ARAMCO Report - The Mother of ALL Mortgage Blogs!

Home inspections could save money

Posted by The Aramco Group on Sun, Jun 25, 2017 @ 14:06 PM

Having your new home checked out by a certified home inspector is a common and often times required part of the home buying process. While some buyers may view the process as tedious and unnecessary, a home inspection could save money in the long run.

A rocky foundation, a leaky roof and mold are among a number of items an inspector may find that could cause a buyer to walk away. But experts suggest that buyers really consider items that they may think are deal breakers before backing out of a deal. Many items can be fixed and used in a negotiation to bring down the price of the home or get help with closing costs.

Home inspectors will often find problems that may require a second opinion from a specialist like a plumber or roofing expert. Buyers can also rest easy with a home warranty that can protect their home and their investment in the event any problems arise down the line.

Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 4 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Refinances climb as rates fall below 4%

Posted by The Aramco Group on Sat, Jun 24, 2017 @ 14:06 PM

A slight decrease in mortgage rates last week was enough to push the volume of refinances higher for the third consecutive week. According to the Mortgage Bankers Association, the refinance index increased two percent during the week ended June 16, brining it to its highest level since November 2016.

The refinance share of mortgage activity increased to 46.6 percent of total applications – up from 45.4 percent the previous week. The drop in mortgage rates is largely behind the increase in refinance volume according to the MBA's vice president of research and economics Lynn Fisher.

"Both the 10-year Treasury yield and the 30-year conventional mortgage fixed rate held steady last week keeping rates well below the recent highs," said Fisher. "The recent pause in the upward movement of interest rates continues to encourage late-to-the-game borrowers to refinance and to assist those ready to purchase."

Today, conforming no-point 30-year fixed mortgage rates are averaging 4 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Popular program makes senior home buying easier

Posted by The Aramco Group on Fri, Jun 23, 2017 @ 14:06 PM

A study conducted by Georgetown University has found that a majority of seniors prefer to age in place. But holding on to the family home in retirement is not the only option – a growing number of America's retirees are taking advantage of a powerful financial tool that relives some of the financial hurdles that seniors who are looking to buy a new home might face.

A Home Equity Conversion Mortgage for Purchase (commonly referred to as H4P) was established by the Federal Housing Administration in 2008 to assist homeowners 62 or older buy a home that suits their retirement needs.

This home financing program is designed specifically to get seniors the funds they need to make a home purchase by combining a down payment with loan proceeds from a Home Equity Conversion Mortgage. And just like a standard HECM, even with a new purchase, borrowers will have no monthly mortgage payments.

Today, conventional conforming no-point 30-year fixed mortgage rates are averaging 4 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Housing costs squeeze Americans

Posted by The Aramco Group on Thu, Jun 22, 2017 @ 14:06 PM

Rising prices for homes and consumer goods are putting a strain on the wallets of homeowners nationwide, according to a new report. The annual State of the Nation's Housing Report from Harvard's Joint Center for Housing Studies reveals that a staggering 39 million households are simply unable to afford their housing needs.

Financial experts suggest that housing costs should not exceed 30-35 percent of monthly income but over a third of American homeowners have surpassed this guideline. Referred to as 'cost burdened' households, 19 million are spending more than 50 percent of their pay on housing costs.

San Diego, Los Angeles and Riverside were among the top cities with the most cost-burdened households.

Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 4 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Homeowners realize profits while buyers struggle

Posted by The Aramco Group on Wed, Jun 21, 2017 @ 14:06 PM

Nationwide, homeowners have doubled their equity over the last eight years according to The National Association of Realtors. This is positive news for those who already own a home but for those looking to make a purchase, the higher home values has lead to pricing that has surpassed affordability levels.

High demand and an ongoing stretch of low inventory levels makes this a catch-22 which is not likely to change in the near future.

"With new and existing supply failing to catch up with demand, several markets this summer will continue to see homes going under contract at this remarkably fast pace of under a month," said Lawrence Yun, Chief Economist for NAR. "Some would-be buyers are having to delay or postpone their home search because low supply is leading to worsening affordability conditions."

