Tuesday, August 31, 2021

Vacation Homes Increasingly In Demand Because Of Remote Work Trends

It's not something you'd expect during a pandemic and recession, but numbers don't lie. According to a PRNewswire report, sales of vacation homes are soaring. According to Redfin's report, demand for second homes skyrocket 100% from a year earlier—the fourth triple-digit increase in the last five months. That outpaces the demand for primary homes.

Home sales are on the rise across the board due to record-low mortgage rates but also because of a wave of relocations during the pandemic. Demand for second homes rises to the top among more affluent Americans who work remotely, no longer need to send their kids to school in person, and are limited by travel restrictions, according to Redfin's lead economist Taylor Marr.

"With mortgage rates at all-time lows and offices shut down across the country, the dream of having a second home outside of the city is becoming a reality for many wealthy Americans," Marr said. "Unfortunately, at the same time, millions of less-fortunate families are behind on their mortgage or rent payments due to financial hardship brought on by the coronavirus pandemic."

Some of these second homes may eventually turn into primary homes, as it's not uncommon for a buyer to close a deal on a second home before putting their current house on the market. It seems resort towns across the U.S. have attracted more homebuyers. Hotspots include Lake Tahoe, Cape Cod, Palm Springs, the Jersey Shore, and Bend, OR.

Even when offices reopen, folks will be able to spend more time than ever before in their second homes because many employers will continue to offer flexible remote-work policies. With workers still commuting in one or two days a week, resort towns that are near major cities will likely continue to heat up."

Thank you for visiting my blog, please leave a comment or question and come back again! 


Roxy Redenbaugh, Broker
Sr Mortgage Consultant
Residential and Commercial
The Greatest Compliment I Can Receive Is A Referral From Friends, Family, and Business Associates,
NMLS#269926 Company NMLS#1930219


Source:PRNewswire, Redfin, TBWS

Saturday, May 22, 2021

'Aging in Place' Helps To Fuel Housing Shortage

As the baby boomer generation has aged, it has also stayed put. And for all the innovations
builders and product manufacturers have come up with to help seniors “age in place.” they may have also made it difficult for would-be homebuyers, causing a lack of housing inventory.

According to a new report from Freddie Mac, 2019 will see a significant shortage of available homes here in the U.S., failing to meet needs by 2.5 million units. It doesn’t help that at the same time millennials are buying fewer homes at this point in their lives compared with previous generations at similar periods.

As seniors continue to prefer to stay where they are as the optimal way to live out their remaining years, housing inventory has tightened nationally. According to the report, for people between the ages of 67 and 87, homeownership rates dropped by 11.6 percent for previous generations but only 3.6 percent for the current (leading edge) generation of seniors, identified as having been born between 1931 and 1941.

New advances in information technology may be the culprit, as well as accessibility to better healthcare and education, with the report crediting those advancements as “boosting and extending” housing demand among seniors. The result? The current senior generation has become much slower in transitioning out of homeownership than prior generations. Reverse Mortgage is another retirement tool being used to keep seniors in their home. 

The U.S. Census Bureau says lost units will need to be replenished at a rate of 350,000 homes per year in order to bring the market to a “well-functioning” status. “Vacant homes increase liquidity in the market, enable prospective buyers to find a match, and give prospective sellers confidence to list their home for sale,” the Freddie Mac report states. “Vacancy rates are an important indicator of housing market vitality. Too high a vacancy rate reflects a moribund market, while too low of a rate reduces the efficiency of the marketplace.”

While this does not bode well for home shoppers, it will boost spending on renovations, according to Chief Economist Sam Kater. “We believe the additional demand for homeownership from seniors aging in place will increase the relative price of owning versus renting, making renting more attractive to younger generations.” If that is true, however, those in a position to purchase the limited number of homes available may well see their property values increase more quickly than anticipated.

Thank you for visiting my blog, please leave me a comment and let me if you like my blog and the information I post. 


