# The Truth About Mortgage > Learn how mortgages work with in-depth posts, guides, how-to articles, and the latest industry news. --- ## Pages - [What Is a Conforming Mortgage? A Loan That Meets the Guidelines of Fannie Mae or Freddie Mac](https://www.thetruthaboutmortgage.com/conforming-mortgage-loans/): A "conforming mortgage" is a home loan with a loan amount up to $806,500 that also meets the underwriting guidelines set forth by Fannie Mae and Freddie - [How Are Mortgage Rates Determined?](https://www.thetruthaboutmortgage.com/what-causes-mortgage-interest-rates-to-move/): See current mortgage rates and learn about the many factors that drive them higher and lower so you can get a better rate. - [Which Mortgage Is Right For Me? Look Beyond the 30-Year Fixed If You Dare](https://www.thetruthaboutmortgage.com/which-mortgage-is-right-for-me/): An age old question: "Which mortgage is right for me?" When shopping for a home loan, whether it’s a new purchase-money mortgage or a refinance, knowing - [The Cash-Out Refinance: A Simple Way to Tap Your Home Equity](https://www.thetruthaboutmortgage.com/cash-out-refinance/): A cash-out refinance is a home loan where the borrower takes out additional cash beyond the amount of the existing loan balance. It can be used for things like home improvements, to pay for college tuition, or to pay off credit cards. - [What Is a Mortgage Broker? Your Personal Rate Shopper and Loan Guide](https://www.thetruthaboutmortgage.com/what-is-a-mortgage-broker/): Unless you live under a rock (like I do), you've probably heard the term "mortgage broker" get thrown around on more than one occasion. You may have heard - [Par Mortgage Rate: An Interest Rate Without Points or Credits](https://www.thetruthaboutmortgage.com/mortgage-dictionary/par-rate-loan/): A par rate loan doesn't require the payment of discount points, nor does it come with lender credits. - [Today's Mortgage Rates](https://www.thetruthaboutmortgage.com/todays-mortgage-rates/): Compare today's mortgage rates from dozens of banks, lenders, and credit unions. - [Mission Statement](https://www.thetruthaboutmortgage.com/mission-statement/): You might be wondering what the point of this website is. Many websites sell a product or offer a service. I don’t sell anything nor do I offer any sort - [Editorial Standards](https://www.thetruthaboutmortgage.com/editorial-standards/): First a brief history. I created The Truth About Mortgage all the way back in 2006. My mission statement continues to be helping prospective home buyers - [Rent vs. Buy Calculator](https://www.thetruthaboutmortgage.com/rent-vs-buy-calculator/): If you’re still determining if it’s time to move on from renting to homeownership, you may want to do the math with the "rent vs. buy calculator" below to - [Mortgage Affordability Calculator](https://www.thetruthaboutmortgage.com/mortgage-affordability-calculator/): One of the most important things you can do when shopping for real estate is determine how much mortgage you can afford (assuming you aren’t paying - [Refinance Calculator](https://www.thetruthaboutmortgage.com/refinance-calculator/): Wondering if it makes sense to refinance your mortgage? Check out the refinance calculator below to determine the potential savings (or lack thereof). - [Early Mortgage Payoff Calculator](https://www.thetruthaboutmortgage.com/early-mortgage-payoff-calculator/): If you own real estate and are considering making extra mortgage payments, the "early mortgage payoff calculator" below could be helpful in determining - [Mortgage Payment Calculator](https://www.thetruthaboutmortgage.com/mortgage-payment-calculator/): If you're looking for a basic mortgage payment calculator, you've come to the right place. The mortgage rate calculator below will give you the monthly - [USDA Home Loans: Eligibility and Program Requirements](https://www.thetruthaboutmortgage.com/usda-home-loans-eligibility-and-program-requirements/): When you see or hear the acronym “USDA,” the first image that probably comes to mind is a big, juicy steak. As in, USDA Prime or Choice. But the U.S. - [Purchase Money Mortgage: The Different Types and How They Work](https://www.thetruthaboutmortgage.com/purchase-money-mortgage/): A “purchase money mortgage” is a home loan used to purchase a piece of property, whether it be a principal residence, a second home, or an investment - [How Balloon Mortgages Work](https://www.thetruthaboutmortgage.com/balloon-mortgage/): A “balloon mortgage” is a home loan that does not fully amortize over the life of the loan, leaving a large balance at the end of the shortened term. What - [Mortgage Discount Points: How They Can Lower Your Interest Rate and Save You Money](https://www.thetruthaboutmortgage.com/mortgage-discount-points/): I think it goes without saying that everyone with a mortgage (or thinking about getting one) wants the lowest interest rate possible. After all, who - [How to Get a Mortgage: From Start to Finish](https://www.thetruthaboutmortgage.com/how-to-get-a-mortgage/): Mortgage Q&A: “How to get a mortgage?” If you already know what a mortgage is, you may be wondering how to obtain one. To refresh your memory, a - [What Is a Short Refinance? A Reduced Mortgage Balance to Keep You in Your Home](https://www.thetruthaboutmortgage.com/what-is-a-short-refinance/): A “short refinance” is a transaction in which your bank or mortgage lender agrees to pay off your existing mortgage and replace it with new a loan with a - [Mortgage Pre-Qualification vs. Mortgage Pre-Approval: The Ultimate Guide](https://www.thetruthaboutmortgage.com/pre-qualification-vs-pre-approval/): Mortgage Q&A: "Pre-Qualification vs. Pre-Approval" When you initially set out to purchase a new home, the real estate agent(s) and home seller will - [What Is Title Insurance? Is It Required for Your Mortgage?](https://www.thetruthaboutmortgage.com/what-is-title-insurance/): Mortgage Q&A: “What is title insurance?” When you apply for a mortgage, keep in mind you'll need to pay a number of closing costs, including a variety - [What Do Mortgage Lenders Look For on Bank Statements and Tax Returns?](https://www.thetruthaboutmortgage.com/what-mortgage-lenders-look-for/): Mortgage Q&A: “What do mortgage lenders look for?” Most banks and mortgage lenders are looking for the same basic thing when they review your - [Mortgages with No Money Down: There Are Many Options to Avoid a Down Payment](https://www.thetruthaboutmortgage.com/mortgages-with-no-money-down/): As of 2024, there are lots of options to get a mortgage with no money down, which is surprising given the devastating financial crisis that took place - [Loan Modification Programs: Options to Keep You in Your Home](https://www.thetruthaboutmortgage.com/loan-modification-programs/): Since the mortgage crisis took flight, “loan modification programs” have become all the rage. Instead of originating new loans, former mortgage brokers - [What Caused the Mortgage Crisis? A Game of Hot Potato](https://www.thetruthaboutmortgage.com/what-caused-the-mortgage-crisis/): So, "what caused the mortgage crisis" anyway? In case you hadn’t heard, we went through one of the worst housing busts in our lifetimes, if not ever. - [Mortgage 101: All the Help Topics You Need to Read Under One Roof](https://www.thetruthaboutmortgage.com/mortgage-help/): An extensive list of mortgage help topics you can use to better understand the home loan process and get a better deal on your mortgage. - [Payment Shock: How It Can Jeopardize Your Mortgage Approval](https://www.thetruthaboutmortgage.com/payment-shock/): You may have heard the phrase “payment shock” get thrown around by your loan officer or mortgage broker, and for good reason. It plays an important role - [Privacy Policy](https://www.thetruthaboutmortgage.com/privacy-policy/): The privacy of our visitors at TheTruthAboutMortgage.com is very important to us. As with most other websites, we collect and use the data contained in - [What Is a Stated Income Home Loan? How The Liar's Loan Works](https://www.thetruthaboutmortgage.com/stated-income-loans/): Stated income loans allow borrowers to simply state their monthly income on a mortgage application instead of verifying their salary by furnishing pay stubs and/or tax returns. - [Alt-A Mortgages: What Are They and How Do They Work?](https://www.thetruthaboutmortgage.com/alt-a-mortgages-alt-a-lending/): The term “Alt-A mortgage” gets thrown around a lot, and for good reason. It’s kind of the generic term for any loan that isn’t prime (A-paper) or - [Fixed-Rate Mortgages: An Easy Option But Are They a Good Deal?](https://www.thetruthaboutmortgage.com/fixed-rate-mortgage/): A "fixed-rate mortgage" is the most basic and uncomplicated home loan available to borrowers today. It is far and away the most popular choice for - [Second Mortgages Explained: The 80/20, Piggyback, and More](https://www.thetruthaboutmortgage.com/second-mortgages/): When you hear the phrase “second mortgage,” a negative connotation may come to mind. You could be thinking, "Why would I need a second mortgage? I’m not - [Biweekly Mortgage Payments: An Easy Trick to Do Them for Free](https://www.thetruthaboutmortgage.com/biweekly-mortgage-payments/): You’ve probably already heard the claims. That a "biweekly mortgage" can save you thousands of dollars. And that biweekly mortgage payments can shave - [What Is a Short Sale? Selling Your Home for Less Than the Mortgage](https://www.thetruthaboutmortgage.com/real-estate-short-sales/): When the mortgage crisis struck in the early 2000s, missed monthly payments and notices of defaults increased dramatically, leading to the rise of the - [Negative Amortization Loans: How They Work](https://www.thetruthaboutmortgage.com/negative-amortization-loan/): You’ve probably heard the term “negative amortization” by now, as the subprime industry goes down the drain and option-arm mortgages get replaced by - [PMI vs. Combo Loans: Which Is the Better Choice?](https://www.thetruthaboutmortgage.com/private-mortgage-insurance-vs-combo-loans/): Before the mortgage crisis, it was common practice for borrowers short on down payment funds or home equity to take out two mortgages simultaneously to - [What Is a Subprime Mortgage? Your Credit Score Is Key](https://www.thetruthaboutmortgage.com/subprime-lending-and-subprime-lenders/): "Subprime mortgage lending" is best defined as offering financing to an individual with poor credit, low income, limited documentation, or a combination - [Seller Carryback Financing: When the Seller Becomes the Bank](https://www.thetruthaboutmortgage.com/seller-carryback-financing/): Let’s face it, selling your home can be pretty difficult, and even if you do find a willing buyer, who knows if they can actually obtain financing to - [Hard Money Loans: Solutions for Hard to Close Mortgages](https://www.thetruthaboutmortgage.com/hard-money-loans/): A hard money loan is a mortgage with a higher-than-market interest rate that usually serves as a source of short-term financing for borrowers who can’t - [The No Cost Refinance: How It Works and What It Really Costs](https://www.thetruthaboutmortgage.com/no-cost-refinance-loans/): A no cost refinance is a home loan where the lender pays all closing costs in exchange for a higher mortgage rate. Find out if it's a good deal. - [Documents Needed for a Home Loan](https://www.thetruthaboutmortgage.com/documents-needed-during-the-loan-process/): Mortgages Are Very Paperwork Intensive If you plan to refinance your home loan or purchase a property with a mortgage, you will be required to fill out a - [Mortgages on Investment Properties](https://www.thetruthaboutmortgage.com/investment-properties/): Investment properties, also known as non-owner occupied properties, can be very profitable for everyday homeowners and real estate investors alike. While - [Terms of Service](https://www.thetruthaboutmortgage.com/terms-of-service/): TheTruthAboutMortgage.com is a free Internet resource that provides information to consumers about residential mortgages and related financial products. - [Interest-Only Mortgages: Pros, Cons, and How They Work](https://www.thetruthaboutmortgage.com/interest-only-home-loans/): An interest-only mortgage can make monthly payments a lot more affordable, but you won't actually pay down your principal balance. - [Mortgage Teaser Rates: Get a Low Start Rate on Your Home Loan](https://www.thetruthaboutmortgage.com/teaser-rates/): A "teaser rate" is a low, introductory interest rate that is typically offered for the first few months or years as an incentive to choose a certain - [No Documentation Mortgage Loans](https://www.thetruthaboutmortgage.com/no-doc-2nd-mortgage/): The housing market was on fire in the early 2000s before it eventually burnt to a crisp. This led to rampant speculation and greed as a larger group of - [Private Mortgage Insurance (PMI): When It's Required and How to Remove It](https://www.thetruthaboutmortgage.com/pmi-private-mortgage-insurance/): I'm sure most prospective homeowners like the idea of putting little to nothing down when purchasing real estate, but doing so isn't without its - [How to Keep Your Home and Avoid Foreclosure](https://www.thetruthaboutmortgage.com/foreclosure-help/): If you fail to make your mortgage payments each month, your bank or mortgage lender may take action to repossess your home. After all, it's not - [Adjustable-Rate Mortgage 101: How They Work and Why They Can Be a Cheaper Option](https://www.thetruthaboutmortgage.com/adjustable-rate-mortgage/): Learn how an adjustable-rate mortgage works and determine if one might be a good fit for you. - [Bridge Loans: Why They're Needed and How They Work](https://www.thetruthaboutmortgage.com/bridge-loan/): A "bridge loan" is essentially a short term loan taken out by a borrower against their current property to finance the purchase of a new property. Also - [Loan Officer Job Description - Expected Salary and What Your Day Will Look Like](https://www.thetruthaboutmortgage.com/loan-officer-jobs/): So you need a job and you’re thinking about becoming a residential mortgage loan officer? Or a mortgage loan originator (MLO) as they're now known. Well, - [How to Quickly Remove Mortgage Lates From Your Credit Report](https://www.thetruthaboutmortgage.com/how-to-remove-mortgage-lates/): So you got a "mortgage late." You thought you paid your home loan on time, but for some reason the bank or loan servicer never got your mortgage payment. - [Buying Down Your Interest Rate: Determine If It's Worth the Cost](https://www.thetruthaboutmortgage.com/buying-down-your-interest-rate/): If you're working with a bank or broker, you can easily buy down your mortgage interest rate by expressing what rate you'd like to pay, and inquiring about the cost to acquire such a rate. - [Homeowners Insurance: How It Works and What's Actually Covered](https://www.thetruthaboutmortgage.com/homeowners-insurance/): Homeowners Insurance provides coverage in the event that your home is damaged or destroyed, and also provides liability for injuries incurred by visitors to your property. - [Types of Mortgage Lenders: Retail vs. Wholesale, Correspondents