Freddie Mac’s New 3% Down Payment

Posted: 23 Mar 2015 KCM Crew

Freddie Mac's New 3% Down Program | Keeping Current Matters

Today, Freddie Mac is scheduled to start buying mortgages with down payments of only three percent – the first time down payments have been this low on Freddie Mac loans in nearly five years. The program is called Freddie Mac Home Possible AdvantageSM. In a recent Executive Perspectives, Dave Lowman EVP, Single-Family Business Freddie Mac, explained the potential impact this program will have on the housing market:

“There’s a new reason Realtors and lenders may expect more qualified borrowers at the closing table during this spring’s home buying season. In addition to low mortgage rates and rising job growth, the down payment hurdle is starting to shrink for creditworthy borrowers, including first-time homebuyers.”

And the mortgage industry agrees with Mr. Lowman. In a recent survey of mortgage originators by the National Association of Realtors (NAR), it was revealed that most loan officers believe the move to a lower down payment will increase access to mortgage credit. Here are that survey’s findings:Down Payment Survey | Keeping Current Matters

Bottom Line

Many potential buyers are “ready and willing” to buy a home but have been afraid they may not be “able” because of a lack of adequate savings for a down payment. Check with a local real estate or mortgage professional to understand what the new rules may mean to you.

Posted in Financing, Home Buying, Home Selling, Homeownership, Market Conditions, Mortgage | Tagged , , , , , | Leave a comment

Home Prices Over 30 Years

Posted: 20 Mar 2015 KCM Crew

Home Prices over 30 Years [INFOGRAPHIC] | Keeping Current Matters
Posted in Financing, Home Buying, Home Selling, Homeownership, Market Conditions | Tagged , , , , | Leave a comment

Billionaire Says Real Estate is Best Investment Possible

Posted: 19 Mar 2015 KCM Crew

Billionaire Says Real Estate is Best Investment Possible | Keeping Current Matters

Billionaire money manager John Paulson was interviewed at the Delivering Alpha Conference presented by CNBC and Institutional Investor. During his session he boldly stated:

“I still think, from an individual perspective, the best deal investment you can make is to buy a primary residence that you’re the owner-occupier of.”

Who is John Paulson?

Paulson is the person who, back in 2005 & 2006, made a fortune betting that the subprime mortgage mess would cause the real estate market to collapse. He understands how the housing market works and knows when to buy and when to sell. What do others think of Paulson? According to Forbes, John Paulson is:

“A multibillionaire hedge fund operator and the investment genius.”

According to the Wall Street Journal, Paulson is:

“A hedge fund tycoon who made his name, and a fortune, betting against subprime mortgages when no one else even knew what they were.”

Why does he believe homeownership is such a great investment?

Paulson breaks down the math of homeownership as an investment:

“Today financing costs are extraordinarily low.”

The latest numbers from Freddie Mac show us that you can still get a 30-year mortgage for under 4%.

“And if you put down, let’s say, 10 percent and the house is up 5 percent,”as many experts predict, “then you would be up 50 percent on your investment.”

How many are seeing a 50% return on a cash investment right now? Paulson goes on to compare the long term financial benefits of owning verses renting:

“And you’ve locked in the cost over the next 30 years. And today the cost of owning is somewhat less than the cost of renting. And if you rent, the rent goes up every year. But if you buy a 30-year mortgage, the cost is fixed.”

Bottom Line

Whenever a billionaire gives investment advice, people usually clamor to hear it. This billionaire gave simple advice – if you don’t yet live in your own home, go buy one.

Posted in Financing, Home Buying, Home Selling, Homeownership | Tagged , , , , | Leave a comment

Get Ready for the Spring Market

by MARK STILES on MARCH 16, 2015 ·

Plowing With StyleIt is often the case that with the melting snow and mild temperatures the spring real estate market sees substantial increases in inventory. After a year of extraordinary snow and very low inventory, this year’s spring market is poised to heat up quickly. An influx of listings should spur a “Seller’s Market.” While every market is different, for those interested in our thoughts from last year’s spring market should read: Five Tips to Thrive in a Thawing Real Estate Market. In light of changing market conditions, we’ve decided to compile some of our thoughts on the emotional and tactical considerations in this year’s market. It’s easy to forget in the rush that selling and buying a home is an emotional process. Sellers are contemplating moving from their home which is a very personal space. Buyers are looking for a place to call home and spending considerable sums of money. It is important for Sellers, and Buyers for that matter, to maintain composure. This week, we will explore some of the tips, tactical and emotional, to help Sellers sell their homes for top dollar.