Roxy Redenbaugh, Broker
Sr Mortgage Consultant
Residential and Commercial
The Greatest Compliment I Can Receive Is A Referral From Friends, Family, and Business Associates,
NMLS#269926 Company NMLS#1930219

Source: Realtor, Reversemortgagedaily, FreddieMacTBWS 

Friday, May 14, 2021

Staying Sane As Work-From-Home Realities Continue

Today, millions are working productively from home, and even when it felt feasible for employers
to ask them to start their commute once again, many have extended the work-from-home option into 2021. But how has this played out with remote workers? Did their giddiness to set up a laptop and work in their sweats last? 

In the best of times, working from home is associated with all sorts of positive emotions for remote workers — freedom, autonomy, trust and happiness, to name just a few. Indeed, remote work is often considered the ‘holy grail’ of flexible work options, with benefits galore that far outweigh any potential downsides. Working from home during the pandemic, however, is not welcomed by all. Juggling personal and professional priorities without access to many of our normal outlets can weigh down on many of us.

It may well be that the key to handling working remotely is accepting (instead of resisting) some of the negative emotions that comes along with it. Trying to develop an “attitude of gratitude’ may well be one of the quickest paths to a positive, happy outlook. While it may feel cathartic to complain, in one study, participants who wrote a few sentences a week for 10 weeks about things they were grateful for were more optimistic and felt better about their lives than those who wrote about what irritated them.

So what can you be grateful for? A supportive boss? Being able to watch your kids grow up and have more time with them? Having more time for self-care? “How you frame something in your mind determines how you experience it. ...So, if you approach things with a ‘glass half-empty’ attitude, you’ll tend to experience them as lacking. Fortunately, you are in complete control of your mindset.”

Other ways to happily accept your remote fate include setting up an efficient, comfortable
home office instead of taking up space on the sofa with your laptop.
Even if your dining room table is all that is available, consider surrounding yourself with things that make you happy — plants, photos of the family, and artwork. Design a backdrop that makes your Zoom meetings look professional once that laptop camera turns on.

Remember the routines you once had when getting ready for work? Develop new ones and stick to them. Perhaps that means getting out of bed and stretching, doing a few minutes of meditation, and then heading to the Nespresso machine. Set up designated break times all day long and tell your boss, co-workers, and family members when you will be available to them.

Bonding with others and feeling like you’re part of a community is key for staying upbeat, so work on developing your work relationships remotely....“Virtual meet-ups, instant messages, group chats and other forms of remote communication can all help.” Productive hours (when you’re “in the zone”) should be focused on getting your best work completed.

Instead of scrolling through your phone while you eat lunch, take the time to “play” at something you really love. “Spending 30 minutes between meetings doing something you enjoy can temper any stress or negative feelings you’ve been having.” If you take care of you, you show up for others when they truly need you. Don’t let self-care slip by the wayside.

Adequate sleep, good lighting, healthy eating, limiting sugar and alcohol, and exercising are all ways to use self-care to combat stress. Taking the time to be outdoors helps tremendously as well. Courtney cites studies that showed that those who spent more time outdoors (even just walking around the block or visiting a local park) reported better sleep and felt significantly less anxiety, stress, and depression than those who spent less than 30 minutes outdoors each day.

Thank you for visiting my blog, please leave me a comment and let me if you like my blog and the information I post. 


Roxy Redenbaugh, Broker
Sr Mortgage Consultant
Residential and Commercial
The Greatest Compliment I Can Receive Is A Referral From Friends, Family, and Business Associates,

NMLS#269926 Company NMLS#1

Source: MoneyTalkNews | TBWS

Tuesday, April 27, 2021

Getting Prepared To Buy Your First Home

 For some it seems like a no-brainer. Renting a home feels like throwing money away, offering no sense of ownership whatsoever. Buying a home is investing in the future. Even if it takes up to 30 years to pay off the loan, you have been LIVING in your investment.

According to a new study by Framework, however, there is more than meets the eye with first time home buyers, who see it as laced with blind spots and pre-loaded with anxiety — mostly because they went into it fairly blind, without enough education and information. The surveys were completed by two groups: recent first-time homebuyers and prospective first-time homebuyers.

The report says only 41% feel very well prepared for the home buying process, 57% worry they can't afford homeownership, 47% think the home buying process is "rigged" against the buyer, 44% fear making costly mistakes, and 55% said they could use an independent advocate to coach them through the process of home buying and homeownership. On top of that, more than half of first time home buyers in both groups said buying a home was more difficult than it should be.