and More](https://www.thetruthaboutmortgage.com/types-of-mortgage-lenders/): There are a variety of different types of mortgage lenders out there that originate home loans, from small mom and pop shops that only offer mortgages to - [Prime Rate, Discount Rate, and the Federal Funds Rate: What It All Means to You and Your Mortgage](https://www.thetruthaboutmortgage.com/discount-rate-prime-rate-and-the-federal-funds-rate/): Ever wonder how the economy goes 'round? Or how inflation is controlled and recessions are avoided? Or at least attempted to be avoided. Much of it has to - [Mortgage Calculators](https://www.thetruthaboutmortgage.com/mortgage-calculators/): The use of a "mortgage calculator" can be very helpful when trying to figure out monthly housing payments, how much one can afford, and how one should - [Reverse Mortgages: Who They're For and The Pros and Cons](https://www.thetruthaboutmortgage.com/reverse-mortgage/): A "reverse mortgage" is a tax-exempt home loan that allows a homeowner to take cash-out of their home using their existing home equity, without taking on - [Tips for First-Time Home Buyers: What You Should Know Before You Buy a Property](https://www.thetruthaboutmortgage.com/tips-for-first-time-homebuyers/): So you're thinking about buying your first piece of real estate? Congratulations! It's an exciting time...and a nerve-racking one. But before you even - [The Rate and Term Refinance Explained: What It Is and How It Works](https://www.thetruthaboutmortgage.com/rate-and-term-refinance/): In the mortgage world, a "rate and term refinance" refers to the replacement of an existing mortgage(s) with a brand new home loan. The refinance loan - [A Long List of Mortgage Stocks Grouped by Industry: Are Any Good Buys?](https://www.thetruthaboutmortgage.com/mortgage-stocks/): Let's talk mortgage stocks for a moment, shall we? During the early and mid 2000s, the housing market was on fire in the United States. As a result, the - [How Option ARM Mortgages Work](https://www.thetruthaboutmortgage.com/option-arm-mortgage/): An option ARM is a mortgage that gives homeowners four payment choices, including a 1% rate, interest-only, and a 15- or 30-year option. - [Mortgage Appraisals and Appraised Value: How the Lender Values Your Home](https://www.thetruthaboutmortgage.com/appraisals-and-appraised-value/): A "home appraisal" is a comprehensive report that determines the value of your property based on a number of factors, ranging from gross living space, to - [Predatory Mortgage Lending: What to Watch Out For](https://www.thetruthaboutmortgage.com/predatory-mortgage-lending/): Predatory mortgage lending is hard to define, but essentially occurs any time a borrower is taken advantage of, whether it be an inflated interest rate or higher than usual fees. - [Loan Origination Fee: What Is It and Do I Need to Pay It?](https://www.thetruthaboutmortgage.com/mortgage-dictionary/loan-origination/): The phrase "loan origination" refers to the initiation/completion of the home loan process, while the "loan origination fee" is the cost of the associated - [How a HELOC Works: Tap Your Home Equity for Cash](https://www.thetruthaboutmortgage.com/home-equity-line-of-credit-heloc/): A "HELOC" or "home equity line of credit," is a type of home loan that allows a borrower to open a line of credit using their home equity as collateral. - [Right of Rescission Period: When It Starts and Ends and Why It's Necessary](https://www.thetruthaboutmortgage.com/right-of-rescission/): Have you ever made a decision you later regretted, only to wish you could have taken it all back? Well, you might be in luck if we're talking about a - [Jumbo Loans: What Are They and Do They Still Cost More?](https://www.thetruthaboutmortgage.com/jumbo-mortgage-loans/): A jumbo loan is a mortgage that exceeds the maximum loan amount (conforming loan limit) set by the Federal Housing Finance Agency (FHFA). - [VA Loans: All Your Veteran Mortgage Questions Answered](https://www.thetruthaboutmortgage.com/va-mortgage-loans/): A VA loan is a mortgage guaranteed by the Dept. of Veterans Affairs that features no down payment or minimum credit score requirement. - [What Is an Islamic Mortgage? How Interest Is Avoided](https://www.thetruthaboutmortgage.com/islamic-mortgage/): Mortgage Q&A: "What is an Islamic mortgage?" There are a variety of different types of home loans out there, some pretty conventional and some a - [FHA Loans: Everything You Need to Know](https://www.thetruthaboutmortgage.com/fha-loans/): What Is an FHA Loan? “FHA loans” are government-backed mortgages insured by the Federal Housing Administration (FHA). Congress established the FHA in 1934 - [10 Mortgage Mistakes to Avoid for a Smooth Home Loan Experience](https://www.thetruthaboutmortgage.com/mortgage-mistakes/): Common Mortgage Mistakes Borrowers Make Not getting pre-approved for a mortgage Not shopping around for a lower interest rate Failing to check credit - [Why It's Super Important to Lock Your Mortgage Rate](https://www.thetruthaboutmortgage.com/mortgage-rate-lock/): A "mortgage rate lock" is essential to ensure you actually receive the interest rate you are quoted by a bank or mortgage broker. When you purchase real - [Asset and Reserve Requirements for Mortgages: How Much Money Do You Need?](https://www.thetruthaboutmortgage.com/assets-and-reserve-requirements/): If you choose to verify assets, banks and lenders will ask for a certain reserve requirement that must be met to qualify for the loan, including a mortgage down payment - [Debt-to-Income Ratio (DTI): What It Is and How to Calculate It](https://www.thetruthaboutmortgage.com/dti-debt-to-income-ratio/): The debt-to-income ratio, or DTI, is an important calculation used by banks to determine how large of a mortgage payment you can afford based on your gross monthly income and monthly liabilities. - [Mortgage Indexes: They Determine Your Rate When Your ARM Adjusts](https://www.thetruthaboutmortgage.com/mortgage-indexes/): If you have an adjustable-rate mortgage, your interest rate may vary from month-to-month, or year-to-year, based on the index associated with your home - [1031 Exchange: How You Can Avoid or Offset Capital Gains](https://www.thetruthaboutmortgage.com/1031-exchange-help-rules/): A "1031 exchange," also known as a real estate exchange or a tax-deferred exchange, was created by the IRS in 1990. Simply put, the exchange occurs when - [Mortgage Pricing Adjustments: How to Read a Mortgage Rate Sheet](https://www.thetruthaboutmortgage.com/mortgage-pricing-adjustments/): If you ever get your hands on a mortgage lender rate sheet, you’ll probably get confused in a hurry. The reason being is that they're intended to be read - [What Is a Prepayment Penalty? Hard vs. Soft and More](https://www.thetruthaboutmortgage.com/prepayment-penalty-mortgage/): Many people don't seem to understand what a "prepayment penalty" is, much to their own detriment months or years after signing mortgage loan documents. - [Mortgage Amortization: Learn How Your Mortgage Is Paid Off Over Time](https://www.thetruthaboutmortgage.com/amortization/): How Mortgage Amortization Works While your mortgage payment stays the same each month The composition changes over time as the outstanding balance falls - [Types of Mortgages to Choose From: Learn About the Many Options Available Today](https://www.thetruthaboutmortgage.com/mortgage-loan-types-home-loan-types/): Quickly learn about the different types of mortgages available to home buyers today. Options include fixed-rate loans, ARMs, and many more. - [What Are Mortgage Points?](https://www.thetruthaboutmortgage.com/mortgage-dictionary/mortgage-loan-points-mortgage-discount-points/): A "mortgage point" is a fancy term used in the industry to describe a percentage point of the loan amount. So if you're paying one point on a $100,000 mortgage, it's simply $1,000. Learn more about how it works and why it's charged. - [Mortgage Dictionary: Key Terms You Should Know Before You Own](https://www.thetruthaboutmortgage.com/mortgage-dictionary/): Use this mortgage dictionary to quickly define mortgage terminology you may encounter when buying a home or refinancing your loan. - [Yield Spread Premium (YSP)](https://www.thetruthaboutmortgage.com/mortgage-dictionary/yield-spread-premium/): The "yield spread premium," or YSP as it was known in the industry, was a fee paid by a mortgage lender to a mortgage broker in exchange for a higher - [Risk-Based Pricing: Your Level of Risk Determines Your Rate](https://www.thetruthaboutmortgage.com/mortgage-dictionary/risk-based-pricing-loan/): When shopping for a home loan, you may come across the term "risk-based pricing". It's a method the mortgage industry uses to measure risk and deliver - [About Me...](https://www.thetruthaboutmortgage.com/about-the-author/): In the early 2000s, I worked as an Account Executive for a large wholesale mortgage lender based in Los Angeles, California. This meant connecting - [What Is a Mortgage? First Let's Define the Word](https://www.thetruthaboutmortgage.com/what-is-a-mortgage-definition/): A mortgage is a loan offered by a bank to a borrower that allows them to acquire a piece of real estate, such as a house or condo. - [Mortgage Brokers vs. Banks: Which Is Better?](https://www.thetruthaboutmortgage.com/mortgage-brokers-vs-banks/): There are a variety of different ways to obtain a mortgage, but let's focus on two specific channels, "mortgage brokers versus banks." There are mortgage - [What Is My Home Worth?: Free Internet House Values and Math Behind Them](https://www.thetruthaboutmortgage.com/home-value-house-value/): When considering a home purchase, or a mortgage refinance for that matter, knowing the true value of the subject property is paramount. Getting a precise - [How Much House Can I Afford: How the Math Works and Rule of Thumb](https://www.thetruthaboutmortgage.com/how-much-can-i-afford/): If the term mortgage has crossed your mind recently and you're in the market to purchase a new home, you've probably asked yourself, "How much house can I --- ## Posts - [Top Mortgage Lender UWM Invests $100M in Bilt Credit Card to Drive More Leads](https://www.thetruthaboutmortgage.com/top-mortgage-lender-uwm-invests-100m-in-bilt-credit-card-to-drive-more-leads/): Another big tie-up has been announced in the mortgage space, this time between the nation’s top mortgage lender and a credit card company. Bilt announced - [Will Paying Rent on Time Really Make It Easier to Get a Mortgage?](https://www.thetruthaboutmortgage.com/will-paying-rent-on-time-really-make-it-easier-to-get-a-mortgage/): You’ve heard the news. FHFA Director Bill Pulte has ordered Fannie Mae and Freddie Mac to begin accepting VantageScore credit scores immediately. The - [For Mortgage Rates, lt’s All Eyes on Labor at This Point](https://www.thetruthaboutmortgage.com/for-mortgage-rates-lts-all-eyes-on-labor-at-this-point/): Somewhat amazingly, the 30-year fixed is once again priced back near 7% thanks to a hot jobs report. While many expected a soft report that would have - [A Key Difference Between HELOCs and Home Equity Loans Could Matter Again Soon](https://www.thetruthaboutmortgage.com/a-key-difference-between-helocs-and-home-equity-loans-could-matter-again-soon/): A lot of people (even industry folks) speak about HELOCs and home equity loans interchangeably. As if they’re essentially the same thing and not even - [Robinhood Partners with Sage Home Loans to Offer Mortgage Rate Discounts to Gold Members](https://www.thetruthaboutmortgage.com/robinhood-partners-with-sage-home-loans-to-offer-mortgage-rate-discounts-to-gold-members/): The popular trading platform Robinhood has teamed up with Sage Home Loans to offer big mortgage rate discounts to its Gold members. While Robinhood hasn't - [Will Mortgage Rates Be Higher or Lower by the End of 2025? I Asked AI.](https://www.thetruthaboutmortgage.com/will-mortgage-rates-be-higher-or-lower-by-the-end-of-2025-i-asked-ai/): I was thinking about mortgage rates, as I often do, when I decided to pose a question to Grok, the LLM chatbot owned by xAI. So many folks debate which - [Rocket Mortgage Completes Redfin Takeover, Offers $6,000 Home Buyer Credit](https://www.thetruthaboutmortgage.com/rocket-mortgage-completes-redfin-takeover-offers-6000-home-buyer-credit/): The Rocket Mortgage acquisition of Redfin is now complete. You might notice changes if you visit the Redfin website, or if you update the app on your - [Trump Wants Interest Rates Cut to 1%. What Would That Mean for Mortgage Rates?](https://www.thetruthaboutmortgage.com/trump-wants-interest-rates-cut-to-1-what-would-that-mean-for-mortgage-rates/): President Trump’s latest salvo against Fed Chair Jerome Powell called for 1% interest rates. And he added that he’d “love him to resign if he wanted to, - [Mortgage Rates Quietly Fall to Lows of 2025](https://www.thetruthaboutmortgage.com/mortgage-rates-quietly-fall-to-lows-of-2025/): While President Trump and FHFA Director Pulte continue to call for lower rates, mortgage rates have quietly marched down to their 2025 lows. It’s kind of - [What the Fannie Mae and Freddie Mac Crypto Order Really Means](https://www.thetruthaboutmortgage.com/what-the-fannie-mae-and-freddie-mac-crypto-order-really-means/): There’s been a lot of hubbub about crypto-backed mortgages in the past 24 hours. But the excitement (of crypto enthusiasts) might be a little overdone. - [Powell Says They’d Still Be Cutting If There Weren’t Tariffs, and Chances Are Mortgage Rates Would Be Lower Too](https://www.thetruthaboutmortgage.com/powell-says-theyd-still-be-cutting-if-there-werent-tariffs-and-chances-are-mortgage-rates-would-be-lower-too/): In testimony to the House Financial Services Committee today, Federal Reserve Chair Jerome Powell said they haven’t cut rates this year because of the - [Rocket Mortgage Launches Bridge Loan to Help Customers Buy Now, Sell Later](https://www.thetruthaboutmortgage.com/rocket-mortgage-launches-bridge-loan-to-help-customers-buy-now-sell-later/): The nation’s second largest mortgage lender has launched a new bridge loan product to help buyers move before selling their existing home. It allows them - [Mortgage Rates Move Lower Despite Evolving Iran Conflict](https://www.thetruthaboutmortgage.com/mortgage-rates-move-lower-despite-evolving-iran-conflict/): While one may have worried that mortgage rates would move higher after the U.S. bombed Iran nuclear facilities, so far things have gone the other way. - [Pulte Blames Powell for High Mortgage Rates and Trapping Borrowers in Their Homes](https://www.thetruthaboutmortgage.com/pulte-blames-powell-for-high-mortgage-rates-and-trapping-borrowers-in-their-homes/): It’s no secret certain folks don’t like Fed Chair Powell. You may have heard of one of them, President Donald Trump, who refers to him as a “Too Late - [Powell Signals There Won’t Be Shortcuts on Rate Cuts or Path to Lower Mortgage Rates](https://www.thetruthaboutmortgage.com/powell-signals-there-wont-be-shortcuts-on-rate-cuts-or-path-to-lower-mortgage-rates/): The big Fed decision yesterday was keeping rates unchanged. Everyone knew that was going to be the