The Real Cost of Impulsive Investing

Worried man watching stock drop as he makes an investing mistake
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It seems to happen every fall. The stock market is rolling right along, hitting new highs every week or so. And then by September or October something spooks the markets.

Investors who have been ignoring economic warning signs all year suddenly start paying attention. Sometimes when the S&P 500 drops by 5% or so, they make a snap judgment to sell, ignoring the double-digit gains it’s posted so far.

They rely on CNBC to guide their next move. They spend every waking minute agonizing over whether to hang on or bail out.

Millions of people invest this way, on impulse. They worry whenever there is any sign of market turbulence and give in to their fears and then get burned.

We’ve all seen this movie and know how it ends. And who benefits the most? The huge institutional traders on Wall Street.

They profit by capitalizing on the impulsive behavior of Main Street investors. Motivated by the twin fears of “I can’t afford to lose” and “I don’t want to lose out,” these investors routinely buy high and sell low.

And Wall Street cashes in by selling high and buying low. Time after time, year after year.

The inevitable results of these David vs. Goliath trading interactions are so predictable that Wall Street has a euphemism for it: exploiting market inefficiencies. The big traders can predict with razor-sharp precision when regular investors will give in to their fears or greed.

Their analysts get access to the information they need to buy or sell shares of stock at the best price long before this same information percolates down to regular investors.

Here is how to understand and avoid self-defeating behavior.

Self-defeating behavior

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Emotions are the enemy of investing. When you’re plagued by doubt, you’re more likely to embrace certain thought patterns or superstitions that result in bad decisions. When you’re emotionally biased, you’re less willing to listen to views that could keep you from going down with the ship.

Psychologists have developed a whole field of study to identify these kinds of self-defeating thought processes: behavioral finance.

Numerous studies have shown that anxious investors often see and react to trading patterns that don’t really exist. They develop biases that aren’t easily shaken. And they fail to see the financial forest for the trees.

While hundreds of these behaviors have been researched and catalogued, there are a few that even the most experienced investors will recognize as applying to themselves at one time or another.

Loss aversion

Worried man holds up hands in a stop or halt motion
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Research has shown that investors are much more upset when their portfolio has dropped 5% in value than they are happy when it rises by 10%.

They’re more likely to hold on to a stock whose price is falling in the hope that it will bounce back. And they’re much more likely to sell a stock whose price has risen long before it’s reached its peak.

Framing

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Even though we consciously understand that a diversified portfolio helps to offset the falling price of one stock with the rising value of another, we still tend to obsess on the outsized profits or losses of individual stocks, regardless of how little overall impact one security has on our portfolio as a whole.

Anchoring

An investor panics over a market crash
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The way certain kinds of information are presented can influence our thinking. For example, when the stock market drops by 10% or more, the media has conditioned us into thinking of it as a market correction, with all of its associated doomsday fearmongering.

But that 10% is just an arbitrary numerical signpost that is no better at predicting a bear market than a 5% drop.

Availability bias

An older man scratches his head and wrinkles his nose while thinking
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People who have experienced a recent major event tend to believe that a similar event will occur when certain situations preceding the event have occurred.

A good example is the belief that rising rates of COVID-19 infections are likely to trigger a major stock selloff similar to the three-month bear market of 2020.

Conservatism bias

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When investors have a strong belief in a certain company they’ve invested in, they tend to cling to their faith even when the company hits a bad patch. The fall of Enron in the early 2000s is a textbook example.

Even when news about the company’s scandals came to light, too many investors believed Enron would emerge unscathed — and ultimately lost their entire investment.

So how do you avoid financial misbehavior?

Monkey Business Images / Shutterstock.com

It’s critical to increase your financial self-awareness. Recognize the beliefs and fears that drive these behaviors and make a determined effort to think before you act.

Start by diagnosing your financial health. If you feel confident that you’re on track toward saving enough for retirement, your children’s higher education, or other goals, then you’ll be less likely to engage in behaviors that could derail your investment plan.

