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Homebuyer affordability decreased slightly in May, as new mortgages took up a larger share of a the average person’s income while rates trended higher. High inflation and rising mortgage rates won’t lessen the burden on new home buyers in the coming months.

The national median payment applied for by applicants rose to $1,897 last month from April’s $1,889, according to the Mortgage Bankers Association (MBA). The national median mortgage payment for conventional loans was $1,960, down slightly from April’s $1,967, but significantly higher than a year ago, when it was $1,394 in May 2021. Federal Housing Administration (FHA) loan payments rose to $1,430 in May from the previous month’s $1,374. 

“The ongoing affordability hit of higher home prices and fast-rising mortgage rates led to a slowdown in purchase applications in May,” said Edward Seiler, MBA’s associate vice president for housing economics and executive director at the Research Institute for Housing America, according to a statement. 

“While the median principal and interest payment only increased $8 from April, a typical borrower is paying $514 more through the first five months of 2022 – a jump of 37.1%,” he said.

The average purchase mortgage rate rose to 5.27% in early May, according to Freddie Mac PMMS, a 13-year high until it surpassed the 6% level in June. 

Citing inflationary pressures and mortgage rates above 5%, Seiler said the MBA expects sales of new and existing homes to fall below 2021 levels. The agency expects some 5.76 million existing homes to sell in 2022, well below the previous year’s sale of 6.13 million existing homes. New home sales are forecast to remain slightly more stable, with the sale of 769,000 new houses projected, down from 771,000 new houses sold last year.

The purchase applications payment index (PAPI), which measures how new monthly mortgage payments vary relative to income, rose 0.4% to 163.4 in May from 162.8 in April. An increase in MBA’s PAPI, indicative of worsening borrower affordability conditions, means the mortgage payment to income ratio is higher due to increasing application loan amounts, rising mortgage rates, or a decrease in earnings. 

Black and white households’ homebuyer affordability dropped at the steepest rate at 0.7 points. The index for Black households rose to 166.6 and climbed to 164.3 for white households in May from April.

Borrowers in Idaho are facing the greatest affordability challenges with a PAPI index coming in at 253, followed by Nevada (249.7), Arizona (233.5) and Utah (210.9). 

Meanwhile, borrower affordability conditions were best in Washington D.C. (99.7), with Alaska (102.6), Connecticut (111.2) and West Virginia (113) trailing behind.

Source: housingwire.com

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Millions of Americans would love to become homeowners—if they could only find an affordably priced home to purchase, that is.

Cue the builders. After years of focusing on the more profitable move-up, custom, and luxury homes, they are finally figuring out how to put up starter homes that first-time and other cash-strapped homebuyers can afford.

“Buyers should expect that over the next 12 to 24 months there will be a notable increase in the number of entry-level homes available,” says Ali Wolf, chief economist of Zonda, a building consultancy.

Homebuilders have begun to focus on this group in the wake of rising mortgage interest rates dramatically cooling off the housing market. Many current homeowners who don’t have to trade up into a new home at a higher monthly rate are choosing to stay put.

And that’s left much of the demand for housing coming from first-time and other buyers who aren’t finding the kinds of homes they want on the resale market.

Before the COVID-19 pandemic, about half of all new homes cost $300,000 or less, according to Zonda. However, lumber prices soared over that period and global supply chain snafus led to high prices and long delays in receiving materials, appliances, and other building components. In the first quarter of this year, just 15% of new construction was available at that price range.

To produce housing more inexpensively, builders downsized the median new-home footprint about 3% year over year, to about 2,270 square feet in the first quarter of this year, according to the National Association of Home Builders. The logic goes that smaller homes on less land typically cost less to construct than larger residences on more acreage. So builders can sell these properties at lower prices.

Townhome construction has also risen as builders can put up more residences on less land. Two years ago, townhomes made up 11.5% of all single-family construction, according to NAHB. It has since risen to 15% in the fourth quarter of 2022.

“Whenever you see an increase in interest rates and a decline in housing affordability, the market shifts a little bit toward somewhat smaller homes,” says NAHB Chief Economist Robert Dietz.

However, buyers shouldn’t get their hopes up too high.

Builders are expected to erect just 6% more entry-level homes this year compared with last, according to the May homebuilder survey from John Burns Research and Consulting.

“Builders will increase their supply of entry-level homes, but it won’t be enough,” says Dietz. This kind of home “will probably remain undersupplied. That’s frustrating news for first-time buyers.”

Why builders aren’t producing more starter homes

Fixing the housing shortage might seem simple: Builders need to put up more homes. But like most things, it’s easier said than done.

In the run-up to the Great Recession, builders erected homes at what seemed like a breakneck pace. But when the housing market went bust in the 2000s, many builders went belly up. Construction workers found other jobs, and sites sat fallow. Even as housing demand has soared over the past decade, builders have struggled to ramp back up. They have also been more cautious this time around, preferring to construct homes they are confident they can sell.

More new construction did go up during the pandemic, and many builders profited from the increase in home prices. But the challenges to putting up more affordable homes aren’t exaggerated.

The shortage of skilled construction workers has persisted, supply chain issues have caused delays and pricier building materials and appliances, and there is a lack of land in many parts of the country. Builders must also contend with zoning restrictions and community opposition to smaller homes. Many local governments also charge builders impact fees, which can total tens of thousands of dollars in some places, to pay for new roads, schools, and water and sewer lines.

Then throw in higher mortgage rates hampering demand for these abodes and a banking crisis that’s likely to make it harder for builders to get loans to erect new homes.

“There is a desire and an acknowledgment of the need for more entry-level housing, but there are also a lot of constraints that prevent that from happening,” says Wolf.

Where are starter homes going up?

While there is a need for starter homes across the country, not every community will see them rise. Builders will focus on areas where there is more land available and fewer costly regulations. They include states such as Texas and Florida in the Southeast as well as swaths of the Midwest.

Starter homes will still be built in the Northeast and West, but costly land, labor, and regulatory expenses tend to push construction prices out of reach of cost-constrained buyers.

“Where the zoning permits it, you are seeing builders trying to provide more affordable homes,” says Dietz.

How homebuilders are making starter homes more affordable

About 42% of builders plan to reduce the square footage of the homes they produce.

(JIM WATSON/AFP via Getty Images)

The trade-off that buyers will face as more affordably priced, new construction goes up for sale is that it likely won’t be as luxurious as new homes have traditionally been.

“The home probably won’t feel particularly premium at a low price point right now,” says Wolf.

More than half of builders are changing things on the exterior or in the interior of their homes to bring down costs, according to the John Burns survey. This could be vinyl countertops instead of granite and carpeting instead of hardwood floors.