case and didn’t bat an eye. However, things are always - [Is Housing Market Weakness What Finally Brings Down Mortgage Rates?](https://www.thetruthaboutmortgage.com/is-housing-market-weakness-what-finally-brings-down-mortgage-rates/): I got to thinking that one way mortgage rates could come down is due to housing market weakness. The thought is layered in all types of irony because the - [Guild Mortgage to Be Acquired by Bayview Asset Management for $1.3B](https://www.thetruthaboutmortgage.com/guild-mortgage-to-be-acquired-by-bayview-asset-management-for-1-3b/): In yet another mortgage tie-up, Guild Mortgage has agreed to be acquired by Bayview Asset Management. It’s pretty big news in the mortgage world because - [7/1 ARM vs. 30-Year Fixed Mortgage: Pros, Cons, and How Much Cheaper Are They?](https://www.thetruthaboutmortgage.com/30-year-fixed-vs-7-year-arm/): Lately, I've been highlighting loan programs beyond the 30-year fixed now that interest rates on fixed-rate mortgages are no longer favorable. Today, - [Rising Oil Prices Could Be Yet Another Headwind for Mortgage Rates](https://www.thetruthaboutmortgage.com/rising-oil-prices-could-be-yet-another-headwind-for-mortgage-rates/): As if mortgage rates didn’t have enough problems lately, now they’ve got the threat of rising oil prices. And the inflation that could come with them, - [Top Mortgage Lenders in Georgia](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-georgia/): It’s time to check out the top mortgage lenders in Georgia based on their 2024 home lending volume. These mortgage companies outranked about 960 other - [Mortgage Rates Lower as Inflation Eases, But Only a Little](https://www.thetruthaboutmortgage.com/mortgage-rates-lower-as-inflation-eases-but-only-a-little/): Mortgage rates came down after a softer-than-expected CPI print. But only a little bit. Instead of a 30-year fixed quote of 7%, you might see 6.875% - [Mortgage Rates Can’t Shake 7%](https://www.thetruthaboutmortgage.com/mortgage-rates-cant-shake-7/): As hard as they try, mortgage rates keep hovering around the 7% level. It appears any time progress is made, they climb right back to 7%, or very close to - [Top Mortgage Lenders in North Carolina](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-north-carolina/): Despite being a big banking hub, the top mortgage lenders in North Carolina are mostly nonbanks. In fact, just two of the top 10 are depository banks, - [Mortgage Rates Will Be Stuck for Longer If Tariffs Keep Getting Pushed Back](https://www.thetruthaboutmortgage.com/mortgage-rates-will-be-stuck-for-longer-if-tariffs-keep-getting-pushed-back/): Lately, the best single word to sum up mortgage rates has been “stuck.” Ever since early April when they jumped higher as the trade war escalated, they’ve - [Cheaper HELOC Rates, Cash Needs Might Finally Lead to a Home Equity Lending Boom](https://www.thetruthaboutmortgage.com/cheaper-heloc-rates-cash-needs-might-finally-lead-to-a-home-equity-lending-boom/): A new report found that the typical monthly payment to borrow $50,000 via a home equity line of credit (HELOC) has dropped by about $100 since 2024. And - [Top Mortgage Lenders in Florida](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-florida/): Now it’s time to take a look at the top mortgage lenders in Florida based on 2024 volume. The Sunshine State is the biggest mortgage market outside of - [High Mortgage Rates Are Delaying Home Purchases](https://www.thetruthaboutmortgage.com/high-mortgage-rates-are-delaying-home-purchases/): This morning, the National Association of Realtors (NAR) reported that pending home sales dropped 6.3% in April from a month earlier. They were also 2.5% - [Nation’s Top Mortgage Lender Rolls Out ARMs. Why Now?](https://www.thetruthaboutmortgage.com/nations-top-mortgage-lender-rolls-out-arms-why-now/): Long out of favor, adjustable-rate mortgages are quietly making a comeback. To be fair, they are still pretty fringe, but the 30-year fixed is beginning - [Redfin Expects Flat Mortgage Rates, Falling Home Prices for Remainder of 2025](https://www.thetruthaboutmortgage.com/redfin-expects-flat-mortgage-rates-falling-home-prices-for-remainder-of-2025/): A few months ago, Redfin proclaimed that a buyer’s market had finally arrived. It was the first time home sellers didn’t have the upper hand this decade, - [Pulte Asks Powell to Lower Interest Rates, But Would Mortgage Rates Actually Go Down?](https://www.thetruthaboutmortgage.com/pulte-asks-powell-to-lower-interest-rates-but-would-mortgage-rates-actually-go-down/): Fed chair Jerome Powell has had no shortage of critics, not least being President Donald Trump. A month ago, there were even rumblings of Trump looking to - [Top Mortgage Lenders in Ohio](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-ohio/): Today we’ll take a look at the top mortgage lenders in Ohio. Last year, nearly 900 mortgage companies originated about $42 billion in home loans there, a - [President Trump Teases Release of Fannie Mae and Freddie Mac](https://www.thetruthaboutmortgage.com/president-trump-teases-release-of-fannie-mae-and-freddie-mac/): In another twist of events, President Donald Trump has floated the release of Fannie Mae and Freddie Mac. On his Truth Social Platform yesterday, he said, - [Mortgage Rates Are Still Expected to Come Down By the End of 2025](https://www.thetruthaboutmortgage.com/mortgage-rates-are-still-expected-to-come-down-by-the-end-of-2025/): With so many calls for higher mortgage rates lately, now might be the perfect time to play contrarian. It’s something I like to do in general, but it - [Is the Magic Number for Mortgage Rates Now Anything Close to 6%?](https://www.thetruthaboutmortgage.com/is-the-magic-number-for-mortgage-rates-now-anything-close-to-6/): One silver lining to elevated mortgage rates, other than the refinance opportunity later, has been a shifting psychology. A few years ago, I wrote that - [How Moody’s Downgrade Could Actually Help Lower Mortgage Rates](https://www.thetruthaboutmortgage.com/how-moodys-downgrade-could-actually-help-lower-mortgage-rates/): In general, I like to play contrarian because it’s nice to consider alternative viewpoints. Instead of simply regurgitating the same take, sometimes going - [Mortgage Rates Aren’t That High](https://www.thetruthaboutmortgage.com/mortgage-rates-arent-that-high/): With mortgage rates staying stubbornly elevated, new narratives are being written in an attempt to change that view. A popular one of late has been - [Top Mortgage Lenders in Texas](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-texas/): Today we’ll take a look at the top mortgage lenders in Texas based on their annual production last year, including both retail and wholesale loan volume. - [PRMG Launches Co-Branded Credit Card That Earns Points on Mortgage Payments](https://www.thetruthaboutmortgage.com/prmg-launches-co-branded-credit-card-that-earns-points-on-mortgage-payments/): Mortgage lender Paramount Residential Mortgage Group (PRMG) has launched a co-branded credit card with fintech company Mesa. The Mesa Homeowners Card is - [7% Mortgage Rates Are Back Again Despite Lower Inflation and Tariff Relief](https://www.thetruthaboutmortgage.com/7-mortgage-rates-are-back-again-despite-lower-inflation-and-tariff-relief/): Why are mortgage rates approaching 7% again if inflation is cooling and the trade war has softened? You would think interest rates would be coming down - [The Trick Home Builders Use to Sell More Homes](https://www.thetruthaboutmortgage.com/the-trick-home-builders-use-to-sell-more-homes/): It’s been an uphill battle to sell a home lately, with interest rates through the roof and home prices equally expensive. But somehow, someway, the home - [Lower Becomes Latest Mortgage Lender to Acquire a Real Estate Portal](https://www.thetruthaboutmortgage.com/lower-becomes-latest-mortgage-lender-to-acquire-a-real-estate-portal/): The year 2025 has been all about mortgage and real estate linkups and vertical integration. Two of the biggest were announced in the month of March, when - [Mortgage Rates Moderately Higher as China Trade Deal Reached](https://www.thetruthaboutmortgage.com/mortgage-rates-moderately-higher-as-china-trade-deal-reached/): Over the weekend, the United States and China reached a temporary deal to cut tariffs tremendously. Instead of an astronomical 145% rate, the U.S. will - [Dave Ramsey Thinks Lower Mortgage Rates Could Ignite a Home Buying Frenzy](https://www.thetruthaboutmortgage.com/dave-ramsey-thinks-lower-mortgage-rates-could-ignite-a-home-buying-frenzy/): While folks debate whether mortgage rates are going higher or lower, most expect a boom if they eventually do come down. Even Dave Ramsey, who is known - [Mortgage Rates Worsen After First Trade Deal Announced](https://www.thetruthaboutmortgage.com/mortgage-rates-worsen-after-first-trade-deal-announced/): A day after the Fed held its key policy rate steady, 10-year bond yields are up double-digits. And that will result in higher mortgage rates for - [This Might Be as Good as Mortgage Rates Get Until Late 2025](https://www.thetruthaboutmortgage.com/this-might-be-as-good-as-mortgage-rates-get-until-late-2025/): I got to thinking lately that mortgage rates are probably as good as they’re going to be for the foreseeable future. And by that, I mean until at least - [Don’t Expect Fed Meeting to Bring Lower Mortgage Rates](https://www.thetruthaboutmortgage.com/dont-expect-fed-meeting-to-bring-lower-mortgage-rates/): While it’s been said countless times, it bears repeating: the Fed doesn’t set mortgage rates. The Fed simply sets short-term interest rates, driven by its - [The Gap Between Good and Bad Mortgage Rates Has Grown Wider, Shop Accordingly](https://www.thetruthaboutmortgage.com/the-gap-between-good-and-bad-mortgage-rates-has-grown-wider-shop-accordingly/): Not all mortgage rates are created equal. Why? Because lenders don’t price them the same for any number of reasons, whether it's cost to originate or - [High DTI Ratios Continue to Be the Leading Cause of Mortgage Denial](https://www.thetruthaboutmortgage.com/high-dti-ratios-continue-to-be-the-leading-cause-of-mortgage-denial/): Last year marked yet another year where high debt-to-income income ratios were the leading cause of denial for mortgage applicants. While a low credit - [Nation’s Top Mortgage Lender Takes Loan Servicing In House to Win Even More Business](https://www.thetruthaboutmortgage.com/nations-top-mortgage-lender-takes-loan-servicing-in-house-to-win-even-more-business/): The mortgage landscape is changing fast, with the two biggest players making major moves to increase their market share even more. Today, top mortgage - [For Mortgage Rates, It’s One Step Forward, Two Steps Back](https://www.thetruthaboutmortgage.com/for-mortgage-rates-its-one-step-forward-two-steps-back/): It’s been a pretty solid week or two for mortgage rates. The 30-year fixed, which unexpectedly breached the key 7% psychological threshold in mid-April, - [The 2% Mortgage Hack Explained](https://www.thetruthaboutmortgage.com/the-2-mortgage-hack-explained/): Folks on social media love coming up with so-called “hacks” to excite their followers. In the mortgage realm, this typically means highlighting math that - [Mortgage Rates Want a Trade Deal, But Patience Might Be Needed](https://www.thetruthaboutmortgage.com/mortgage-rates-want-a-trade-deal-but-patience-might-be-needed/): If the last few days are any indication, mortgage rates want a trade deal. They don’t like tariffs, trade wars, or any of the uncertainty that comes with - [Top Mortgage Lenders in California: UWM Sweeps All Categories, Rocket Second](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-california/): Thanks to newly-released data, it's time to take a fresh look at the top mortgage lenders in California in 2024. The Golden State is by far the biggest - [Here’s Why the Housing Market Isn’t Crashing Today](https://www.thetruthaboutmortgage.com/heres-why-the-housing-market-isnt-crashing-today/): With home prices out of reach for many today, an obvious question has been when will the housing market crash? To be honest, this question gets asked - [Mortgage Brokers Are Supposed to Shop Around on Your Behalf](https://www.thetruthaboutmortgage.com/mortgage-brokers-are-supposed-to-shop-around-on-your-behalf/): A new lawsuit filed by Ohio Attorney General Dave Yost claims the nation’s top mortgage lender is ripping off Ohio consumers. It’s an interesting one - [How Will Mortgage Rates React to the End of the Trade War?](https://www.thetruthaboutmortgage.com/how-will-mortgage-rates-react-to-the-end-of-the-trade-war/): Is it too soon to be talking about the end of the trade war? Perhaps, but there have been rumblings of a closed-door meeting to get a deal done, along - [What Happens to Mortgage Rates If Powell Gets Fired?](https://www.thetruthaboutmortgage.com/what-happens-to-mortgage-rates-if-powell-gets-fired/): There’s growing talk about Fed Chair Jerome Powell being fired by President Donald Trump. Similar to his first term, he has lobbed insults at Powell while - [Beware of the Mortgage Rate That Ends with .875%](https://www.thetruthaboutmortgage.com/beware-of-the-mortgage-rate-that-ends-with-875/): I was looking at ICE’s most recent Mortgage Monitor Report when something struck me. In their rate distribution chart of recent mortgages, I noticed a - [Redfin Ultimatum: Buyers Should See All the Listings](https://www.thetruthaboutmortgage.com/redfin-ultimatum-buyers-should-see-all-the-listings/): A week after Zillow drew a hard line on off-market listings, Redfin has rolled out its own ultimatum. Redfin CEO Glenn Kelman penned a short statement, - [Mortgage Rates Back Below 7%, But Don’t Expect Any Huge Moves Lower](https://www.thetruthaboutmortgage.com/mortgage-rates-back-below-7-but-dont-expect-any-huge-moves-lower/): The mortgage rate whirlwind continues as we start another week. This time, rates are back below 7% (just barely), though it’s little consolation - [The Fight for Control of Real Estate Listings Heats Up as Zillow Plays Hardball](https://www.thetruthaboutmortgage.com/the-fight-for-control-of-real-estate-listings-heats-up-as-zillow-plays-hardball/): A new battle, or perhaps war, is underway for control of real estate listing data. Depending on who you ask, it’s about the consumer. Mostly the home - [Where Would Mortgage Rates Be Without Liberation Day?](https://www.thetruthaboutmortgage.com/where-would-mortgage-rates-be-without-liberation-day/): In case you haven’t heard, the tariffs levied against China are now 145%. Yes, you read that right. Not the 125% you may have heard about yesterday - [Mortgage Rates Back to 7% as Tariff Day Rattles Bond Market](https://www.thetruthaboutmortgage.com/mortgage-rates-back-to-7-as-tariff-day-rattles-bond-market/): Welp, the question I asked recently, would mortgage rates hit 5.99% or 7% next, has been answered. And unfortunately, if you’re a prospective home buyer - [Mortgage Rates Can Change In an Instant](https://www.thetruthaboutmortgage.com/mortgage-rates-can-change-in-an-instant/): If you’ve been paying attention to mortgage rates