan can still be approved. If your job or employment status has changed recently, share that with your lender as well. Ultimately, it’s best to fully disclose and discuss your intentions with your loan officer before you do anything financial in nature.

Bottom Line

You want your home purchase to go as smoothly as possible. Remember, before you make any large purchases, move your money around, or make any major life changes, be sure to consult your lender – someone who’s qualified to explain how your financial decisions may impact your home loan.

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What Does The Rest Of The Year Hold For The Housing Market

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where is the housing market going

If you’re thinking of buying or selling a house, you’re at an exciting decision point. And anytime you make a big decision like that, one thing you should always consider is timing. So, what does the rest of the year hold for the housing market? Here’s what experts have to say.

The Number of Homes Available for Sale Is Likely To Grow

There are early signs housing inventory is starting to grow and experts say that should continue in the months ahead. According to Danielle Hale, Chief Economist at realtor.com:
“The gap between this year’s homes for sale and last year’s is one-fifth the size that it was at the beginning of the year. The catch up is likely to continue, . . . This growth will mean more options for shoppers than they’ve had in a while, even though inventory continues to lag pre-pandemic normal.”

As a buyer, having more options is welcome news. Just remember, housing supply is still low, so be ready to act fast and put in your best offer up front.
As a seller, your house may soon face more competition when other sellers list their homes. But the good news is, if you’re also buying your next home, having more options to choose from should make that move-up process easier.

Mortgage Rates Will Likely Continue To Respond to Inflationary Pressures

Experts also agree inflation should continue to drive up mortgage rates, albeit more moderately. Odeta Kushi, Deputy Chief Economist at First American, says:

“… ongoing inflationary pressure remains likely to push mortgage rates even higher in the months to come.”

As a buyer, work with trusted real estate professionals, including your lender, so you can learn how rising mortgage rate environments impact your purchasing power. It may make sense to buy now before it costs more to do so, if you’re ready.
As a seller, rising mortgage rates are motivating some homeowners to make a move up sooner rather than later. If you’re planning to buy your next home, talk to a trusted real estate advisor to decide how to time your move.

Home Prices Are Projected To Continue To Climb

Home prices are forecast to keep appreciating because there are still fewer homes for sale than there are buyers in the market. That said, experts agree the pace of that appreciation should moderate – but home prices won’t fall. Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), explains:
“Prices throughout the country have surged for the better part of two years, including in the first quarter of 2022. . . Given the extremely low inventory, we’re unlikely to see price declines, but appreciation should slow in the coming months.”

As a buyer, continued home price appreciation means it’ll cost you more to buy the longer you wait. But it also gives you peace of mind that, once you do buy a home, it will likely grow in value. That makes it historically a good investment and a strong hedge against inflation.
As a seller, price appreciation is great news for the value of your home. Again, lean on a professional to strike the right balance of the best conditions possible for both selling your house and buying your next one.

Bottom Line

Whether you’re a homebuyer or seller, you need to know what’s happening in the housing market, so you can make the most informed decision possible. Connect with a real estate advisor to discuss your goals and what lies ahead, so you can pick your best time to make a move.

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What Are The Best Options For Today’s First Time Buyers

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first time buyers options

If you’re looking to buy your first home, you’re likely balancing several factors. Because both mortgage rates and home prices have risen this year, it costs more to buy a home than it did even just a few months ago. But that doesn’t mean you have to put your plans on hold.

If you partner with a trusted real estate advisor and hone your strategy, you can navigate today’s market and find the home you’re looking for. Here are two tips to help you get started.

Work with a Professional To Prioritize Your Wish List

If you’re having trouble finding a home in your budget that checks all the boxes, it may be worth taking another look at your lists of what you want and what you really need. According to the latest First-Time Homebuyer Metro Affordability Report from NerdWallet, your wish list can have as much impact on your search as your finances:
“Your budget isn’t all that you need to be concerned about; your wish list and desired location may carry just as much weight.”

It’s all about prioritization. If you’re serious about purchasing your first home soon, be flexible in what you’re looking for to open up your pool of options. Partner with a local real estate professional to better understand what’s available in today’s market and reprioritize your wish list. Remember, making a concession now doesn’t mean you’ll never have everything on your list. After you’ve moved in, you can always add certain features to make the home your own.

