Category Archives: Getting a Home Loan

Median Price of Single Family Homes Already On The Rise In 2016

Santa Clarita Home Prices Take a Sizable Upswing In January

Last year, there were some experts and analysts wondering just how long the real estate market could continue to rise. There were definitely rumors of changes in light of What is your home's value?interest rates being raised by the Federal Reserve at the end of last year.

January is usually a very slow month for real estate. Many buyers and sellers are recovering from the holidays, and it's usually not at the forefront of the "to do" list. Typically, we see a slight drop in home values between December and January. For example, last year January saw a $15,000 drop in home prices from December of 2014. At the beginning of 2013, home prices dropped nearly $40,000 in one month. You get the picture, right?

However, this January saw single family home prices actually JUMP by $12,000 over December's closing price of $518,000. That's right. TWELVE THOUSAND IN ONE MONTH!

How is this happening in what's normally a slow month for real estate?

For one, mortgage rates are still dropping. That's right! We've seen them go down almost half a percentage point in recent months, and currently (As of the date of this post), rates for a 30 year fixed rate mortgage are at the nearly historic low of 3.64 percent. Qualified buyers can get a 15 year fixed rate home loan for just UNDER 3 percent.

If that's not motivation to get "off the fence" and find your dream home, then what else is there?

Continue reading Median Price of Single Family Homes Already On The Rise In 2016

Shopping Home Loans Can Save You Money

Making smart decisions when it comes to choosing a mortgage loan can save you a huge amount of money for years to come.

We talk a lot about interest rates. In most cases, the rates we’re discussing are base rates without any points or fees added by mortgage lenders. Many Investing in Propertylenders may not want you to know this, but those points and fees may be negotiated to your best advantage.

A recent survey showed that, while 4 out of 5 Americans consider themselves bargain hunters, less than 30 percent of consumers actually look for, or ask for, better terms for their home loan.

Why is it so important to shop lenders?

There are several reasons. The main one of course would be….money! Aside from lender fees that you would pay as a lump sum at close of escrow, even negotiating your interest rate a few fractions of a percent can save you thousands of dollars over the lifetime of your loan. What’s equally important is the level of service you can expect from your mortgage lender. Finding out how easy it is to have problems resolved through their customer service branch, or even if a lender regularly sells your loan to another bank are good things to know up front. Continue reading Shopping Home Loans Can Save You Money

Can You Afford To Buy a Home?

Do you have a down payment? Want a no-money-down loan? Are you self-employed? Follow these tips to making sure you’re ready to buy a home.

There are plenty of reasons why owning a home is one of the most sound investments you can have. Even still, there are some out there who think

Team Avalos Real Estate Santa Clarita
Rose and Carlos Avalos

buying a home is a lot like buying a car. You know, walk on the “lot”, pick out what you want, haggle the price a little, and drive home…right?

Actually, the two couldn’t be more different. But before you get into the PURCHASING part of home buying, it’s best to make sure you’re ready to afford a home. What does it take? What do lenders look for? Can you buy a home when you’re self employed?

First up, your finances.

It’s one thing to have a good credit score, and it’s another to know that the money you make is enough to afford a monthly mortgage payment. Assuming your credit is in good shape, lenders also look at your DTI, or Debt-to-Income ratio. Very simply, this is an easy bit of math where you divide your monthly recurring debt (Car payments, credit cards, alimony if applicable, student loans, personal loans, rent/mortgage payment) by your combined gross monthly household income. The result should come in the form of a decimal point. Of course, from there, basic math says that you move that decimal point over two spaces to the left, and the answer turns into a percentage. So let’s say you have a monthly combined gross income of $7,000. Your recurring debt expenses are $2,500. Divide 2500 by 7000 and the answer is (rounded up) .36, or 36 percent DTI. Some lenders will allow mortgages when a borrower’s DTI is as high as 42%, but most like to see it between around 28-35% to offer the best rate.

From there, your lender will determine your best monthly mortgage payment that is affordable within your DTI, and along with your qualifying interest rate, will then determine your total loan amount.

Okay, what if I don’t have 20% down to purchase a home?

Of course, we know especially with today’s housing prices, not everyone has saved up the usual high five figure amount that would equal a 20% down payment. Even still, your lender will look at your DTI to determine your loan figure based on the amount of cash (if any) you can put toward your home purchase. Keep in mind that while there are low money and no money down loans out there, you still have to be able to afford the monthly mortgage. The more you have to put toward the purchase price, the more home you can afford, and/or the lower monthly payment you’ll have.