lately, you might be wondering what on earth is going on. Mortgage rates appeared to be heading back - [A Good Reminder That Lenders Are Always Quick to Raise Mortgage Rates](https://www.thetruthaboutmortgage.com/a-good-reminder-that-lenders-are-always-quick-to-raise-mortgage-rates/): I keep hearing that lower mortgage rates are the silver lining of a global trade war. That despite the stock market fallout and possibly much higher - [What the Heck Is Going on with Mortgage Rates?](https://www.thetruthaboutmortgage.com/what-the-heck-is-going-on-with-mortgage-rates/): There’s a lot going on right now with mortgage rates so I’m dedicating a very long post to it. First and foremost, mortgage rates are dropping fast as the - [Top Mortgage Lenders of 2024: UWM Beats Rocket for Second Straight Year, But Will It Last?](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-of-2024/): Like the year before, United Wholesale Mortgage (UWM) was the top mortgage lender in 2024. It marked their second year as the top dog, beating out their - [Fannie Mae Now Expects Mortgage Rates to Be 30 Basis Points Lower By Year End](https://www.thetruthaboutmortgage.com/fannie-mae-now-expects-mortgage-rates-to-be-30-basis-points-lower-by-year-end/): The latest mortgage rate forecast from Fannie Mae is a good one, assuming you’re a prospective home buyer or an existing homeowner. The - [Mortgage Rates Appear to Be Falling as Recession Fears Rise](https://www.thetruthaboutmortgage.com/mortgage-rates-appear-to-be-falling-as-recession-fears-rise/): As always, it’s been hard to determine the path forward for mortgage rates. They’re never easy to predict, but since the new administration took over, - [Rocket Buying Nation's Largest Loan Servicer Mr. Cooper to Reclaim Top Mortgage Lender Title](https://www.thetruthaboutmortgage.com/rocket-buying-nations-largest-loan-servicer-mr-cooper-to-reclaim-top-mortgage-lender-title/): I’ve been saying for a year or two, maybe longer, that recapture was the next big thing in mortgage. Instead of going out and spending a lot of time and - [Should I Wait for Mortgage Rates to Drop Before Buying a Home?](https://www.thetruthaboutmortgage.com/should-i-wait-for-mortgage-rates-to-drop-before-buying-a-home/): I’ve seen a lot of posts lately on social media talking about waiting for mortgage rates to drop before buying a home. Or conversely, NOT waiting for - [Non-Permanent Residents No Longer Eligible for FHA Loans](https://www.thetruthaboutmortgage.com/non-permanent-residents-no-longer-eligible-for-fha-loans/): A sweeping change took place this morning that blocks non-permanent residents from taking out FHA loans. After conforming loans backed by Fannie Mae and - [Mortgage Rates Could Go Up If Foreign Countries Dump Their MBS Holdings](https://www.thetruthaboutmortgage.com/mortgage-rates-could-go-up-if-foreign-countries-dump-their-mbs-holdings/): File this one under unintended consequences of a global trade war. When you start a trade war, or at least threaten one, unexpected things can happen. We - [Veterans United the Top VA Loan Lender in 2024 for Third Straight Year](https://www.thetruthaboutmortgage.com/veterans-united-the-top-va-loan-lender-in-2024/): Well, another year is in the books at the VA, and like prior years, Veterans United topped the list as the #1 VA loan lender in America. This marked their - [Where Would Mortgage Rates Be Today If Kamala Harris Won?](https://www.thetruthaboutmortgage.com/where-would-mortgage-rates-be-today-if-kamala-harris-won/): A couple weeks ago, I wrote about how mortgage rates hadn’t really done much since the U.S. presidential election took place. By not doing much, I meant - [If You Have a Mortgage, You Are Not Rich](https://www.thetruthaboutmortgage.com/if-you-have-a-mortgage-you-are-not-rich/): I’ve been a lot more active on social media over the past few years. And one of my observations is that everyone is looking to go viral with some - [If Mortgage Rates Don’t Move, They’ll Be Better in a Month](https://www.thetruthaboutmortgage.com/if-mortgage-rates-dont-move-theyll-be-better-in-a-month/): Lately, mortgage rates have been pretty flat. They enjoyed a nice string of six or seven weeks where they tumbled down from around 7.25% to 6.75% before - [2025 Home Selling Tips to Get Top Dollar: How to Navigate a Cooler Housing Market](https://www.thetruthaboutmortgage.com/12-home-selling-tips-for-2019/): Let's talk home selling tips. While still-high mortgage rates will undoubtedly make prospective home buyers feel stretched, there's still plenty of hope - [Higher Mortgage Rates Mean Principal Repayment Has Slowed to a Crawl](https://www.thetruthaboutmortgage.com/higher-mortgage-rates-mean-principal-repayment-has-slowed-to-a-crawl/): I remember when I wrote my mortgage myths post, I pointed out that mortgages aren’t mostly interest. But I did so when mortgage rates were near record low - [Mortgage Rate History: Check Out These Charts from the Early 1900s](https://www.thetruthaboutmortgage.com/check-out-these-mortgage-rate-charts-from-the-early-1900s/): Today we'll take a brief look at some mortgage rate history to gain a little context for where we stand today. It's always helpful to know what came - [If You’re Buying a Home Today, Expect to Keep It for a Long Time](https://www.thetruthaboutmortgage.com/if-youre-buying-a-home-today-expect-to-keep-it-for-a-long-time/): It seems pretty clear that the housing market has cooled, and is now more of a buyer’s market than a seller’s market. While this does and will always vary - [Can the Housing Market Stomach a Return to 7% Mortgage Rates?](https://www.thetruthaboutmortgage.com/can-the-housing-market-stomach-a-return-to-7-mortgage-rates/): Yesterday, I wrote about how the uncertainty surrounding tariffs was hurting mortgage rates. In short, the market doesn’t know what to make of the tariffs - [How to Reduce Closing Costs on Your Mortgage](https://www.thetruthaboutmortgage.com/how-to-reduce-closing-costs-on-your-mortgage/): Closing costs can be very expensive. Fortunately, there are a number of ways to reduce out-of-pocket costs and hold onto more of your money. - [The Trade War Matters More to Mortgage Rates Than Cool Economic Data](https://www.thetruthaboutmortgage.com/the-trade-war-matters-more-to-mortgage-rates-than-cool-economic-data/): It’s clear that the trade war is now the biggest driver of mortgage rates today. Prior to the arrival of tariffs and a wider trade war, inflation and - [2025 Could Be the Year of the Rate and Term Refinance](https://www.thetruthaboutmortgage.com/2025-could-be-the-year-of-the-rate-and-term-refinance/): So far, 2025 is shaping up to be a bit better when it comes to mortgage rates. While the 30-year fixed is only slightly below year-ago levels at the - [Rocket to Acquire Redfin to Boost Home Purchase Lending and Take Back #1 Spot](https://www.thetruthaboutmortgage.com/rocket-to-acquire-redfin-to-boost-home-purchase-lending-and-take-back-1-spot/): Just a week after Rocket Mortgage exited Canada, parent company Rocket Companies has announced its intent to acquire Redfin. The Seattle, WA-based real - [Navy Federal Mortgage Review: Rates Appear Low and They Keep Your Loan](https://www.thetruthaboutmortgage.com/navy-federal-mortgage-review-rates-appear-low-and-they-keep-your-loan/): One of the oldest and largest credit unions in the nation, Navy Federal FCU, happens to be a big player in the home loan space. Instead of just offering - [Don’t Be Surprised If Mortgage Rates Go Up Tomorrow](https://www.thetruthaboutmortgage.com/dont-be-surprised-if-mortgage-rates-go-up-tomorrow/): Tomorrow is a big day for mortgage rates, potentially. I say that because tomorrow is the release of the monthly jobs report from the Bureau of Labor - [Have Trump and Bessent Actually Lowered Mortgage Rates At All?](https://www.thetruthaboutmortgage.com/have-trump-and-bessent-actually-lowered-mortgage-rates-at-all/): There’s been a lot of optimism about mortgage rates under Trump. After all, rates have fallen for the past six weeks from around 7.25% to 6.75%, which is - [Mortgage Rates Are Now Back to October Levels. How Could They Move Even Lower?](https://www.thetruthaboutmortgage.com/mortgage-rates-are-now-back-to-october-levels-how-could-they-move-even-lower/): Today was yet another good day for mortgage rates, which came down an additional 10 bps (0.10%), per the latest daily survey from Mortgage News Daily. The - [Renting vs. Buying a Home: 55 Pros and Cons](https://www.thetruthaboutmortgage.com/renting-vs-buying-55-pros-and-cons/): It's time for yet another mortgage match-up, so without further ado, here’s a biggie: “Renting vs. buying a home.” Or a townhouse for that matter... This - [Are Mortgage Rates Going to 5.99% or 7% Next?](https://www.thetruthaboutmortgage.com/are-mortgage-rates-going-to-5-99-or-7-next/): It’s no secret mortgage rates are falling. I’ve argued they never really stopped falling since the 30-year fixed hit 8% back in late 2023. But there have - [Mortgage Rates Are Down About Half a Percent in the Past Six Weeks](https://www.thetruthaboutmortgage.com/mortgage-rates-are-down-about-half-a-percent-in-the-past-six-weeks/): What a run it has been for mortgage rates lately. In just the past six weeks, the 30-year fixed has fallen about half a percentage point. At last glance, - [Locking vs. Floating Your Mortgage Rate: Which Is Better and Why?](https://www.thetruthaboutmortgage.com/locking-vs-floating-your-mortgage-rate/): Trying to decide between locking and floating your mortgage rate? Discover the pros and cons of each, and how to make the right choice. - [A Weakening Economy Might Bring Lower Mortgage Rates, But What Else?](https://www.thetruthaboutmortgage.com/a-weakening-economy-might-bring-lower-mortgage-rates-but-what-else/): It’s been a great week for mortgage rates. You can’t argue that. The 30-year fixed is now averaging around 6.80%, down from over 7% a week ago. Aside from - [Mortgage Rates Back Below Year-Ago Levels as We Head into Spring](https://www.thetruthaboutmortgage.com/mortgage-rates-back-below-year-ago-levels-as-we-head-into-spring/): As anticipated, mortgage rates are back below their year-ago levels. I had suspected they would be, despite a rough couple of months pre- and - [How to Pay Off the Mortgage Early: 30+ Methods You Can Use Right Now](https://www.thetruthaboutmortgage.com/how-to-pay-off-the-mortgage-early/): Mortgage Q&A: “How to pay off the mortgage early.” If you're looking to pay off your mortgage quickly, now might be a good time to do so because - [Buying a Home in 2025? Supply Is Finally Rising and Some Are Calling It a Buyer's Market. Here Are 11 Tips to Help Make It Happen!](https://www.thetruthaboutmortgage.com/buying-a-home-in-2018-11-tips-to-get-it-done/): If you’ve yet to enter the housing market, but are thinking of buying a home in 2025, there’s a lot you need to know. The 2025 housing market is going to - [RocketRentRewards Offers 10% Back on Rent to Use Toward Closing Costs on a Home Purchase](https://www.thetruthaboutmortgage.com/rocketrentrewards-offers-10-back-on-rent-to-use-toward-closing-costs-on-a-home-purchase/): In a bid to help more renters make the leap to homeownership, Rocket Mortgage has launched a new program called “RocketRentRewards.” As the name suggests, - [FHA Layoffs: 40% of Staff to Be Let Go in Latest Government Cuts](https://www.thetruthaboutmortgage.com/fha-layoffs-40-of-staff-to-be-let-go-in-latest-government-cuts/): Less than a week after a task force was launched to “eliminate waste, fraud, and abuse” at HUD, it appears nearly half of the Federal Housing - [Is Trump’s Plan to Lower Mortgage Rates Mass Government Layoffs?](https://www.thetruthaboutmortgage.com/is-trumps-plan-to-lower-mortgage-rates-mass-government-layoffs/): I got to thinking the other day that Trump’s plan to lower mortgage rates might be through increased unemployment. While everyone is seemingly focused on - [Can You Use a Credit Card for a Down Payment on a House?](https://www.thetruthaboutmortgage.com/can-you-use-a-credit-card-for-a-down-payment-on-a-house/): One of the biggest hurdles to homeownership is the down payment. After all, the typical American has barely anything in the way of savings. At last - [Trump Wants to Lower Mortgage Rates without the Fed](https://www.thetruthaboutmortgage.com/trump-wants-to-lower-mortgage-rates-without-the-fed/): You’ve likely heard that one of President Trump’s goals is to lower mortgage rates. He talked about it on the campaign trail before he got elected, and - [Is It Better to Refinance with Your Current Mortgage Lender?](https://www.thetruthaboutmortgage.com/is-it-better-to-refinance-with-your-current-mortgage-lender/): If you already have a mortgage, you might be curious about refinancing, and more specifically if you have to use your original lender. Or if it’s best to - [The Release of Fannie and Freddie Could Come Down to Mortgage Rates: But Should It?](https://www.thetruthaboutmortgage.com/bessent-says-release-of-fannie-and-freddie-depends-on-mortgage-rates/): If you’re hoping for a quick release of Fannie Mae and Freddie Mac, you might want to exercise some patience. While the odds of the pair exiting - [What Is Mortgage Matchup? And Why Did UWM Create It?](https://www.thetruthaboutmortgage.com/what-is-mortgage-matchup/): If you’ve seen commercials for “Mortgage Matchup” lately, perhaps during an NBA game, or on the court itself, you might be wondering what they’re all - [Mortgage Rates Back Below 7%, But Pricing Remains Cautious](https://www.thetruthaboutmortgage.com/mortgage-rates-back-below-7-but-pricing-remains-cautious/): It’s been a good couple of weeks for mortgage rates, which benefited from a delay on tariffs and some favorable economic data. Between a slowing economy, - [Better Forever Program Waives Loan Origination Fees for Life](https://www.thetruthaboutmortgage.com/better-forever-program-waives-loan-origination-fees-for-life/): A new loyalty program has been launched by Better Mortgage that waives loan origination fees for life. Known as the “Better Forever Program,” it rewards - [Can You Refinance an Adjustable-Rate Mortgage?](https://www.thetruthaboutmortgage.com/can-you-refinance-an-adjustable-rate-mortgage/): If you have an adjustable-rate mortgage you’re looking to get out of, the good news is it’s usually as simple as applying for a refinance. The bad news is - [Housing Inventory Expected to Normalize by Mid-2026](https://www.thetruthaboutmortgage.com/housing-inventory-expected-to-normalize-by-mid-2026/): It’s no secret for-sale inventory has been in short supply for a long time now, making it increasingly difficult to find your dream home. The supply of - [Treasury Secretary Bessent Becomes Acting Director of CFPB: How Will It Affect Mortgages?](https://www.thetruthaboutmortgage.com/treasury-secretary-scott-bessent-becomes-acting-director-of-the-consumer-financial-protection-bureau/): The Consumer Financial Protection Bureau (CFPB) has a new acting director, none other than Treasury Secretary Scott Bessent. The news was announced today - [Home Builders Urge Trump to Rethink Tariffs That Could Drive Home Prices Up