So what does this tell the average real estate professional or mortgage loan officer? That they may have fallen short of making their buyers literate enough to have confidence in the process? While, once they had been through the process of buying a home, 64% of responders said they emerged from it knowing a lot more about the financial aspects of it, most wished they had taken some kind of class to prepare them for it.

When you think about it, those in the industry often don't do a great job in explaining aspects of homeownership not in their purview — things like paying taxes, how and when a payment can adjust, or promoting the idea of having a home ownership "slush fund" in the case of an emergency, such as flooding, a failing roof, or plumbing leaking underground. Of course, these aren't included in the warm, fuzzy feelings industry professionals care to project as they lead buyers through the process, but that doesn't mean first-time homebuyers shouldn't be encouraged to find classes or sources that address their concerns.

CurrentMortgageRatesToday.org says that while the largest cost of owning a home will be
your monthly mortgage payment,
there are several other costs that you should be aware of when trying to find out how much homeownership will cost you — things like an HOA fee (and what it covers), property taxes, homeowner's insurance, and utilities. And then there is maintenance and repairs.

There are always risks inherent in any large purchase. But it's up to the potential homeowner to decide if it's the best financial step for them. Lenders and Realtors often offer courses for first-time homebuyers, but they can also be found online as well.

Thank you for visiting my blog, please leave me a comment and let me if you like my blog and the information I post. 


Roxy Redenbaugh, Broker
Sr Mortgage Consultant
Residential and Commercial
The Greatest Compliment I Can Receive Is A Referral From Friends, Family, and Business Associates,
NMLS#269926 Company NMLS#1


Source: PRNewswire, currentmortgageratestoday.org, TBWS

Sunday, April 25, 2021

Obstacles That Can Hold Up Closing For Both Buyers and Sellers

Whoever said it’s the little things that count wasn’t kidding when it comes to closing escrow
on a house you just bought or sold.
If your escrow agent or real estate consultant were able to articulate all the hoops that must be jumped through from the day an offer is accepted to the day you hand over the house keys, they will have earned hero status.

The BIG things for the seller include signing off on the buyers’ inspections or fixing anything that comes out of them as a negotiation point of the sale, making sure the buyer gets a final loan approval and seeing their funds being deposited in escrow. But what about some of a sellers’ most overlooked things — those that have the capacity to wreak havoc at the least minute, keeping escrow from closing just when you thought the money would be in the bank?

Little things can be mini-bombs that go off at the last minute. You may not give utility bills a second thought. But utility companies, as well as closing personnel, will certainly notice that you forgot to pay your water bill. Any bills that stacked up against your property are your responsibility until you hand over the house keys. Failure to pay a $55 water bill can see everything come to a screeching halt.

A detailed walkthrough of your property is not only expected by the buyers, but encouraged
by their agent, their banker
— anyone who has an interest in seeing the transaction close. If they saw your home furnished and appearing in pristine condition when they made their offer, but now see gouged floors and banged up walls that weren’t there until after you moved out, it’s your responsibility to fix it, even if it’s due to natural causes, like flooding from a bad storm. Damage that occurred after a home inspection is always the responsibility of the seller, so fess up and make good on any damage that was your fault or even may have been your fault.

An issue that crops up more frequently than anyone would want to admit is property line and survey issues. If your neighbor was such a bud that his play set’s piers were cemented into the ground within your property line, it can hold everything up until the structure is moved if the buyer requests it. If you built a storage shed over a utility easement without knowing it, you’re still at fault and must remedy the situation. Fences don’t always follow property lines, either. Make sure you study the survey performed on your property and get these things addressed before the buyer heads over the sign papers.

So now we’ve warned sellers. What if you are the buyer? Something Realtors or Loan Officer's might not warn you about (but should) is committing the error of making major purchases AFTER your loan approval — one that has the capacity to lower your cash reserves and/or affect your credit score, making your loan approval become a fleeting moment instead of a reality. While it’s a royal pain for YOU, since you thought you had chosen the house of your dreams, think as well about the seller of the home you offered on in good faith. They may have already purchased another home and physically moved out. Your faux pax may have just caused a domino effect to take place, with escrows fallouts happening in rapid succession. Any other changes in your income, credit or access can change your approval, be careful during escrow to make sure you have no changes until AFTER you close escrow. 

