Uncategorized

Applying For A Mortgage: Why So Much Paperwork?

~ The ASSAL Team ~ Leave a comment

Mortgage-Paperwork

We are often asked why there is so much paperwork mandated by the bank for a mortgage loan application when buying a home today. It seems that the bank needs to know everything about us and requires three separate sources to validate each and every entry on the application form.

Many buyers are being told by friends and family that the process was a hundred times easier when they bought their home ten to twenty years ago.

There are two very good reasons that the loan process is much more onerous on today’s buyer than perhaps any time in history.

The government has set new guidelines that now demand that the bank prove beyond any doubt that you are indeed capable of affording the mortgage. During the run-up in the housing market, many people ‘qualified’ for mortgages that they could never pay back. This led to millions of families losing their home. The government wants to make sure this can’t happen again
The banks don’t want to be in the real estate business. Over the last seven years, banks were forced to take on the responsibility of liquidating millions of foreclosures and also negotiating another million plus short sales. Just like the government, they don’t want more foreclosures. For that reason, they need to double (maybe even triple) check everything on the application.
However, there is some good news in the situation. The housing crash that mandated that banks be extremely strict on paperwork requirements also allowed you to get a mortgage interest rate probably at or below 4%.

The friends and family who bought homes ten or twenty ago experienced a simpler mortgage application process but also paid a higher interest rate (the average 30 year fixed rate mortgage was 8.12% in the 1990’s and 6.29% in the 2000’s). If you went to the bank and offered to pay 7% instead of <4%, they would probably bend over backwards to make the process much easier.

Bottom Line

Instead of concentrating on the additional paperwork required, let’s be thankful that we are able to buy a home at historically low rates.

Tired of renting and/or being a Tenant(s)? Thinking of selling your home?, looking to upgrade?, First Time buyer(s)? Buying your dream home this year? Call us, you know you can count on our help every step of the way while reaching your goal faster, easier and with a smile on your face. 📞786.554.8063 📧George@GeorgeAssal.com 💻 www.GeorgeAssal.com

Advertisement

There is NO Housing Bubble – Most Experts Agree.

~ The ASSAL Team ~ Leave a comment

There is no doubt that home prices in the vast majority of housing markets across the country are continuing to increase on a month over month basis. The following map (based on data from the latest CoreLogic pricing report) reveals the appreciation level by state:

1-month-price-change-GA

These increases in value have caused some to be concerned about a new price bubble forming in residential real estate. Here are quotes from many of the most respected voices in the housing industry regarding the issue:

Nick Timiraos, reporter at the Wall Street Journal:

“Predictions of a new national home price bubble look unfounded for now, according to data.”

Michael Fratantoni, Chief Economist, the Mortgage Bankers Association:

“I don’t really see it as a bubble.”

Jack M. Guttentag, Professor of Finance Emeritus at the Wharton School of the University of Pennsylvania:

“My view is that we are a long way from another house price bubble.”

Rajeev Dhawan, Director of Economic Forecasting Center at J. Mack Robinson College of Business, Georgia State University:

“To have a bubble, you need to have construction rates higher than the perceived demand, which is what happened in 2003 to 2007. Right now, however, we have the reverse of that.”

Victor Calanog, Chief Economist, Reis:

“The housing market has yet to show evidence of systematic runaway asset price inflation characterized by home prices rising much faster than household income.”

David M. Blitzer, Chairman of the Index Committee for S&P Dow Jones:

“I would describe this as a rebound in home prices, not a bubble and not a reason to be fearful.”

Andrew Nelson, US Chief Economist, Colliers International:

“I don’t think there is a housing bubble.”

George Raitu, Director, Quantitative & Commercial Research, NAR:

“We do not consider the current market conditions to present a bubble.”

Christopher Thornberg, Founding Partner, Beacon Economics:

“The housing market is far from overheated.”

So why have prices been increasing?