Further](https://www.thetruthaboutmortgage.com/home-builders-urge-trump-to-rethink-tariffs-that-could-drive-home-prices-up-further/): If you haven’t heard, the Trump administration imposed tariffs on imports from Mexico, Canada, and China today. As of February 1st, there is a 25% tariff - [Mortgage Rates vs. Tariffs: What's the Impact?](https://www.thetruthaboutmortgage.com/mortgage-rates-vs-tariffs/): I knew I was going to have to write this post at some point during Trump’s second term. And here we are, only 10 days in. In case you didn’t hear, the - [What Is a Cash-In Refinance? Lower Your Loan Balance and Your Mortgage Rate](https://www.thetruthaboutmortgage.com/what-is-a-cash-in-refinance/): A home loan where you bring money to the table to lower your loan balance and your mortgage rate at the same time. - [Non-Mortgage Housing Costs Nearly Exceed the Mortgage Itself](https://www.thetruthaboutmortgage.com/non-mortgage-housing-costs-nearly-exceed-the-mortgage-itself/): If you’re an existing homeowner who purchased your property as recently as 2022, you probably have a really low, fixed mortgage rate. Perhaps something - [Down Payment Assistance Programs May Be Affected by Federal Funding Pause](https://www.thetruthaboutmortgage.com/down-payment-assistance-programs-may-be-affected-by-federal-funding-pause/): While it appears that Trump’s funding freeze won’t affect home buyers who use a government-backed mortgage, there’s now another concern. It came to my - [What Happens If the Appraisal Comes In Low?](https://www.thetruthaboutmortgage.com/what-happens-if-the-appraisal-comes-in-low/): With home prices dare I say a little frothy these days, low appraisals are becoming a concern again for home buyers. It wasn’t uncommon for appraisals to - [Trump’s Funding Freeze Causes Uncertainty for Government-Backed Mortgages](https://www.thetruthaboutmortgage.com/trumps-funding-freeze-causes-uncertainty-for-government-backed-mortgages/): Yesterday, President Trump released a memo calling for the temporary pause of grants, loans, and other financial assistance programs. The executive order - [Trump May Get His Wish of Lower Mortgage Rates Granted, But Not for the Right Reasons](https://www.thetruthaboutmortgage.com/trump-may-get-his-wish-of-lower-mortgage-rates-granted-but-not-for-the-right-reasons/): Last week, President Donald Trump demanded that “interest rates drop immediately” while addressing the World Economic Forum in Davos, Switzerland - [Existing Home Sales Fall to Lowest Level Since 1995](https://www.thetruthaboutmortgage.com/existing-home-sales-fall-to-lowest-level-since-1995/): To say it’s been a bad 12 months for home sales would be a massive understatement. Today, the National Association of Realtors (NAR) reported that - [The Largest HELOC Lenders in the Nation (Updated for 2025)](https://www.thetruthaboutmortgage.com/top-heloc-lenders/): Now that tapping home equity is back in fashion, I figured it’d be helpful to see who the top HELOC lenders are. This is especially timely with the prime - [FHA Life of Loan Premiums Might Be Scrapped Under Trump](https://www.thetruthaboutmortgage.com/fha-life-of-loan-premiums-might-be-scrapped-under-trump/): Well, we’re just one day into Trump’s second term and there are already rumblings of new residential housing policy. While it’s still all just talk, at - [Mortgage Rates Begin Above 7% to Start Trump’s Second Term in Office](https://www.thetruthaboutmortgage.com/mortgage-rates-begin-above-7-to-start-trumps-second-term-in-office/): Well, President Donald Trump is officially back in office after the long-awaited inauguration took place today in Washington D.C. He was sworn in as the - [HELOC Rates Expected to Continue Falling in 2025](https://www.thetruthaboutmortgage.com/heloc-rates/): Let's talk about HELOC rates. If you’ve had a home equity line of credit (HELOC) for a while, you likely saw your interest rate rise significantly over - [WaFd Bank Exits Single-Family Mortgage Lending Business](https://www.thetruthaboutmortgage.com/wafd-bank-exits-single-family-mortgage-lending-business/): Welp, another day in 2025, another mortgage lender calling it quits. This time it’s depository Washington Federal Bank, or WaFd for short. The - [Mortgage Rates Get Boost from Bessent and Soft Economic Data](https://www.thetruthaboutmortgage.com/mortgage-rates-get-boost-from-bessent-and-soft-economic-data/): As I’ve said before when talking about mortgage, what a difference a week makes. Or even a couple days. If you’re new to mortgage rates, know that first - [What Is a Letter of Explanation? Your Chance to Talk to an Underwriter](https://www.thetruthaboutmortgage.com/what-is-a-letter-of-explanation/): Mortgage Q&A series: “What is a letter of explanation for a mortgage?” If you’re currently going through the joyful process of obtaining a home loan, - [What Is a 3/1 ARM? A 30-Year Loan That's Only Fixed for the First Three Years](https://www.thetruthaboutmortgage.com/what-is-a-3-1-arm/): If you haven’t been feeling 30-year mortgage rates recently, maybe an ARM could suit you better. This is especially true if you don’t plan to stay in the - [10 Simple Ways You Can Save Money on Your Next Mortgage](https://www.thetruthaboutmortgage.com/10-ways-to-save-money-on-your-next-mortgage/): You’ve heard the news – mortgage rates jumped from close to 6% back in September to over 7% in less than a few months, before climbing even higher. And - [Can You Refinance a Home Equity Loan or a HELOC?](https://www.thetruthaboutmortgage.com/can-you-refinance-a-home-equity-loan-or-a-heloc/): With second mortgages like home equity loans and home equity lines of credit (HELOCs) growing in popularity lately, I figured it’d be prudent to talk - [Fannie, Freddie, FHA, and Chase Announce Mortgage Relief for LA Wildfire Victims](https://www.thetruthaboutmortgage.com/fannie-freddie-fha-and-chase-announce-mortgage-relief-for-la-wildfire-victims/): While the Los Angeles wildfires are still ongoing, some mortgage relief options are beginning to roll out. This morning, both Fannie Mae and Freddie Mac - [What Is the Downside of Getting a Mortgage?](https://www.thetruthaboutmortgage.com/what-is-the-downside-of-getting-a-mortgage/): I saw his seemingly straightforward question posed and was surprised I’d never really addressed it. I’ve been writing about mortgages on this blog since - [Ally Financial Calls It Quits on Mortgage Lending, Will Lay Off Staff](https://www.thetruthaboutmortgage.com/ally-financial-calls-it-quits-on-mortgage-lending-will-lay-off-staff/): Well, 2025 is off to a rough start with one fairly large mortgage lender calling it quits already. Ally Financial is reportedly done with mortgage lending - [Should You Drive Until You Qualify for a Mortgage?](https://www.thetruthaboutmortgage.com/should-you-drive-until-you-qualify-for-a-mortgage/): In the mortgage/real estate world there’s a saying: “Drive until you qualify.” It’s a cute way of saying if you can’t afford a home in a certain - [New Rule Removes Medical Bills from Credit Reports, Could Lead to 20K More Mortgage Approvals Annually](https://www.thetruthaboutmortgage.com/new-rule-removes-medical-bills-from-credit-reports-could-lead-to-20k-more-mortgage-approvals-annually/): The Consumer Financial Protection Bureau (CFPB) has finalized a rule that will remove medical debts from consumer credit reports. In doing so, Americans' - [Is the 30-Year Fixed Even a Good Deal Anymore?](https://www.thetruthaboutmortgage.com/is-the-30-year-fixed-even-a-good-deal-anymore/): It’s no secret that the 30-year fixed was the best deal ever a few short years ago. Back in 2021 (and in surrounding years) you could lock-in a sub-3% - [Mortgage Rates Are Back at 2001 Levels](https://www.thetruthaboutmortgage.com/mortgage-rates-are-back-at-2001-levels/): The popular 30-year fixed averaged 6.91% to begin 2025, per the latest Freddie Mac data. This means mortgage rates are now on par with 2001 levels, when - [What Is a Mortgagee? Hint: It's Not a Typo Nor Is It Misspelled](https://www.thetruthaboutmortgage.com/what-is-a-mortgagee/): Are You a Mortgagee or Mortgagor? It's 2025 and it's time for some fresh mortgage Q&A! Today's question: “What is a mortgagee?” No, it's not a typo. I - [Lender Credits: The Opposite of Paying Points on Your Mortgage](https://www.thetruthaboutmortgage.com/what-is-a-lender-credit/): A lender credit can eliminate the closing costs on your mortgage. But it will increase your mortgage rate as a result. - [We Are Entering 2025 with Mortgage Rates on the Rise](https://www.thetruthaboutmortgage.com/we-are-entering-2025-with-mortgage-rates-on-the-rise/): What a difference a year makes. Toward the end of 2023, mortgage rates fell nearly 150 basis points to ring in the New Year. Meanwhile, mortgage rates - [2025 Mortgage and Real Estate Predictions: Where Is the Market Headed Next?](https://www.thetruthaboutmortgage.com/2025-mortgage-and-real-estate-predictions/): 1. Mortgage rates will move lower and hit the 5s at some point I always start my New Year predictions post with a guess about which way mortgage rates - [One Major Reason Why the Housing Market Is Much Better Off Than It Used to Be](https://www.thetruthaboutmortgage.com/one-major-reason-why-the-housing-market-is-much-better-off-than-it-used-to-be/): With home prices out of reach for many and affordability the worst it’s been in decades, a lot of folks are talking about another housing crash. However, - [Mortgage Rates Increased About a Quarter Percent This Week. What Does That Actually Mean?](https://www.thetruthaboutmortgage.com/mortgage-rates-increased-about-a-quarter-percent-this-week-what-does-that-actually-mean/): If you’ve scanned the headlines lately, you probably saw that mortgage rates went up yet again. And they did so despite another Fed rate cut, which has a - [The Reason Mortgage Rates Jumped After the Fed Rate Cut](https://www.thetruthaboutmortgage.com/the-reason-mortgage-rates-jumped-after-the-fed-rate-cut/): Well, it happened again. The Federal Reserve announced another rate cut and mortgage rates surged higher. In fact, the 30-year fixed now starts with a 7 - [2025 Mortgage Rate Predictions: Where Do They Go From Here?](https://www.thetruthaboutmortgage.com/2025-mortgage-rate-predictions/): It’s that time of the year when I look at what the next year might have in store for mortgage rates. It’s never easy to accurately forecast mortgage - [Larger Loan Amounts Require Smaller Mortgage Rate Decreases for a Refinance to Pencil](https://www.thetruthaboutmortgage.com/larger-loan-amounts-require-smaller-mortgage-rate-decreases-for-a-refinance-to-pencil/): While 2025 offers some hope mortgage rates will move lower, that’s still very much up in the air. There are renewed worries that inflation could reignite, - [If You’re Serious About Selling Your Home, List Below the Zestimate](https://www.thetruthaboutmortgage.com/if-youre-serious-about-selling-your-home-list-below-the-zestimate/): Recently, I’ve encountered two very different types of for-sale listings in the market. There are the properties that go pending in about a week, - [Homeowners Who Refinanced Recently Saw the Biggest Mortgage Rate Improvement in Decades](https://www.thetruthaboutmortgage.com/homeowners-who-refinanced-recently-saw-the-biggest-mortgage-rate-improvement-in-decades/): When mortgage rates fell to around 6% in August, homeowners jumped at the opportunity to refinance. In the months of September and October, more than - [Opt-Out Before You Begin Mortgage Shopping](https://www.thetruthaboutmortgage.com/opt-out-before-you-begin-mortgage-shopping/): Often times when you apply for a mortgage, you’ll be bombarded by offers from competing banks and lenders. The reason this happens is because the credit - [Are We Still in a Falling Mortgage Rate Environment?](https://www.thetruthaboutmortgage.com/are-we-still-in-a-falling-mortgage-rate-environment/): It’s been a wild ride for mortgage rates this year. The 30-year fixed began 2024 at around 6.625% and is currently not far from those levels. Despite - [Winter Is Coming for Mortgage Rates. Why That Might Be a Good Thing](https://www.thetruthaboutmortgage.com/winter-is-coming-for-mortgage-rates-why-that-might-a-good-thing/): Mortgage rates have been on a wild ride the past few years. In fact, it was still possible to obtain a 3% 30-year fixed mortgage in early 2022. By late - [The U.S. President Doesn’t Set Mortgage Rates](https://www.thetruthaboutmortgage.com/the-u-s-president-doesnt-set-mortgage-rates/): Mortgage rates are a pretty complex subject. They’re also commonly misunderstood and oversimplified, with many myths perpetuated by those who work in the - [Why You Might Want to Steer Clear of a Cash Out Refinance Right Now](https://www.thetruthaboutmortgage.com/why-you-might-want-to-steer-clear-of-a-cash-out-refinance-right-now/): It’s no secret that mortgage rates aren’t cheap anymore. In the first quarter of 2022, you could still get a 30-year fixed in the 3% range. Within a year, - [Bilt Card to Offer Point Earning on Mortgage Payments](https://www.thetruthaboutmortgage.com/bilt-card-to-offer-point-earning-on-mortgage-payments/): Well, it sounds like the new Mesa Homeowners Card got the attention of one of its competitors. Bilt is best known for its credit card that allows its - [Mortgage Rates Tend to Fall Within 12 Weeks of a First Fed Rate Cut](https://www.thetruthaboutmortgage.com/mortgage-rates-tend-to-fall-within-12-weeks-of-a-first-fed-rate-cut/): Lately, there’s been a ton of speculation surrounding the direction of mortgage rates. I too have taken part in this quite a bit as I’ve attempted to - [Mortgage Rates Improve After New Treasury Secretary Bessent Announced](https://www.thetruthaboutmortgage.com/mortgage-rates-improve-after-new-treasury-secretary-bessent-announced/): As I’ve been saying for a while now, all of the potential bad news (for mortgage rates) has been largely baked in over the past couple months. And then - [Watch Out for Mortgage Mailers That Look Super Official But Aren’t](https://www.thetruthaboutmortgage.com/watch-out-for-mortgage-mailers-that-look-super-official-but-arent/): Lately we’ve been hearing a lot about trigger leads due to legislation trying to ban them. If you’re unaware, when a lender pulls your credit, the credit - [Three Key Differences Between HELOCs and Home Equity Loans](https://www.thetruthaboutmortgage.com/three-key-differences-between-helocs-and-home-equity-loans/): Lately, homeowners have been turning to their equity for their cash needs. After all, most already have a super low fixed mortgage rate and don’t want to - [It’s Okay to Negotiate with Your Real Estate Agent](https://www.thetruthaboutmortgage.com/its-okay-to-negotiate-with-your-real-estate-agent/): The big NAR settlement is expected to be finalized next week, but the changes already took effect back in August. They include needing a written buyer - [Normal Mortgage Rates? The Average Mortgage Rate Since 1972 Is Roughly 7.75%](https://www.thetruthaboutmortgage.com/normal-mortgage-rates-the-average-mortgage-rate-since-1972-is-roughly-7-75/): Lately, I’ve been a hearing a lot of people say that