Increase Your Search Radius To Consider More Locations

Some areas may have more homes within your target price range than others, but it may require you to be flexible on your location. For example, if you’re a remote worker, you may be able to expand your search radius. As Fannie Mae explains:

“. . . continued remote work flexibility is likely giving many the ability to live farther away in more affordable areas.”

The decision to search in places with a lower cost of living could help you find a home that fits your budget and checks the most boxes off your wish list.

Bottom Line

If you’re serious about purchasing your first home this year, revisiting your wish list and desired location can help.
Work with a trusted real estate advisor to explore all the options in your local market – and beyond – so you can achieve your homeownership dreams.

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Why You Need An Expert To Determine The Right Price For Your Home

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Why You Need An Expert To Determine The Right Price For Your Home

If your lifestyle has changed recently and you’re ready to make a move, taking advantage of today’s sellers’ market might be just the answer for your summer plans. With homes continuing to get multiple offers, this could be your moment to get the contract you’re looking for on your house if you’re ready to sell.

And here’s the thing – you need an expert on your side to ensure you make all the right moves when you do, especially when it comes to pricing your house. Even in this competitive market, you can’t stick just any price tag on your home and get the deal you want. A key piece of the puzzle is setting the right asking price so you can help buyers notice your home (and get excited about it) from the very first time they view the listing. That’s where a real estate professional comes in.

Why Pricing Your House Right Is Important

The price you set for your house sends a message to potential buyers. Price it too low and you might raise questions about your home’s condition or lead buyers to assume something is wrong with the property. Not to mention, if you undervalue your house, you could leave money on the table which decreases your future buying power.

On the other hand, price it too high, and you run the risk of deterring buyers. When that happens, you may have to do a price drop to try to re-ignite interest in your house when it sits on the market for a while. But be aware that a price drop can be seen as a red flag for some buyers who will wonder why the price was reduced and what that means about the home.

In other words, think of pricing your home as a target. Your goal is to aim directly for the center – not too high, not too low, but right at market value. Pricing your house fairly based on market conditions increases the chance you’ll have more buyers who are interested in purchasing it. That makes it more likely you’ll see multiple offers, too. And if a bidding war happens, you’ll likely get an even higher final sale price. Plus, when homes are priced right, they tend to sell quickly.

To get a look into the potential downsides of over or underpricing your house and the perks that come with pricing it at market value, see the chart below:
Why You Need An Expert To Determine The Right Price For Your Home

Lean on a Professional’s Expertise

There are several factors that go into pricing your house, and balancing them is the key. That’s why it’s important to lean on an expert real estate advisor when you’re ready to move. A local real estate advisor is knowledgeable about:

The value of homes in your neighborhood
The current demand for houses in today’s market
The condition of your house and how it affects the value

A real estate professional will balance these factors to make sure the price of your house makes the best first impression and gives you the greatest return on your investment in the end.

Bottom Line

If you’re thinking about selling, pricing your house appropriately is key.
Work with a trusted real estate advisor to make sure your house is priced right for the local market, your home’s condition, and to stand out from the competition.

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More Listings Are Coming Onto The Market

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More Listings Are Coming Onto The Market

Some Highlights

Worried you won’t be able to find your next home after you sell? You should know data from realtor.com shows more listings are coming onto the market each month this year.
Having additional options can make the search for your next home easier. But inventory is still low overall, which means your house should still stand out when you sell.
If your biggest question is where you’ll go if you sell, take this as encouraging news.
Connect with a local real estate professional to start the process today.

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How Homeownership Impacts You

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How Homeownership Impacts You

June is National Homeownership Month, and it’s the perfect time to reflect on how impactful owning a home can truly be.
When you purchase a house, it becomes more than just a space you occupy. It’s your stake in the community, an investment, and a place you can put your stamp on.

If you’re thinking about buying a home this year, here are some of the benefits you’ll experience when you do.

The Emotional Benefits of Homeownership

Because it’s a place that’s uniquely yours, owning a home can give you a sense of pride and happiness in several ways.
Your Home Can Reflect Your Tastes and Personality

Investopedia puts it like this:
“One often-cited benefit of homeownership is the knowledge that you own your little corner of the world.”

That knowledge can lead to a powerful, emotional connection to the place where you live. But so can the realization that your home will grow with you. Because it’s yours, you have the freedom to make updates to it as your needs and tastes change. As Logan Mohtashami, Lead Analyst for HousingWire, says:
“The psychology is that this is yours and you’re going to make it as good as possible because you’re in for a long time, . . . “

And that can create a greater sense of ownership, pride, and connection with your home and your community.