About 42% of builders plan to reduce the square footage of the homes they produce, 22% will offer smaller lots, and 20% will construct more attached homes, such as townhomes and duplexes, according to the survey.

For example, the nation’s largest homebuilder, D.R. Horton, is shrinking the average square footage of its homes by 2% in the second quarter of this year to address affordability concerns, according to a company spokesperson.

“When affordability gets stretched, buyers will accept smaller square footage and less expensive finishes in order to purchase a home,” says Devyn Bachman. She is the senior vice president of research and operations at John Burns.

Another tool that builders have at their disposal is buying down mortgage rates. Many have their own financing arms, which allow them to offer buyers savings through temporary and permanent mortgage rate buydowns.

The 2-1 buydown allows buyers to shave 2 percentage points off of their mortgage in their first year of homeownership, 1 percentage point in the second, and then it reverts to whatever the rate was when the borrower took out the loan for the rest of the mortgage. That means if rates are currently 6.5%, borrowers would have a 4.5% rate in the first year, a 5.5% rate in the second, and then the rate would revert to 6.5% for the remaining 28 years of a 30-year fixed-rate loan.

“When housing demand pulls back, builders try to provide a more affordable product,” says Dietz.

Source: realtor.com

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Congratulations! Buying a home is an exciting time for every family.
The next step is packing up your current home and moving into your new one. Moving can be overwhelming but, luckily, we have a checklist to help you make your move efficient and organized.

The Ultimate Moving Checklist:

1. Disconnect all utilities: Before you move schedule for your cable, internet, electricity, etc. to be turned off. Call your provider about a month before the move to let them know the date that you want to stop the service.

2. Schedule new utilities: Let there be light! A month before your move, call all your providers to schedule to have your utilities setup.

3. Measure doorways and furniture: Take the extra precaution of measuring all your furniture and doorways in both your new and old home. Inform the movers of the measurements and make sure they have a backup plan in case some pieces can’t fit.

4. Change mailing address: Don’t let your mail get lost in the shuffle. Call your post office five weeks before the big move and let them know of your change in address.

5. Leave a change of address: It’s better to be safe than sorry. Leave a note for the new residents, informing them of your new address. If any stray mail gets through the postal system, they’ll be able to send it your way.

6. Get covered: It seems like a tedious task but it’s important. If you’re moving outside of your current neighborhood, it’s best to call your old pharmacy and transfer all your current prescriptions to a local pharmacy closer to your new home. Tell your doctors that you are moving and ask for referrals and record transfers. If you have children, make sure to register them for school in your new school district.

7. Notify accounts of your move: Whether it’s your newspaper and magazine subscriptions or your credit cards, don’t miss anything. Call all the important companies and providers in your life to give them your new address. Don’t forget to get your homeowners insurance changed to your new address!

8. Tag your furniture for placement: You get to your new home, furniture is all moved in, and it just so happens that everything is in the wrong place. Prevent that by sticking notes on larger pieces of furniture, signifying where they belong in the home.

9. Create a “just in case” kit: If the movers are late or get lost on the way, it’s best to be prepared. Fill a box with cash, a first aid kit, toilet paper, snacks, and any other daily essentials you may need to get yourself through moving day.

10. Get a new driver’s license, voter’s registration, etc.: Changing your address through the postal service and other accounts are important, but don’t forget to take care of personal documents as well. Change your address on your driver’s license, insurance policies, and voter’s registration.

Moving to a new home is the start of a new chapter. Be prepared in all aspects to ensure that you have the best moving experience ever!

Source: century21.com

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The mortgage industry has its own language, and in order to understand it, homebuyers need to learn different acronyms and jargon when shopping for a home loan. A typical home loan payment or mortgage payment involves a single payment, which is the sum of four different line items: the loan principal, interest, taxes, and insurance – also referred to as PITI. 

Before you set your sights on a home, know if you can afford the costs by learning what PITI is and how it impacts your monthly mortgage payments.

Grey craftsman home with garage and white accents

What does PITI stand for? 

PITI stands for the loan principal, interest amount, taxes, and insurance on your home – the four major elements that make up mortgage payments. 

Homebuyers often underestimate the true cost of homeownership by failing to take into account property taxes and homeowners insurance. It’s crucial that you budget for all the components of your mortgage payment before purchasing a home.

What is PITI? The four components

Now that we know what PITI stands for, let’s break down each of the four components and analyze the individual elements that make up your monthly mortgage payment.

1) Principal

The mortgage principal is the loan amount before any interest is calculated. This is the base amount of your home purchase price minus any down payment you make. 

We’ll use a hypothetical home purchase for reference; if you buy a home for $450,000 with a 20% down payment ($90,000), your mortgage principal amount will be $360,000.

Over your mortgage term, you pay substantially more than the original $360,000 to the lender in the form of loan interest. The principal is the base amount used for loan calculations to determine if they will extend a loan to you. 

2) Interest

Your mortgage interest rate is what you pay the lender as part of your monthly mortgage payment to borrow the funds to purchase your home. The mortgage lender calculates interest as a percentage of your outstanding principal. If your principal loan is for $360,000 and your lender charges you an interest rate of 6%, this means that you will pay $21,600 (6% of $360,000) in interest for the first year of your mortgage.

Your mortgage interest and principal payments are itemized on a mortgage amortization table. The amortization charts show how much each mortgage payment pays down your principal and interest. When you first start making mortgage payments, most of your monthly payment goes toward interest instead of the principal. 

This split shifts over time, and eventually, the amount you pay toward interest decreases, and more is paid toward the principal. As the principal amount of your loan decreases, you start to earn equity on your home. Equity is the portion of your home that you own outright. Your interest decreases as well, as you only pay interest on the principal amount you have not paid off.

For our example, you will pay $21,600 in interest over the first year of your $360,000 mortgage. By the time you have paid down $260,000 of that principal, your principal amount will be $100,000; at that point, you’ll pay interest of $6,000 annually (6% of $100,000).

3) Taxes

When you own your house, you pay taxes on the property to your local government to maintain roads, emergency services, police, firefighters, schools, and more. Buyers often overlook property taxes when estimating homeownership costs, but it is important to consider this recurring annual cost when you’re searching for your new home. Property taxes vary by location and are the most expensive tax homeowners pay. Taxes may be higher in a newer neighborhood or an area coveted by many homeowners. They are often less if you live just outside coveted neighborhoods and in rural areas. 