This can be difficult to do on your own, which is why you might want to seek out the services of a qualified, fee-only fiduciary financial planner.

This professional can help you address your fears, overcome your inertia, and conquer your biases by helping you figure out exactly where you are financially today and what you may need to get back on track. And if you hire them to manage your investment portfolio, you can sleep easier knowing that your financial future is in good hands.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

This Surprising Generation Saves Best for Retirement

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Saving for retirement is like eating our peas and carrots: We know we should do more of it, but few of us do.

However, it appears that some generations are better than others when it comes to putting away money for their golden years. In fact, one surprising generation can teach the rest of us a thing or two about building a solid financial future.

Recently, Empowering America surveyed more than 2,500 Americans to learn more about how they are saving and preparing for retirement. Following is a look at how four different generations are doing.

1. Baby boomers

Baby boomer couple looking at their finances
John Keith / Shutterstock.com

Participants in this generation contributing to retirement plans: 83.9%

We give boomers a bit of a pass for their sagging savings rate, which is the lowest among the generations surveyed. After all, a decent percentage of boomers are already in retirement and therefore no longer saving for it.

Still, Empowering America characterizes the last-place finish of baby boomers as somewhat surprising, and it is likely that more than a few members of this generation regret not having saved more for their golden years.

If you are among them, check out the tips from Money Talks News founder Stacy Johnson in “I’m 55 and Have No Retirement Savings — What Should I Do?” While you might be a tad past that age, the advice is still great for anyone who is older and only has saved a little.

2. Generation X

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Participants in this generation contributing to retirement plans: 85.7%

Members of Generation X are not ready to retire just yet, but they can see the promised land just over the horizon. They are doing a better job than boomers of saving, but younger workers still are outpacing them.

While it might be too late for a baby boomer with no savings to end up rich, workers who belong to Generation X still have time. So, if your goals are ambitious, check out “5 Ways You Can Save $500,000 in 15 Years.”

3. Millennials

A millennial Black couple happily packs to move to another city
fizkes / Shutterstock.com

Participants in this generation contributing to retirement plans: 86%

This much-maligned generation is doing a surprisingly good job of saving for retirement. If you are a millennial, don’t worry about the steady stream of sneers you hear from baby boomers and members of Generation X. It appears that you are going to get the last laugh.

4. Generation Z

Generation Z friends
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Participants in this generation contributing to retirement plans: 86.8%

In these trying times, here is a heartening statistic: The working members of the youngest generation surveyed are doing the best job of saving for retirement.

This is especially good news because the earlier you start saving, the more time your money has to compound — and the wealthier you are likely to get.

So, if you are a member of one of the older generations, don’t curse at the young whippersnappers around you or holler for them to “get off your lawn.” Treat them nicely, and maybe they will give you a loan — or at least teach you some valuable lessons about the right way to save.

Can’t find a friendly member of Generation Z to guide you? Sign up for the Money Talks News’ retirement course, The Only Retirement Guide You’ll Ever Need.

Money Talks News founder Stacy Johnson is your guide for the course — a 14-week boot camp intended for those who are 45 or older. It can teach you everything from Social Security secrets to how to time your retirement.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

Why I Expect Mortgage Rates to Go Down Sometime Soon

If you thought 2021 was bad, just in general, you might think 2022 is even worse, if the subject happens to be mortgage rates.

They’ve started the year off with a bang, higher, and are now at their highest point in about two years.

A lot of market watchers expected mortgage rates to rise in 2022, but perhaps not this quickly and violently.

For example, the 30-year fixed finished the year 2021 close to 3%, and is now hovering around 3.5%, depending on the loan scenario in question.

It could be even higher than that depending on your FICO score and LTV ratio, and there’s fear things could get even worse.

A Big Jump in Mortgage Rates Is Often Followed by a Correction

Now I don’t want to be a sucker and try to time the market, but I’ve been thinking about this ever since mortgage rates shot up a week or so ago.

It seems like it came out of nowhere, despite the advanced warnings that the Fed would be raising rates this year.