I’m self-employed. Can I qualify for a home loan?

There was a time, before the recession, that it was fairly easy to get a home loan, even if you were self-employed. The “stated income” loan often used by those who were self-employed required little in the way of proof that what you actually made equaled what you put on your loan application. Guess what? Believe it or not, both buyers and lenders “occasionally” abused the system, which resulted in many buying homes they actually could not afford.

Since the recession, new rules and guidelines have been in place and are enforced for self-employed home buyers. First of all, you’ll need to show your lender at least two years’ worth of tax returns from your business that provide an accurate portrayal of your annual earnings. Also, your lender will use only your adjusted gross income as a qualifier, and not your overall gross income.

Team Avalos Real Estate is here to help you with all of your real estate needs!

As licensed, full service real estate agents, we have the experience and knowledge to help get you qualified for a home loan and get you into the home of your dreams. Contact us today for a no obligation consultation.

 

Previous Homeowners May Qualify As First Time Buyers Once Again

“Boomerang” home buyers are re-entering the marketplace, and some are able to take advantage of first time home buyer programs.

The last decade brought us a few tough years, especially for some home buyers. Real estate professionals like us were able to help many avoid Team Avalos Real Estateforeclosure during the darkest days of what’s become known now as “The Great Recession.” In some cases, foreclosure was avoided through a short sale or other means such as deed-in-lieu. Of course, in avoiding foreclosure, the now former homeowner was once again in the position of renting the place in which they lived.

Fortunately, in most cases, distressed times are short-lived, and many were (and are) able to get back on their financial feet. Lenders made changes to their restrictions, some allowed former short sellers to qualify for a mortgage in as little as two years under certain circumstances.

For others, their wait to be able to afford another home purchase may have taken a little bit longer. However, there’s good news for them, especially when it comes to first time home owner programs. Continue reading Previous Homeowners May Qualify As First Time Buyers Once Again

The Pros and Cons Of The 15 Year Home Mortgage Loan

There are many benefits to paying off your mortgage more quickly, but is a 15 year loan right for you?

Interest rates are a sticky business. They rise, they fall…and while we try to predict their outcome, they’re a “moving target” when it comes to really 15yearfixedtrying to pinpoint where they will land on any given day.

We’ve noticed just a little bit of a bump in rates over the past month or so. Even still, they are holding just over 4 percent, which is still incredible. Are you aware that there are loan programs out there that are not only available at lower than standard rates, but will help you own your home more quickly?

The 15 Year Home Loan

Wouldn’t it be great to not have to make your mortgage payments for 30 years? What about the possibility of putting more of your house payment toward your principle, which increases your equity as you pay down your loan faster? What if, on top of all this, your loan is at a lower interest rate than a traditional 30 year home mortgage? Continue reading The Pros and Cons Of The 15 Year Home Mortgage Loan

Low Rates Spur Huge Jump In Mortgage Applications

January sees highest number of loan applications since 2008.Mortgage applications on the rise in 2015

With mortgage rates holding at below 4 percent for the past few months, it’s no wonder home buyers are seeing the opportunities available to them in the form of greater purchasing power.

According to the Mortgage Banker’s Association, nationwide mortgage applications were up 49 percent as of the week ending January 9th 2015, which is the largest increase since 2008. What’s interesting about this phenomenon is that it flies in the face of predictions made by some financial analysts who predicted mortgage rates would rise.

So why have mortgage rates remained low despite predictions?

We’ve seen the foundations of not just an economic recovery, but a true rebound in the past 12 months. Nationally, unemployment rates have dropped, while the GDP (Gross Domestic Product) surpassed expectations in the latter part of 2014. Stocks have been strong, as have Mortgage-Backed Securities. Strong investment in the stock side of real estate has helped maintain low rates as well. Consumer confidence has also soared in the wake of lower gasoline prices, putting more money into peoples’ pockets.  Continue reading Low Rates Spur Huge Jump In Mortgage Applications

Do I Have To Wait 7 Years To Buy a Home After Foreclosure?