It Can Enhance Your Neighborhood and Civic Engagement

Homeownership can lead you to get even more involved with your local area. After all, you’re putting your roots down in a location and will want to do what you can to help improve it, much like your home. In a recent report, the National Association of Realtors (NAR) says:
“Living in one place for a longer amount of time creates and [sic] obvious sense of community pride, which may lead to more investment in said community.”

The Financial Benefits of Homeownership

When you choose to become a homeowner, you’re making a financial decision as well. That’s because your home is also an investment.

It Can Help You Feel Financially Stable

Homeownership is truly one of the best ways to improve your long-term financial position. Not only will you have a predictable monthly housing expense that can benefit your budget in the short term, but you’ll also gain equity as your home appreciates in value and you make your monthly mortgage payment. As Freddie Mac says:
“Building equity through your monthly principal payments and appreciation is a critical part of homeownership that can help you create financial stability.”

It Can Grow Your Wealth

Because of your growing equity, you can build your net worth as a homeowner. And when you compare the difference in net worth between a renter and a homeowner, it’s clear that owning a home truly offers a great way to build your long-term financial position.

According to the latest data from NAR, the median household net worth of a homeowner is roughly $300,000, while the median net worth of renters is only about $8,000. That means a homeowner’s net worth is nearly 40 times that of a renter.
Bottom Line

Homeownership is truly a way to find greater satisfaction and happiness and to build financial freedom.

If National Homeownership Month has you dreaming about purchasing a home, contact a local real estate professional to begin the process today.

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Bright Days Are Head When You Move Up This Summer

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Bright Days Are Head When You Move Up This Summer

Some Highlights

Warmer weather and longer days mean summer is almost here. Celebrate by upgrading to the home of your dreams so you can enjoy all the season has to offer.
When you list your house, you can capitalize on today’s sellers’ market to fuel your upgrade. Then, you can move to a home with the features you want, like space to entertain or rooms for work and play.
If you’re ready to upgrade to a home that matches your changing needs, reach out to a real estate professional.

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Work With A Real Estate Professional If You Want The Best Advice

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home sweet home tara burner real estate

Because buying or selling a home is such a big decision in our lives, the need for clear, trustworthy information and guidance is crucial. And while no one can give you perfect advice, when you align yourself with an expert, you’ll get the best advice for your situation.

An Expert Will Give You the Best Advice Possible

Let’s say you need an attorney, so you seek out an expert in the type of law required for your case. When you go to their office, they won’t immediately tell you how the case is going to end or how the judge or jury will rule. What a good attorney can do, though, is discuss the most effective strategies you can take. They may recommend one or two approaches they believe will work well for your case.

Then, they’ll leave you to make the decision on which option you want to pursue. Once you decide, they can help you put a plan together based on the facts at hand. They’ll use their expert knowledge to work toward the resolution you want and make whatever modifications in the strategy necessary to try and achieve that outcome.

Similarly, the job of a trusted real estate professional is to give you the best advice for your situation. Just like you can’t find a lawyer to give you perfect advice, you won’t find a real estate professional who can either. They can’t because it’s impossible to know exactly what’s going to happen throughout your transaction. They also can’t predict exactly what will happen with conditions in today’s housing market.

But an expert real estate advisor is knowledgeable about market trends and the ins and outs of the homebuying and selling process. With that knowledge, they can anticipate what could happen based on your situation and help you put together a solid plan. And they’ll guide you through the process, helping you make decisions along the way.

That’s the very definition of getting the best – not perfect – advice. And that’s the power of working with an expert real estate advisor.

Bottom Line

If you want trustworthy advice when buying or selling a home, contact a local real estate professional.

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Three Tips For First Time Home Buyers

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tips for first time home buyers

Buying your first home is a major decision and an exciting milestone. Even though it can feel daunting at times, it has the power to change your life for the better. If you’re looking to purchase your first home, you may be wondering what’s happening in the housing market today, how much you need to save, and where to start.

Here are three things that can help give you the information you need to confidently pursue your dream of homeownership.

1. Consider All Options When the Number of Homes for Sale Is Low

Today, there are far more buyers in the market than there are homes available for sale. When that happens, it’s a good idea to do what you can to increase your pool of options. That could mean expanding your search to include additional housing types. For first-time buyers, considering condominiums (condos) and townhomes can be an excellent way to increase your choices. According to Bankrate:
“Townhomes often cost less than single-family homes of a similar size in the same location.”

