Mortgage

When it comes to real estate, there are always going to be upswings in the market that will have an impact on your mortgage payment and overall financial health. However, with a fluctuating market here to stay, you may be wondering how you can guard your biggest investment and your finances against rate increases. If you’re concerned about rates on the rise, here are a few tips to test out you’re fiscal well-being.

Calculate Your Debt-To-Income Ratio

It’s beneficial to determine your DTI ratio prior to purchasing a home, but since debt and housing costs are always fluctuating, calculating this number again can be a wakeup call. By adding up your monthly expenditures (including any debt), and dividing that number by your pre-tax income, you’ll be able to determine your DTI percentage. While it’s ideal to have a percentage of less than 28%, if your expenditures have risen above this number, it may be time to take a look at your monthly budget and see what you can cut out.

Do You Have Emergency Savings?

Many people make a habit of putting money into their retirement funds each paycheck, but it’s equally important to have emergency savings you can access in the event of car repairs, home maintenance issues or an unforeseen medical problem. While it’s often suggested that a person should have a minimum of 3 months of expenses at their disposal, saving more than this can make you even more prepared in the event that a rate increase requires you to dive into other funds.

Review Your Budget

It’s easy enough to have a monthly budget, but the hard part for most people is sticking to it on a day-to-day basis. If you’ve veered off the trail a little bit in this regard, sit down to review your expenditures and determine what your financial outlook would be if you experienced an interest rate bump next month. In the event that there’s very little cushion and no money for savings, it may be worth your time to craft a new budget that gives you a bit more wiggle room.

Many people are uncertain about what the short-term economy will bring for their mortgage rates, but by reviewing your budget and maintaining emergency savings, you can be better prepared for the future. If you’re currently considering purchasing a home,  contact one of our mortgage professionals for more information.

The post-election period is often one of uncertainty, and the time since the 2016 election has been no different with regards to market force and the financial world. With a new administration taking office, there are many questions regarding how Donald Trump’s presidency will impact the market and your mortgage. If you’re wondering what the predictions are for the coming year, here are a few things the experts are considering.

An Increase In Rates

Due to an expected hike in rates by the Federal Reserve, it’s unlikely that potential homebuyers will be able to get the low interest rates of previous years. While higher rates are likely, the proposed tax plan and budget of Donald Trump may lead to increased inflation and could also have an impact on rates down the road. The low rates of previous years certainly made homeownership a more feasible option, but it’s still a good time to get into a home before they rise even more.

Less Red Tape

The money invested into regulations is something that Donald Trump was highly critical of in the run up to the election, and this may mean many opportunities for home ownership that did not exist before. While a poor credit history can make or break a mortgage application, in a time of loosening regulations there will likely be more available mortgage products for those who have a less than stellar financial situation.

Privatizing Loan Programs

There is the possibility that government-sponsored home loan organizations like Freddie Mac and Fannie Mae will come under new ownership. While this may provide an opportunity for potential homeowners, because the risk will be taken on by private owners – and not the government – this may lead to higher rates. As Jordan Levin of the California Association of Realtors says, “I can say with a pretty good level of confidence that it will increase the cost of borrowing because there’s going to be more risk from those pools being borne by the private sector and they’re going to want to be compensated for that additional risk that they’re bearing.”

While the economic policy of the coming years has yet to take shape, the mortgage rates are on the rise and the regulations surrounding home ownership are likely to loosen. If you’re currently waiting out the 2017 market and are considering your options for home ownership, contact your trusted mortgage professionals for more information.

Whether they’re found online or heard from family and friends, there are so many mortgage tips out there that it can be hard to know exactly how to proceed. But, if you’re new to the market, there are a few surefire things you can do to get a mortgage rate you’ll feel good about. For some of the best tips on getting a great loan, look no further than the following.

Know Your Credit History

It’s a simple fact that one of the most important factors in your mortgage application is your credit history, so good or fair, it’s important to be aware of where you stand. While the acceptable credit score for mortgage approval can fluctuate, the best rates are often available to those with a score that is higher than 760. In order to improve your chances, get a copy of your credit report and pay attention to any discrepancies that might be in it. These can have a negative impact on your score and your application, so you’ll want to have them revised if they’re incorrect.

Save Your Down Payment

It’s not a requirement of mortgage approval to put 20% down, but a down payment of this size will lower your debt-to-income ratio and will make you a more solid bet for the lender. By having 20% in the bank to go towards your home investment, you will also be able to qualify for a lower rate. Not only this, you will not be required to pay mortgage insurance which means a lowered monthly payment and a higher disposable income in the event of market fluctuations.

Consult With A Mortgage Professional

You may want to pursue a mortgage on your own, but having a professional to help you with the process can be beneficial for a number of reasons. A mortgage expert will not only be aware of market conditions, they will have a relationship with the lenders that means they may be able to get you a rate you wouldn’t be offered on your own. While you may want to go it alone, there are benefits to consulting a professional.

There’s a lot involved in the mortgage process, but by putting 20 percent down and having a good credit history, you’ll be well on your way to a great rate. If you’re currently on the market for a home, contact one of our mortgage professionals for more information.