The amount of property tax you pay is determined by the local property tax rate and the value of your home. A general guideline to estimate property taxes is to allocate approximately $1 for every $1,000 of your home’s value, paid on a monthly basis.For example, if your home is worth $450,000, you can expect to pay around $450 per month in property taxes or $5,400 per year. 

As part of the home purchase process, most states require that you get an unbiased, official appraisal to estimate your taxes accurately. Your lender usually orders the home appraisal and includes the cost in their list of closing costs. After you close on your home purchase, keep in mind that your local government will regularly reassess properties every few years for tax purposes, which could lead to a change in your tax bill.

4) Insurance

The “insurance” component of PITI refers to homeowner’s insurance and, when it’s required, private mortgage insurance (PMI). Let’s discuss each of these concepts in more detail. 

Private mortgage insurance (PMI)

Your PMI rates depend on how much of a down payment you made and your credit score. If you’re putting down less than 20% on a conventional loan, you’re required to pay for private mortgage insurance (PMI), which protects the lender if you default on your mortgage payments. Once you build at least 20% equity in your home — and your loan-to-value (LTV) ratio is 80% or less — you can get rid of PMI. For FHA loans, a similar mortgage insurance premium has to be paid throughout the life of the loan on any FHA-backed mortgage loan.

If your PMI comes in at a rate of 1%, here’s how you’d calculate a mortgage of $360,000: $360,000 x 1% = $3,600 per year; $3,600 ÷ 12 monthly payments = $300 per month.

living room with fireplace

Homeowners insurance

Most mortgage lenders require a homebuyer to purchase and maintain homeowners insurance over the entire loan term. Homeowners insurance covers you and the lender if something catastrophic happens to the home, and you need to rebuild or move. Most homeowners insurance policies cover your home in the event of a break-in, fire, or storm damage. 

Most insurance companies require you to buy additional coverage for damage from earthquakes or flooding. You can also purchase insurance riders to cover items of significant value, such as an expensive musical instrument, art, or jewelry. If you buy a condominium, you’ll also pay a homeowners association fee. Your lender may consider your HOA fee your insurance as the HOA carries its own insurance that covers the building, and thus you may not need another policy. 

Property insurance amounts can vary among different insurances. It’s wise to shop around after the seller accepts your purchase contract, and before you close on the property, to get a good idea of reasonable rates. Insurance companies consider these factors when calculating an insurance premium:

  • The home’s value
  • Whether you live in an urban area or a rural area
  • Whether you live in an area with high climate risk
  • How close your home is near a fire department or fire hydrant 
  • Whether you have an insurance risk on your property, i.e., something could injure children, such as a trampoline, pool, or specific dog breed 
  • How many insurance claims you make each year for other types of insurance

When estimating your homeowner’s insurance costs, it’s helpful to keep a general rule of thumb in mind. On average, you can anticipate paying approximately $3.50 per every $1,000 of your home’s value in annual homeowner’s insurance premiums. For instance, if your property is valued at $450,000, you can expect to pay around $1,575 per year for insurance coverage, which translates to roughly $131 per month.

How to calculate PITI

Before you start your search for a house, it’s a good idea to calculate PITI to determine your price range and help you find a mortgage option that will fit your budget. The exercise will make you a more rational home buyer and keep you from falling in love with a house outside your price range. 

The simplest way to calculate PITI is by using an online monthly mortgage calculator. Redfin’s mortgage calculator includes the principal and interest, taxes, insurance, HOA, and PMI. You can also add in your location for more accurate estimates.

PITI and the 28% Rule

Your PITI gives you a rough idea of what purchase price range you can afford. One way to identify a purchase price within manageable limits is to use the housing expense ratio. To ensure your ongoing ability to make your mortgage payments, home finance experts typically recommend that your housing costs should be equal to or below 28% of your monthly household budget. If your PITI is more than 28% of your monthly budget, your lender may require you to pay for additional mortgage insurance.

In our example, you can estimate your housing expense ratio by dividing your PITI by your total monthly income. If your household income is $10,000 a month, your PITI will make up about 28% of your monthly budget, well within recommended guidelines. ($2,800/$10,000 = 28%.)

Keep in mind that PITI may just account for just some of your monthly expenses when owning a home. Depending on where you live and how you are paying for your home, there may be additional costs to consider. Additionally, the components that make up PITI are broadly defined here; there is often more complexity that goes into each part of PITI.

How PITI impacts loan approval

During the home buying process, it can be easy to trick yourself into thinking you can afford a more expensive home if you only look at your mortgage’s principal and interest cost without considering the total PITI with taxes and insurance. 

For instance, let’s take a 30-year mortgage on a $450,000 property, assuming a property tax rate of 1.25% ($5,625 per year) and an annual homeowners insurance premium of $3,600. In this scenario, your monthly financial commitment would go beyond just the principal and interest amount, as you would need to allocate an additional $581 to cover taxes and insurance. Understanding and accounting for these factors will provide you with a comprehensive understanding of the actual costs involved in homeownership.

Here is a breakdown of the example discussed above. 

Principal and Interest PITI
Interest rate 7% 7%
20% down payment $90,000 $90,000
Property taxes N/A $450
Homeowners insurance N/A $131
Private mortgage insurance N/A N/A
Monthly payment $1,800 $2,381

How DTI factors in

The principal balance will factor into your debt-to-income (DTI) ratio. Your DTI ratio gives lenders an idea of how capable you are of managing money and the likelihood that you will consistently make your monthly payments. To determine your DTI, the lender uses your total minimum monthly debt obligation and divides it by your gross monthly income to arrive at a percentage. This calculation also includes payments on credit card accounts, auto loans, student loans, and other recurring debt payments. Lenders consider you a higher risk if your DTI ratio exceeds 43%, some lenders will allow a DTI as high as 50%. 

Don’t overlook other housing costs

PITI is just one fundamental concept to understand before applying for a mortgage. As you consider how much house you can afford, you’ll also need to plan for additional costs typically associated with homeownership. These include HOA or condo fees, which can range from $100 to $1,000 per month, with an average of $200 to $300. Additionally, budgeting for repairs and maintenance is crucial, with a general guideline of saving 1% to 5% of your home’s value annually. For a newer $450,000 home, this would mean setting aside $4,500 to $22,500 per year. Utility bills for electricity, water, gas, sewer, cable, trash, and internet should also be factored in, and contacting the utility company or asking the seller or neighbors can help estimate these costs.

The bottom line on PITI

Buying a home is very exciting, but before signing your mortgage contract, know what payment amount you can afford based on PITI and other monthly costs. The more you understand the home buying and mortgage process and the total cost of homeownership, the easier it will be to finalize your purchase decision. Your home purchase represents an important milestone in your life – avoid confusion and uncertainty by gaining a solid understanding of PITI and the cost of homeownership. 

