What Happens if Fannie Mae and Freddie Mac go away?

waving goodbyeDissolving Fannie Mae, Freddie Mac may hurt borrowers
Source: The LA Times

What will the proposed elimination of Fannie Mae and Freddie Mac mean for consumers? In the absence of a government guarantee, experts contend that mortgage rates are likely to rise, and the widespread availability of 30-year mortgages would be jeopardized. Economists at Moody’s Analytics estimate the average mortgage borrower would see interest rates increase by one-half to three-quarters of a percentage point.
Read the full story

Click here to start searching for your new home or list it for sale before rates go any higher!

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Do you ask Mom and Dad for the cash to buy that home?

parent loanAsking Mom and Dad for Cash to buy that Home

Source: Wall Street Journal

Loans from family members could go the extra mile in making a down payment, but financial experts say parental help is most useful when it comes as a gift rather than a loan during the mortgage application process. A family loan may not be viewed favorably by a lender and could lead to disqualification for a mortgage since the loan is considered unsecured debt.  Read the full story.

Click HERE to find out what your home is worth in today’s market.

Watch out for this Mortgage Scam

scam alertPutting borrowers into higher-rate mortgages still occurs, U.S. says

Source: The Los Angeles Times

A lawsuit filed recently by the Consumer Financial Protection Bureau indicates that “upselling” remains a pressing concern due to hidden, backroom ploys. “Upselling” leads mortgage applicants into higher-cost terms that increase the lender’s profits, and this abusive practice was banned by the Federal Reserve Board in 2011. Read the full story

Visit www.clarkransom,com if you are considering buying or selling a home.

How do you compete with Other Buyers and all-cash Investors when buying a home?

compete with cash buyersFor Buyers, only the most fit will survive and succeed in purchasing a home – those with excellent credit and a sizeable down payment can compete with Investors paying all cash.  According to C.A.R.’s 2013 Home Buyer Survey, 96% of buyers use the internet to find a home and 70% of those use their smartphones to do so.  Not a laptop, not an i-Pad…. their phone.  That is a significant change in how buyers shop for homes.  Other factors Buyers will face in order to compete include:

  • Tighter lending standards with 85% of buyers obtaining 30-year fixed loans (they have to put more “skin” in the game than before)
  • Higher Down payments; the average is now 25%
  • Rising interest rates
  • It takes longer to find a home due to lower inventory of houses on the market ( average of 9.8 weeks)
  • Instant Text notifications from Listing sites allow buyers to “jump” on a new listing before others,
  • In multiple offer situations you will need to add a “cover story” page to your offer that makes you unique and appeals to the Seller’s emotional side.

Yet there is good news on the horizon.  As the number of lower-priced homes available on the market begins to decline, Buyers will find the competition leveling out as Cash Investors rarely delve into properties that are priced over $500k.

Click HERE to watch a video on “What you DON’T want to do before you Buy that Home.”

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