Wow did you see the rates today? They are down to 5.125% for a 30 year fixed mortgage. That is absolutely fantastic. In addition, first time homebuyers can receive an $8,000 federal tax credit.
To give you some perspective, if you purchased a $200,000 house at 6.5% (still considered not bad), your principal and interest payment would be $1,264.14 plus taxes, mortgage insurance and homeowners insurance. If you can get that same loan at 5.125%, the payment would be $1,088.97 per month plus taxes, mortgage insurance and homeowners insurance.
That's a savings of $175.17 per month!!! This may allow you to buy a house for almost $30,000 more or another way to look at it is when the interest rates go up, you lose $30,000 of your purchasing power.
This is why if you are thinking of purchasing a home, now would be a good time to do it. Inventory is still good and the interest rates are fantastic. If the fed thinks that we are starting to get inflation however, they will take actions that will result in the rates going up. Rates can go up as much as one point in a day and it can be devasting to your budget.
If you would like to get set up on an Email Subscription to the Multiple Listing Service so you can see what is out there and what it looks like, just give me a call at 801-792-1257. I will find out what you think you may be looking for and get it set up so you can get the new listings each day as they come on the market.
Also, the Utah Housing Corp program is fantastic for first time homebuyers. If you qualify, you won't need a downpayment and we can have the sellers pay your closing costs. So you don't need very much money to buy a house now. For information on this program you need to call a loan officer with a bank that offers it - mortgage brokers are typically not approved for this program. One loan officer I have worked with on these programs is Rachel Thorell, Academy Mortgage at 801-502-9200. She will be able to tell you over the phone if you qualify for this program and what your payments would be when you purchased.
Call Patty Purdue at Utah Select Realty at 801-792-1257 with any real estate questions.
Thursday, July 9, 2009
Wednesday, July 8, 2009
APPRAISAL ISSUES
Now that the new rules have gone into effect for appraisals we are seeing a lot of problems with homes not appraising. The new rules, if you are not familiar with them, state that if the loan is a conventional loan that will be sold to Fannie Mae or Freddie Mac there can be no contact with the appraiser. The lender nor the real estate agent can pick the appraiser. So how the appraiser is chosen is through an Appraisal Mangement Company. The lender sends in the order for an appraisal to them and they then pick your appraiser.
The biggest problem with this is that some appraisers are appraising properties in areas that they are not familiar with. They are also choosing the appraisers by how much they charge. If an appraiser charges less, then the management company gets to keep more, therefore, making that appraiser more desireable to them. Not necessarily because they are a better appraiser, just simply because they charge less.
We have seen a lot of experienced appraisers simply leave the business. They were making $400-$450 per appraisal and now they are making half that amount since they have to give some of the fee to the management company. They also can not control their business flow any longer since they are on somewhat of a lottery system with management company. This is a shame because these were the guys that were able to appraise a unique property correctly. Just about anybody can appraise a property in a tract subdivision where all of the houses look the same and are about the same square footage, but when you get into a property that has let's say half an acre of land in an area that has mostly quarter acre lots, that takes a little more work.
So the moral of the story is that even if you think you can find a buyer for your home at your desired asking price because the upgrades are so fantastic. Be aware that the appraisal could blow up the whole transaction. It appears that lately the appraisers don't care that you have granite when the comps have formica. Or that you have real hardwood floors in beautiful condition while the other comps have worn carpet. To them flooring is flooring and countertops are countertops. They appear to be ignoring upgrades. What this means is that if a house down the street just like yours sold because it was not in the best condition, that sale may have set the price for your neighborhood even though it is not typical for your area.
So price your home to be 3%-5% below the neighboring homes and you will not only sell faster and probably for more money, but you will also be able to pass that almightly appraisal.
If you have any questions on the value of your home in the Salt Lake City area, don't hesitate to call me, Patty Purdue, at 801-792-1257.
The biggest problem with this is that some appraisers are appraising properties in areas that they are not familiar with. They are also choosing the appraisers by how much they charge. If an appraiser charges less, then the management company gets to keep more, therefore, making that appraiser more desireable to them. Not necessarily because they are a better appraiser, just simply because they charge less.
We have seen a lot of experienced appraisers simply leave the business. They were making $400-$450 per appraisal and now they are making half that amount since they have to give some of the fee to the management company. They also can not control their business flow any longer since they are on somewhat of a lottery system with management company. This is a shame because these were the guys that were able to appraise a unique property correctly. Just about anybody can appraise a property in a tract subdivision where all of the houses look the same and are about the same square footage, but when you get into a property that has let's say half an acre of land in an area that has mostly quarter acre lots, that takes a little more work.
So the moral of the story is that even if you think you can find a buyer for your home at your desired asking price because the upgrades are so fantastic. Be aware that the appraisal could blow up the whole transaction. It appears that lately the appraisers don't care that you have granite when the comps have formica. Or that you have real hardwood floors in beautiful condition while the other comps have worn carpet. To them flooring is flooring and countertops are countertops. They appear to be ignoring upgrades. What this means is that if a house down the street just like yours sold because it was not in the best condition, that sale may have set the price for your neighborhood even though it is not typical for your area.
So price your home to be 3%-5% below the neighboring homes and you will not only sell faster and probably for more money, but you will also be able to pass that almightly appraisal.
If you have any questions on the value of your home in the Salt Lake City area, don't hesitate to call me, Patty Purdue, at 801-792-1257.
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