The key here is to stay vigilant as to any potential hiccups that can occur by staying in close touch with your agent, your escrow officer, and any loan personnel that may be involved during closing week. They may have multiple transactions to deal with, while you have one — your own. And what can appear to be a small hiccup on the surface can bring things to a screeching halt if not dealt with promptly. While everyone tries to keep things together on your behalf, being proactive is never a bad idea.

Thank you for visiting my blog, please leave me a comment and let me if you like my blog and the information I post. 


Roxy Redenbaugh, Broker
Sr Mortgage Consultant
Residential and Commercial
The Greatest Compliment I Can Receive Is A Referral From Friends, Family, and Business Associates,
NMLS#269926 Company NMLS#1930219


Monday, January 25, 2021

Fun Real Estate Facts That Will Make You Smile

Sometimes it’s not the big real estate news about trends and statistics that send us falling
onto our backsides
— it’s the lesser-known facts that make us smile, make us think and realize the world is a crazy-messy place.

Inman News featured some amazingly entertaining real estate facts we’d like to share, and there is no time like the present — when we are reeling over stock market volatility and wondering what comes next — to get a bit of comic, head-scratching relief.

You want fries with that? Did you know that the McDonald corporation possesses one of the world’s most comprehensive (international) real estate portfolios? Franchisees do all the burger-flipping work while the Big D enjoys the land-holding and franchise fee revenues without worrying about the calories.

Some people are billionaires, but you wouldn’t know it by the way they live. Mogul Warren Buffet lives in the same house he bought in 1958 for a cool $31,500. Think his mortgage is paid off by now? A number of high profile celebrities have some frugal leftover tendencies as well, including Jay Leno, who made the choice to never spend his $15 million a year TV show salary, Leonardo DiCaprio, who drives a Toyota Prius, and Paul McCartney, who had his daughter pay her own way through college and asks party guests to pay for their own drinks.

You don’t have to sound brassy if you have a brass doorknob. You just don’t tend to pass on the flu as easily. According to a number of sources, brass doorknobs disinfect themselves, being the most antimicrobial metal of all. So next time you turn the knob or push down on a brass lever, you’ll have fewer worries that you may start sneezing because of it.

It’s a red letter day when you pay off your mortgage. The Scots not only think so — and they make sure you know about it. In Scotland when someone writes that last monthly mortgage check they run out and buy a bucket of and paint their front doors red. This mortgage-free announcement is thrilling to homeowners who definitely think it’s worth proclaiming.

Think a tiny paperclip is no big deal? Think again. Beginning in 2005, Canadian Kyle McDonald traded a paperclip for a pen, then for a doorknob, then a camp stove, a generator and on and on. He traded rent, favors, and even a movie role until he ultimately got a 2-story farmhouse for all his swapping efforts. Don’t let anyone tell you it’s not the little things that count.

Sometimes Public Enemy #1 is a nice guy. Some say this may be an urban myth, but the story continues to be told. Charles (Pretty Boy) Floyd, a Depression-era gangster not only robbed banks. He also served as a kind of modern-day Robin Hood, destroying mortgage documents in the process and freeing a number of citizens of their financial obligations. Sometimes the little guy comes out on top.

Capitalism produces winners and losers, but who’d a thunk the game Monopoly was designed by a woman to teach us a lesson? Still a bestselling board game, the concept taught us to buy up property, stack it with hotels, and charge fellow players sky-high rents for the privilege of accidentally landing there. But the little-known inventor, Elizabeth Magie had no idea that it would encourage its players to celebrate values opposed to those she intended to champion. A devout and vocal socialist, Magie proclaimed ‘the equal right of all men to use the land is as clear as their equal right to breathe the air – it is a right proclaimed by the fact of their existence.’ Seems Americans never grasped that idea.