The Fed thing was telegraphed and baked in, but the ongoing story has been inflation, which started off as “transitory” and lately became more concerning and perhaps permanent.

That has forced the Fed to get a bit more aggressive, prompting the dual stock market and bond market carnage we’ve seen lately.

At the same time, most 2022 mortgage rate predictions have called this, though just not this quickly.

There’s also a sense that the worst is behind us with COVID, even if omicron is leading to record numbers in all categories.

I’m hearing a lot of pandemic becomes endemic…emphasis on end.

So Much Bad News Yet Mortgage Interest Rates Are Higher?

mortgage rate trend

While it’s decidedly gloomy out there, here’s why I think mortgage rates might actually get cheaper next month.

If you look at short periods of volatility, they’re usually followed by a correction, whether it’s up or down. This seems to apply to most things, most notably the stock market.

Because mortgage interest rates surged so quickly, there’s a good chance they could fall back to earth for that very reason alone.

Simply put, too much selling makes something oversold and ripe for a purchase, in this case mortgage-backed securities (MBS).

Just look at this 30-year fixed chart from MND, which shows periods of rate spikes, followed by some correcting.

It’s obviously not a perfect science, and still a risk, but I could see rates taking a breather in February. Or perhaps March.

There are other factors working in favor of that argument, like surging COVID cases and hospitalizations.

Yes, we’ve all heard that the omicron variant is “mild,” but somehow daily cases are set to triple the record set a year ago.

And some 132,646 Americans are currently hospitalized with COVID, above the 132,051 record set in January of last year.

While it seems like everyone has COVID, it seems fewer are getting severe disease, despite the hospitalizations.

There’s also a sense that this was expected, seeing that we’ve been through a bad winter already. And there was much more mingling this holiday season.

That could explain why mortgage rates haven’t gone down, but UP. But give it time and things could change direction.

And I think it’d be silly to think there isn’t a next variant on the horizon, even if it’s all media hype.

There’s also that psychology when you think something can’t possibly happen that it does. And right now, it’s hard to imagine mortgage rates improving.

Mortgage Lender Competition to the Rescue?

Lastly, consider mortgage lenders for a moment. While an everyday homeowner or prospective home buyer certainly won’t like a higher mortgage rate, lenders despise them.

A big rate surge like this one will tank their loan volume in a hurry and have them wondering about rightsizing their staff.

It’ll make a cash out refinance less attractive and put a rate and term refinance out of reach for millions of homeowners.

When volume drops, lenders have to get more aggressive pricing-wise to stay afloat. It might mean making less per loan to get the loan to begin with!

And as I’ve written about before, it can be wise to apply for a home loan when it’s not busy.

Not just because your loan will get to the finish line faster, but because it should be cheaper, relatively speaking.

Why? Because the lender is willing to shrink their profit margin to get your business. When they’re slammed, they’ll maybe even ignore you.

So if it feels like all hope is lost on the mortgage rate front, it probably isn’t, for that reason alone.

When things turn around is another question. Does it happen in the next week or two, in February, or in March? Do things get worse before they get better?

I’m not sure, but I do think we could see a reprieve before the traditional home buying season gets underway in later March and April.

It might be short-lived though, so be ready to pounce if and when it happens.

Read more: What time of year are mortgage rates lowest?

Source: thetruthaboutmortgage.com

6 Ways to Increase Your Retirement Savings in the New Year

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Editor's Note: This story originally appeared on The Penny Hoarder. If you’re feeling shaky about your retirement savings, you’re not alone. According to a February 2021 research report by the National Institute on Retirement Security, 56% of respondents said they’re worried about achieving a financially secure retirement. If your savings fell short in 2021, the new year is a great time to get…

Source: moneytalksnews.com

Zillow Offers Shuts Down Because It Can’t Forecast Future Home Prices, 25% of Workforce to Be Let Go

In a somewhat strange turn of events, the iBuying unit of Zillow, known as Zillow Offers, is shutting down after an initial suspension late last month. I call it strange because it’s happening at a time when the real estate market has never been hotter. You would think that any entity or individual who purchased… Read More »Zillow Offers Shuts Down Because It Can’t Forecast Future Home Prices, 25% of Workforce to Be Let Go

The post Zillow Offers Shuts Down Because It Can’t Forecast Future Home Prices, 25% of Workforce to Be Let Go appeared first on The Truth About Mortgage.