In another article, Bankrate also says:“Buying a condo can be a great way to dive into homeownership without worrying about the upkeep that comes with single-family homes and townhouses.”

Condos and townhomes are both great entryways into homeownership. When you buy either one, you can start building equity which increases your net worth and can fuel a future move.

2. Know Your Down Payment Could Be More Within Reach Than You Think

Saving for a down payment can feel like one of the biggest obstacles for homebuyers, but that doesn’t have to be the case. As the National Association of Realtors (NAR) says:
“One of the biggest misconceptions among housing consumers is what the typical down payment is and what amount is needed to enter homeownership.”

Data from NAR shows the median down payment hasn’t been over 20% since 2005. The graph below breaks down the median down payment by age group for recent homebuyers according to the 2022 Home Buyers and Sellers Generational Trends Report from NAR (see graph below):

Three Tips For First Time Home Buyers

Based on the data above, the median down payment for all homebuyers is only 13%. That’s well below the common misconception of 20%, and it’s even lower for younger buyers. This could mean you may not need to save as much for a down payment as you initially thought.

There are also down payment assistance programs available for many buyers. Not to mention, some loan options require as little as 3.5% (or even 0%) down for buyers who qualify. While there are advantages to putting 20% down, especially in today’s competitive market, know that you have options. To get more information on how much you may need to save and the help that’s available, talk with a professional.

3. Work with a Trusted Real Estate Advisor Throughout the Process

Finally, no matter where you’re at in your homeownership journey, the best way to make sure you’re set up for success is to work with a real estate professional.

If you’re just starting out, they can help you with the initial steps, like educating you on the process and connecting you with a trusted lender to get pre-approved. Once you’re ready to begin your search, a real estate professional can help you understand your local market and search for available homes. And when it’s time to make an offer, they’ll be an expert advisor and negotiator to help your offer stand out above the rest.

Bottom Line

Knowledge is key to succeeding on your homebuying journey. Knowing market trends, what you need for a down payment, and what options you have as a buyer today can give you the confidence you need to buy a home.
Connect with a local real estate professional so you have an expert on your side who can help you navigate the homebuying process.

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Is It Enough To Offer Asking Price

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questions to ask yourself before buying a home

If you’re planning to buy a home this season, you’re probably thinking about what you’ll need to do to get your offer accepted. In previous years, it was common for buyers to try and determine how much less than the asking price they could offer to still get the home. The buyer and seller would then negotiate and typically agree on a revised price that was somewhere between the buyer’s bid and the home’s initial asking price.

In today’s real estate market, buyers shouldn’t shop for a home with the same expectations.

Things Are Different Today

Today’s housing market is anything but normal. According to the National Association of Realtors (NAR), the average home that’s sold today:
Receives 4.8 offers
Sells in just 17 days

Homes selling quickly and receiving multiple offers shows how competitive the housing market is for buyers right now. This is because there are more buyers on the market than homes for sale. When the number of homes available can’t keep up with demand, homes often sell for more than the asking price.

How Does This Impact You When It’s Time To Submit an Offer?

Market conditions should help guide your decisions throughout the process. Today, the asking price of a home is often the floor of the negotiation rather than the ceiling. Knowing this is important when it’s time to submit an offer, but you should also use that information as you’re searching for homes too. After all, you don’t want to fall in love with a home that ultimately sells for a price higher than what you’ve budgeted for.

The Mortgage Reports has advice if you’re looking to purchase a home in a competitive market. The article encourages you to be realistic with your housing search, saying:
“The best thing to do is set your budget and expectations ahead of time so you know how much you can afford to offer — and when to walk away. This will make negotiations a lot easier.”

Of course, when you’ve found your dream home, you’ll want to do everything you can to submit your best offer up front and win a potential bidding war. Knowing the current market is key to crafting a winning offer. That’s where working with an expert real estate advisor becomes critical.

A real estate professional will draw from their experience and expert-level knowledge of today’s housing market throughout the process. They’ll also balance conditions in your area to make sure your offer stands out above the rest.

Bottom Line

Understanding how to approach the asking price of a home and what’s happening in today’s real estate market are critical for buyers.
Partner with a real estate advisor to create a winning plan for you.

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