Recent FHA Guidelines Change The Rules On Wait Times For Home Purchases After Foreclosure

There is a lot of good news in the Santa Clarita housing market. Home prices are up, mortgage rates are down, and many formerly “upside down” borrowers are once again seeing positive equity in their properties. We’re seeing a lot of positive signs elsewhere as well. Short Sales are down over 80%, and foreclosures have dropped over 50% since this time last year.

While it appears we’re well on the road to recovery real estate-wise, we know that many people have gone through a lot. We have helped many people avoid foreclosure through a short sale, and yet there were so many homeowners who, through no fault of their own, lost their home to the bank. The Great Recession affected many who struggled financially due to circumstances beyond their control. In many cases, those circumstances were temporary, and many are back on the path to a more financial future.

Are you ready to re-enter the housing market?

If you were one of the many who suffered setbacks as a result of the Great Recession and had short sold lost your home to foreclosure as a result, we have good news! Recent guideline changes from the Federal Housing Administration allows former homeowners the ability to wait only one year to purchase a home after going Continue reading Do I Have To Wait 7 Years To Buy a Home After Foreclosure?

How To Get The Best Loan Rate When Buying a Home

A lower interest rate can improve your purchasing power when it comes to buying a home.

INTEREST RATES ARE STILL INCREDIBLY LOW! Team Avalos Real Estate

We regularly shout it out to remind home buyers not to delay if they are on the fence about purchasing property. As of the date of this article, mortgage rates are still hovering around four and a half percent. When you consider that the historic average is around 7 and a half percent (Based on data collected since 1971), this gives qualified buyers a great opportunity to either buy a larger home, or maintain a lower interest payment.

So what is a “qualified” home buyer?

“Qualified” basically means just as it sounds: A buyer is qualified under certain conditions to obtain a home mortgage loan to purchase property. So what can you do to insure you’re getting the best rate possible? Continue reading How To Get The Best Loan Rate When Buying a Home

Study Shows Real Estate Agents Are Still Best Source For Buyers Searching For Homes

National Association Of Realtors Report Shows More Buyers Trust Agents To Help Find Home Than Any Other Source

A recent study by the National Association of Realtors (NAR) shows that 87 percent of Real Estate Agents were viewed as a trusted and useful information source for buyersWhy it's important to use a real estate agent when searching for a home for sale. you used an agent when searching for a home.

The comprehensive report, titled 2013 Profile of Home Buyers and Sellers, detailed nearly all aspects of the real estate experience from the perspective of the home buyer and seller. The 120 page study also focused on the home search process, the buying and selling process, and real estate financing.

Why It Is Important To Use a Real Estate Agent When Beginning Your Home Search

It’s understandable that many potential home buyers are unsure of their goals when first considering purchasing a property. Unfortunately, so many go about it the wrong way when they do their best to avoid contact with a licensed real estate professional. The Internet has made it much easier for buyers to search anonymously, but in most cases, they may not know much (or anything) about the areas or neighborhoods where they are searching. Even worse, they haven’t begun the loan qualification process to assess their spending power. Continue reading Study Shows Real Estate Agents Are Still Best Source For Buyers Searching For Homes

Another Reason To Buy a Home Now: FHA Loan Rates Dip Below 4%!

Home mortgage rates continue to drop as 2013 nears an end.

Home buyers were in a bit of a struggle over the summer. Not only did interest rates take a 1 percent jump, but available housing inventory for sale was still pretty scarce. Mortgage interest rates once again on the declinePrices rose due to such a high velocity demand from not only buyers who wanted a residence to live and/or raise a family, but investors were still snatching up properties as well.

With the considerable rebound in housing prices, it’s no wonder that buyers are back in the game. Knowing that the investment they make will begin to grow equity almost immediately whetted the whistle of those looking for homes, and sellers took complete advantage. Many home sellers experienced multiple simultaneous offers, putting them completely in the driver’s seat as far as price, terms and conditions against the buyer whose offer was finally accepted.

A slight shift in the real estate market that turns into a win-win for both buyers and sellers.

As interest rates rose over the summer, housing sales began to level off slightly, bringing about a slow rise (VERY slow!) in available houses for sale. While inventory is still low in Santa Clarita, it has raised a few hundred units from around 300 at the end of summer, to around 500 in October. Now, this is typical as the year winds down and the holidays near. Many sellers consider holding off listing their home until after the new year, although there are many who are serious enough about selling that they will continue to offer their homes to buyers straight through. Continue reading Another Reason To Buy a Home Now: FHA Loan Rates Dip Below 4%!