Source: thetruthaboutmortgage.com

2022 FHA Loan Limits: Floor Rises to $420,680, Ceiling to $970,800

Similar to the FHFA, the U.S. Department of Housing and Urban Development (HUD) announces maximum loan limits each year for FHA loans.

Today, they unveiled the 2022 FHA loan limits, which like the 2022 conforming loan limits, will be significantly higher than the limits in effect this year.

This is thanks to continued home price appreciation, and the fact that the calculation of the FHA loan limits is driven by the conforming loan limit itself.

To come up with the FHA loan limits, HUD uses a percentage of the national conforming limit to set both a floor and a ceiling.

In cities like Los Angeles, home buyers can enjoy the higher ceiling loan limit, while many less expensive cities nationwide are set at the floor. There are also limits in between these two thresholds.

FHA Low-Cost Area Loan Limits (The Floor)

One-unit property: $420,680
Two-unit property: $538,650
Three-unit property: $651,050
Four-unit property: $809,150

To calculate the FHA loan limit floor, HUD uses 65 percent of the national conforming limit, which will be $647,200 for a one-unit property in 2022.

That puts it at $420,680, up from $356,362 in 2021. That’s a big 18% increase, and enough to make many more home buyers eligible for FHA financing nationwide.

It’ll be even higher for multi-unit properties, such as duplex or triplex.

If you put down the minimum 3.5% on a home purchase, you’ll now be able to purchase a property for as much as $435,000.

FHA High-Cost Area Loan Limits (The Ceiling)

One-unit property: $970,800
Two-unit property: $1,243,050
Three-unit property: $1,502,475
Four-unit property: $1,867,275

In more expensive metros nationwide, HUD allows for even higher loan limits, known as high-cost area mortgage limits.

These are set at 150 percent of the conforming limit, which matches them up with the high cost loan limits for mortgages backed by Fannie Mae and Freddie Mac.

As you can see, a four-unit property permits a near-$2 million loan limit, which tells you just how high home prices have risen.

This means a home buyer in Los Angeles could purchase a $1.5-million-dollar triplex with just $52,500 down. That’s pretty amazing.

Aside from the floor and ceiling, there are many metros that fall between these two limits throughout the country.

For example, the maximum loan limit for an FHA loan on a one-unit property in Denver, Colorado will be $684,250 in 2022.

Similarly, home buyers in the Miami-Ft. Lauderdale area will enjoy higher loan limits of $460,000 next year.

And in Phoenix, Arizona it will be $441,600, up from $368,000 in 2021. The same goes for Atlanta, where the 2022 FHA loan limit will be $471,500.

2022 FHA Loan Limits for Special Exception Areas

One-unit property: $1,456,200
Two-unit property: $1,864,575
Three-unit property: $2,253,700
Four-unit property: $2,800,900

Lastly, there are even higher loan limits for so-called special exception areas, which include Alaska, Guam, Hawaii, and the Virgin Islands.

They are adjusted higher to account for more expensive construction costs in these states and territories.

For a four-unit property, this loan limit is nearing a staggering $3 million, which tells you the dollar just ain’t worth what it used to be.

Regardless, this means a lot more home buyers will be able to take advantage of an FHA loan vs. a conventional loan.

Note that these are all forward mortgage limits for calendar year 2022, which are effective for case numbers assigned on or after January 1st, 2022.

For reverse mortgages, also known as Home Equity Conversion Mortgages (HECMs), the maximum nationwide claim amount will rise to nearly $1 million dollars ($970,800) for all cities.

If you were on the cusp of FHA loan eligibility because of a loan limit issue, you may want to take a second look at your loan scenario.