Low interest rates are also continuing to push demand higher with conforming no-point 30-year fixed mortgage rates are averaging 4 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Casual investors finding profit in house flipping

Posted by The Aramco Group on Tue, Jun 20, 2017 @ 14:06 PM

The home flipping business may not necessarily be a full-time gig, according to new data. The often highly profitable practice is being more and more conducted by 'casual flippers', or those who complete such transactions once a quarter. Nearly 70 percent of all single family homes and condos flipped in the first quarter of 2017 were by infrequent investors. This information is according to ATTOM Data Solutions' Q1 2017 U.S. Home Flipping Report.

Flipping a home is when a property is sold for the second time within a twelve month period. Investors conduct an arms-length transaction in which the home is renovated and sold for a higher price.

In addition to the overall volume of flipped homes being conducted by mom-and-pop investors, the profit being realized is climbing. In parts of San Diego County, over 16 percent of homes sold in the first quarter of this year were flipped properties with investors seeing up to $150,000 in profit.

Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 4 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Covering long-term care expenses through a HECM

Posted by The Aramco Group on Mon, Jun 19, 2017 @ 14:06 PM

Knowing that the vast majority of Baby Boomers have far from enough savings to make them comfortable in retirement, many insurance companies are heavily marketing long-term care coverage as a way to protect seniors against the financial struggles of their final years. But soaring premium payments may make these plans too costly to meet seniors' needs.

More financial advisors are recommending the benefits of a Home Equity Conversion Mortgage, commonly known as HECM to be used in conjunction with long-term care insurance. A type of reverse mortgage, a HECM can allow those 62 or older to eliminate monthly mortgage payments and receive supplemental income in the form of a lump sum, line of credit or monthly payout.

The additional income can be used for any reason, including paying for long-term care or unexpected medical expenses.

Meanwhile, conventional conforming no-point 30-year fixed mortgage rates are averaging 4 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Home builder confidence still solid despite drop

Posted by The Aramco Group on Sun, Jun 18, 2017 @ 14:06 PM

Builder confidence in the market for newly-built homes decreased in June, down two points according to the National Association of Home Builders. The market index fell to a reading of 67 this month from 69 in May. Readings above 50 indicate that more builders view sales conditions as good rather than poor.

While the two point drop is a reflection of a slightly weaker builder sentiment at the start of the summer, the reading remains historically high.

"As the housing market strengthens and more buyers enter the market, builders continue to express their frustration over an ongoing shortage of skilled labor and buildable lots," said NAHB chief economist. "That is impeding stronger growth in the single-family sector."

The index reached a 11-year high in March with a reading of 71. Single-family housing starts have more than doubled from the lows seen in 2009 but are still well below levels needed to meet demand.

Today, conforming no-point 30-year fixed mortgage rates are averaging 4 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Growing homes; shrinking lots

Posted by The Aramco Group on Sat, Jun 17, 2017 @ 14:06 PM

Although the number of household members of the average American family has gradually gotten smaller over the last several decades, the homes they live in are growing. Since the late 1990s, the median size of a new single-family home in the U.S. has increased 24 percent to an average of 2,600 square feet, according to Zillow.

Yet, the land on which these larger homes are sitting is smaller than ever.

"The idea that Americans increasingly prefer smaller homes is simply not supported by the most recent construction data," said Zillow Chief Economist Svenja Gudell. "We still want our big homes with ample bedrooms and bathrooms. Americans want both space and convenience, but the land available relatively close to job centers is expensive."

The median lot size has shrunk by ten percent since the turn of the millennium, from about 9,600 square feet in 1999 to 8,600 square feet today. That's less than two feet of yard space for every one foot of indoor space.

Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 4 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.

Mortgage rates still low despite Fed rate hike

Posted by The Aramco Group on Fri, Jun 16, 2017 @ 14:06 PM

In an expected move, the Federal Reserve announced Wednesday its intentions of raising short-term interest rates another quarter percentage point. This marks the third increase in the benchmark rate in just six months.

Although a decision by the Fed to raise rates does not directly correlate to higher mortgage rates, the increased cost of short-term borrowing can impact housing. Long term rates, including mortgages, dipped slightly as bonds rallied and the 10-year Treasury note yield fell.

"The move by the Fed to increase short-term rates was expected, and we expect to see another increase from them before the end of the year," said Sean Becketti, chief economist for Freddie Mac. Becketti also notes that 30-year fixed mortgage rates continue to remain near a seven-month low, "which is very good news for those potential homebuyers in the market and even those who may be looking to refinance."

Today, conforming no-point 30-year fixed mortgage rates are averaging 4 percent while 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.