Category Archives: Buyers

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Mastering the Credit Score

Planning

Your credit score is important. Those three little digits help lenders decide whether to loan you money and at what terms. The higher your score, the less of a credit risk you are to lenders. And that can mean you’ll pay lower interest rates on loans.

Believe it or not, you may have more than one credit score. The FICO® score, which is used by many lenders, ranges from 300 to 850. Your credit score(s) reflects how you handle financial commitments. And knowing what lenders see as risky can help you make smarter decisions and avoid big mistakes that can damage your scores for years.

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Signs Suggest Looming Opportunity for First-time Buyers

Family

CoreLogic recently reported that the number of underwater homes, properties worth less than what is owed on them, fell from 6.3 million to 5.3 million between the 1st and 2nd quarters of 2014. This change is large and important for the health of the housing market.

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A Confluence of Positive Trends

Home

After a slow start this year, partly due to the frigidly cold winter, home sales are picking up steam. Existing-home sales have risen for four straight months and in July were at the highest pace of the year, 5.15 million. Pending contracts point to more gains, too.

Jobs are always important for home sales, and in the last 12 months they’ve grown by 2.6 million. North Dakota, Texas, Utah, and parts of California are good examples of job growth leading to healthy real estate activity. Amazingly, mortgage rates refuse to rise, even after the Federal Reserve has started talking about tightening its monetary policy, keeping the recovery intact.

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What’s Necessary to Bring Back First-Time Buyers

The Federal Housing Administration’s rise in its mortgage insurance fees in recent years is pricing many “creditworthy Americans out of the market” and causing the number of first-time home buyers to reach new lows, housing analysts argue.

First-time home purchases have fallen to historic lows. They account for about 28 percent of existing-home sales year-to-date – well below the long-term benchmark of 40 percent, according to the National Association of REALTORS®.

The 24- to 35-year-old cohort – which usually makes up the largest share of first-time buyers – has been faced with high levels of student debt and stricter underwriting standards that have made it more difficult for them to apply for a mortgage. But in an op-ed piece in American Banker, Richard A. Smith, CEO and president of Realogy Holdings Corp., also notes that the “biggest and most surprising challenge faced by today’s aspiring home owners come from the FHA, the very agency created to help them.”

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Is That Nanny Cam Recording You in a Listing?

Home Tour

You and your buyers should walk through every home like there is a nanny cam recording your private conversations. If you are recorded, the information gleaned from your private conversations with buyers could be used against you in negotiations, warns a new video by the Washington REALTOR® Legal Hotline Lawyer.

Lawyer Annie Fitzsimmons with the Washington REALTORS® says that more sellers are using nanny cameras to record video – and in some cases, even audio – when their home is on the market. The cameras may allow them to intercept conversations between agent and buyer inside the house that sellers can then use to their advantage in negotiations, such as the buyer raving about how much they loved the house and how they’d even be willing to pay full price for it, Fitzsimmons says.

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10 Hot Spots for Seniors by 2019

On the verge of retirement, where will those aged 55 and over choose to live? Realtor.com® recently analyzed Nielsen Demographics data to find the metro markets that will see the largest percentage of growth in residents aged 55 and over within the next five years.

The list may surprise you!

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Where Autumn is Hot for House Hunting

Seasonal Home Search Activity

Labor Day marks the end of summer – and the end of the traditional house-hunting season. Based on properties viewed on the Trulia website for the full years of 2011-2013, home search activity jumps in March, stays high through summer, and then falls below the annual average in September and stays that way until the new year begins. Nationally, home searches for September and October combined are 6% below the annual average.

Does that mean that everyone looking to buy or sell a home in 2014 has missed the boat? Not necessarily. Every local market has its own seasonal pattern for house hunting. Comparing September and October search activity with annual averages in 2011-2013, we found markets where the autumn slowdown is slight. And there are a handful of local housing markets where autumn is actually prime house-hunting season – mostly vacation areas that are in the mountains and forests but not near the beach.

Read the article and see where Seattle ranks…

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Millennials Keep Current on Mortgage More Than Other Ages

Front Door 2

Mortgage borrowers under the age of 30 have the lowest mortgage delinquency rate of any other age group, according to a newly released TransUnion mortgage report. However, the age group also makes up the smallest share of all mortgage accounts at 4.16 percent, TransUnion notes.

“It is encouraging to see younger borrowers perform well, since their generation was significantly impacted by the recession and their loans are among the newest,” says Steve Chaouki, head of financial services for TransUnion.

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Fannie Mae More Cautious On Housing Outlook

Fannie Mae economists have downgraded their housing outlook after a weak end to the second quarter, and they say that near-term indicators are suggesting only a minor improvement in the second half of the year.

“The impact on mortgage rates from the market’s expectation that the Federal Reserve would soon start tapering their securities purchases, combined to some degree with the weather effect in the first half of 2014, led to very little seasonal growth in housing,” says Doug Duncan, Fannie Mae’s chief economist. “In the first six months of the year, total sales have run below last year’s pace.”

Also, Duncan notes that “on the demand side, there appears to be a conservatism among consumers and their willingness to take on big-ticket purchases, such as homes.”

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FICO Scoring Changes May Help More Qualify for Mortgages

Money

FICO, the nation’s most popular credit-scoring system, announced it is tweaking some of the criteria used in coming up with consumers’ scores, which could help consumers save more money in qualifying for mortgages and other types of loans.

The changes include reducing the toll that overdue medical bills can take on credit scores, as well as removing other past penalties from consumers who have paid off debts that had been assigned to collection agencies. A consumer whose only major delinquency comes from an unpaid medical bill could see their credit score rise by 25 points due to the changes.

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