Source: thetruthaboutmortgage.com

What Will Cause the Next Housing Crash?

I think I finally know what’s going to cause the next major financial collapse. Crypto. Ignore the fact that the word “cry” is part of the word.

For the record, I don’t have anything against crypto, I just believe it’s a classic case of something climbing too high, too fast.

Don’t believe me? Look at silly meme coins like Doge and Shiba Inu coin, which rallied because Elon Musk recently acquired a Shiba Inu puppy.

Over time, the crypto industry could resemble something like the Internet, but similar to the Internet, growing pains will accompany its upward trajectory.

And because more and more investors are piling into cryptocurrencies, it’s just a matter of time before it all comes crashing down. The question is will it take housing with it?

Staples Center Becomes Crypto.com Arena

In the latest piece of ominous news, the long-named Staples Center will become known as Crypto.com Arena in a 20-year deal.

Apparently, Crypto.com shelled out more than $700 million for the naming rights, which makes it one of the most expensive deals in sports history.

The arena’s new logo will debut on Christmas day when the Los Angeles Lakers host the Brooklyn Nets.

And all of Staples Center signage is expected to be replaced with the new brand by around June 2022.

When I saw the news, it just kind of hit me that this whole crypto thing is getting out of control. Even my wife shared the news, and the tone was decidedly dubious.

There’s just something that smells off about the whole thing, even if the company is perfectly sound and a long-term winner.

If you remember the dot-com era, the toys.com, the pets.com, and so on, you might be feeling similar vibes today.

As noted, this doesn’t mean the whole idea is wrong or destined to fail, it’s just that a major correction will probably take place.

But what’s interesting is the concentration of investment in crypto, which is also probably super leveraged, has the ability to take down the entire financial system.

This could mean that crypto inadvertently stops the housing market bull run in its tracks, even if housing is otherwise sound.

Risks to the Housing Market

I started compiling a list of risks to the housing market a few months ago because I expect things to cool off in a couple years.

While I don’t think real estate is going down anytime soon, I do believe it will at least begin to face resistance in late 2023 and more so in 2024.

As I wrote yesterday, investors are still super bullish on real estate so chances are everyday Joes will also be buying for some time.

But if and when that takes a turn, we could see home prices flatten and eventually fall.

The crypto piece is definitely interesting, and before this Staples Center name change a friend told me another interesting trend.

He’s a real estate photographer who keeps a close eye on who’s buying real estate in Southern California.

I forget all the different “phases” of buyers he mentioned, but I believe there were the regular folk, the Instagram/YouTube and all-around influencer people, and the latest the crypto investors.

So the individuals buying the expensive homes of late are the crypto winners. That gave me pause knowing how fickle this nascent industry can be.

Other than a hypothetical crypto bust, I see these other potential risks:

  • Forbearance ending (COVID-related job losses)
  • Single-family home investors selling all at once
  • A spike in mortgage rates
  • Eventual overbuilding (zoning changes and pent up building)
  • Climate change
  • Contentious presidential election

There are plenty of potential dangers lurking in the housing market’s path, and it could be a combination that leads to the next housing crash.

As I’ve said before, I see the next housing crash happening around 2024, or at least beginning around that time.

Sprinkle in a U.S. presidential election that is likely to be a real barn burner, and well, it starts to make a lot of sense.

Why is doesn’t happen earlier might be a celebratory year related to us getting through COVID, hopefully.

How Bad Will the Next Housing Crash Be?

While I do see another financial collapse on the horizon, it may not actually be that bad. And housing could actually hold up pretty well.

If you look back at the dot-com bubble, Bay Area home prices fell about 10% after the technology stock market rout.

Of course, the pullback was pretty short-lived and eventually home prices were back on their merry way in 2002 and beyond.

Back then, it wasn’t housing’s fault, and this next time around that could be true as well.

While home prices are a lot more expensive than they were just a few years ago, or heck even last year, the housing market still mostly makes sense.

