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Pool Home with Renovated Master Suite

Special Bulletin - Mortgage Rate News

By Mickey Carlton with Thomas Mortgage (one of the preferred vendors of ViewThisOrlandoHome.com)

As your trusted advisor, I want to make sure you get the facts on changes in the mortgage market.  Here are answers to recently asked questions about mortgage interest rates:

How low did they go?
Wednesday morning (1/23) saw rates in the low 5% range.  Yes, the Federal Reserve slashed interest rates.  But the Fed move was REACTIVE.  The Fed did not “cause” the rates to go lower.  The Fed was reacting to the dramatic decline in stock prices and the belief that the economy might be tilting toward recession.  The Fed does not set mortgage rates.  Mortgage rates are set by "the market".  The Fed lowered an overnight rate used by banks to borrow from each other.  Mortgage rates fell because investors were selling stocks and moving to the perceived safety of bonds.

These prices only lasted a short time.  Stocks rallied and the interest rates went up, as well.  Currently, rates are hanging around in the mid 5% to the low 6% range (without discount points or origination fees).

How low do rates need to go to justify a refinance?
Depends on loan size, credit score, purpose of refinance and other variables.  Lending rules have changed in significant fashion during the last six months.  Refinances must be considered on a case-by-case basis.  You may e-mail me at m.carlton@thomasmortgage.com for an individual loan analysis customized to your needs and circumstances.

Is a refinance worth the cost?
Depends.  One has to do the arithmetic to determine how quickly the payment savings from a refinance will recover the closing costs. I do that on a daily basis and can help you with the computation.  Clearly, you do not want to refinance if it will take two years to recover the cost and you think you might move in only a year or so.

What about a no-cost refinance?  The guy on the radio said "no out-of-pocket costs".
No-cost refinances are simply an illusion. Someone has to pay the state taxes, recording fees, title insurance, etc.  That someone is always the borrower in one form or another. Lenders who promise no cost refinances are either rolling the cost into the new loan amount or increasing the new rate enough to allow the lender to absorb the costs.  Either way, the borrower pays the costs.  Either of these techniques is acceptable and I can do them; I just won't mislead you and imply that it is not costing you anything.  A claim of "no out-of-pocket costs" just means that the lender is rolling the costs into the new loan amount. Be wary of advertised claims. They can be deceptive. Call or e-mail me for an evaluation if something looks enticing.

Should I refinance out of my ARM loan?
Not necessarily.  Rates are dropping.  Your ARM might get cheaper.  Call for specific comment.

Speaking of moving...
This is an excellent time to buy whether you are a first-time buyer or a “move-up” buyer.  Perhaps it is time for a larger home or a home in a more desirable geographic location.  Anyone considering a move should factor in today’s low rates.  Contact me at 407-788-5100 or  m.carlton@thomasmortgage.com for a discussion of the many other variables.

Pool Home on a Cul-de-Sac --Backs to Conservation

Smart Ways to Save on Your Electric Bill

There are a number of things you can do to lower your electric bill.  But to save the most energy and money, FLP (Florida Power & Light Company) recommends these top 10 tips:

1. Cool your home at 78 degrees or warmer with the thermostat fan switch on 'auto.'  For additional, savings, raise your thermostat to 82 degrees or warmer when you're away from home.
2. Heat your home to 68 degrees or cooler with the thermostat fan switch on 'auto.'  To save, even more, lower your thermostat to 65 degrees or cooler at bedtime or when you're away from home.
3. Install a programmable thermostat to adjust the temperature automatically and maximize your energy savings.  It also helps to maintain a comfortable temperature when you wake up or return home. 
4. Clean or replace your A/C filter every month to trim your cooling costs and help your unit run more efficiently.
5. Turn off your ceiling fan when you leave the room.  A fan that runs all the time costs about $7 a month. 
6. Avoid pre-rinsing dishes before putting them in the dishwasher.  It can save up to $70 per year.
7. Limit the time you run your pool pump:  Summer - 6 hours a day, Winter - 4 hours a day.
8. Adjust the water level on your washing machine to match the load size, especially when using hot water.  Always use a cold rinse.
9. Clean the lint filter in your dryer before every load to dry your clothes faster and save money.
10. Use the auto sensor function on your dryer, if you have one, to conserve energy by not over-drying your clothes.

Wisely Spending Money to Make Money

This final installation in the 'Setting the Stage' series on the Today Show, Barbara Corcoran, real estate staging expert, does a major staging job spending $5,000 preparing a home to sell for the highest possible price.  Learn more about how to spend money wisely to prepare your home for sale to get two to three times the amount you put in back when the home sells.

 

New FHASecure loan program - will it help me refinance?

One of my former clients e-mailed this morning and asked whether the new FHASecure loan program would be appropriate for her to use in refinancing her ARM.  I expect that many Realtors will get similar questions from clients who've purchased homes with them as this new program gets more exposure in the media.  And it WILL get more exposure as politicians try to convince the public that steps are being taken to alleviate the "mortgage mess".

This program will help a few people but will not be the silver bullet that solves all problems.  In fact, most people who are in trouble with their ARM loans will not even qualify for the program.   In the case of my client mentioned above, she does not need, nor does she even qualify for the program because her loan has not started to adjust (as required by the current guidelines).  In addition, as is the case with all FHA programs, this one carries upfront mortgage insurance plus a monthly ongoing mortgage insurance.  My client is not currently paying mortgage insurance of any kind so this loan would actually increase her monthly housing expenses.

In addition to being exposed to the media coverage of this loan, homeowners are going to get all sorts of direct mail and telephone solicitations offering refinances.  As a mortgage consultant, I continue to take steps to ensure that the clients who trust me are not "taken" by people who are just trying to make a quick dollar.  This loan, while being salvation for a few, will not be appropriate for most people. It's best to talk with a trusted mortgage expert about your specific situation for advice in this matter.

Mickey Carlton
Mortgage Consultant with Thomas Mortgage
(a trusted vendor of ViewThisOrlandoHome.com)

Let the Buyer Be Aware

Here’s a quick post to let you know how we can help you or anyone you might refer to us.

As we’ve watched a seller’s market turn into a buyer’s market, we find ourselves thinking of the large inventory of homes for sale and the large number of people who have been thinking about making a move or an investment.  But do they understand the importance of taking action now, before the market changes again — as we know it will?

Over the past few months, our team has helped two young couples purchase their first home; a growing family buy a larger home with a wonderful backyard; a husband and wife purchase two rental properties; and a student buy the townhouse he’d been renting near his college.  Some or all of these purchases might not have been possible for our clients a year ago, but now the timing is right — for buyers who are aware of the opportunities.

Len Hardison, Your Friend Real Estate

P.S. Who’s the next person you know who’s thinking of purchasing their first home, a move-up home or an investment property?  Please give us a call to discuss how we can let them know about our services.

Spend Under $500 to Stage Your Home For Sale

The second in the 'Setting The Stage' series on The Today Show, Barbara Corcoran gives expert advice on how to stage a home for sale to garner the best price while spending only $500 on staging elements.

How to Stage Your Home For Sale For Under $100

Real Estate staging guru Barbara Corcoran explains to The Today Show's Matt Lauer how to stage a home to sell for more money.  Better yet, these staging strategies cost less than $100.