Today, there is a gap between supply (number of houses on the market) and demand (the number of buyers looking for a new home). In any market, this would cause values to increase. Here are some experts’ comments on this issue:

Jonathan Smoke, realtor.com Chief Economist:

“So does that mean we’re in a bubble? Nope, that’s just what happens when demand increases faster than supply.”

Robert Bach, Director of Research – Americas, Newmark Grubb Knight Frank:

“I don’t think the housing market is overheated based on demand and supply fundamentals.”

Mark Dotzour, Chief Economist, Real Estate Center, Texas A&M University:

“We are not in a housing bubble. We are in a situation where demand for houses is much higher than supply.”

Calvin Schnure, SVP of Research & Economic Analysis, NAREIT:

“Given all the demand and little supply the residential market is FAR from overheated.”

Bottom Line

Currently, there is an imbalance between supply and demand for housing. This has created a natural increase in values not a bubble in prices. Don’t let the imbalance bubble to get you, CALL us today 786.554.8063 or email us at George@GeorgeAssal.com, you know you can count on our help every step of the way while reaching your goal faster, easier and with a smile on your face.

52% Likely to Buy in the Next 5 Years!! Are You?

~ The ASSAL Team ~ Leave a comment

Likely to Buy

According to the recently released BMO Harris Bank Home Buying Report, 52% of Americans say they are likely to buy a home in the next five years. Americans surveyed for the report said they would be willing to pay an average of $296,000 for a home and would average a 21% down payment. The report also had other interesting revelations.

Those Looking to Buy

  • 74% of those looking to buy a new home will consult a real estate agent
  • 59% said they will visit online real estate websites
  • 37% will seek recommendations from friends and family
  • 78% plan to get pre-approved before seriously searching for a home

Those Who Already Own

  • 75% of current home owners set a budget before looking for a home. 16% ended up spending less while 13% went over their budget.
  • 63% of American homeowners spent under six months looking for a new home before they made a purchase.
  • 8% bought their home without participating in an active real estate search – or even any plan to buy at all – because a specific property caught their attention.

The last point is very interesting: 8% of those that purchased a home, bought “without any plan to buy at all”. A property caught their attention and they acted on it.

Why are More People not Planning their Next Move?

Why are people that are considering a move not putting their home search to a plan, and instead, buying only when a property catches their attention? A recent article by Fannie Mae may give us that answer, there is evidence that a large numbers of homeowners are dramatically underestimating the equity they have in their current home. The report explains:

“Homeowners may be underestimating their home equity. In particular, if homeowners believe that large down payments are now required to purchase a home, then widespread, large underestimates of their home equity could be deterring them from applying for mortgages, selling their homes, and buying different homes.”

Bottom Line

Perhaps it is time to sit with a us to help you determine the actual equity you have in your house and take a look at the opportunities that currently exist in the real estate market. This may be the perfect time to move-up, move-down or buy that vacation home you and your family has always wanted. Act now give us a call to help you be part of the statistic, while reaching your goal faster, easier and with a smile on your face! Call us today at 786.554.8063 or send us an email at george@georgeassal.com– you can count on our help every step of the way.

Homeownership is the Key to Well-Being in Retirement

~ The ASSAL Team ~ Leave a comment

Home-Equity

There has been much talk about homeownership and whether it is a true vehicle for building wealth. A new report looks at the impact owning a home has on the financial wellbeing of people closing in on their retirement years (ages 55-64).

In recently study by the Hamilton Project, Ten Economic Facts about Financial Well-Being in Retirement, it was revealed that:

1. Middle-class households near retirement age have about as much wealth in their homes as they do in their retirement accounts.

“Over the past quarter century the largest single source of wealth for all but the richest households nearing retirement age has been their homes, which accounted for about two-fifths of net worth in the early 1990s and accounts for about one-third today.”