Although India is a land of haves-and-have nots, one of the haves built a billion-dollar home. It boasts 27 floors (six of them for parking), 3 helipads, is staffed with 600 people, offers a 4-story hanging garden and is complete with a movie theater. We’re not sure how many bathrooms one needs for a life well-lived, however.

Thank you for visiting my blog, please leave me a comment and let me if you like my blog and the information I post. 


Roxy Redenbaugh, Broker
Sr Mortgage Consultant
Residential and Commercial
The Greatest Compliment I Can Receive Is A Referral From Friends, Family, and Business Associates,
NMLS#269926 Company NMLS#1930219

Monday, December 28, 2020

PANDEMIC SPURS RISE IN MULTI-GENERATIONAL HOUSEHOLDS

 Life circumstances can sometimes change on a dime. Such is the case of household living situations since the pandemic began, causing social and economic upheavals for many families.

After the stay-at-home orders went into effect in many parts of the country in March, the National Association of Realtors noted a 15% increase in buyers who purchased a multigenerational home compared with before the pandemic hit, compared with 11% in the previous year. NAR's vice president of demographics and behavioral insights, Jessica Lautz, says, "One in six home buyers who purchased during the pandemic purchased a multigenerational home. That's an increase from 1 in 10."

Intergenerational homes can be anything from two (or more) attached, fully functional units in a duplex model or one home that offers private kitchens and separate entrances, like a rental unit in a single-family house. Or they might also be a detached accessory dwelling unit, typically a smaller home, in the backyard of a larger house. Adult children concerned about placing their parents in nursing homes during the pandemic have simply decided to keep things in their own backyards, just to be safe. Parents whose older kids lack employment or can't attend college are included in this "pod" living situation as well.

The ideal is, of course, to offer the other generation a degree of independence, with separate entrances and separate kitchen facilities. And homebuilders have been and continue to step up to the plate to provide this arrangement. "As you might expect, homes intended for more than one family tend to be a little larger, by nearly 22%, according to NAR data. "The typical existing home is 1,880 square feet and costs about $270,000. Yet a multigenerational abode is roughly 2,290 square feet and costs about 10.7% more, with a $299,000 price tag." These larger, higher-priced alternatives also take into account the pooling of several incomes, according to NAR's research.

The figures released by NAR account only for recent purchases.  "The actual number of intergenerational households that have formed since the start of the pandemic has actually increased by a staggering 61%."

U.S. Census data found that a record 64 million people—20% of the U.S. population—lived with multiple generations of adults in a single-family home.

Thank you for visiting my blog, please leave me a comment and let me if you like my blog and the information I post. 


Roxy Redenbaugh, Broker
Sr Mortgage Consultant
Residential and Commercial
The Greatest Compliment I Can Receive Is A Referral From Friends, Family, and Business Associates,
NMLS#269926 Company NMLS#1930219

Wednesday, December 23, 2020

How Does Refinancing Save Homeowners Money

 Question: How does refinancing save homeowners money?

There are two categories of refinancing, "rate-and-term" and "cash-out." Both can save you money.


The first type, rate-and-term, replaces your existing loan with one that has a better rate and/or terms. You might replace an ARM or balloon loan with a fixed-rate loan, for example. Or you may decide to lower your rate AND shorten your term. Some borrowers have been able to refinance from a 30-year loan into a 15 or 20-year loan, reducing the term, without appreciably raising their payments.


A borrower does not receive any significant amount of cash in a rate-and-term refinance; lenders generally consider that any cash proceeds above $2,000 pushes the loan into a cash-out category.

There are always certain costs involved in any mortgage transaction; there will always be fees for title, escrow, underwriting and document preparation, for example. Borrowers can add these fees to their new loan so as to avoid having to pay them in cash. Financing these items is not considered cash-out.

When you are deciding whether to do a rate-and-term refinance, you should evaluate it in two primary ways: first, how long will it take to recover the cost of doing the loan? For example, if the closing costs amount to $3,000 and the reduction in rate gives a saving of $1,500 per year in the first year, it will take approximately two years to "break even." For most people, this time frame is more than satisfactory, but you should make your own decision. The second criterion is net savings over some time period, say five years, ten years or more. 