Source: redfin.com

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I asked, as I sometimes do, what personal finance question my friends and Twitter followers had for me. It was a slow day on the internet and the responses flooded in.

My friend Neil asked, “what do you think about real estate?” A broad question, indeed, and I got him to clarify. “You know… should I buy a house? Why not just rent?”

Why not indeed.

The Dream of Home Ownership
I too bit off and gulped down the dream of home ownership when just a small lass. When I graduated from college, I moved to a Southern U.S. city — Charlotte, North Carolina — and like any young professional often in the company of older, established professionals — saw immediately that they all owned houses. And that this was very good.

What they had, I wanted: the houses with the staircases and the pretty backyard decks and the grand old trees in the back and the guest bathrooms with bowls of little colored soaps. I wanted a kitchen, with wide countertops and an arching clamp-hose faucet over the deep sinks and big drawers for flour and pot lids and recycling bins. And art on the walls, and a king-sized bed, and a walk-in closet, and a master bath.

My dream was only made more intense while shopping for condos in New York City, then in Reston, Virginia, with my 20s-era boyfriend. When he went to sign his first title, I went too, and we went out to lunch afterward at a restaurant on 54th street; we spent $112 and when I ate the tiny plate of tiny after-lunch sweets (a little cheesecake, a little truffle, a little gelee), I felt I’d arrived.

Years later, after the boyfriend, I became pregnant and my now-husband and I shopped for homes. My stories of those searches are intense and full of longing and stress; but by my fourth month of pregnancy I was living in house all my own. I vowed to never move.

Tip: Compare mortgage rates from multiple lenders for new home loans and mortgage refinance loans.

Other People’s Dreams
I am — I was — the classic case for home ownership. I live in a small city and, when I bought the house, prices were reasonable; my mortgage payment is now less than many pay for renting an apartment. I love working on the yard and painting walls and I even tiled my bathroom myself (with lots of structural help from my father and husband). My husband is handy, and can run wiring and solder plumbing and he built a whole room in the basement. We’re the home ownership success story (though admittedly we have a lot more work to do, and no walk-in closet, no master bath).

But for many people, home ownership should remain the stuff of other people’s dreams.

I think my friend Neil is a good example. His ex-wife longed to buy a home in Los Angeles, where they had made a home after Neil’s upbringing in New York City. The situation was probably even more intense for her than for me in Charlotte; their friends and colleagues owned expansive ranch-style show-homes and sweet artsy bungalows, in neighborhoods where the price-per-square foot probably neared four digits at the peak of the market. The mortgage on those homes would require all of one middle-class salary.

Even for the more economic choices, prices were high and there was no clear benefit to buying over renting; in fact, most mortgages would be more than the cost to rent a nice (and low-maintenance) apartment.

Neil wasn’t good with a hammer or a chop saw, nor did his wife have any desire to keep a fine vegetable garden. There was no dad around to rip out old bathroom floors or teach Neil to solder copper pipes. Neil had no dreams of living in his home forever with his growing family; to date, he has no children and he’s now divorced; he’s not sure if he’ll stay in LA for the rest of the year, let alone the decade. For him, home ownership is someone else’s dream.

Should I Buy a Home?
For me, Neil’s question was easy. “No,” I said finally. “I don’t think you should buy a home.”

“But isn’t that the goal?” he asked me. “Isn’t that what you’re supposed to do?”

Well, maybe. But I’ve found my own definition of “getting rich slowly” is often made up of doing few things that one is “supposed” to do; for me, living a double income, office job lifestyle is one such “supposed to” I’ve discarded. For Neil, I prescribed letting go of that “supposed to” of buying a home.

How to Know When You’re Neil
Are you Neil? That is to say, should you too avoid adopting the dream of home ownership? Here are a few signs you may be Neil:

  • You are still a transient. Of course, we know I don’t mean “homeless person.” I believe many of us today graduate college (or high school, if college wasn’t the path for you) as transients, expecting to live in one place for a few years before trying out another, and another, and another, until one feels like home (or until you fall in love with someone who’s rooted to a place, giving you a graft and rooting you, too). If you’re not sure yet if this place is going to be your home for more than the next few years, home ownership is not for you. With closing costs and the uncertainties of the real estate market, it’s very difficult to come out of a two-year home ownership transaction without losing money as compared to renting.
  • You have no desire to engage in home and garden upkeep. While some such people might hire gardeners and contractors to fill in the holes in their handy skills and passions, most of those who don’t care to pick weeds or fix fences or mow lawns or plant apple trees are better off with an apartment. Purchasing a condo might be an option, if you don’t say “yes” to any of the other items in the “are you Neil” list.
  • The market in your favorite neighborhood doesn’t make sense. If the cost of a monthly payment on a mortgage would be greatly higher than the price of a two-bedroom apartment or other rental suitable for your family’s needs — say, more than 25 or 30% higher — it’s probably not a good time to buy. While indeed mortgage interest deductions and home buyer credits and the time value of money might be squished around to make the comparative cost similar, do remember that life is uncertain and markets fluctuate and maybe you should wait a bit — or look around for a more sensible neighborhood — before buying something.
  • You’re not sure about your career or your job. Maybe you’re considering going back to school to become a sommelier. Maybe you’re pretty sure your boss wants to retire and sell the company. Maybe you just don’t love your job and you’re looking around for something new. If you’re not fairly confident your next few years won’t include a significant change in income, it’s probably not a good time to engage with the home ownership dream.
  • Your relationship with your partner is rocky. I’ve been watching several of my friends deal with the tough decision over what to do with the family home when a relationship is over. In one case that worked out for the best — the family made a nice profit from the sale. But that was a rarity. If you’re married, you might end up having to sell and take a significant loss, even if you’d rather stay in the house solo; if you’re not married, things could be even more wonky. One woman I know lost her grandmother’s home after a pre-marriage breakup (with someone who obviously turned out to be enough of a jerk to keep her grandmother’s home, though that analysis is one-sided and second-hand, so take it with salt). Be honest with yourself, and know that, much like puppies and babies, houses do not fix broken relationships.
  • You would have to cash in retirement or emergency savings to buy the house. A home buying fund should be separate from those savings for emergencies and retirement. You’ll have more emergencies, in all likelihood, with a home than without. And you know how we feel about retirement savings. If your dream is that intense, then you can use your intensity to fuel your frugality while you save up for the down payment.

It also makes sense to run the numbers through a rent vs. buy calculator to see if the results would influence your decision one way or another. Have you struggled with the decision to rent or buy? Where did you come out on the Neil/not Neil spectrum?

