27
Apr
By First Rate Financial Group
Mortgage

What Does It Mean To Be In A Seller’s Market: A Brief Overview

What Does It Mean To Be In A Sellers' Market: A Brief OverviewIn the realm of real estate, market conditions can differ significantly due to a variety of factors. One such state is known as a seller’s market, which typically benefits those wanting to sell their property. Let’s dive into what makes a seller’s market advantageous for homeowners looking to offload their house and why it’s an attractive option for buyers too. 

A Lack Of Inventory

The lack of available homes creates supply-side pressure in a seller’s market; there are fewer houses on offer than there are prospective purchasers searching for them. This scarcity could be attributed to many reasons including economic prosperity, increased employment opportunities, and favorable mortgage rates – all encouraging people not to part with their homes under current circumstances. Therefore, buyers must compete over limited options, driving up home prices, resulting in great returns for vendors who may receive multiple offers from interested parties pushing sale costs beyond listed amounts.

Greater Demand For Homes

When demand exceeds supply you know you’re likely dealing with a seller’s paradise – but even though they hold the power when house hunting season comes around each year – smart shoppers can also take advantage if they play by the rules: move fast when you see something that fits your criteria because someone else probably has too! On top of this, make sure you have pre-approval from lenders so vendors will consider your offer seriously among others vying fiercely against one another.

Low Rates Of New Construction

In a seller’s market, construction companies often do not build homes as quickly. Maybe there is a labor shortage, or perhaps they don’t have the supplies they need to turn around homes quickly. Limited new construction could be driving demand, which could mean lower opportunities for buyers, increasing the demand for the homes that are still available. 

Understand What It Means To Be In A Seller’s Market

No matter where either side stands within a seller’s market, understanding these nuances will ensure success when navigating through any sale or purchase transaction related matters. Additionally, having access to knowledgeable professionals such as experienced agents or attorneys throughout each step could prove advantageous as they have expertise in many areas, including but not limited to, contract writing, contract review, and negotiation techniques that may come into play during various stages along your journey towards closing day!

26
Apr
By First Rate Financial Group
Mortgage

Understand Your Options When You Refinance A Home Loan

Understand Your Options When You Refinance A Home LoanAre you interested in refinancing your mortgage? There are a variety of reasons why you might want to refinance your home loan. For example, you might want to secure a lower interest rate, or you may want to reduce your monthly payment. You might even want to tap into the equity you have in your home for some quick cash. There are different loan options available, so you need to think carefully about which one is best for your needs. 

The Conventional Mortgage Refinance

One of the first options you will consider is a conventional mortgage refinance. This could be the best option for you because it provides you with the greatest degree of flexibility. For example, you can shorten the term of your mortgage, pull cash out of your home’s equity value, and even reduce your monthly payment. Typically, your credit requirements will be a bit higher than the other options, so you should work with an expert if you are considering this option. 

FHA Streamline

Another option you might want to consider is the FHA streamline. Many people like this program because it is a shorter, less expensive program. The credit requirements are also a bit lower, and you might not need to get your house appraised. On the other hand, you cannot choose this option if you want to pull cash out of your home’s equity value. 

Jumbo Loan Refinance

If you have a loan that is greater than the conventional loan limits, then you may be required to perform a jumbo loan refinance. Because the loan is so large, the lender takes on a significant amount of added risk, and that is why the credit requirements are typically higher as well. You may also need to verify not only your income but also your cash reserves.

Find the Best Refinance Program To Meet Your Needs

These are just a few of the many options available if you are interested in refinancing your home loan. The right option for one person is not necessarily going to be the right option for someone else, so make sure you reach out to an expert who can help you find the right loan refinancing option to meet your needs. 

 

25
Apr
By First Rate Financial Group
Mortgage

How Do I Get Rid of PMI?

How to Get Rid of PMIHow to Get Rid of PMI?

PMI (Private Mortgage Insurance) is a type of insurance that lenders may require borrowers to pay if they have a down payment of less than 20% of the home’s purchase price. The purpose of PMI is to protect the lender in case the borrower defaults on the loan. However, once you have paid off enough of your mortgage or your home has appreciated in value, you may be able to get rid of PMI. Here are some ways to do so:

Pay down your mortgage: If you make extra payments on your mortgage or pay more than the required monthly payment, you can build equity in your home faster and reduce the amount of PMI you have to pay. Once you reach 20% equity in your home, you can request your lender to remove the PMI.

Refinance your mortgage: If you can’t afford to make extra payments, you may consider refinancing your mortgage to a lower interest rate. This could lower your monthly mortgage payment and help you build equity in your home faster. Once you have enough equity in your home, you can request your lender to remove the PMI.

Get your home appraised: If your home has appreciated in value since you bought it, you may be able to get rid of PMI by getting your home appraised. If the appraisal shows that you have 20% or more equity in your home, you can request your lender to remove the PMI.

Wait for automatic termination: If you have a conventional mortgage, your lender is required to automatically terminate your PMI when you reach 22% equity in your home, provided you are current on your mortgage payments.

Why Do Lenders Require PMI?

Lenders require PMI (Private Mortgage Insurance) when a borrower has a down payment of less than 20% of the home’s purchase price. The purpose of PMI is to protect the lender in case the borrower defaults on the loan. If the borrower defaults, the PMI will cover the lender’s losses up to a certain percentage of the loan amount, typically 20% to 30%.

Lenders require PMI because borrowers with less than 20% down payment are considered to be at a higher risk of defaulting on their mortgage. This is because they have less equity in the property, which means they have less of their own money invested in the home. If the borrower defaults, the lender may not be able to recover the full amount of the loan by selling the property.

PMI allows lenders to offer mortgages to borrowers with less than 20% down payment while still protecting themselves against the risk of default. Without PMI, lenders would likely require larger down payments, which would make it more difficult for many borrowers to qualify for a mortgage.

It is important to note that PMI is not the same as homeowner’s insurance, which covers damage to the property. PMI is solely for the benefit of the lender and does not provide any protection for the borrower. The specific requirements and procedures for removing PMI may vary depending on your lender and the type of mortgage you have. It is important to check with your lender to determine what steps you need to take to remove PMI.