Summer Slide

I hope everyone is starting off the summer wonderfully.  I have some great news……Interest rates continue to slide and people’s buying power has been greatly enhanced.  Also people can save money too!

If you currently own a home, and are paying 4.25% or more in interest, or have an adjustable rate mortgage, now is the time to get a rate in the high 3’s and fixed!

I am currently scheduling personalized refinance meetings at my CrossCountry Mortgage office at 180 Main Street in Gloucester next week.  Bring your current mortgage statement, and I will run your credit, debt to income and savings analysis for free.  That way we can find out how much you can save each month.  We also have NO CLOSING COSTS loans and we also use local Gloucester attorneys to help us close these transactions.

If you want to find out how much you can afford on a new home, I am scheduling those meetings next week too.  Bring a paystub and W2, and I will run the same numbers for free. If you do get preapproved, I will connect you with one of the great agents that are on Capeannhome.com that will assist with the home search.

Again, these are all complimentary services that we provide at CrossCountry Mortgage in Gloucester.

Do NOT wait for rates to go back up!  The current financial market is volatile and these low rates can go away as fast as they came.

Please reach out to me today at brandon.pratt@myccmortgage.com, direct at 617.688.6891 or online 24 hours a day at http://www.northshorehomeloans.com and click Apply Now.

It’s time to save some money and enjoy the summer!

Summer Rates Heating Up

We have finally got some warm weather to compliment the hot real estate market that has been occurring this spring.  The question earlier this year was, what are rates going to do and how was that going to influence the housing market???

You will notice from the above graphic, that in May 2018 rates were close to 4.5% and moving up to almost 5% at year-end 2018.  January 2019 the rates dropped, and then in March, they really dropped and where they stay today…the low 4’s.  The reason this is happening is because, as I wrote in March, the Fed decided to keep rates unchanged for the most part in 2019. The markets reacted favorably to this news, and rates began to settle down.  Because there is no talk of future rate hikes, and with uncertainty in the trade and tariff markets, mortgage rates have benefited.  And you can too!

Were you trying to buy a house last year but the rates were too high?  Did you try to refinance but the cost was too much?  With these lower mortgage rates, buying power, refinancing power and equity growth can now be easier to achieve.

Buying and refinancing with lower interest rates allow you to have lower payments, increased equity potential and better overall financial health.  Also with higher home prices, existing homes now have more equity.  That means lowering or removing PMI,  taking cash out for home renovations, debt consolidation or college tuition.

With lower mortgage rates, there is so much you can do.  To learn more about what you can do to take advantage of these lower rates, contact me today for a no commitment, hassle-free financial review.  You have nothing to lose but money!

Brandon Pratt- NMLS 46922

CrossCountry Mortgage- 180 Main Street, Gloucester, MA

brandon.pratt@myccmortgage.com * 617.688.6891

Do you suffer from Offer Fatigue?

Google Offer Fatigue and I bet it doesn’t come up.  The reason is, it’s a new term and I have recently adopted it.  I cannot take credit for it’s origin.  I think it was a real estate agent that said it to me a few years ago.  You still don’t hear much of the term Offer Fatigue, but let me tell you, it’s real.  And I want to help people overcome it.

So, what is Offer Fatigue and what are the symptoms you ask?  Well it’s submitting one offer after another on a house or condo, only to have them all rejected.  This occurs over weeks, months and even years.  It comes with low-ball offers, over-list offers, closing cost credits and offers to the seller they can live in their home for months for free as they look for a house. Finally, it comes with the prognosis that no offer is going to stick, and I might as well get out of the home buying search.  Today I am here to offer you a new perspective, it’s not you….it’s your team!

Home buying is a team event.  You can’t rely on one person in today’s market.  You have to have a team of professionals there to help you every step of the way.   A team is not only a real estate agent, but a real estate attorney (notice how I didn’t say any attorney, but a real estate attorney…must be an attorney who is real estate centric) and of course, a mortgage banker like myself.  The reason is, the team can help the seller answer all their questions and concerns about a buyer.  The team provides all the resources it can to help the buyer, and seller get the deal done.  The team is there when you need them.  The team knows the answers and will convey them correctly.

Here’s a couple examples how a team can work.  On the North Shore and Boston, there are a few tricky things to look out for that could hurt someone’s preapproval and buying power.  In Boston, it’s common for a condo to be listed for sale on MLS with a resident exemption tax rate instead of the full tax rate.  If you live in a property you own in Boston, you get up to a $2700 a year exemption in your tax bill.  That is over $200 a month.  If a home buyer’s preapproval is tight, $200/month could result in a denial on the loan.  If it’s not caught until after the offer accepted, a home inspection and appraisal is ordered, the buyer is out $100’s if not $1000’s of dollars.  That’s in addition to the time and anxiety of the process.  Money, time and energy wasted by all parties.

