Tag Archives: Idaho

Summer home sales in Boise, Idaho are smoking hot!

the Independence day weekend marks the mid point for summer sales for most of us. Boise’s 2015 sales season has been very hot from the early spring.  Unlike 2014, when we had a prolonged, colder winter, people seemed to be ready to start shopping in February.

Earlier on, in the start of the season, we say several homes sold at or above asking price.  Many others, have come back over the appraised value and some people still bought.  In most cases, a cancellation or re-negotiating  of the sales price happened.

Other interesting fact, the local real estate appraisers are factoring the “Production Builder penalty” into their valuations.  Without naming any specific names, we have several builders in the Treasure Valley who build hundreds of homes a year, typically in their own subdivisions.  If they build for less than “Custom Home Builders”, the value a home owner is going to be compared to other homes built by that builder.  They could be as much as $20/foot or more less than a custom home of the same size and finishes.  This has led to some upset realtors and home owner’s but its something to consider when buying or building a new home.

Realtors I work with are reporting multiple offers on newly listed homes in a matter of days if not the first day a home is listed on the local MLS.

As a result of our hot market, I am seeing longer times to appraise a home.  Loan underwriting times are getting longer as well as more home purchase loans are submitted.  FYI, Fairway Independent Mortgage Corporation underwriting times are about 5 business days right now.  Most loans are getting finished within 30 days of application.

Another trend I am seeing is people relocating from California, Nevada, and other states to the Boise area.  Many times they are retirees with pensions and cash from the sale of their previous home.  They can pay cash and close in a couple of days if they wish.  This may not be the best use of that lump sum, the HECM for Purchase Loan enables borrowers 62 or up to put up a fraction of the price of the new home and a reverse mortgage, or HECM, will cover the rest.  Expect to put down half and the Reverse Mortgage covers the rest.  Save the rest of your cash for getting outdoor and enjoying what Idaho has to offer.

Mortgage interest rates are still low.  They have moved up about .5% on a 30 year fixed rate loan from the low 3’s to the upper 3’s and low 4 percent rates as of today.  The “experts” keep saying rates are going to go up in the future, but so far they are holding at historically low rates.  You could be regretting not getting a home if you had the chance in summer of 2015 and didn’t.

 

How to increase your credit score, FAST!

Outstanding credit card balances can impact a large portion of your total credit score.

Look at the available credit line vs what you owe.

If you have accounts that are being utilized over 50%, pay them down to under this amount.

If you are actually over the available balance, pay that down first.

The credit card companies usually report new data every month, and that will impact your next credit score when factored into the overall credit report.

 

Got a credit Question, ask below!

 

USDA increases its mortgage insurance fees in October

The Rural Development loan program offered through the US Department of Agriculture is increasing its monthly mortgage insurance fees starting 10/01/2014.

Right now, the Rural Development loan program charges a monthly mortgage insurance fee equal to .4% of the loan amount per year.  This will increase to .5% starting 10/01/2014.

What is the difference in payment?  On a $135,000 loan the monthly mortgage insurance goes from $45.00 per month to $56.30 per month.  This may not sound like much, but it wasn’t that long ago that RD loans didn’t have a monthly mortgage insurance fee.

RD loans in addition, still have the 2% up front Mortgage Insurance, called a “funding fee” that is typically financed on top of the loan.  That would be an extra $2700 added to the above mentioned $135,000 loan, a typical loan size for the RD eligible areas such as Star, Middleton, Kuna, Idaho.

To qualify for the additional $56 per month, a borrower would need to earn an extra $130.23 per month.

Are there alternatives to using the USDA’s Rural Development loan?  Yes, there are.  To determine if they are the best loan program for your situation, you need to call a local lender you trust and discuss your mortgage needs.

Should you not have a lender, you can always call me at 861-7579 and I will go over your individual situation and find the best mortgage program for your needs.

What is the cost of waiting to buy?

The spring is here, and that means the Boise, Idaho real estate market is awaking from its winter slumber.  Experts are saying our market will appreciate about 5% this year, but some segments might go even higher, say 10% or more.

 

Here is an info graphic that illustrates the costs of waiting.

Cost-1024x561

 

Anyway, we expect costs to go even higher as demand for housing confronts the shortage of housing in the Treasure Valley.  Combine that with expected higher rates and you can see a definite “cost” top waiting.

If you don’t want the next home to cost more, then call me today and lets put a plan together for you next home.

 

 

 

Who is Fairway of Idaho?

FHA’s back to work program requirements

The changes to FHA’s back to work initiative have opened up the housing market to many potential home buyers  who otherwise would have to wait another year.

The Back to work guidelines allow for a home buyer to purchase a home after 12 months from the date of a Foreclosure, Bankruptcy, or short sale.  Until now, the guidelines required 24 months or longer after those events.

Its not without its qualifications, here they are:

  • Borrower(s)      must have a FICO score of 640 and above.
  • Borrower(s)      experienced an “economic event” such as job loss, loss of income, or combination of both which caused a foreclosure/pre-foreclosure, deed-in-lieu, or short sale.
  • “Economic event” resulted in at least 20% decline in household income and      lasted six months or more.
  • A   minimum of 12 months has elapsed since “economic event”.

Borrower(s) must receive HUD-approved counseling.

 

I’m not sure how I feel about the changes, on one hand it gets people into homes earlier than in the past.  On the other hand, I didn’t feel than 24 months after a bankruptcy and 36 after a foreclosure was too long to sit out of the home ownership market.

Bottom line is, some people will be sufficiently motivated to go through the counseling, gather documents proving the economic event and have made efforts to get their credit straightened.  Those people are probably the ones who will be ok buying a home sooner than later.

