At the end of the year, the national average of mortgage debt was $173,876 per person, very close to past year levels. Californians had the most mortgage debt: an average of $313,749. West Virginia residents had the lowest level: $104,279. With refinancing at lower rates, most are paying much less per month.
Consumer sentiment in January hit the highest level since May, with both current and future economic conditions seen as improving, according to data released Friday by the University of Michigan and Thomson Reuters. The consumer-sentiment index reached 74 in the preliminary reading for January, compared with 69.9 in December.
Foreclosure filings slid by 34 percent in 2011, the lowest level since 2007, according to RealtyTrac. The main reason was the length of time for the foreclosure process, which averaged 348 days to move through the process, up from 336 days in the third quarter and 305 days in the fourth quarter of 2010.
in the first week of the year according to the Mortgage Bankers Association. Cash purchases by investors still dominate sales, 80% of new mortgages are refinancing and rents are rising. This pattern can only go on so long before housing inventory is substantially reduced and prices move higher.
With low mortgage rates and reduced house prices, the affordability index to own a home is at an all time high. At the same time, apartment vacancy rates are at the lowest in 10 years, which gives landlords the power to raise rents, reports of 5-10% increases around the country. This direction will only last so long before renters say ‘wait a minute, it’s much cheaper to buy then rent’
Know how much you can afford. Don’t let the lender tell you how much you qualify for. Anticipate additional monthly expenses with your new home, such as; lawn and other maintenance, increases in insurance and property taxes, cable and other utility bills, etc. Also, consider a shorter term mortgage. 15 yr rates are usually 1/2 % less then a 30 yr mortgage and based on the loan amount, this is a considerable savings.
Federal Law requires the Loan Originator to provide you with an Initial/Preliminary ‘Truth-in-Lending Disclosure’. After you provide your social security number to get a credit report, this is the next step. Do not give money for an appraisal, sign any document or provide any more information until you get this disclosure. This dislosure will show you the interest rate, payment, total finance charge, total payments and the Annual Percentage Rate you will be paying.
Understand how the interest rate you pay is determined. In the old days, bank executives would meet once a week and decide the mortgage rate they charge until the next meeting. Then you could go the entire week knowing what the rate is. Now, those bankers sell the mortgage loans to wall street investors on a daily basis. Wall Street determines the rates based on the minute by minute trading. Your banker will ask you if you want to lock in the rate right now or wait a day or two. Plus the higher your credit score, the better rate you will be offered.
Credit score: a good score is the key to obtaining a mortgage. Get copies of your credit scores and history from the three main credit reporting bureaus. Make sure there are no errors or issues to resolve before applying. Most lenders require a minimum credit score of 680 to comply with Fannie Mae and Freddie Mac’s guidelines. Federal Housing Administration (FHA) allows for lower scores as low as 620.
why all the blogs about economic data? The economic data is an important step that indicates whether or not buyers are confident and ready to buy real estate. Just like selling your house isn’t as simple as putting a sign in your yard or calling an agent to help. Finding a buyer is a process, a step by step process. And you can do it. FSBO.com is a great resource to begin with. Online exposure, unlimited photos, signage, brochures, access to legal forms, mortgage companies, etc.