Consider Hiring a Professional Stager to Put your House “Over the Top”: Some Sellers have found great success by hiring a professional “stager” to add some furnishings to entice Buyers into making an offer. By making your house look inviting and stylish, you will make it easier for a Buyer to picture him or herself living in the house. Some Buyers may be so enchanted that they make an offer which calls for all furniture to be sold with the house. This is proof positive that the staging worked–and don’t worry, the Stager will be happy to sell the furniture to the Buyer. If hiring a professional would not be cost effective, consider obtaining the same effect through sweat equity. Spend ten minutes looking at listings on the MLS. The house that has fresh paint, a manicured lawn, shampooed carpets, and all clutter removed will look indescribably more appealing than a house that does not. Don’t let a little elbow grease stand between you and a top dollar offer. If your budget allows, consider professional photography as another way to make your listing stand out among the rest.

Leverage (Know thy Enemy): When I sat down to write this article, I didn’t think I’d be quoting Sun Tzu, but the point is too good to miss. Understanding the Buyer’s situation can make the difference between a good and great deal. Has your Buyer already sold and is therefore desperate to find a house, even if they overpay slightly? Does the Buyer have a subjective attachment, i.e., do they love your house and can’t stand the thought of not living there? Calling your Buyer “thy Enemy” may overstate the adversarial nature of this exchange. Treat your Buyer with respect–buying a house is emotional for the Buyer, involves a substantial amount of money and can be very stressful. A relaxed, happy Buyer may be more willing to make an offer, and will generally result in an easier sale process for you, the Seller.

Preemptive Home Inspection: Just like people, houses are not perfect. You know the Buyer will be conducting a home inspection. By hiring your own inspector, you have the chance to address serious repair concerns before any Buyers begin their inspection. A Buyer’s inspector, and by extension the Buyer, will be impressed by the proper repair of important systems. Minimizing surprises helps to keep your sales price from sliding. While your Real Estate agent is a wonderful adviser with regard to many issues, he or she is likely not a contractor or home inspector. Until you have a professional give you an honest assessment, your sale price is, to some extent, something of a guess.

You have more “Stuff” than you Think: As a Seller, one of your most important contractual obligations is delivering the house with your personal property removed. Before agreeing to a three week closing, consider whether it’s realistic to move the contents of your entire house in such a short time. Even with enough time, some Sellers wait until the last hours to remove their possessions. If your possessions aren’t removed by closing, the Buyer could walk away from the transaction. Further, the Buyer’s rate lock may expire. When this happens, the Seller usually pays the expense of an extension–often over $1,000. Take my advice: start packing now!

Perform all Obligations in a Timely Manner: Consider this scenario: the Seller receives an offer at top dollar, but the Seller must replace all outlets in the house. In the Seller’s excitement, she grabs the closest pen, signs, and faxes the Offer back to the Buyer’s agent. As the closing approaches, the Seller realizes that replacing all outlets in the house is quite a chore. Rather than hiring an electrician to finish the work, she thinks: “I won’t do the work; what’s the worst that could happen?” Nothing causes more drama and consternation than unfulfilled contractual obligations. The Buyer can (and sometimes does) walk away from the transaction. The closing may be delayed. Often, the Seller is forced to pay the Buyer for the cost of the work, usually with some built in premium to account for the uncertainty of the true cost. It’s almost always advisable to perform the work in a timely manner. This doesn’t just apply to repair items. The Seller that leaves dirty dishes in the sink, leaves an uncooked turkey in the oven, removes the bathroom mirror, or leaves trash piled in the shed (we’ve really seen each of these) will suffer the same fate. By making a real effort to respect the Buyer and your contractual obligations, the Buyer is more likely to look past that scuff on the floor or small hole in the wall. Buying and Selling a house is stressful–make it a little easier by fulfilling your contractual obligations.

We’ve tried to provide some of the best tips for being a “good” Seller in this hot spring market. Whether adding some beautiful furniture, understanding your Buyer’s position, or conducting a preemptive home inspection, be sure to treat the Buyer with respect and honesty. No amount of furnishings or hard ball negotiation can save a deal that is destroyed by mistrust and hurt feelings.

Stiles Law, with offices located in Boston and Marshfield, Massachusetts, is a firm concentrating in real estate conveyancing and mortgage lending services, representing buyers, sellers, borrowers, banks, mortgage companies, investors, builders and developers in all of their real estate and mortgage transactions. Stiles Law serves all areas of eastern Massachusetts–the North Shore, Boston, and Cape Cod, in addition to the entire South Shore, including: Plymouth, Kingston, Duxbury, Hanover, Pembroke, Marshfield, Scituate, Norwell, Cohasset, Hull, Hingham, Weymouth, Braintree, and Quincy.