mortgage rates are “average” or “normal.” As in, they aren’t high or low. They’re just typical. This - [What Does It Actually Mean to Return to Lower Mortgage Rates?](https://www.thetruthaboutmortgage.com/what-does-it-actually-mean-to-return-to-lower-mortgage-rates/): Recently, a lot of people have argued that we won’t return to lower mortgage rates. That there’s no possible way we can go back to low mortgage rates. - [Do the Home Builders Need to Offer Mortgage Rate Buydowns to Make the Math Work?](https://www.thetruthaboutmortgage.com/do-the-home-builders-need-to-offer-mortgage-rate-buydowns-to-make-the-math-work/): If you’ve been home shopping since early 2022 when mortgage rates surged higher, you’ve likely come across the buydown. The buydown is used to lower a - [Can Mortgage Rates Improve Much Before Trump’s Inauguration?](https://www.thetruthaboutmortgage.com/can-mortgage-rates-improve-much-before-trumps-inauguration/): While mortgage rates have already seen some improvement since the election dust settled, they remain quite elevated. At last glance, the 30-year fixed was - [Don’t Attempt to Time the Housing Market](https://www.thetruthaboutmortgage.com/dont-attempt-to-time-the-housing-market/): It’s a tale as old as time. Someone attempts to time the market, only to fail miserably. Then they either miss out completely, or chase an opportunity - [Is This Housing Market Cycle Just Getting Started?](https://www.thetruthaboutmortgage.com/is-this-housing-market-cycle-just-getting-started/): I sometimes wonder with so little equity extracted this cycle if it’s still early innings for the housing market. At least in terms of the next collapse. - [What Will Happen to Mortgage Rates During Trump's Second Term?](https://www.thetruthaboutmortgage.com/what-will-happen-to-mortgage-rates-during-trumps-second-term/): It’s been no secret that most everyone thinks mortgage rates will be higher under President Trump. But because it’s been so telegraphed this time around, - [First-Time Home Buyer Share Hits Record Low: Why That Might Be a Good Thing](https://www.thetruthaboutmortgage.com/first-time-home-buyer-share-hits-record-low-why-that-might-be-a-good-thing/): The National Association of Realtors (NAR) reported that the first-time home buyer share fell to a historic low of just 24%. That was down from 32% a year - [How Did Almost Half of Recent Home Buyers Snag a Mortgage Rate Under 5%?](https://www.thetruthaboutmortgage.com/how-did-almost-half-of-recent-home-buyers-snag-a-mortgage-rate-under-5/): Everyone knows high mortgage rates have been a total drag lately, especially for prospective home buyers facing extremely high asking prices. But what if - [Chase Relationship Pricing Offers Discounted Mortgage Rates for Up to 1% Off](https://www.thetruthaboutmortgage.com/chase-relationship-pricing-offers-discounted-mortgage-rates-for-up-to-1-off/): If you recall, Chase took over troubled First Republic Bank back in May 2023. Prior to First Republic going under, they were the leading jumbo home loan - [Mortgage Rates Are in a Holding Pattern Until After the Election](https://www.thetruthaboutmortgage.com/mortgage-rates-are-in-a-holding-pattern-until-after-the-election/): Seems pretty clear now that it doesn't matter what economic data shows up between now and next week. Mortgage rates aren't going to improve by any - [Would-Be Sellers vs. Must-Sell Sellers](https://www.thetruthaboutmortgage.com/would-be-sellers-vs-must-sell-sellers/): I wanted to take a moment to talk about the types of sellers that exist in the housing market. There are typically two types of sellers in the - [Figure Launches a Piggyback Second Mortgage](https://www.thetruthaboutmortgage.com/figure-launches-a-piggyback-second-mortgage/): Figure Lending has unveiled a new piggyback loan at a time when housing affordability has rarely been worse. Call it a sign of the times, and maybe an - [Home Buyers: Use High Mortgage Rates as an Excuse to Get a Lower Price](https://www.thetruthaboutmortgage.com/home-buyers-use-high-mortgage-rates-as-an-excuse-to-get-a-lower-price/): I often try to find silver linings in bad situations. The latest issue facing prospective home buyers is a return to 7% mortgage rates, up from around 6% - [Fannie and Freddie Expand Appraisal Waivers to Even More Home Buyers](https://www.thetruthaboutmortgage.com/fannie-and-freddie-expand-appraisal-waivers-to-even-more-home-buyers/): Both Fannie Mae and Freddie Mac announced newly expanded appraisal waivers to reduce costs and help more first-time home buyers purchase a property. The - [Calque Looks to Solve the Buy Before You Sell Problem](https://www.thetruthaboutmortgage.com/calque-mortgage-looks-to-solve-the-buy-before-you-sell-problem/): Another fintech has been quietly growing in the mortgage space, looking to solve the age-old “buy before you sell” conundrum. A major challenge for - [The Second Mortgage Sales Pitch Is Coming, Be Ready](https://www.thetruthaboutmortgage.com/the-second-mortgage-sales-pitch-is-coming-be-ready/): We’re currently in a strange sort of housing crisis where existing homeowners are in a fantastic spot, but prospective buyers are mostly priced out. The - [Use a Higher Mortgage Rate When Shopping for a Home to Stay Within Budget](https://www.thetruthaboutmortgage.com/use-a-higher-mortgage-rate-when-shopping-for-a-home-to-stay-within-budget/): With mortgage rates surging higher again, somewhat unexpectedly, a thought came to my mind if you’re currently home shopping. A couple years ago, I threw - [Is It Time to Bring Back the Mortgage Prepayment Penalty?](https://www.thetruthaboutmortgage.com/is-it-time-to-bring-back-the-mortgage-prepayment-penalty/): When the housing market crashed in the early 2000s, new mortgage rules emerged to prevent a similar crisis in the future. The Dodd-Frank Act gave us both - [Do Mortgage Payments Increase? Here Are 4 Ways They Can Get More Expensive](https://www.thetruthaboutmortgage.com/do-mortgage-payments-increase/): This might sound like a no-brainer question, but there are several scenarios where mortgage payments can rise, even if your rate is fixed. - [Mortgage Rates Take Time to Fall, So Be Patient](https://www.thetruthaboutmortgage.com/mortgage-rates-take-time-to-fall-so-be-patient/): If you’ve been paying attention, you may have noticed that mortgage rates have quietly crept back up to nearly 7%. While it appeared that those 7% - [Is Home Equity Lending Really That Crazy Today?](https://www.thetruthaboutmortgage.com/is-home-equity-lending-really-that-crazy-today/): I came across a report from CoreLogic the other day that said home equity loan lending increased to its highest level since 2008. Whenever anyone hears - [UWM Is Now Offering 90% LTV Cash Out Refis. Should We Worry?](https://www.thetruthaboutmortgage.com/uwm-is-now-offering-90-ltv-cash-out-refis-should-we-worry/): The nation’s largest mortgage lender, UWM, has launched a new 90% LTV cash-out refi to drum up more business. While it’s being sold to mortgage - [Assumable Mortgages Have a Down Payment Problem](https://www.thetruthaboutmortgage.com/assumable-mortgages-have-a-down-payment-problem/): At first glance, assumable mortgages sound like an awesome solution to a problem home buyers have been facing lately. With mortgage rates now closer to - [A Temporary Buydown Could Make Sense While Mortgage Rates Continue to Fall](https://www.thetruthaboutmortgage.com/a-temporary-buydown-could-make-sense-while-mortgage-rates-continue-to-fall/): Last week, I argued that mortgage rates remain in a downward trend, despite some pullback lately. The 30-year fixed had almost been sub-6% when the Fed - [Are Mortgage Rates Just a Distraction for High Home Prices?](https://www.thetruthaboutmortgage.com/are-mortgage-rates-just-a-distraction-for-high-home-prices/): Over the past several years, we’ve been entirely focused on high mortgage rates. The 30-year fixed surged from sub-3% levels to around 8% in the span of - [Is This Mortgage Rate Scare Going to Get Home Buyers Off the Fence?](https://www.thetruthaboutmortgage.com/is-this-mortgage-rate-scare-going-to-get-home-buyers-off-the-fence/): It’s not quite Halloween just yet, but home buyers may have already gotten a good scare. The 30-year fixed mortgage, for which most buyers rely upon, - [If You Can’t Refinance, You Can Make Larger Mortgage Payments Each Month Instead](https://www.thetruthaboutmortgage.com/if-you-cant-refinance-you-can-make-larger-mortgage-payments-each-month-instead/): Did those higher mortgage rates ruin your plans to refinance your mortgage? Well, there might be a temporary solution to save some money while you wait - [Five Million Refinances Hinge on Mortgage Rates Falling Back to 5.5%](https://www.thetruthaboutmortgage.com/five-million-refinances-hinge-on-mortgage-rates-falling-back-to-5-5/): In the mortgage rate world, it’s sometimes a game of inches. This can be true for both prospective home buyers and existing homeowners looking for rate - [Mortgage Rates Don’t Move in a Straight Line Up or Down](https://www.thetruthaboutmortgage.com/mortgage-rates-dont-move-in-a-straight-line-up-or-down/): Ever since the Fed announced their 50-basis point cut, mortgage rates have been climbing higher. In fact, they’re basically 50 bps higher since the Fed - [Don’t Buy a Home with Friends](https://www.thetruthaboutmortgage.com/dont-buy-a-home-with-friends/): Recently, Zillow began airing a commercial called “Homeowner Mates.” It depicts three women moving into a home together. It shows their individual - [Did Mortgage Lenders Raise Their Early Bird 2025 Conforming Loan Limits Too High?](https://www.thetruthaboutmortgage.com/did-mortgage-lenders-raise-their-early-bird-2025-conforming-loan-limits-too-high/): Over the past several years, mortgage lenders have been offering “early bird” conforming loan limits for the upcoming year. This allows them to make - [Maybe Homeowners Are Struggling with Mortgage Loan Amount Lock-In](https://www.thetruthaboutmortgage.com/maybe-homeowners-are-struggling-with-mortgage-loan-amount-lock-in/): When mortgage rates surged off their record lows in early 2022, the housing market ground to a halt. In the span of less than 10 months, 30-year fixed - [Those Double-Digit Mortgage Rates from the 80s Required You to Pay Points Too!](https://www.thetruthaboutmortgage.com/those-double-digit-mortgage-rates-from-the-80s-required-you-to-pay-points-too/): Even though mortgage rates have fallen quite a bit from their highs seen a year ago, they remain quite elevated relative to much of the past decade. Sure, - [Is This as Good as Mortgage Rates Get For Now?](https://www.thetruthaboutmortgage.com/is-this-as-good-as-mortgage-rates-get-for-now/): Well, it’s been over a week since the Fed cut rates and mortgage rates went up. While this may have come as a surprise to some, seasoned mortgage industry - [The Other Reason You Should Shop Around for Your Mortgage](https://www.thetruthaboutmortgage.com/the-other-reason-you-should-shop-around-for-your-mortgage/): I know, I know, mortgage shopping is the worst. It’s not a fun thing to do. It’s not like shopping for a new car or a new TV, or even a new house. But - [Home Purchase Lending Expected to Be Lackluster in 2025 Despite Lower Rates](https://www.thetruthaboutmortgage.com/home-purchase-lending-expected-to-be-lackluster-in-2025-despite-lower-rates/): While lower mortgage rates have reinvigorated hope for the stalling housing market, 2025 might not wind up much better than 2024. Sure, lower interest - [Mesa Wants to Reward You for Every Dollar You Spend on Your Home](https://www.thetruthaboutmortgage.com/mesa-wants-to-reward-you-for-every-dollar-you-spend-on-your-home/): There is apparently a “home cost crisis,” and a new fintech company called Mesa is looking to solve that. It’s no secret that home prices are through the - [You Could Try a Mortgage Rate Modification Instead of a Refinance](https://www.thetruthaboutmortgage.com/what-is-a-mortgage-rate-modification/): Want to lower your mortgage rate without a traditional refinance? Look into a “mortgage rate modification,” which does just that. Instead of having to - [Fed Rate Cut, But Mortgage Rates Up: What Gives?](https://www.thetruthaboutmortgage.com/fed-rate-cut-but-mortgage-rates-up-what-gives/): Anyone who works in the industry probably saw this coming. But those who don't might be left scratching their head. Yesterday, the Fed finally pivoted and - [Why You Probably Don’t Want to Lock Your HELOC](https://www.thetruthaboutmortgage.com/why-you-probably-dont-want-to-lock-your-heloc/): If you’ve got a home equity line of credit (HELOC), payment relief may finally be here. The Fed is expected to “pivot” today, meaning they’ll shift from a - [Rate and Term Refinances Are Up a Whopping 300% from a Year Ago](https://www.thetruthaboutmortgage.com/rate-and-term-refinances-are-up-a-whopping-300-from-a-year-ago/): What a difference a year makes. While the mortgage industry has been purchase loan-heavy for several years now, it could finally be starting to shift. A - [Mortgage Rates Could Fall Another Half Point Just from Market Normalization](https://www.thetruthaboutmortgage.com/mortgage-rates-could-fall-another-half-point-just-from-market-normalization/): It’s been a pretty good year so far for mortgage rates, which topped out at around 8% last year. The 30-year fixed is now priced about one full percentage - [UWM Launches KEEP to Recapture Prior Mortgage Clients for Its Broker Partners](https://www.thetruthaboutmortgage.com/uwm-launches-keep-to-recapture-prior-mortgage-clients-for-its-broker-partners/): I’ve said for a while that the mortgage recapture game was going to ramp up and get more aggressive. Customer retention has always been a big thing in - [I Pay My Mortgage Around the 15th of Every Month](https://www.thetruthaboutmortgage.com/i-pay-my-mortgage-around-the-15th-of-every-month/): Lately, savings accounts have been paying a pretty solid return. Companies like Capital One and Discover have been offering over 4% APY. It’s not - [Surge in FHA Loans with Piggyback Second Mortgages Could Spell Future Problems](https://www.thetruthaboutmortgage.com/surge-in-fha-loans-with-piggyback-second-mortgages-could-spell-future-problems/): A recent report from CoreLogic revealed that “piggybacked purchase loans” for FHA borrowers reach a new high in June of this year. While piggybacked home - [More Consumers Think Mortgage Rates Will Go Down and That Home Prices Are Going to Fall](https://www.thetruthaboutmortgage.com/more-consumers-think-mortgage-rates-will-go-down-and-that-home-prices-are-going-to-fall/): The latest monthly national housing survey from Fannie Mae revealed an interesting contradiction. Last month, a new survey-high 39% of respondents said - [It’s Not a Mortgage Rate Story Anymore](https://www.thetruthaboutmortgage.com/its-not-a-mortgage-rate-story-anymore/): The other day I noticed that mortgage rates were being advertised at some really low levels. Many quotes in the mortgage rate table on my own site were in - [The Hidden Problem with FHA Loans](https://www.thetruthaboutmortgage.com/the-hidden-problem-with-fha-loans/): If you’re