Source: getrichslowly.org

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<img data-lazy-fallback="1" data-attachment-id="263090" data-permalink="https://www.housingwire.com/articles/more-proof-that-rent-is-getting-cheaper-across-the-u-s/the-concept-of-falling-real-estate-market-reduced-interest-in-the-mortgage-a-decline-in-property-prices-and-apartments-low-interest-rates-on-mortgage-loans-reduced-demand-for-home-purchase/" data-orig-file="https://www.housingwire.com/wp-content/uploads/2020/07/rent-falling.jpeg" data-orig-size="1200,675" data-comments-opened="1" data-image-meta=""aperture":"0","credit":"u0410u043du0434u0440u0435u0439 u042fu043bu0430u043du0441u043au0438u0439 – stock.adobe.com","camera":"","caption":"The concept of falling real estate market. Reduced interest in the mortgage. A decline in property prices and apartments. Low interest rates on mortgage loans. Reduced demand for home purchase.","created_timestamp":"1548806718","copyright":"u00a9u0410u043du0434u0440u0435u0439 u042fu043bu0430u043du0441u043au0438u0439 – stock.adobe.com","focal_length":"0","iso":"0","shutter_speed":"0","title":"The concept of falling real estate market. Reduced interest in the mortgage. A decline in property prices and apartments. Low interest rates on mortgage loans. Reduced demand for home purchase.","orientation":"0"" data-image-title="The concept of falling real estate market. Reduced interest in the mortgage. A decline in property prices and apartments. Low interest rates on mortgage loans. Reduced demand for home purchase." data-image-description data-image-caption="

The real estate market is cooling down, observers say.

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The real estate market is cooling down

Reports released this week by several respected market observers point to less good and increased bad and ugly ahead for the housing market.

For some of the good, a U.S. Census Bureau report released late last week spurred a bout of optimism when it revealed that new-home sales jumped by nearly 11% month-over-month in May on a seasonally adjusted basis, after declining by 12% in April. 

Moody’s Investors Service, in a housing-market report released this week, puts some ugly back into the home-sales figures for May, however.

“At 696,000 units, May new home sales were around 17% below the recent peak of 839,000 units in December last year,” the Moody’s report notes. “[On June 21], the National Association of Realtors said that existing-home sales declined for the fourth consecutive month. 

“Existing-home sales fell in May by 3.4% on a seasonally adjusted basis to 5.41 million, the lowest since June of 2020 and similar to pre-pandemic levels.”

Those figures, along with “sharp recent increases in mortgage rates” and other supporting data, lead Moody’s to conclude that the “U.S. home-price boom is over.” The firm, which rates securitization offerings and provides other capital-market services, predicts “material declines” in both new- and existing-home transactions this year, compared with 2021.

Supporting the ugly outlook for the housing market is the release today, June 29, of the quarterly CFO Survey, conducted jointly by Duke University’s Fuqua School of Business and the Federal Reserve Banks of Richmond and Atlanta. The survey of more than 300 U.S. financial executives conducted between May 25 and June 10, shows optimism about the broader U.S. economy continuing to decline.

The average index score for the current survey was 50.7, compared with 54.8 in the prior quarter and 60.3 two quarters ago.

“Price pressures have increased, real revenue growth has stalled and optimism about the overall economy has fallen sharply,” said John Graham, a Fuqua finance professor and the survey’s academic director. “Monetary tightening [by the Federal Reserve] is one of several factors dampening the economic outlook.” 

The CFO Survey’s findings are echoed by a revised first-quarter 2022 gross domestic product (GDP) estimate released Wednesday by the U.S. Department of Commerce’s Bureau of Economic Analysis (BEA). It shows that a drastic economic slowdown is already underway.

“Real gross domestic product [a measure of all goods and services produced in the economy] decreased at an annual rate of 1.6 percent in the first quarter of 2022 …,” the BEA report states. “In the fourth quarter of 2021, real GDP increased 6.9 percent.”

The BEA’s first-quarter GDP estimate, it’s third to date, was revised downward from -1.4% and -1.5% in the two prior estimates. The grim data led Mortgage Capital Trading (MCT), a San Diego-based capital market software and services firm, to broach the “R“ word in its daily market-overview report.

“Concern over a slowing economy and aggressive interest rate hikes from the Fed are beginning to dominate market sentiment,” the MCT report states. “This morning’s GDP release [on June 29] came with a downward revision for the last reading, further supporting views that a recession is either in progress or coming soon.”

What does all this mean for the housing market in the months ahead? The Moody’s report attempts to frame some of the expectations.

“We expect some increases in existing-house prices over the next 18 months, though for appreciation to be well below the general rate of inflation,” the Moody’s report states. “After that, we expect home appreciation to settle in at levels somewhat lower than the rate of overall U.S. inflation.”

The report even indicates that there “is risk that existing home prices will have a minor correction over the next two years, similar to housing markets in many other developed counties facing risks after recent booms.” 

The “moderation” in the U.S. housing market is ongoing and the full effects of recent rate increases have yet to be fully realized, the Moody’s report adds, especially with respect to housing prices.

Moody’s predicts that housing demand will “dampen significantly” in the months ahead due to the doubling of rates for 30-year fixed mortgages since the start of the year, which is fueling a huge jump in monthly mortgage costs. Freddie Mac’s most recent Primary Mortgage Market Survey shows the average 30-year fixed rate mortgage at 5.81% as of June 23. 

“The monthly costs of new mortgages on existing homes sold at median transaction prices [are] more than 60% higher than a year ago,” the Moody’s report states. “Although higher mortgage rates do not always drive home prices lower, they typically affect sales activity and drive down the rate of price appreciation. 

“We also expect higher rates to restrict for-sale supply because current homeowners will be reluctant to lose low-rate fixed borrowing costs.”

So, in effect, moderating or even declining home prices could be neutralized by rising borrowing costs, leading the housing market toward stagnation — the doldrums — in the worst-case scenario.

There is some good news mixed in with all this bad and ugly, however. Moody’s points out that some “fundamental housing strengths” will likely help to mitigate the degree of any market correction, at least over the next 12 to 18 months.

Those strengths include “favorable demographic trends, solid underwriting of outstanding mortgages and lingering housing supply constraints from a period of underbuilding,” according to the Moody’s report. Also on the bright side, according to Moody’s, is that a moderate decline in housing prices could be good for the market longer-term. That’s assuming the Federal Reserve wins the fight to tame inflation, now running at 8.6%,  without causing a major spike in unemployment, which was at 3.6% in May for the third month in a row, according to the Bureau of Labor Statistics.