Homeowners with adjustable rate mortgages (ARMs) may decide to refinance into a fixed rate loan, even though their rate may initially be higher, they might feel more secure knowing that their rate will never change. This is more of a defensive strategy to guard against the possibility of a higher rate in the future, but it may not "save money."


The other type of refinance, a "cash-out," is one where the borrower receives cash of more than $2,000 at closing. This is accomplished by getting a new loan that is larger than the balance of the old one plus closing costs. Borrowers can use that money for anything. Some homeowners have used cash-out refinances to pay off consumer debt, like car loans, student loans, and credit cards. Using home equity to pay off credit cards can drop the payment dramatically! But paying down installment loans can create a false economy. A $30,000 car loan with an interest rate of 6% will have a payment of $500, but paying off that loan with the proceeds of a home refinance will effectively drop the payment to $150—but does it really make sense to finance a car for 30 years? 


Hope this is useful.

Thank you for visiting my blog, please leave me a comment and let me if you like my blog and the information I post. 

Roxy Redenbaugh, Broker
Sr Mortgage Consultant
Residential and Commercial
The Greatest Compliment I Can Receive Is A Referral From Friends, Family, and Business Associates,
NMLS#269926 Company NMLS#1930219



Friday, December 18, 2020

Don't be a 'Lone Ranger' when house hunting


If your idea of a fun weekend is making a list of open houses to visit and then running all over town to see if you can find that diamond of a home, then have at it. The only problem with it is that you're doing it without the knowledge and protection of a professional real estate consultant. Can you buy a home without one? Absolutely. Is it wise? Not really, especially when, in most cases, you pay nothing for the services of a buyer's agent.

Real estate is complex, filled with nuances and pitfalls better navigated by seasoned professionals who can usually spot something amiss a mile away. Here are a few of the risks you expose yourself to going it alone.

Negotiation is something kids learn to do at an early age. "I'll trade you my PBJ for your salami sandwich." When they get older, they may strike a compromise with the teacher for turning in an important project a day late. Older yet and they are negotiating a salary for a new job. But real estate negotiation is a different animal. It's not a place to "practice" the art of negotiation if you weren't good at it as a kid or even a grown adult. Real estate agents not only understand how to best use leverage to earn you the best deal possible. They also know when to advise you to walk away because they know how sellers operate. Despite their home being desirable, a seller whose sales price is unreasonably high (not in line with other homes for sale in the area that are of similar size, age, and condition) is not realistic. It means they are not that truly dedicated to selling their home any time soon. A house priced unusually low and being sold in "as is" condition may be a recipe for remodeling disaster. By not working with an agent, you can't tap into their insights and acumen for how to drive the best bargain possible – a loss that can cost you.

Market knowledge is not something you can glean by spending a few evenings online looking at houses and neighborhoods. The prices listed on real estate apps can't always be trusted. A Realtor knows this and will call each listing agent or owner to confirm what they see is true. Sure, you can make those calls on your own, but you just may shoot yourself in the foot by revealing your motivation to buy, leaving you a limited opportunity to negotiate. A agent offers insights into trends in the market over time, will have researched the area for development, commercial and school construction and will give you an estimate for how much you should be budgeting for your target property -- all of which can change constantly. It's what agents do in their sleep.

How do you know you've got the real skinny on a property? The vetting process is an important one, with real estate professionals being held to legal standards that require them to thoroughly vet a property for potential pitfalls – water damage, toxic materials, health and flooding hazards, the list goes on and on. They are not keen on being the ones being held responsible for encouraging you to buy a property that has serious issues without all those issues being disclosed in the light of day and in writing. They always, always recommend professional inspections be performed as well as obtaining hazard and environmental reports for the area. You could be buying a home on ground where there was once an airfield, with toxic substances still remaining in the soil where your children play. Or the house may be located in an area where some serious mining took place, leaving it vulnerable to sinkholes or foundation sagging.

Don't kid yourself. The paperwork involved in a real estate transaction is nothing to scoff at. Contracts, disclosures, addendums, transfers, inspections, and reports can bury you. And what about those loopholes you may have overlooked? You assumed the seller would leave all the pool equipment, the chandelier in the dining room, and the entertainment cabinets that perfectly fit the walls in the family room. But when you get the keys to move in, you discover they are gone. Why? You forgot to intentionally specify they remain when signing the purchase agreement. Realtors don't forget these things. In fact, they may go overboard in enumerating all the items that stay with the house just to play if safe.