There is a short supply of homes available that exceeds demand. And mortgage rates are super low, which drives prices up but keeps mortgage payments affordable for buyers.

Sure, home buyers don’t want to spend this much on a house, but most can afford it and weather any storm that comes along.

Back in 2008, this wasn’t the case, which explained the massive real estate market collapse.

In other words, if you’re sitting back waiting for that next big opportunity, you might be disappointed.

Home prices will probably come down at some point relatively soon, but the discount might not be worth the wait.

Source: thetruthaboutmortgage.com

Is Real Estate Going Down, At Long Last? Why You Shouldn’t Get Your Hopes Up Just Yet

The headlines surrounding the housing market and mortgage rates have been quite pessimistic lately.

So bad that you might think this so-called real estate bubble we’ve supposedly been in is about to pop, once and for all.

The warnings have been coming for a while now, but more and more folks are saying enough is enough.

If things do take a turn, it might allow fence sitters to finally get in without having to enter a bidding war, or pay a sky-high premium.

But there’s just one problem – there’s really no catalyst for real estate to cool off. And, it’s actually not as expensive as it seems.

Is Real Estate Really That Expensive?

real house prices

The topic du jour has been inflation – everything seems to have gone up in price, real estate included.

Ultimately, this means the value of each dollar you own isn’t worth as much as it once was.

So if you’re looking at home prices through a 2020 lens, or an even earlier one, chances are you’re making them look a lot higher than they appear.

We can’t simply compare today’s home prices to those seen back in 2006, at the height of the housing bubble.

For example, a home priced at $250,000 back then is comparable to a property listed for nearly $350,000 today.

That’s a roughly 40% increase. If the home were priced for $500,000, it’d be selling for almost $700,000 now.

A $1 million home back then? How about $1.4 million now.

The other thing you need to consider is wage growth. The more a prospective home buyer makes, the more they can afford.

Sprinkle in still-low mortgage rates and things aren’t so bad for a buyer, even if inventory is slim and competition high.

Today’s Home Buyers Still Have Nearly 40% More Purchasing Power Than in 2006

Believe it or not, despite the record year-over-year gains in home values, today’s buyers are still much better off than their predecessors.

Per the latest analysis from First American, so-called “house-buying power-adjusted house prices” are still a whopping 37.5% below their 2006 housing boom peak.

Now I always point out that 2006 shouldn’t be used as a barometer, given how overpriced and unsustainable prices were back then.

But the sheer margin between now and then tells me that we’ve still got some legs in this housing boom, even with the recent home price increases baked in.

And this is despite the fact that unadjusted home prices are roughly 36% higher than they were when the housing market peaked in 2006.

Now at some point this obviously has to give, but the data might be telling us there are still a few good years left.

[Are home prices going down anytime soon?]

It Might Depend on Interest Rates

The big question mark hanging over the housing market is interest rates, which can have a big impact on purchasing power.

They’ve already risen off their record lows and most economists see them climbing further in 2022.

Instead of the 30-year fixed going for as low as 2.5%, it’s now projected to be closer to 3.5% next year.

Obviously that alone can erode purchasing power, but there is something that can offset higher mortgage rates. And that’s higher wages.

And the whole reason interest rates have been pressured higher is due to inflation, which is typically aligned with a growing economy.

What also comes with a rising economy is wage growth, something First American’s Mark Fleming points out in the analysis.

This is why home prices and mortgage rates can rise together, despite seeming to have an inverse relationship.

There’s also some question about how much rates may rise. The Fed is going to taper its purchase of mortgage-backed securities (MBS), but they seem to be hesitant to raise rates.

This uncertainty could mean a more subdued increase in mortgage rates in 2022.

At the same time, the fear of higher mortgage rates could be a great motivator for home buyers next spring!

What Happens to Real Estate with Nearly 4% Mortgage Rates?

Fleming ran a scenario where mortgage rates increase from around 2.84% to the expected end-of-year level of 3.2%.

Assuming the borrower puts down five percent, and the average household income is steady at $68,658, purchasing power falls roughly $21,500.