In short, the housing market has reached a fork in the road, based on the Moody’s analysis — with one path leading to the doldrums, or even decline, and the other toward resurgence and a new normal.

“If U.S. home prices were to decline modestly, it would increase affordability for potential homebuyers and improve demand, including for individuals who were priced out of the market in the recent months because of rapidly rising interest rates,” Moody’s reasons in its report. “However, sustained large increases in mortgage rates or a material weakening in the labor market could lead to sharper declines in housing activity and prices.”

Source: housingwire.com

Apache is functioning normally

Purchase mortgage rates this week dropped 11 basis points to 5.70%, according to the latest Freddie Mac PMMS Index, ending a two-week climb following the Federal Reserve’s rate hike earlier this month.

A year ago at this time, 30-year fixed rate purchase rates were at 2.98%. The PMMS, a government-sponsored enterprise index, accounts solely for purchase mortgages reported by lenders during the past three days.

“The rapid rise in mortgage rates has finally paused, largely due to the countervailing forces of high inflation and the increasing possibility of an economic recession,” said Sam Khater, chief economist at Freddie Mac.

Another index showed the 30-year conforming rates also slid from last week.

Black Knight’s Optimal Blue OBMMI pricing engine, which includes some refinancing data — but excludes cash-out refis to avoid skewing averages – measured the 30-year conforming rate at 5.89% Wednesday, down slightly from last week’s 5.9%. The 30-year fixed-rate jumbo was at 5.42% Wednesday, up from 5.33% from the previous week, according to the Black Knight index.

Khater expects the dip in mortgage rates will also slow down home price growth.  

What lenders should know about today’s economic climate

Between continuing rate hikes from the Federal Reserve, the ongoing war in Ukraine and continued economic recovery following the pandemic, mortgage lenders across the country are managing a volatile housing market. Learn how updating your mortgage technology stack can help you get ahead in today’s unpredictable lending environment.

Presented by: Polly

“This pause in rate activity should help the housing market rebalance from the bottleneck growth of a seller’s market to a more normal pace of home appreciation,” Khater said. 

Mortgage application volume rose 0.7% last week led by refinancing applications and a slight uptick in conventional loans, according to the Mortgage Bankers Association. After increasing 65 basis points during the past three weeks, the 30-year fixed rate declined 14 basis points last week, the MBA said. 

Refi application rose 1.9% from the previous week and purchase application marginally increased 0.1% from a week earlier.

Mortgage rates tend to move in concert with the 10-year U.S. Treasury yield, which reached 3.10% Wednesday, down from 3.16% a week before. The federal funds rate doesn’t directly dictate mortgage rates, but it does steer market activity to create higher rates and reduce demand.

Following the Federal Reserve’s interest rate hike of 75 basis points on June 15, mortgage rates have been showing an upward trend for the past two weeks.

According to Freddie Mac, the 15-year fixed-rate purchase mortgage averaged 4.83% with an average of 0.9 point, down from last week’s 4.92%. The 15-year fixed-rate mortgage averaged 2.26% a year ago. 

The 5-year ARM averaged 4.50% up from 4.41% the previous week. The product averaged 2.54% a year ago. 

Economists expect the tightening monetary policy will reduce originations in 2022 and 2023. The MBA expects loan origination volume to drop about 40% to about $2.4 trillion this year, from last year’s $4 trillion. Meanwhile, the MBA expects 6.53 million existing and new home sales in 2022, compared to 6.9 million in 2021. 

Source: housingwire.com

Apache is functioning normally

The mortgage space is unique from a lot of other businesses in that the customer isn’t always right.

And special offers are typically few and far between. This is mostly because of the complexities involved with closing a home loan.

For example, it’s pretty easy to find a promo code when booking a hotel, or snag a sign-up bonus for opening a credit card.

But when it comes to a home loan, you typically aren’t offered much other than perhaps speedy service, or a money-back guarantee if things go wrong and it’s entirely their fault.

Price-matching is also pretty hard to come by, though Chase has just launched such a deal.

Get $200 If Chase Can’t Match or Do Better

In honor of National Homeownership Month, Chase has rolled out some new offerings in their home loan department.

This includes homebuyer education resources, a Closing Guarantee, and as mentioned, a price-matching pilot program.

The way it works is fairly straightforward – Chase will give home buyers $200 if they can’t match or beat a competing loan offer.

To be eligible, you need to complete an initial purchase loan application with Chase by September 30th, 2023.

And you must provide an official Loan Estimate (LE) from another licensed lender that includes the same loan term, purpose, product, and loan type.

Assuming Chase can’t match or beat it, they’ll provide you with $200 within 30 days of withdrawal of the Chase application.

At the moment, this is only available to customers purchasing properties in the states of Arizona and Ohio.

And the following counties in Texas: Austin, Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery, and Waller.

It’s also only valid for customers who hold an active Chase personal deposit account opened on or before May 1st, 2023.

Your loan scenario has to be pretty vanilla, meaning no investment properties, 2-4 unit properties, second homes, home equity loans or second mortgages.

Chase $5,000 Closing Guarantee and Lock and Shop

Aside from the new price match offer, Chase has a Closing Guarantee that provides $5,000 if they’re unable to close a home purchase loan on time.

As always, you need to hold up your end of the bargain by getting income/asset documents and signed disclosures to Chase in a timely fashion.

And the contract closing date must be at least 21 calendar days after receipt of a completed home loan application for conventional loans (30+ for FHA/VA).

Of course, delays caused by third parties or due to force majeure events won’t result in compensation.

This is kind of one of those things where if you’re using Chase anyway, keep an eye on it as you might be compensated if they don’t close on time.

Additionally, Chase launched a new “Lock and Shop” option that lets you lock in your mortgage rate for 90 days before finding a home to buy.

That way you have assurances that your mortgage payment won’t go up if mortgage rates unexpectedly rise during the home search.

And there is no upfront fee for this option when using Chase Homebuyer Advantage, which is their conditional letter of approval you can obtain upfront.

You get 60 days to find a property to purchase, and a one-time float down option will be available if mortgage rates improve during that time.

This can be combined with the Closing Guarantee as well.

Chase Offering Grants of $2,500 and $5,000 in Select Areas Nationwide

Lastly, you can search for down payment assistance and other grants via Chase’s Homebuyer assistance finder.

Simply enter an address and it will show you matched programs that might be available.

In select areas, the Chase Homebuyer Grant provides $2,500 or $5,000 toward a new home purchase.

The company notes that a $5,000 grant is available to eligible home buyers purchasing a property in majority-Black and Hispanic neighborhoods throughout the United States.