West Gloucester has sewer projects deferred billing added every other quarter to the tax bill.  So, we must look at the full year taxes and not the quarterly taxes.  Lots of Cape Ann’s roads are private and require a private road agreement.  However, in Gloucester, these private road agreements rarely exist.   I know how to get around it, and a good local team would know too.

If you think you are suffering from Offer Fatigue, you need to get in touch with me asap.  I will review your preapproval for free, and then connect you to one of the great real estate agents here at capeannhome.com.  From there we will create your dream home buying team.

Don’t go into the last parts of the spring buying market suffering Offer Fatigue, get energized by The Pratt Mortgage Team at CrossCountry Mortgage and its teammates!

Where’s the affordable housing?

Six.  That’s the amount of single family homes for sale in Gloucester under $500k as I write this post.  There are 61 single family homes for sale in Gloucester in total.  So that means 55 of the remaining homes for sale in Gloucester are listed at over a half a million dollars.  MLS shows the average list price of homes for sale in Gloucester currently at $1.389mil…that’s not very affordable.

The good news is that you don’t have to spend close to $1.5mil to buy a home in Gloucester.  It just means there is a shortage of homes for sale that are considered affordable.  The majority of the current homes for sale are on the water, marshes and beaches of Gloucester….some absolutely beautiful homes.   This is common with the spring market, as buyers would want to be in Gloucester for the summer.  This is prime second home buying season.  We are six or so weeks before Memorial Day, which is the typical length of a home-buying transaction.

There are more affordable homes for sale outside of Gloucester and Cape Ann, and that’s where things seem to be busiest as well.  People are moving further north to the border towns of Mass, and crossing the boarder into New Hampshire.  There are just more homes to buy that people can afford.

If you want to know what you can afford, and the towns that have the best affordable housing options, please contact me directly.  I am licensed as a mortgage banker in both Mass and NH, with offices in both downtown Gloucester and Danvers.  I can help you identify the best ways to get your offers accepted, connect you with great real estate agents (like the agents who are on CapeAnnHome.Wordpress.com) and find you a home you can afford!  Don’t wait for mortgage rates and home prices to increase more.

Brandon Pratt

NMLS 46922

brandon.pratt@myccmortgage.com

 

Mortgage Rates Continue to Drop

If you were a home shopper, or wanted to refinance your home this fall, you were probably in for sticker shock.  Not at higher home prices, but higher home-mortgage rates.  Mortgage rates through December rose to the upper 4’s and lower 5’s.  Combine that with escalating home prices, and some people all of a sudden got priced out of the market.

The good news in 2019 is we may have stabilizing mortgage rates.  The Fed announced last month they may be easing the rate hikes they had planned for 2019.  In 2018, the Fed had 4 increases to the benchmark lending rate.  On January 17, 2019, the Fed said they are going to be more careful of rate hikes in 2019 as to not to interfere with the economic growth the country has been experiencing.

All of this means that consumers, at the moment, have a brief interest rate respite as rates are lower than they’ve been in months.  In addition, home equity has never been higher in recent years.  These two positive events mean that if you were thinking of buying a home, but was put off in the fall, now is the time to get that preapproval updated and start looking again.

If you were thinking about refinancing, now may be that time to do it.  Taxes are going to be due soon, so that paperwork a mortgage person will be asking for should be handy.  Christmas bills are rolling in, and we can help consolidate that debt to make your budget friendlier.  You can also tap some equity to do some home projects you were thinking about doing.  The great thing with lower rates, it may not cost you anything to refinance and even lower your bills.

There is no reason to wait to for higher rates and home prices.

This is the time to get the lowest rates in months.  Contact me today for a free consultation to see how you easy it is for you to buy or refinance a home.

Brandon Pratt- CrossCountry Mortgage Gloucester, MA- 180 Main Street, Suite A

brandon.pratt@myccmortgage.com and or for an easy online application,

Click on www.northshorehomeloans.com and Apply Now.

Down payment Assistance is Here

One of the biggest obstacles people face purchasing a new home is the down payment.  It’s not that people can’t save, it’s the amount they need to save to buy a home here in Eastern Massachusetts.  Prices are high, and therefore the down payments tend to be higher because down payments are a percentage of the home price.

Most people think that you need 20% to purchase a home, but that couldn’t be furthest from the truth.  In fact, most mortgages require as little as a 3-3.5% down payment.  The more you put down, the better the terms.  5% is better than 3%, 10% is better than 5%, and so on.  So that’s why you hear about 20% down being required, because that’s when it’s the best terms.  However, if everyone waited for 20% down, we would not have over 60% of the population homeowners.  It’s just not realistic.

What I want to share is that we at CrossCountry Mortgage on Main Street in Gloucester has a few programs that offer no money down mortgages!  It’s usually a combo of a first and second mortgage.  The first mortgage being the mortgage after down payment, and the second mortgage being the down payment amount.  In Gloucester (and some North Shore cities and towns), the City has down payment assistance but the income limits are fairly low.  Therefore they are not easy to get.  That means a couple who want to buy a home with down payment assistance from Gloucester cannot make more $64,900 combined.  For Masshousing, Fannie Mae and Freddie Mac loans, the income expands to just under $108k.  This is for anyone on the loan….so if a couple combined makes more than $108k, then one person can go on the loan if they qualify by themselves.

