Blog — Page 789 of 830 — First Rate Financial Group

12

Nov

Home Mortgage Tips

How to Use a Mortgage Calculator to Determine Your Monthly Payments, Interest and More

How to Use a Mortgage Calculator to Determine Your Monthly Payments, Interest and More Are you thinking about using a mortgage to buy a new home? Buying your own piece of local real estate is a major financial investment and one that can require some pretty complex math to fully understand.

In this blog post we’ll discuss mortgage calculators and how to use one of these tools to determine your monthly mortgage payments, interest charges, amortization periods and more.

Determining Your Principal and Down Payment Amounts

To get started with a mortgage calculator you’ll need to know how the price of the home and how much you intend to contribute as a down payment. Generally speaking you’ll want to place a down payment of at least 20 percent in order to avoid having to pay for private mortgage insurance and to give you access to better interest rates.

Choosing Your Interest Rate and Amortization Period

Now that you have an idea of the amount of mortgage financing you’ll need, the next step is to choose your interest rate and amortization period. Different lenders will offer different interest rates for every one of their mortgage products, so again you’ll want to play around with these numbers and run the calculation to see which combination of mortgage financing, interest rate and amortization period gives you a monthly payment that suits your budget.

Using a Mortgage Calculator for Refinancing

If you’re thinking about refinancing your current mortgage you can also use a mortgage calculator to help make the math a bit easier. Simply use your outstanding mortgage balance as the principal amount and then choose an amortization schedule that fits your financial goals. Be sure to keep an eye on your interest payments, as you may find that by refinancing to a longer amortization period your monthly payments go down but your total interest paid is quite a bit higher.

Don’t Forget the Closing Costs

Finally, don’t forget that there are numerous “closing costs” – fees, taxes and more – which you’ll need to factor in to your overall calculation. Closing costs will include everything from home appraisal fees to government filing fees and property taxes, and will vary depending on the home and the city or community you’re buying in.

While online mortgage calculators can handle the tricky math to determine monthly payments and interest costs you may still find that you have questions about your mortgage or some aspect of the process. For more information, contact your local mortgage professional and they’ll be happy to share their advice and expertise.

10

Nov

By support

Market Outlook

What’s Ahead For Mortgage Rates This Week – November 10, 2014

Negotiation Tips: How to Ask the Seller to Pay the Closing Costs Last week’s economic reports contained mixed reports indicating that the economy continues to recover with occasional “blips” in its progress. Construction spending was lower than expected.

A Federal Reserve survey of senior loan officers indicated that credit standards remain strict for mortgages and other types of lending. According to the survey, a “modest net fraction” of large banks had eased credit standards for prime mortgage lending.

First-Time Homebuyers Struggle as Market Share Hits 27-Year Low

The National Association of REALTORS® (NAR) reported that first-time buyers’ share of home purchases has slipped to 33 percent, which was its lowest level in 27 years. According to Lawrence Yun, chief economist for the NAR, high home prices and mortgage insurance costs along with strict mortgage credit requirements continue to sideline first-time buyers.

In other news, the Department of Commerce reported that construction spending dropped by 0.40 percent in September as compared August’s reading of -0.50 percent and an expected reading of +0.70 percent. September’s reading represented a seasonally-adjusted annual construction spending rate of $950.90 billion.

Mortgage Rates: Average 30-Year Mortgage Rate Tops Four Percent

Average mortgage rates rose last week according to Freddie Mac. The average rate for a 30-year fixed rate mortgage rose by four basis points to 4.02 percent. The average rate for a 15-year fixed rate mortgage rose by eight basis points to 3.21 percent, while the average rate for a 5/1 adjustable-rate mortgage rose by three basis points from 2.94 percent to 2.97 percent. Average discount points remained at 0.50 percent for all three types of mortgages.

This is not altogether bad news, as higher mortgage rates are typically prompted by improving economic conditions. 2014 started with an average rate for 30-year fixed rate mortgages of 4.05 percent.

Labor Reports Suggest Stronger Jobs Markets

Last week’s economic news included several reports that indicated improvements in U.S. labor markets. The Department of Labor released its Non-Farm Payrolls report for October with a reading of 214,000 jobs added against expectations of 243,000 jobs added and September’s reading of 256,000 jobs added. While this appears contrary to stronger labor markets, analysts said that a new low in the national unemployment rate of 5.80 percent indicated that fewer new jobs were needed. October was the ninth consecutive month reporting 200,000 or more jobs added.

The ADP employment report, which tracks payrolls in the private sector, reported an increase of 5,000 jobs from September’s reading of 225,000 jobs to October’s reading of 230,000 jobs.

Weekly jobless claims fell to 278,000 against expectations of 285,000 new jobless claims filed and the prior week’s reading of 288,000 new claims filed. This reading supports a stronger jobs market and may compel would-be home buyers to enter the market as concerns about unemployment and jobs wanes.

The national unemployment rate reached a new low with October’s reading of 5.80 percent. In related news, Fed Chair Janet Yellen indicated in a speech on Friday that the target Federal funds rate will likely rise in 2015, but she gave neither a prospective date nor details about how much the benchmark federal funds rate may rise.

07

Nov

By support

Home Buyer Tips

Negotiation Tips: How to Ask the Seller to Pay the Closing Costs

Negotiation Tips: How to Ask the Seller to Pay the Closing Costs You’ve found the perfect new house or condo, and you are now preparing an offer that you believe the seller will find tempting enough to accept. However, you know that there are going to be thousands of dollars in closing costs that need to be paid before the sale is completed and you become the home’s new owner.

The question is, should you ask the seller to pay some or all of the closing costs? In today’s blog post we’ll address this question and list a few scenarios in which you may want to consider having the seller pick up the tab.

Ask if You’re Offering the Full Listing Price

If you’re prepared to offer the full asking price for the home you can certainly include the caveat that the seller assist with some or all of the closing costs. Many sellers will price their home slightly higher than they expect to receive as they believe that buyers will submit low initial offers which need to be negotiated.

For example, if a home is listed at $275,000 a seller might actually be expecting $260,000 or $265,000 for it. You can offer $275,000 but ask that they take care of the closing costs.

Ask if You’re Confident the Seller Has Few Other Options

If the home has been on the market for a number of months or if you’re fairly confident that the seller isn’t going to find much luck elsewhere you can ask them to pick up the closing costs as one of your purchase conditions. You’ll obviously want to negotiate in good faith, but if you’re coming from a position of strength you can leverage this in to some additional savings.

Ask if You’re Ready to Close Immediately

Are you ready to sign on the dotted line today? If you’re sure that this is the right home for you, let the seller know that as long as they’re willing to assist with the closing costs and accept your bid that you’ll start the closing process today. Nearly all sellers will be willing to make a small sacrifice to get the deal done.

As you can see, there are a number of situations in which it makes sense to ask the seller to shoulder some of the closing costs. If you have found a home that you wish to purchase and you’d like advice on how to proceed, contact a real estate agent today. An experience real estate professional can help you craft an offer that the seller won’t be able to refuse.