2. Home equity is a very important source of net worth to all but the wealthiest households near retirement age.

“Home equity is an important source of wealth for middle income households, accounting for more than one-third of total net worth for the second, third, and fourth quintiles of the net worth distribution… The fifth quintile has a much larger share in business equity—almost a quarter—than any other quintile. (The figure leaves out the bottom quintile of households because they have negative net worth. It is likely that these households will rely almost exclusively on Social Security in retirement.)”

Here is an asset breakdown for the middle 20% of Americans determined by median net worth ($165, 720):

2Components-of-Net-Worth

Obviously, the data again proves that homeownership has a big role in building wealth for American families 

Are you prepared to retire and ready to start a new life?  YES?, We the ASSAL team are here to help you reach your goal faster, easier and with a smile on your face while planning your future. Call us today at 786.554.8063 or send us an email at george@georgeassal.com– you can count on our help every step.

Is now a good time to Rent? Definitely NOT!

~ The ASSAL Team ~ Leave a comment

No-Rent

People often ask us whether or not now is a good time to buy a home. No one ever asks when a good time to rent is. However, we want to make certain that everyone understands that today is NOT a good time to rent.

The Census Bureau just released their second quarter median rent numbers.

Here is a graph showing rent increases from 1988 until today:

Increase-in-rents

At the same time, a report by Axiometrics revealed:

“The national apartment market’s annual effective rent growth rate of 5.1% in June 2015 represented a 47-month high, and continued a streak of 5.0%-plus rent growth that is now the longest in at least six years, according to apartment market research. The effective rent growth in June 2014 was 3.7%, putting June 2015’s exceptional performance into perspective. 

This is the highest rate since the 5.3% of July 2011. The metric has reached at least 5.0% for five straight months, the longest such streak since Axiometrics started monthly reporting of annual apartment data in April 2009.”

Where will rents be headed in the future?

Stephanie McCleskey, Axiometrics vice president of research, commented on the above report in an article by Real Estate Economy Watch:

“Rent growth is just shy of the post-recession peak, and the June metrics reflect the continued strength of the apartment market. The demand for apartments is still strong, despite the record number of new units being delivered this year. Tight occupancy is why landlords can push rents higher.”

Bottom Line

Tired of paying rent? Are you ready, willing and able to start a new life? if you answered YES, now may make sense, it might not be a good time to rent however is a good time to buy,  We (the ASSAL team) are not for rent nor for sale but YES to help you reach your goal faster, easier and with a smile on your face! Call us today at 786.554.8063 or send us an email at george@georgeassal.com– you can count on our help every step of the way.

The REAL Reasons to Buy a Home

~ The ASSAL Team ~ Leave a comment

Real Reasons to Buy

We often talk about the financial reasons why buying a home makes sense. But often, the emotional reasons are the more powerful, or compelling reasons. The Joint Center for Housing Studies at Harvard University performs a study every year surveying participants for the reasons that American’s feel are most important in regards to homeownership.

The top 4 reasons to own a home cited by respondents were not financial.

1. It means having a good place to raise children & provide them with a good education

From the best neighborhoods to the best school districts, even those without children at the time of purchasing their home, may have this in the back of their mind as a major reason for choosing the location of the home that they purchase.

2. You have a physical structure where you & your family feel safe

It is no surprise that having a place to call home with all that means in comfort and security is the #2 reason.

3. It allows you to have more space for your family

Whether your family is expanding, or an older family member is moving in, having a home that fits your needs is a close third on the list.

4. It gives you control over what you do with your living space, like renovations and updates

Looking to actually try one of those complicated wall treatments that you saw on Pinterest? Want to finally adopt that puppy or kitten you’ve seen online 100 times? Who’s to say that you can’t in your own home?

The 5th reason on the list, is the #1 financial reason to buy a home as seen by respondents:

5. Owning a home is a good way to build up wealth that can be passed along to my family

Either way you are paying a mortgage. Why not lock in your housing expense now with an investment that will build equity that you can borrow against in the future?

