Archives for January 2018
Spring time means new home starts and for those of you who are working on, or would like too build a new home, FHA offers a construction loan program that rolls into a permanent loan.This program also allows you to acquire land as part of the loan.
FHA will lend up to 96.5% of the value of the project, but for owner occupied only. In #Mendocino County and #Sonoma County, California, these loans could help rebuild homes that were destroyed by the fires of last October. Many of those homeowners were under insured and this program would help them get back the home they lost!
Keep in mind the time frame that is necessary to get a project approved and the lender is going to want to have a final building permit before they will fund the loan to purchase the land or start the project. This means that you must have a seller willing to cooperate with your time frames since it could take you 4-6 months to get your project approved.
Some borrowers are looking at modular homes which already have plans drawn and would speed up the time frames since you could take those plans, cost breakdowns, etc., immediately to the jurisdiction responsible for issuing the permit.These are different then manufactured homes, and are homes that look like a traditional stick built home.There are numerous modular home companies listed on online.
For more information, just give us a call or send us an email! email@example.com
If you have been watching the ten year bond yield over the last two weeks, then you may have noticed that it has been increasing almost every day. Since mortgage rates tend to follow the ten year yield, then what does this mean to mortgage rates? Well, this means that interest rates have been moving up as well. What was a market of 4.125-4.25 is now closer to 4.375-4.5%. These rates assume that you are not paying any origination fee to get that rate. So, what does a 1/4 percent increase in the interest rate really mean?
Let’s use a loan amount of $300,000 and lets start with a rate of 4.25%. The monthly payment on that loan would be $1476 per month. Now let’s look at 4.5% using the same loan amount. That payment would be $1520 per month or an increase of $44 per month. That sure doesn’t sound as bad as rates going up by 1/4? In fact, i think that might be my coffee tab at the local coffee house for the week!
For some i understand that rates going up causes additional mental stress and anxiety because most new homebuyers are already concerned about whether they can afford to pay this new mortgage. But, this is the trend i believe over 2018 and you are going to have to get comfortable with a higher rate of interest. The good news is that i do not think that $44 per month is going to be a deal killer for most!