While you should make sure you personally review any binding document before signing it, a real estate professional can greatly reduce how much time you spend on legal matters so you can get back to how you really want to spend your time – activities like choosing that new king-sized bed for the master bedroom. Or buying patio furniture for around the pool you always wanted and finally got.

And then there is FOMO — the fear of missing out. Going it alone means you are limited to word of mouth recommendations and only what you can find on your computer. You may not realize that a new home community is being built nearby that might knock the socks off the neighborhood you are considering. The right Realtor will bring detailed knowledge of the market in your area or neighborhood – as well as other potential markets nearby that you might not have considered but could be just what you are looking for. They cast a wide net when looking for your home, so why not leverage their knowledge? They'll have information on property taxes, closing costs, HOA fees (as well as the health of the HOA itself), and even supplemental taxes you might not find out about until after you moved in. Why? It's their job. So why not let a Realtor be the detective instead of being a weekend house-hunting warrior? You've got nothing to lose and a lot to gain.


The first step to buying your home is getting pre-approved for a home loan. Call me and lets get started. I can also introduce you to a Realtor that will look out for your best interests and help you find the perfect home.  



Thank you for visiting my blog, please leave me a comment and let me if you like my blog and the information I post. 

Roxy Redenbaugh, Broker
Sr Mortgage Consultant
Residential and Commercial
The Greatest Compliment I Can Receive Is A Referral From Friends, Family, and Business Associates,
NMLS#269926 Company NMLS#1930219

Source: Lendersnetwork, TBWS

Wednesday, September 30, 2020

Minimum Down Payment For First-Time Home Buyers

Someone once asked me: With the way the economy 
has taken a toll on savings accounts, the traditional 20% down payment seems out of reach for many first-time home buyers like myself. Are more first-timers going the route of 5%-15% down payments? Or should I wait until I've got the 20% saved?

I can answer your question in two ways because you're asking two separate questions.

I take "realistic" to mean whatever makes sense for a buyer. There are some who believe that 20% is a "realistic" minimum down payment because it avoids mortgage insurance. Lenders view borrowers who make a smaller down payment as presenting more risk. Because of this, lenders require mortgage insurance to manage their risk. That insurance costs the borrower money.

If a buyer has enough money for a 20% down payment and closing costs and has something left over for cash reserves, 20% is fine. I say that with one caveat: if you carry any consumer debt with rates higher than that of a mortgage, it is FAR better to pay those more expensive items off with available cash than to put it into a home down payment. 

There are many loan programs designed for lower 
down payments 3% on conventional or
3.5% for FHA, No down payment for VA and USDA
. Down Payment Assistance (DPA) is offered by FHA Government Grant program for 2% - 3.5% do
wn payment help, that is considered a gift and doesn't have to be paid back. 

If a buyer doesn't quite have enough cash for a 20% down payment plus closing costs, waiting to save up the money can be very expensive. First, home values are increasing in most areas of the country today. This means that if there is an appreciation rate of 4%, the $300,000 home you have your eye on today will cost $312,000 a year from today. There is also the matter of rising interest rates. 

If you have the ability to buy today regardless of the amount of cash you have—as little as 3% plus closing costs can get you into a home—buying now is a good idea. Yes, there will be mortgage insurance (MI), but that is temporary; once you can demonstrate to the lender that your loan balance is 80% of the home's market value or less, if you have an FHA loan you will need to refinance to remove your mortgage insurance.. but generally once you have 20% equity you can get your MI removed. 

I hope this is useful. Call me if you want to get pre-approved and see how much you qualify for, then you just need to find a home.  

Thank you for visiting my blog, please leave me a comment and let me if you like my blog and the information I post. 


Roxy Redenbaugh, Broker
Sr Mortgage Consultant
Residential and Commercial
The Greatest Compliment I Can Receive Is A Referral From Friends, Family, and Business Associates,
NMLS#269926 Company NMLS#1930219