Conclusion 

Whether you are a first time homebuyer or a move-up buyer who wants to start a new chapter in their life, now is a great time to reflect on the intangible factors that make a house a home.  We the ASSAL team are another reason for you to buy a house, while reaching your goal faster, easier and with a smile on your face! Call us today at 786.554.8063 or send us an email at george@georgeassal.com– you can count on our help every step of the way.

Don’t Wait to Move Up to Your Dream Home!

~ The ASSAL Team ~ Leave a comment

Dont Wait

Now that the housing market has stabilized, more and more homeowners are considering moving up to their dream home. With interest rates still near 4% and home values on the rise, now may be a great time to make a move.

Sellers should realize that waiting while mortgage rates are increasing probably doesn’t make sense. As rates increase, the price of the house you can afford will decrease if you plan to stay within a certain budget for your monthly housing costs.

Here is a chart detailing this point:

Buyers Purchasing Power

With each quarter percent increase in interest rate, the value of the home you can afford decreases by 2.5%, (in this example, $10,000). Experts predict that mortgage rates will be closer to 5% by this time next year.

Act now give us a call  to help you get your dream home. We at the ASSAL team want to make sure you get the most house for your hard earned money, while reaching your goal faster, easier and with a smile on your face! Call us today at 786.554.8063 or send us an email at george@georgeassal.com– you can count on our help every step of the way.

¿Hacia dónde se dirigen las tasas hipotecarias?

~ The ASSAL Team ~ Leave a comment

La tasa de interés que usted paga por la hipoteca de su casa tiene un impacto directo en el pago mensual.  Mientras mas alto el interes mayor será el pago.

Mortgage RatesEs por eso que es importante tener en cuenta que las tasas se dirigen al decidir comprar ahora o esperar hasta el próximo año .

A continuación hay una gráfica creada usando el Freddie Mac’s July 2015 U.S. Economic & Housing Marketing Outlook. Como usted puede ver la tasa de interés se proyecta que va aumentar constantemente durante el curso de los próximos 12 meses.

Tasas hipotecarias

¿Cómo va a afectar el pago de su hipoteca?

Dependiendo de la cantidad del préstamo que usted aseguro, el aumento de la mitad de un porciento (.5 %) en la tasa de interés puede aumentar el pago mensual de su hipoteca significativamente.

El Doctor Frank Nothaft, Vicepresidente principal & economista principal de CoreLogic, dijo esto es su último MarketPulse:

“Si usted está pensando en comprar una casa y tiene los medios financieros para hacerlo, este podría ser un buen momento para dar un vistazo a los vecindarios que le interesan. Nosotros esperamos que los precios de las casas en nuestro índice nacional subirán cerca de 4.3 % en los próximos 12 meses, y las tasas hipotecarias también parece que van a aumentar durante el próximo año”.

Si ambas predicciones de los aumentos en los precios de las casas y la tasa de interés se convierten en una realidad, las familias terminarían pagando más considerablemente para su próxima casa.

En conclusión

Incluso un pequeño aumento en la tasa de interés puede afectar el bienestar de su familia. Reúnase con nosotros para evaluar su capacidad de compra de la casa de sus sueños . Recuerde Nosotros (The ASSAL Team)  queremos asegurarnos de que usted obtenga  la tasa de interés hipotecario más bajo posible , mientras logra su meta más rápido, más fácil y con una sonrisa en su cara! Llámenos hoy mismo al 786.554.8063 o envíenos un correo electrónico a george@georgeassal.com– usted puede contar con nuestra ayuda en cada paso del camino.

Where Are Mortgage Rates Headed? This Fall? Next Year?

~ The ASSAL Team ~ 1 Comment

The interest rate you pay on your home mortgage has a direct impact on your monthly payment. The higher the rate the greater the payment will be.

Mortgage Rates

That is why it is important to look at where rates are headed when deciding to buy now or wait until next year.

Below is a chart created using Freddie Mac’s July 2015 U.S. Economic & Housing Marketing Outlook. As you can see interest rates are projected to increase steadily over the course of the next 12 months.