Chase was the fourth largest mortgage lender in the U.S. in 2022, per HMDA data. They funded about $99 billion in home loans last year.

Only three lenders originated more mortgages, including United Wholesale Mortgage (UWM), Rocket Mortgage, and Wells Fargo.

As always, be sure to look at the big picture when comparing mortgage offers. This includes the interest rate, lender fees, and the company’s overall competency and service.

Source: thetruthaboutmortgage.com

Apache is functioning normally

Nestled on the picturesque Gulf Coast of Florida, Naples has long been regarded as a captivating destination renowned for its pristine beaches, vibrant cultural scene, and luxurious lifestyle. As you contemplate the idea of moving to Naples, it is crucial to weigh the pros and cons of living in this sun-drenched city. From its flourishing economy and abundant recreational opportunities to its high cost of living and occasional natural hazards, there is a lot to consider. In this Redfin article, we will delve into the 10 most significant pros and cons of living in Naples. So whether you’re looking at apartments for rent in Naples, FL, browsing homes for sale, or you’re just curious about the area – keep reading to learn if Naples is right for you.

Gulf Shore Living in Naples, FL

1. Breathtaking beaches

Naples, the gem of Florida’s Paradise Coast, offers a beach lover’s paradise with miles of pristine, soft, white sands lapped by turquoise waters. Not only are these beaches stunning, but they are also well-maintained and offer a serene place to relax, sunbathe, or engage in water sports. Naples’ shoreline delivers a visual feast and the quintessential coastal Florida lifestyle, from the picturesque Barefoot Beach Preserve to Lowdermilk Beach Park.

2.  Vibrant arts and culture scene

For the culturally inclined, Naples won’t disappoint. The city brims with a rich and lively arts scene that echoes in its many galleries, performance venues, and arts festivals. Institutions such as the Naples Philharmonic and the Baker Museum host a variety of world-class performances and exhibitions. Art shows, craft fairs, and cultural festivals are staples in the local calendar, offering regular opportunities for residents to immerse themselves in a diverse tapestry of artistic expression.

Family Day at the Beach

3. A unique resort lifestyle

Living in Naples feels like an endless vacation with dozens of unique things to do, courtesy of its resort-like ambiance. From high-end shopping districts and gourmet dining venues to luxury spas, the city rolls out a sophisticated lifestyle that mirrors the world’s most popular resort destinations. The array of well-manicured golf courses, lavish residential communities, and top-notch services create a distinct sense of living in a luxurious retreat, offering residents the perks of a holiday year-round.

4. Endless outdoor adventures

Naples is an outdoor enthusiast’s dream, with a smorgasbord of activities. The city’s adjacency to the Everglades presents fantastic kayaking, hiking, bird watching, and wildlife spotting opportunities. Fishing and boating enthusiasts will love the accessibility to the Gulf of Mexico’s bountiful waters. Whether it’s a serene bike ride along the city’s picturesque paths or an exhilarating jet ski adventure, Naples caters to all shades of outdoor passions.

Bird of Paradise Flower

5. Golf capital of the world

For golf lovers, Naples is nothing short of paradise. Fondly known as the “Golf Capital of the World,” the city offers a stunning array of meticulously designed courses that cater to beginners and experts alike. With over 90 golf courses and glorious golfing weather that lasts almost all year, the city delivers an unmatched golfing experience–a compelling reason to consider Naples your new home.

Cons

1. High housing costs 

One significant downside of living in Naples, Florida is the high cost of housing. The allure of the city’s stunning natural beauty and upscale amenities comes at a price, and that price often translates into steep housing costs. When it comes to Naples, Florida real estate, you’ll find that housing prices are considerably higher compared to other cities in Florida. As of April 2023, the median sales price in Naples reached $725,000 In comparison, the median sale price in Orlando stood at a more affordable $360,000, while in Tampa, it amounted to $420,000.

The demand for housing in this desirable location, coupled with limited available land for development, has resulted in a tight housing market and elevated prices. Additionally, the cost of living, in general, tends to be higher in Naples, which can further strain budgets and impact overall affordability.

Condominiums Along The Florida Coast

2. Crowds of tourists

Being a popular tourist destination, Naples can get quite crowded, especially during the winter when ‘snowbirds’ from colder states flock to enjoy the balmy Florida weather. The influx of tourists can lead to overcrowded beaches, long wait times at restaurants, and a general increase in the hustle and bustle around the city, potentially hampering the tranquil lifestyle some residents seek.

3. Danger of hurricanes

Naples’ tropical paradise charm is somewhat tarnished by its vulnerability to hurricanes. Like much of Florida, the city faces an annual threat of these severe storms. This year alone, on average, floods have caused $1,399 in property damage for homeowners. While modern infrastructure and advanced warning systems mitigate the risks, residents must be prepared for potential evacuations, property damage, and the stress associated with hurricane season.

Beautiful Patio Furniture at Estate Home Overlooking Bay

4. Low walkability

Despite its many charms, Naples falls short of walkability. The city has a below-average Walk Score of 35, indicating a strong dependence on cars. This can be a downside for those who prefer a lifestyle where amenities are within walking distance. 

5. Scorching summer heat

Summers in Naples can be intensely hot and humid. The city’s tropical monsoon climate means that summer temperatures frequently rise into the 90s (Fahrenheit), with high humidity levels adding to the discomfort. Those not used to such weather might find the summer months challenging and need to consider this aspect before moving.

Is Naples, Florida a good place to live? The bottom line

With its breathtaking natural beauty, lively cultural scene, and endless opportunities for outdoor adventure, Naples certainly has its merits. However, there are downsides to be mindful of. The high cost of housing can pose a challenge for those on a budget, and the risk of hurricanes and occasional tourist crowds can be drawbacks. Ultimately, the decision to make Naples your home depends on your priorities, financial situation, and tolerance for the mentioned considerations. By carefully evaluating these factors, you can determine if Naples is the right fit for your desired lifestyle and aspirations.

Source: redfin.com

Apache is functioning normally

Everyone likes a discount, right, even if it’s on a small one-time purchase that equates to a nominal amount. For one reason or another, it just feels like a win.

It’s obviously even sweeter if you get a discount on a big-ticket item, as the savings will be much larger.

Better yet, how about a discount on something that you could be paying off for the next 360 months, like your home loan? Now we’re talking!

I did some research and came up with a list of mortgage lenders with the “best mortgage rates” to consider if you’re in the market to finance a new home purchase or refinance an existing mortgage.

There are literally thousands of mortgage lenders out there, so it’s easy to miss some along the way if comparison shopping.