The great news is that here at CrossCountry Mortgage on Main Street in Gloucester we have all of these programs!  We can do the state Masshousing mortgage, the national programs through Fannie Mae and Freddie Mac and of course, the City of Gloucester grant.

Below is an example of a condo for sale in Gloucester under $300k that qualifies for down payment assistance.

Contact me today for a no hassle and free consultation to see if you qualify!

Brandon Pratt- CrossCountry Mortgage

NMLS 46922- brandon.pratt@myccmortgage.com

Direct 617.688.6891

Home Interest Rates and Price Dropping in 2019?

Happy New Year!  I hope you all had a festive and wonderful holiday season.  As January 2nd is upon us, it’s time to start planning for the year ahead.   With that, I want to touch on a few financial and real estate topics that may be beneficial to everyone.

In the beginning of December, all the talk was about increasing interest rates, home prices declining and inventories rising.  Now in the beginning of January, things are looking a little different.  How is that possible?  The Fed increased the benchmark interest rate .25% in December, it’s the holiday season where there tends to be less home buyers and even less sellers and we are going into winter when it’s typically slow.  The easiest way to explain this is to look outside.

While the decent winter weather can account for more people buying and selling homes, that has nothing to do with interest rates.  I mean the Fed did raise the interest rate in December, so how can mortgage rates dip shortly thereafter?  Well it depends which window that mortgage money comes from to fund a home purchase.  There are two common ways to get a mortgage, a local or larger bank or a mortgage lender.  We at CrossCountry Mortgage happen to be a mortgage lender, which means we lend money directly to the consumer.  We are governed by each state’s Division of Banks and are considered a non-depository lending institution.  Meaning we don’t provide bank accounts, we just provide money for home purchases and refinances directly to the consumer.

We at CrossCountry, tend to get our money through the secondary market, which is affected more by bonds and the stock market.  The price of the mortgage bonds has gone up lately, and that means the yield has gone down.  When yields go down, rates go down.  So the stock market is beating up the bond yield, which is good for mortgage rates.  Local banks tend to get their money from the treasury and fed, and they are the ones who just increased their rates.  So with the stock market getting clobbered, here is one bright spot in the financial markets!

So what will really happen with interest rates and housing prices in 2019?  It depends on what type of house you want, where you want it, the down payment amount and credit scores.

If you don’t have the answers to the above questions, contact me today for a no-cost and hassle-free mortgage and home ownership consultation!!

Brandon Pratt

brandon.pratt@myccmortgage.com and 617.688.6891

180 Main Street, Suite A, Gloucester, MA, in historic downtown Gloucester

 

 

Credit Score and PMI Explained

One of the most important aspect of any person’s financial profile is their credit score.  This is the first thing all creditors look at when making a credit decision for an applicant.  Someone’s credit score will help determine whether they will get a loan or not, and more importantly, what that loan will cost.  The lower the credit score, chances are it will come with a higher interest rate. Conversely, a higher credit score is going to get someone a better and more competitive rate.

This is true when buying a home as well.  Not only will a higher credit score give someone a better interest rate, but if they are putting down less than 20% for a down payment, it will also affect how much they will pay in PMI.  PMI stands for Private Mortgage Insurance.  If a homebuyer wants to buy a house with less than 20% down, most banks won’t make that loan.  The reason is, there isn’t enough equity to pay back the bank loan if the house goes into foreclosure if there is only 5% in equity.  So PMI was recreated in the 1950’s to allow homebuyers to buy a house with less than 20% downpayments (previous to that PMI existed but the industry went bankrupt after the Great Depression).  PMI is commonly paid a few ways today, monthly, upfront or lender paid.  You may hear that someone may not have to pay PMI with less than 20% down, but the fact is it’s Lender Paid and built into the interest rate.  That interest rate being higher than paying PMI monthly.  You can also pay it all at once upfront at closing, which can be up to 60% cheaper than paying it monthly if you add up all the payments over time.

PMI rates are based on just a few factors.  First and most important being the credit score, second the down payment amount (also known as Loan to Value or LTV) and the last items are the type of house and how much debt that person has each month.  A condo could be slightly higher in premium while higher down payments lower the PMI rates.

At the end of the day people just want the lowest possible payment, and that is going to happen with higher credit scores.  Most mortgage professionals want their clients to have higher credit scores, as it makes the deals easier and cheaper for the client.  If you want to learn more about your credit score, please feel free to contact me and I can provide a no cost credit report and debt to income analysis.  If your credit needs to be worked on to get it higher, we can help there too.

Brandon Pratt NMLS #46922

brandon.pratt@myccmortgage.com