Mortgage Rate

How Will This Impact Your Mortgage Payment?

Depending on the amount of the loan that you secure, a half of a percent (.5%) increase in interest rate can increase your monthly mortgage payment significantly.

Dr. Frank Nothaft, the SVP & Chief Economist for CoreLogic, had this to say in their latest Market Pulse:

“If you are thinking of buying a home and have the financial means to do so, this could be a good time to take a look at the neighborhoods you are interested in. We expect home prices in our national index to be up about 4.3% in the next 12 months, and mortgage rates are also likely to increase over the next year.”

If both the predictions of home price and interest rate increases become reality, families would wind up paying considerably more for their next home.

Bottom Line

Even a small increase in interest rate can impact your family’s wealth. Meet with us to evaluate your ability to purchase your dream home. Remember We at the ASSAL team want to make sure you get the lowest mortgage rate possible, while reaching your goal faster, easier and with a smile on your face! Give us a call today at 786.554.8063 or send us an email at george@georgeassal.com– you can count on our help every step of the way.

Selling Your Home? Price It Right From the Start!

~ The ASSAL Team ~ Leave a comment

In today’s market, where demand is outpacing supply in many regions of the country, pricing a house is one of the biggest challenges real estate professionals face. Sellers often want to price their home higher than recommended, and many agents go along with the idea to keep their customers happy. However, we realized that telling the homeowner the truth is more important than getting the seller(s) to like us.

Price It Right

There is no “later.”

Sellers sometimes think, “If the home doesn’t sell for this price, I can always lower it later.” However, research proves that homes that experience a listing price reduction sit on the market longer, ultimately selling for less than similar homes.

John Knight, recipient of the University Distinguished Faculty Award from the Eberhardt School of Business at the University of the Pacific, actually did research on the cost (in both time and money) to a seller who priced high at the beginning and then lowered the their price. In his article, Listing Price, Time on Market and Ultimate Selling Price published in Real Estate Economics revealed:

“Homes that underwent a price revision sold for less, and the greater the revision, the lower the selling price. Also, the longer the home remains on the market, the lower its ultimate selling price.”

Additionally, the “I’ll lower the price later” approach can paint a negative image in buyers’ minds. Each time a price reduction occurs, buyers can naturally think, “Something must be wrong with that house.” Then when a buyer does make an offer, they low-ball the price because they see the seller as “highly motivated.” Pricing it right from the start eliminates these challenges.

Don’t build “negotiation room” into the price.

Many sellers say that they want to price their home high in order to have “negotiation room.” But, what this actually does is lower the number of potential buyers that see the house. And we know that limiting demand like this will negatively impact the sales price of the house.

Not sure about this? Think of it this way: when a buyer is looking for a home online (as they are doing more and more often), they put in their desired price range. If seller is looking to sell their house for $400,000, but lists it at $425,000 to build in “negotiation room,” any potential buyers that search in the $350k-$400k range won’t even know your listing is available, let alone come see it!

One great way to see this is with the chart below. The higher you price your home over its market value, the less potential buyers will actually see your home when searching.

Price Visibility

A better strategy would be to price it properly from the beginning and bring in multiple offers. This forces these buyers to compete against each other for the “right” to purchase your house.

Look at it this way: if you only receive one offer, you are set up in an adversarial position against the prospective buyer. If, however, you have multiple offers, you have two or more buyers fighting to please you. Which will result in a better selling situation?

The Price is Right

Great pricing comes down to truly understanding the real estate dynamics in your neighborhood.  Our team will take the time to simply and effectively explain what is happening in the housing market and how it applies to your home.

Our team  will tell you what you need to know rather than what you want to hear. This will put you in the best possible position.

Thinking of selling your home and not sure how to price it right?  Call us, We at the ASSAL team want to make sure you price your home right while reaching your goal faster, easier and with a smile on your face! Give us a call today at 786.554.8063 or send us an email at george@georgeassal.com– you can count on our help every step of the way.