Here are 10 that might offer a discount relative to other banks and lenders out there, not only because they seem to offer low mortgage rates, but also limited or no lender fees.

The one caveat here is no one mortgage lender can be the cheapest all of the time, for all borrowers.

So be sure to always take the time to shop around and get multiple quotes, even if it takes some additional legwork. Sure, it’s not fun but nor is spending more money.

Also, if you want the best mortgage rate, you’ve got to be a good borrower.

That means coming to the table with an excellent credit score, a decent down payment, and checking all the other boxes that affect mortgage rates.

You can’t expect the lender to do all the heavy lifting.

Better Mortgage

Aside from being a tech-savvy lender with a digital mortgage platform, Better Mortgage also prides themselves on not charging a loan origination fee. Or any lender fees or commissions for that matter.

Often, this fee can be 1% of the loan amount, so if you take out a $300,000, that’s $3,000 right there. Then there might also be additional fees for processing, underwriting, and so on.

They also openly advertise their daily mortgage rates right on their website, so they’re pretty transparent about their pricing as well.

In summary, you could get a discount and breeze through the home loan process thanks to their technology – they can fund 100%-digital loans without even a single phone call.

They’ve got a 4.6-star rating out of 5 on LendingTree with a 91% recommendation rating.

CIT Bank / OneWest Bank

If you choose to work with CIT Bank or OneWest Bank to get your home loan, they provide a number of discounts on top of their already low mortgage rates.

This includes a $525 cash back bonus if you have or open a CIT Bank or OneWest Bank deposit account before closing on your mortgage with them.

Additionally, they offer mortgage rate discounts if you make new deposits, including 0.10% off your rate with 10% of loan amount in new deposits, and 0.25% off if you can muster 25% of the loan amount in new deposits.

At last glance, they had a 4.5/5 on Zillow based solely on their home loans business, so they come highly rated as well.

Costco Mortgage

Folks looking for a deal often head to Costco, and you can actually shop your mortgage with the big-box retailer as well.

While not a direct mortgage lender, they have partnered with a variety of vetted lenders that have agreed to cap their lender fees.

For example, Gold star members pay lender fees of $650 or less, while Executive members only pay lender fees of $350 or less.

If the mortgage rates from their partner lenders are competitive, you might wind up with a low rate and limited fees, which is an excellent combination.

The Mortgage Program for Costco Members has a 4.8-star rating out of 5 based on Trustpilot, and the individual lenders involved have similarly-high ratings from past customers.

Intelliloan

I added Intelliloan to this list because they won’t stop talking about their mortgage rates. In fact, the first thing you’ll see if you visit their website is mortgage rates.

Their latest refinance rates match their APRs, which means they’re advertising their interest rates without any lender fees or discount points.

The company also offers a Rate Protection Promise where they’ll refinance you without lender fees if interest rates fall significantly within three years of your initial loan closing.

They’ve got excellent reviews across all the major ratings websites, including a 4.9-star rating out of 5 on LendingTree, with a 98% recommend score.

LoanFlight Lending

The holy grail for homeowners is a low mortgage rate with limited or no fees.

After all, a low rate that requires you to pay multiple discount points might not truly be low, but one that only requires a $1 in fees is usually as good as it looks.

LoanFlight Lending tends to advertise on Zillow a lot, and often features some of the lowest fixed rates listed, along with just $1 in lender fees.

That’s a tough combination to beat if you’re looking to save on your mortgage. They also have very good customer reviews to boot, with a 4.76-star rating on Zillow and a 4.7 on LendingTree with a 91% recommend rate.

The only downside appears to be the fact that they’re licensed in just 12 states.

Lower Mortgage

As I’ve said before, with a name like Lower Mortgage, you kind of have to offer low mortgage rates. Oh, and low lender fees too.

They say they do both, and the cherry on top is a Free Refi for Life deal, whereby you won’t be charged any lender fees on a future refinance with the company.

So if 30-year fixed rates do go down and they happen to be offering low rates relative to the other guys, you can get that new low rate sans fees.

The company also has great reviews, including a 4.9-star rating out of 5 based on LendingTree with a 99% recommendation rate.

Reali Loans

Formerly known as Lenda, Reali Loans, Inc. is the home of “no-nonsense home loans.” What that means is you won’t be charged traditional loan commissions or any lender fees.

In the past, I found that their interest rates were quite low when I played with the little rate slider on their website.

Like other fintech newcomers in the mortgage space, they lean heavily on technology to make the loan process less cumbersome and faster overall. That tech also allows them to offer more competitive rates to borrowers.

Reali Loans currently has a 4.57-star rating on Zillow and similarly excellent reviews on Trustpilot.

Redfin Mortgage

If you’re buying a home in certain states, one perhaps unexpected mortgage lender to consider is Redfin Mortgage.

Yes, the real estate brokerage also launched a home lending division and seems to have really competitive mortgage rates.

Additionally, they don’t charge lender fees, so the mortgage APR should be just as low as the mortgage rate.

The only downside is they don’t offer refinance loans, at least not at the moment. But that could change in the future.

On top of the low rates and lack of fees, they offer a $1,000 mortgage closing guarantee that promises to get you to the finish line in either 25 or 30 days (depending on the type of pre-approval) or you’ll receive a check.

Sebonic Financial

This so-called digital startup, which is actually the fintech arm of Cardinal Financial, a top-40 mortgage company nationally, often advertises mortgage rates with just $1 in lender fees.

In other words, you’re typically getting a no cost loan from Sebonic Financial, at least with regard to lender fees.

And they seem to still offer highly competitive refinance rates relative to other lenders, which often charge the usual fees that can amount to thousands of dollars due at closing.

They are also a highly-rated mortgage lender, with a 4.49-star rating out of 5 based on more than 3,000 customer reviews on Zillow.

Wyndham Capital Mortgage

Lastly, we’ve got Wyndham Capital Mortgage, which promises no hidden lender fees and competitive, below market mortgage interest rates

Aside from no hidden fees, they also don’t charge a loan origination fee. So if their mortgage and refinance rates are also low, that’s a pretty solid deal.

On top of that, they say they can offer discounts on costly things like title insurance because of their relationships with preferred settlement agents.

In terms of customer satisfaction, they’ve got a 4.8-star rating out of 5 on LendingTree from nearly 7,000 reviews, and 99% of customers would recommend them.

There are many more lenders out there, and you should certainly search locally as well as online to explore all of your options, including credit unions, local mortgage brokers, and more.

Remember, your monthly mortgage payment will stay with you for a long time, so putting in a few extra hours at the start can really pay dividends over the years.

Source: thetruthaboutmortgage.com