 

 

The key to a successful home purchase is preparation

As with most activities, preparation makes a big difference in the outcome.  When buying a home, you need to ask yourself the following questions:

How much can I afford to pay and still pay my other bills and meet my other financial goals.

What do I really “need” in my new home?  What is a “want.”  Wants are often optional and always more expensive.

Is the new home closer or further from my work.  If further, did you take into account the extra cost of commute?

What does the surrounding neighborhood look like and is it changing?

How long do I see myself being there?

The next preparation is a financial one.

Gather your last 2 years w2 statements, your last month’s paystubs, the last 2 months bank statements and go visit your local lender.  If you don’t have one, I know a great one in the Boise, Idaho area!

Your mortgage loan officer will look at your income and assets and come up with an amount and loan program that will meet your needs.  You’ll probably want to have them run your credit report to make sure its in order as well.

When your mortgage loan officer has all three, he can run a pre-approval and give you a mortgage pre-approval letter.  Having a mortgage pre-approval letter will make your home offer more attractive to the home seller.  In many cases, a mortgage pre-approval letter is mandatory when making offers on government or bank owned homes.

The next preparation is to find yourself a Realtor you want to work with.  It seems that you can find a Realtor anywhere you go, but finding the right Realtor is vital to have a successful and positive experience buying a home.  You could call the agent who has a sign in front of the house you are interested in, but their duty is to the seller who listed the home with them.  They will probably be happy to show you the home and may be the greatest
realtor in the world, but remember, their duty is to the seller.  Anything to tell them, they are required to report it back to the seller.

This is why you should get your own Realtor, a buyer’s agent.  If you need the name of a great Boise are Realtor, I work with many great agents.  Each one has their own uniqueness, abilities, and personalities.  You will be spending a lot of time with your Realtor, so choose wisely.  A great Realtor will be one you will use again on the next house and would be one you could refer to friends and family.

When you make your offer on a home and get it accepted, then the real fun starts.  You have to set a deadline for closing and during that time many things will have to happen to make it close on time.  You probably should spend the money on a professional home inspection, it could turn up an expensive defect in the home.  You also should make arrangements  for utilities , mail forwarding, moving help, and final walk through.  When your loan is past final underwriting, you can set an appointment with the Escrow company to do your signing.  Having a few days notice to get off of work early or take a long lunch is helpful.  Escrow is done during business hours so plan on taking some time or ever the day off if possible.  It’s good practice to let your supervisor know that you are going to need a little time off soon to close on your house.

Once you close on your home, its yours.  You’ll probably have a lot of moving and unpacking to do, but that’s a subject for another post.

As you can see, with so much to do, its vital to be prepared or else it can be a very stressful experience!  If you need help getting ready to buy and are in Idaho, feel free to contact me.

Best of Luck!

 

What are the new changes to FHA home loans?

As of June 1st this year, major changes were made to the FHA home loan program and its Mortgage Insurance Premiums.  Any new FHA loan after the date is subject to higher rates on Mortgage Insurance Premiums and the duration of the MIP.

The FHA Mortgage Insurance Premium(MIP) consists of 2 parts, upfront MIP and a monthly MIP.  The rates now are 1.75% of the loan amount upfront and 1.35% per month on a 30 yr fixed rate loan amount and the monthly payment.  For example, a 30 yr fixed rate FHA Mortgage with 3.5% down payment, the numbers would look as follow:

Purchase price: $175,000-This is the average price in my market, Boise, Idaho.

3.5% down $6125,

Loan: $ 168,875

Upfront MIP, 1.75% $2955.31

Monthly MIP: 1.35%  $2279.81 per year or $189.968 per month.

As you can see, the FHA Mortgage Insurance can add a considerable amount to your monthly payment.

As if that wasn’t enough, the Mortgage Insurance is part of the loan for as loan as you have a FHA loan.  It used to drop off once you had paid your balance down to 78%.  Now the only way to drop MIP from your loan is to refinance out of the FHA loan or sell the property.

This will make conventional loans, with their 3% down payment much more attractive than a FHA Loan.

Any good loan officer will run the comparisons for a home buyer considering a FHA loan to make sure the client is getting the best possible loan at the lowest possible payment.

If you’re in the Boise, Idaho area and need a quote, give me a call.

 

 

Rate sale now at Fairway!!

I have never seen this with any company I worked for, but Fairway Independent Mortgage Corporation is giving us a discount to pass along to our clients.

Our normal interest rates are great and our closing cost structure beats any mortgage broker, but now we have almost a full discount point to credit to our buyers.  This means a rate .25% less than the going rates.

The idea behind it is because mortgage interest rates have risen here in Boise, Idaho and the rest of the country, and that’s going to keep some people from taking advantage of the last best opportunity to refinance their home loan or buy a home for the lowest possible rates in decades.

I don’t know how long its going to last, but if you know of anyone who is sitting on the fence because interest rates have risen in the last month, here’s a last chance to get that low interest rate.

If you are in the Boise, Idaho area and want to see what is available, call me at 861-7579.

The shady gimickmeisters are coming out again

Its only a matter of time when an industry is growing before the slick gimickmeisters come out and try to get into what is percieved as easy money.

I get calls almost weekly from past clients and friends saying they a got a call or a mailer from a company offering a rate of 2.5% on a loan.

In most every case, the offer has been something they didnt think it was, ie a 10 yr fixed rate at 2.75% or a 2.25% VA loan that actually turns out to be a 3 yr adjustable rate with 1% origination and 1% discount points.  Compare that to a regualr 30 yr fixed rate VA loan in the 3.5% range with zero origination points and zero discount points.

My advice is to deal only with a local, trusted advisor, never someone over the phone.  If you don’t have one, I would love to help you.  I’m in Meridian, Idaho.  I can be reached at 861-7579.

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