Copyright © 2015 Stiles Law, All rights reserved. Stiles Law is a Massachusetts licensed law firm and all content is based on Massachusetts law. The information presented above is meant to be used for general informational purposes and it should not be construed as legal advice or legal opinion on any specific facts. No child labor laws were breached during the creation of this Blog, further Bob Bonkley was compensated for his likenesses and appearances in the same.

Posted in Home Buying, Home Selling, Homeownership, Market Conditions | Tagged , , , , , , | Leave a comment

Don’t Get Caught in the “Renter’s Trap”

Posted: 18 Mar 2015 KCM Crew

Don’t Get Caught in the ‘Renter’s Trap’ | Keeping Current Matters

There are many benefits to homeownership, one of top ones, is being able to protect yourself from rising rents and lock in your housing cost for the life of your mortgage. The National Association of Realtors (NAR) just released their findings of a study in which they studied “income growth, housing costs and changes in the share of renter and owner-occupied households over the past five years in metropolitan statistical areas throughout the US.”

Don’t Become Trapped

The study revealed that over the last five years, a typical rent rose 15%, while the income of renters grew by only 11%. If you are currently renting, this disparity in growth could get you caught up in a cycle where increasing rents continue to make it impossible for you to save for a necessary down payment. The top 5 markets where renters have seen the highest increase in rents since 2009 are:

  • New York, NY (50.7%)
  • Seattle, WA (32.4%)
  • San Jose, CA (25.6%)
  • Denver, CO (24.1%)
  • St. Louis, MO (22.3%)

Homebuyers, who were able to purchase their home over the same five-year period and lock in their housing costs, were able to grow their net worth as home values have increased and their mortgage balances have gone down.

Know Your Options

Perhaps you have already saved enough to buy your first home. HousingWirereported that analysts at Nomura believe:

“It’s not that Millennials and other potential homebuyers aren’t qualified in terms of their credit scores or in how much they have saved for their down payment.  It’s that they think they’re not qualified or they think that they don’t have a big enough down payment.” (emphasis added)

According to Freddie Mac:

“Depending on their credit history and other factors, many borrowers can expect to make a down payment of about 5 to 10%. And new 3% down financing options for qualified borrowers could mean a down payment as little as $6,000 for a $200,000 home.”

Bottom Line

Don’t get caught in the trap so many renters are currently in. If you are ready and willing to buy a home, find out if you are able. Have a professional help you determine if you are eligible to get a mortgage.

Posted in Financing, Homeownership, Market Conditions, Rent vs. Buy | Tagged , , , , , | Leave a comment

3rd Gardening Green Expo

Come to our 3rd Gardening Green Expo
March 28 & 29

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Volunteers Needed for the Gardening Green Expo

Could you give a few hours on either Saturday, March 28 or Sunday, March 29 to help out at the Gardening Green Expo? We need volunteers to drive vans, help greet guests and help the NSRWA with our membership table. The benefits – spending a few hours in a gorgeous greenhouse surrounded by spring flowers! Please contact Paula at or 781-659-8168.

Posted in Going Green, In my Neighborhood, Marshfield, Parks & Recreation | Tagged , , , , , | Leave a comment

Location, Location Location …..

Posted: 16 Mar 2015 KCM CrewLocation, Location, Location | Keeping Current Matters

A recent Demand Institute report revealed “nearly half of all American households plan to move at some point in the future.” Seventy-five percent of those surveyed in the report cited one or more ‘location-related reasons’ for their eagerness to move. Here are the top 5 reasons:

  1. Safer Neighborhood – 30%
  2. Closer to Family – 27%
  3. Change of Climate – 26%
  4. Closer to Work – 25%
  5. For a New Job – 23%

While the majority of Americans (74%) will move within their home state, for the 26% planning to call a new state home, it is important to know that prices in each state are appreciating at different rates and waiting to buy or sell your home could cost you more in the long run. The map below was created using the FHFA’s latest Home Price Index and shows year-over-year price gains in each state.Year-Over-Year Price Gains | Keeping Current Matters

Bottom Line

If your plan for 2015 includes relocating to a new state, meet with a local real estate professional in that area who can help you find the best fit for you and your family’s needs.

Posted in Financing, Home Buying, Home Selling, Homeownership, Market Conditions | Tagged , , , , | Leave a comment