thinking about purchasing a property, you’ve likely sifted through available home loan options to determine what’s best. There are lots of loan - [Researchers Says Don’t Wait on the Fed Rate Cut to Refinance Your Mortgage](https://www.thetruthaboutmortgage.com/researchers-says-dont-wait-on-the-fed-rate-cut-to-refinance-your-mortgage/): A new paper from Yale professor Kelly Shue argues that consumers mistakenly wait to take out mortgages and other long-term loans when the Fed is expected - [Home Buyers Were Urged to Beat the Rush, But Are Now Being Told They Might Want to Wait](https://www.thetruthaboutmortgage.com/home-buyers-were-urged-to-beat-the-rush-but-now-told-that-they-might-want-to-wait/): They say not to time the market. It’s a chump’s game. If anyone had any real success at it, they’d be rich. This type of advice typically applies to the - [I am Debt-Averse, But Don’t Mind Having a Mortgage](https://www.thetruthaboutmortgage.com/i-am-debt-averse-but-dont-mind-having-a-mortgage/): I went for a walk today and starting thinking about mortgage debt. I know, pretty lame. But that’s what apparently goes through my head when I make a - [New Flat-Fee AI-Powered Real Estate Buyer Agent Service Called Landian Launches](https://www.thetruthaboutmortgage.com/new-flat-fee-ai-powered-real-estate-buyer-agent-service-called-landian-launches/): What’s better than taking on the National Association of Realtors (NAR) and winning? Well, launching your own flat-fee, AI-powered real estate service - [New Study Says Mortgage Brokers Save Consumers More Than $10K](https://www.thetruthaboutmortgage.com/new-study-says-mortgage-brokers-save-consumers-more-than-10k/): If you’re looking to save money on your next mortgage, a mortgage broker might be able to help. A firm by the name of Polygon Research conducted a study - [Rocket Mortgage Unveils New 2-1 Rate Buydown for Lower Income Home Buyers](https://www.thetruthaboutmortgage.com/rocket-mortgage-unveils-new-2-1-rate-buydown-for-lower-income-home-buyers/): In an effort to boost affordability for those most in need, Rocket Mortgage has launched a new program called “Welcome Home RateBreak.” Similar to their - [How Does Real Estate Commission Work Now?](https://www.thetruthaboutmortgage.com/how-does-real-estate-commission-work-now/): In the not-so-distant past, aka before August 17th, 2024, real estate commissions worked a lot differently. Or at least the rules governing them did. Back - [Can Real Estate Commissions Be Financed via the Mortgage?](https://www.thetruthaboutmortgage.com/can-real-estate-commissions-be-financed-via-the-mortgage/): You’ve probably heard about the big NAR settlement that could completely change how real estate works going forward. But if you haven’t, or are unsure of - [I Refinanced My Mortgage Without Making a Single Phone Call](https://www.thetruthaboutmortgage.com/i-refinanced-my-mortgage-without-making-a-single-phone-call/): In recent years, new technologies have been rolled out to increase efficiency, lower costs, and improve the borrower experience during the home loan - [Is It Better to Buy a Home When Mortgage Rates Are High?](https://www.thetruthaboutmortgage.com/is-it-better-to-buy-a-home-when-mortgage-rates-are-high/): Over the years, there’s been a popular argument that it’s better to buy a home when mortgage rates are high. The logic is that home prices should be lower - [Will Home Prices Go Up When Interest Rates Go Down?](https://www.thetruthaboutmortgage.com/will-home-prices-go-up-when-interest-rates-go-down/): Well, here we are. It took longer than expected, but mortgage rates have finally strung together a decent rally after nearly three years of increases. - [Will the Housing Market Crash in 2025?](https://www.thetruthaboutmortgage.com/will-the-housing-market-crash-in-2025/): I got active on Twitter over the past year and change and to my surprise (not sure why it’s surprising really), encountered lots of housing bears on the - [Presidential Candidate Kamala Harris Has a 7-Year Adjustable-Rate Mortgage](https://www.thetruthaboutmortgage.com/presidential-candidate-kamala-harris-has-a-7-year-adjustable-rate-mortgage/): By now you’ve heard the news. President Biden dropped out of the 2024 presidential race and paved the way for current VP Kamala Harris to run in his - [Beware of Inferior Mortgage Refinance Offers from Your Original Lender](https://www.thetruthaboutmortgage.com/beware-of-inferior-mortgage-refinance-offers-from-your-original-lender/): In case you haven’t heard, there’s talk of a “refinance boom” as soon as 2025. Yes, you read that right. While it seemed like high mortgage rates were - [More Than 4 Million Mortgages Originated Since 2022 Have Rates Above 6.5%](https://www.thetruthaboutmortgage.com/more-than-4-million-mortgages-originated-since-2022-have-rates-above-6-5/): Want to hear some good news about mortgage rates that involves them being a lot higher than they previously were? Yes, I know that sounds absurd, but hear - [Will Mortgage Rates Ever Go Back Down to 3% Again?](https://www.thetruthaboutmortgage.com/will-mortgage-rates-ever-go-back-down-to-3-again/): They say to never say never. But why? Because if you say it, whatever you said would never happen typically happens. Go figure. Well, speaking of, Fannie - [If I Have a Mortgage, Do I Actually Own My House?](https://www.thetruthaboutmortgage.com/if-i-have-a-mortgage-do-i-actually-own-my-house/): I’ve heard this argument many times, whether in real life or on social media. That if you hold a mortgage (or two), you don’t actually OWN your house. The - [Can I Mortgage a House That Is Paid Off?](https://www.thetruthaboutmortgage.com/can-i-mortgage-a-house-that-is-paid-off/): Mortgage Q&A: “Can I mortgage a house that is paid off?” When you own a home without any associated mortgages, it’s known as a “free and clear” - [Freddie Mac’s Pilot Program to Buy Second Mortgages Probably Isn’t a Big Deal](https://www.thetruthaboutmortgage.com/freddie-macs-pilot-program-to-buy-second-mortgages-probably-isnt-a-big-deal/): In case you missed it, the Federal Housing Finance Agency (FHFA) granted conditional approval to Freddie Mac to purchase single-family closed-end second - [The Other Major Downside to a Higher Mortgage Rate (Aside From the Payment)](https://www.thetruthaboutmortgage.com/the-other-major-downside-to-a-higher-mortgage-rate/): If you’re currently thinking about buying a home, or somehow in a position to refinance an existing loan, current mortgage rates don’t look great. While - [Is a 0% Down Home Purchase Much Different Than a 3% Down Purchase?](https://www.thetruthaboutmortgage.com/is-a-0-down-home-purchase-much-different-than-a-3-down-purchase/): You may have heard that the nation’s largest mortgage lender just rolled out a zero down mortgage. If you were around for the housing market crash in the - [What Is a Conditional Loan Approval?](https://www.thetruthaboutmortgage.com/what-is-a-conditional-loan-approval/): When you apply for a home loan, an underwriter will review your file in order to make a lending decision. They can approve your loan, deny your loan, or - [What Is a Mortgage Account Executive?](https://www.thetruthaboutmortgage.com/what-is-a-mortgage-account-executive/): There are many different people involved in the home loan process. I wrote about this in detail already, but probably didn’t even include everyone. - [HELOC vs. Credit Card: Why the Plastic May Work Out Better](https://www.thetruthaboutmortgage.com/heloc-vs-credit-card-why-the-plastic-may-work-out-better/): You may have heard recently that "tappable" home equity has reached an all-time high, thanks to rapidly appreciating home prices and conservative - [Want to Move But Have a Super Low Mortgage Rate? Here’s What My Friend Is Doing](https://www.thetruthaboutmortgage.com/want-to-move-but-have-a-super-low-mortgage-rate/): I spoke to a friend the other day who is selling their home and moving up to a bigger one. Crazy I know! What with home prices where they are the mortgage - [Which Mortgage Should I Pay Off First?](https://www.thetruthaboutmortgage.com/which-mortgage-should-i-pay-off-first/): Mortgage Q&A : “Which mortgage should I pay off first?” Today we're going to talk about strategy if you hold multiple mortgages and want to reduce - [Assumable Mortgages: Do They Finally Make Sense with 7%+ Mortgage Rates?](https://www.thetruthaboutmortgage.com/assumable-mortgages-set-to-get-popular-once-rates-rise/): How an assumable mortgage works and why they might get super popular with mortgage interest rates above 7%. - [What Do Mortgage Loan Processors Do? In Short, Everything to Close Your Loan!](https://www.thetruthaboutmortgage.com/what-do-loan-processors-do/): I’ve already covered the mortgage underwriter’s role, so let’s take a look at what mortgage loan processors do too. After you speak to a mortgage broker - [What Do Mortgage Underwriters Do? Decide If You're Approved!](https://www.thetruthaboutmortgage.com/what-do-underwriters-do/): Here’s some Q&A with regard to the home loan approval process: “What do underwriters do?” Once you actually apply for a home loan, your mortgage - [Portfolio Lenders: A Solution for Hard to Close Mortgages](https://www.thetruthaboutmortgage.com/use-portfolio-lenders-for-hard-to-close-mortgage-deals/): If you’re having trouble obtaining a home loan, perhaps after speaking to multiple banks, lenders and even a mortgage broker, consider reaching out to a - [How Does Mortgage Refinancing Work?](https://www.thetruthaboutmortgage.com/how-does-refinancing-work/): A detailed overview of how mortgage refinancing works, including examples and a breakdown of different types of refinances. - [What Mortgage Rate Can I Get With My Credit Score?](https://www.thetruthaboutmortgage.com/what-mortgage-rate-can-i-get-with-my-credit-score/): A reader recently asked, “What mortgage rate can I get with my credit score?” So I figured I’d try to clear up a somewhat complex question. With mortgage - [Top Mortgage Lenders of 2023: UWM Finally #1 After Rocket's Reign Comes to an End](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-2023/): We’ve finally got data for 2023 and United Wholesale Mortgage (UWM) left no doubt that it was the top mortgage lender during the year. And by a wide - [Why Are Refinance Rates Higher? It All Has to Do With Risk](https://www.thetruthaboutmortgage.com/why-are-refinance-rates-higher/): Mortgage Q&A: “Why are refinance rates higher?” If you’ve been comparing mortgage rates lately in an effort to save some money on your home loan, you - [Does the Fed Control Mortgage Rates?](https://www.thetruthaboutmortgage.com/does-the-fed-control-mortgage-rates/): Mortgage Q&A: “Does the Fed control mortgage rates?” With all the recent hubbub concerning mortgage rates, and the Fed, you might be wondering how it - [Fannie Mae and Freddie Mac Expect Mortgage Rates to Be Higher for Longer](https://www.thetruthaboutmortgage.com/fannie-mae-and-freddie-mac-expect-mortgage-rates-to-be-higher-for-longer/): Well, so much for mortgage rates falling just in time for the spring home buying season. While many expected interest rates to be lower by now, they’ve - [Why Won’t Home Builders Lower Prices If Mortgage Rates Are Way Higher?](https://www.thetruthaboutmortgage.com/why-dont-home-builders-lower-prices-if-mortgage-rates-are-way-higher/): Lately, mortgage rates have surged higher, climbing from as low as 2% to over 8% in some cases. Despite this, home builders have been enjoying healthy - [President Biden Proposes New $10,000 Mortgage Relief Credits](https://www.thetruthaboutmortgage.com/president-biden-proposes-new-10000-mortgage-relief-credits/): The Biden Administration has just unveiled a number of proposals to make homeownership more affordable. Aside from legislation to build and renovate more - [The Power of Extra Mortgage Payments](https://www.thetruthaboutmortgage.com/the-power-of-extra-mortgage-payments/): Mortgages can be viewed very differently. Some see them as a positive financial instrument, a way to free up their money so it can be invested elsewhere, - [UWM Is Officially the Nation’s Largest Mortgage Lender](https://www.thetruthaboutmortgage.com/uwm-is-officially-the-nations-largest-mortgage-lender/): It’s official. United Wholesale Mortgage (UWM) is the nation’s largest mortgage lender. The Pontiac, Michigan-based wholesale lender took the top spot for - [What Is a Mortgage Loan Servicer? The Company That Collects Your Payments](https://www.thetruthaboutmortgage.com/what-is-a-mortgage-loan-servicer/): Perhaps one of the most confusing aspects of getting a mortgage is knowing who you actually pay once the thing funds. And to that end, when your first - [The Refinance Rule of Thumb: Only Refinance Your Mortgage If...](https://www.thetruthaboutmortgage.com/the-refinance-rule-of-thumb/): How Much Lower Should Mortgage Rates Be to Refinance? Unfortunately there is no one-size-fits-all answer to this question Because no two loan scenarios - [What’s the Best Mortgage for First Time Buyers?](https://www.thetruthaboutmortgage.com/whats-the-best-mortgage-for-first-time-buyers/): If you’re new to real estate and preparing to make an offer on a property, you might be wondering what mortgage is best for a first-time home buyer. This - [15-Year Fixed vs. 30-Year Fixed: The Pros and Cons](https://www.thetruthaboutmortgage.com/30-year-fixed-vs-15-year-fixed/): An in-depth look at the 15-year fixed vs. 30-year fixed mortgage, and the reasons one may be better suited for you. - [Cash Out vs. HELOC vs. Home Equity Loan: Which Is the Best Option Right Now and Why?](https://www.thetruthaboutmortgage.com/cash-out-vs-heloc-vs-home-equity-loan/): It's time for another mortgage match-up: "Cash out vs. HELOC vs. home equity loan." Yes, this is a three-way battle, unlike the typical two-way duels - [Mortgage Impounds vs. Paying Taxes and Insurance Yourself: The Pros and Cons](https://www.thetruthaboutmortgage.com/mortgage-impounds-vs-paying-taxes-and-insurance-yourself/): If you’ve been researching mortgages, or are in the process of taking out a home loan, you may have come across the term “impounds” or “escrows.” When you - [Is Rent Out and Rent the New Way to Move to a Different House?](https://www.thetruthaboutmortgage.com/is-rent-out-and-rent-the-new-way-to-move-to-a-different-house/): I had a conversation with a friend the other day about his current housing situation. In a nutshell, the home he resides in isn’t large enough for his - [18 Important Mortgage Refinance Questions Answered](https://www.thetruthaboutmortgage.com/refinance-questions/): With mortgage rates no longer at or near record lows, the refinance question has become a lot more complex. It used to be a no-brainer to refinance if you - [Should You Only Buy a House If You Can Afford a 15-Year Fixed Mortgage Payment?](https://www.thetruthaboutmortgage.com/should-you-only-buy-a-house-if-you-can-afford-a-15-year-fixed-mortgage-payment/): I’ve already written at length about the pros and cons of a 15-year fixed mortgage, but some financial experts claim you shouldn’t even buy a home if you - [10 Big Mortgage Myths Proved Wrong, Once and For