If 30-year fixed mortgage rates rise to around 3.7%, which is their anticipated end of 2022 level, home buying power would fall by about $49,000.

However, we need to inject wage growth into the equation as well to get an accurate picture.

If incomes continue to rise at a monthly rate of 0.2% through the end of this year, the higher wages will reduce projected end-of-year 2021 house-buying power by just $18,000.

And if this trend continues through the end of 2022, the projected end-of-year 2022 decrease in house-buying power would be only $35,000.

Remember, that assumes the 30-year fixed rises as much as expected. If it doesn’t, for all sorts of possible reasons, purchasing power may not be much different next year.

So if history follows suit, we could have a 2022 housing market that is still much cheaper than it was during the prior peak. And thus, prices will keep climbing.

Read more: When will the housing market crash again?

Source: thetruthaboutmortgage.com

Neat Loans Will Give You a $500 Discount on Your Mortgage If You Got the COVID-19 Vaccine

This appears to be a first – digital mortgage lender Neat Loans will provide applicants with a $500 discount if they’re vaccinated for COVID-19.

The Boulder, Colorado-based company believes they are the first mortgage lender, and indeed financial services company, to offer a discount for getting the COVID-19 vaccine.

At a time when cases are surging again in many parts of the country following a bit of a lull, it appears they’re putting safety first.

Of course, this move will probably come with its share of controversy as well, like all things COVID do.

As to why they’re doing this, Neat Capital CEO Luke Johnson said, “Mortgage lenders need to have important conversations with their clients about the home-buying process and their vaccine status as it relates to employment.”

Adding that responsible companies have required their employees to get vaccinated to keep workplaces safe, and without a job, it’s tough to get a home loan.

Vaccinated Customers Will Receive a $500 Lender Credit from Neat Loans

Specifically, Neat Loans will provide a $500 lender credit to borrowers if they provide proof of COVID-19 vaccination.

Borrowers may use any digital or electronic picture of a vaccine record to satisfy the requirement. So you can probably take a photo of a paper copy and upload it as well.

It doesn’t matter which vaccine manufacturer you went with, such as J&J, Pfizer, or Moderna, or the number of doses received.

This offer is available to both those purchasing a home and those who apply for a mortgage refinance.

However, the mortgage loan application must be received on or after August 13th, 2021, and the promotion can come to an end at any time.

The company will also provide the same $500 credit to unvaccinated applicants who declare they’re unable to be vaccinated due to health or religious reasons.

And if you weren’t able to get the shot due to healthcare accessibility, cost, childcare availability, or transportation costs, Neat will ensure free vaccine access so borrowers can receive this promotional credit.

But you’ll need to submit a loan application with Neat first to have those costs covered.

Lastly, not all customers need to be vaccinated in order to apply with Neat Loans, to ensure equal access among all individuals. So you can still get a mortgage from them, just without the lender credit.

Neat Loans Provides Real-Time Mortgage Underwriting

This bonus credit aside, Neat Loans says you can get pre-approved for a mortgage in just three minutes, and make cash-like offers in just 48 hours once you receive an official approval.

They’ll even back up their so-called “Platinum Certified” approval for up to $50,000 of your earnest money (5% of the purchase price) if the deal falls through due to financing.

Neat claims to provide “real-time underwriting” designed to close loans 3X faster than the industry average.

And you can even earn $100 to upload required documentation in the first 24 hours, which will all be neatly listed for your convenience.

Another perk to Neat is the fact that their mortgage rates are openly displayed on their website, without the need to sign up first to view them.

They also provide handy estimates of required income and assets you’ll need to qualify for certain loan amounts and loan programs.

Their goal is to provide a “mortgage without the mess,” and close loans quicker with more transparency.

Props to them for having the courage to reward those who are taking their own health seriously and protecting their communities in the process.

At the moment, Neat Loans is only licensed to lend in five states, including California, Colorado, Connecticut, Texas, and Washington.

(photo: Marco Verch, CC)

Source: thetruthaboutmortgage.com