All](https://www.thetruthaboutmortgage.com/mortgage-myths/): These days, the world is full of misinformation. You can thank the Internet for that, which has led to an explosion in content, both good and bad. Social - [When Should You Start Looking for a House?](https://www.thetruthaboutmortgage.com/when-should-you-start-looking-for-a-house/): Real estate Q&A: "When should you start looking for a house?" The short answer: Immediately. That is, if you want to buy a home at some point in the - [Does Refinancing Hurt Your Credit Score?](https://www.thetruthaboutmortgage.com/does-refinancing-hurt-your-credit-score/): Mortgage Q&A: “Does refinancing hurt your credit score?” Everyone seems to be obsessed with their credit scores and what impact certain actions may - [Do Mortgage Rates Change Daily?](https://www.thetruthaboutmortgage.com/do-mortgage-rates-change-daily/): Similar to stocks and bonds, mortgage rates can move higher or lower daily based on economic reports and market conditions. - [Are Mortgage Points Worth the Cost?](https://www.thetruthaboutmortgage.com/are-mortgage-points-worth-the-cost/): Mortgage Q&A: "Are mortgage points worth it?" When taking out a mortgage, whether for a new home purchase or to refinance an existing loan, one - [Mortgage Lingo: 26 Terms You Should Know Before You Apply](https://www.thetruthaboutmortgage.com/mortgage-lingo/): Applying for a mortgage can be stressful, what with all the money that’s on the line. Oh, and the possibility that you could be denied entirely, perhaps - [25 Mortgage Questions You Should Know the Answer To](https://www.thetruthaboutmortgage.com/21-mortgage-questions-that-are-commonly-asked-answered/): The most popular mortgage questions from aspiring home buyers and existing homeowners, all answered in one convenient place. - [What Is a Trigger Lead?](https://www.thetruthaboutmortgage.com/what-is-a-trigger-lead/): If you’ve recently applied for a home loan and been bombarded by competing offers, a “trigger lead” might be to blame. Simply put, when your credit is - [How Much Does a Real Estate Agent Make?](https://www.thetruthaboutmortgage.com/how-much-does-a-real-estate-agent-make/): Ever wonder how much that real estate agent you constantly see on bus benches or your grocery store receipts makes? Given the ongoing commission lawsuits, - [A Record High Share of Consumers Believe Mortgage Rates Will Go Down Over the Next 12 Months](https://www.thetruthaboutmortgage.com/a-record-high-share-of-consumers-believe-mortgage-rates-will-go-down-over-the-next-12-months/): With the winter break now finally behind us, it’s time to talk mortgage rates again. Lately, they’ve been on the minds of anyone even remotely interested - [2024 Mortgage and Real Estate Predictions: Lower Rates and Falling Home Prices?](https://www.thetruthaboutmortgage.com/2024-mortgage-and-real-estate-predictions/): Well, another year is nearly in the books, which means it’s time to look ahead to what the next 365 days have in store. While 2022 felt like it couldn’t - [How to Track Mortgage Rates: It's Easier Than You Might Think](https://www.thetruthaboutmortgage.com/how-to-track-mortgage-rates/): If you’re thinking about buying a home, or refinancing an existing home loan, mortgage rates are likely top of mind. As you may or may not know, mortgage - [Do We Need a Mortgage MSRP?](https://www.thetruthaboutmortgage.com/do-we-need-a-mortgage-msrp/): Mortgage rate pricing can be a bit of a mystery. And also super complex. I’ve written about it in detail (how mortgage rates are determined). But you - [It’s Easier to Save More Money When Refinancing a High-Rate Mortgage](https://www.thetruthaboutmortgage.com/its-easier-to-save-more-money-when-refinancing-a-high-rate-mortgage/): Over the past year and change, mortgage refinance applications have fallen off a cliff. We had some of the biggest refi years in 2020 and 2021, followed - [Mortgage Rates Fall to Lowest Levels Since Spring As Fed Indicates Cuts on the Way in 2024](https://www.thetruthaboutmortgage.com/mortgage-rates-fall-to-lowest-levels-since-spring/): Just when it appeared that the recent rally was running out of steam, mortgage rates sunk even lower. Despite a lackluster CPI report yesterday that - [K. Hovnanian American Mortgage Review: Big Mortgage Rate Deals for Home Builder Customers](https://www.thetruthaboutmortgage.com/k-hovnanian-american-mortgage-review/): Today we’ll take a look at another home builder’s lender, K. Hovnanian American Mortgage. They are the affiliated lender of K. Hovnanian Homes, which is a - [Buy Now, Refinance for Free Deals Aren’t All They're Cracked Up to Be](https://www.thetruthaboutmortgage.com/buy-now-refinance-for-free-deals-arent-all-their-cracked-up-to-be/): Lately, some mortgage lenders have pitched “buy now, refinance for free” offers to get more home buyers to take the plunge. The thinking is mortgage rates - [Should I Use the Home Builder’s Mortgage Lender or a Different One?](https://www.thetruthaboutmortgage.com/should-i-use-the-home-builders-mortgage-lender-or-a-different-one/): Lately, new home sales have surged as existing housing supply continues to be hard to come by. This is partially because mortgage rates more than doubled - [Will Mortgage Rates Go Down in 2024? Here Are All the Latest Predictions From the Biggest Names](https://www.thetruthaboutmortgage.com/will-mortgage-rates-go-down-in-2024/): Well, another year is nearly in the books, which means it’s time to look ahead at what 2024 might have in store. As is customary, I take a look at - [Newrez Enters the 1% Down Mortgage Fray with RezSource](https://www.thetruthaboutmortgage.com/newrez-rezsource-1-down-mortgage/): A new week, a new 1% down mortgage product, the latest coming from Fort Washington, Pennsylvania based lender Newrez. Call it a sign of the times, with - [Silverton Mortgage Launches 100% Financing Across All Loan Types](https://www.thetruthaboutmortgage.com/silverton-mortgage-launches-100-financing-across-all-loan-types/): Silverton Mortgage has rolled out a series of mortgages that feature 100% financing in light of ongoing affordability woes. Some of the loan programs rely - [HomeAmerican Mortgage Review: Interest Rate Specials for Those Buying a Richmond American Home](https://www.thetruthaboutmortgage.com/homeamerican-mortgage-review/): Today we’ll take a hard look at “HomeAmerican Mortgage,” yet another home builder affiliated mortgage lender. They offer home purchase financing to - [2024 FHA Loan Limits Rise to $498,257](https://www.thetruthaboutmortgage.com/2024-fha-loan-limits-rise-to-498257/): The Federal Housing Administration (FHA) announced new loan limits for 2024 this week, bumping up the “floor” on FHA loans to $498,257. This represents a - [2024 Conforming Loan Limit Climbs to $766,550](https://www.thetruthaboutmortgage.com/2024-conforming-loan-limit-climbs-to-766550/): Another year, another increase in the conforming loan limit, thanks to continued home price gains. The FHFA announced today that the new limit for loans - [Foreclosures Halted for VA Loan Holders Until June 2024 (Extended to December 31st)](https://www.thetruthaboutmortgage.com/foreclosure-halted-for-va-loan-holders-until-june-2024/): In an effort to keep more veterans and servicemembers in their homes, the VA has paused foreclosures for the next six months. The move was made following - [Guaranteed Rate Launches Lock It, List It: Real Estate Agents Can Secure a Discounted Mortgage Rate for the Buyer Before They List](https://www.thetruthaboutmortgage.com/guaranteed-rate-launches-lock-it-list-it/): A new program called “Lock It, List It” allows real estate agents to secure a mortgage rate for a buyer before the property even hits the market. - [Zillow Home Loans Review: Best-in-Class Service Offered By a Household Name, But How Are the Rates?](https://www.thetruthaboutmortgage.com/zillow-home-loans-review/): In the spring of 2019, “Zillow Home Loans” was launched by its parent company Zillow. You probably know them best for their popular Zestimates, which are - [Is Now a Good Time to Refinance My Home?](https://www.thetruthaboutmortgage.com/is-now-a-good-time-to-refinance-my-home/): Mortgage Q&A: “Is now a good time to refinance my home?” If you’re one of the few people asking this question right now, the short answer is most - [Down Payments on Houses Rise to Highest Levels in Over 20 Years](https://www.thetruthaboutmortgage.com/down-payments-on-houses-rise-to-highest-levels-in-over-20-years/): Gone are the days of the zero-down mortgage. At least for the typical home buyer. Instead, the 2023 Profile of Home Buyers and Sellers from the National - [It Now Takes More Than a Decade to Break Even on a Home Purchase](https://www.thetruthaboutmortgage.com/it-now-takes-more-than-a-decade-to-break-even-on-a-home-purchase/): I’ve already written about it not being the best time to buy a home right now, at least from a pure investment standpoint. In short, home prices are - [What Mortgage Has the Best Interest Rate and Why?](https://www.thetruthaboutmortgage.com/what-mortgage-has-the-best-interest-rate/): The longer the loan term and/or fixed-rate period, the higher the mortgage rate. If you want the cheapest mortgage rate, think shorter. - [Inspire Home Loans Review: You Might Be Able to Snag Major Savings When Buying a New Home](https://www.thetruthaboutmortgage.com/inspire-home-loans-review/): It's time to check out "Inspire Home Loans," which is the lending partner of home builder Century Communities. They pride themselves on knowing how their - [Redfin Says It’s the Best Time to Buy a Home Since Mid-September: Should You Buy Now or Hold On?](https://www.thetruthaboutmortgage.com/redfin-says-its-the-best-time-to-buy-a-home-since-mid-september-should-you-buy-now-or-hold-on/): Thanks to a record number of price cuts and a big improvement in mortgage rates, home buying conditions have improved tremendously. Taken together, you - [Toll Brothers Mortgage Review: The Builder's Lender Is Hard to Beat](https://www.thetruthaboutmortgage.com/toll-brothers-mortgage-review/): It’s time to check out “Toll Brothers Mortgage,” which is a subsidiary of home builder Toll Brothers. Toll Brothers is one of the largest home builders in - [CEO of Nation’s #1 Mortgage Lender Expects Mortgage Rates to Be Lower Before the Election](https://www.thetruthaboutmortgage.com/ceo-of-nations-1-mortgage-lender-expects-mortgage-rates-to-be-lower-before-the-election/): Mortgage rates finally caught a break last week after steadily rising throughout much of 2023. The 30-year fixed fell about a half a percentage point in - [Taylor Morrison Home Funding Review: Huge Mortgage Rate Buydowns Make Them Hard to Beat](https://www.thetruthaboutmortgage.com/taylor-morrison-home-funding-review/): If you’ve got your eye on a Taylor Morrison home, you may have come across their affiliated lender “Taylor Morrison Home Funding.” As with many other home - [loanDepot accessZERO: You Can Buy a Home with Zero Down Again](https://www.thetruthaboutmortgage.com/loandepot-accesszero/): In order to make homeownership more accessible, loanDepot has launched a new program called “accessZERO.” As the name suggests, it allows prospective home - [Low Mortgage Rates Are the #1 Reason Homeowners Aren't Moving](https://www.thetruthaboutmortgage.com/low-mortgage-rates-are-1-reason-homeowners-arent-moving/): While there has been some debate about the so-called mortgage rate lock-in effect, it appears to be a pretty legit force in the housing market today. As - [Lender Will Split the Difference If You Give Up Your 3% Mortgage Rate](https://www.thetruthaboutmortgage.com/lender-will-split-the-difference-if-you-give-up-your-3-mortgage-rate/): You’ve probably heard of the mortgage rate lock-in effect, where homeowners are unwilling (or unable) to give up their ultra-low mortgage rates. Also - [Use of VantageScore May Boost Annual Mortgage Volume by $1 Trillion](https://www.thetruthaboutmortgage.com/use-of-vantagescore-may-boost-annual-mortgage-volume-by-1-trillion/): How does an additional $1 trillion in annual home loan origination volume sound? At the moment, it sounds incredible if you’re in the mortgage industry - [NVR Mortgage Review: A One-Stop Shop for a New Home and a Loan](https://www.thetruthaboutmortgage.com/nvr-mortgage-review/): The fourth largest home builder in the country, NVR, also operates its own financing division called “NVR Mortgage.” This allows them to complete more of - [Are Adjustable-Rate Mortgages Going to Replace Mortgage Rate Buydowns?](https://www.thetruthaboutmortgage.com/are-adjustable-rate-mortgages-going-to-replace-mortgage-rate-buydowns/): Lately, mortgage rate buydowns have been all the rage as a means to reduce home buying costs. This could come in the form a temporary or permanent rate - [KBHS Home Loans Review: Mortgage Rate Specials for Those Who Buy a KB Home](https://www.thetruthaboutmortgage.com/kbhs-home-loans-review/): Today we’ll check out another home builder’s in-house mortgage lender, this time KB Home’s “KBHS Home Loans.” As the name suggests, they are the - [Higher Mortgage Rates Hurt Sales Volume, Not Home Prices](https://www.thetruthaboutmortgage.com/higher-mortgage-rates-hurt-sales-volume-not-home-prices/): For those of you still wondering why home prices haven’t plummeted, despite significantly higher mortgage rates, it’s because there isn’t a negative - [Pulte Mortgage Review: Gain Access to Unique Financing Specials If You Use the Builder's Lender](https://www.thetruthaboutmortgage.com/pulte-mortgage-review/): One of the nation’s largest home builders, PulteGroup, also operates its own financing division called “Pulte Mortgage.” This is a common setup employed - [It’s Not a Good Time to Buy a Home and Everyone Knows It](https://www.thetruthaboutmortgage.com/its-not-a-good-time-to-buy-a-home-and-everyone-knows-it/): As if you needed more evidence that it’s not a good time to buy a home. The latest piece comes from the WSJ, which revealed that renting is 50% more - [An Alternative to Paying the Mortgage with a Credit Card](https://www.thetruthaboutmortgage.com/an-alternative-to-paying-the-mortgage-with-a-credit-card/): This week, I read an article in the WSJ about paying the mortgage with a credit card. Either things are really bad in the economy, or things are really - [DHI Mortgage Review: The Nation's Largest Home Builder Has Its Own Mortgage Lender](https://www.thetruthaboutmortgage.com/dhi-mortgage-review/): The nation’s largest home builder, D.R. Horton, also has its own affiliated mortgage lender known as “DHI Mortgage.” Recently, new home sales have surged - [Is It Time to Start Talking About 9% Mortgage Rates?](https://www.thetruthaboutmortgage.com/9-mortgage-rates/): If you thought 8% mortgage rates were bad, what about 9% mortgage rates? What was once unthinkable is now not so hard to believe, with 30-year fixed - [What Is Escrow?](https://www.thetruthaboutmortgage.com/what-is-escrow/): If you have ever purchased a home and applied for a mortgage, you’ve likely come across the term “escrow.” Contrary to Portlandia’s definition, the “the - [An 8% Mortgage Rate?! Use These Mortgage Charts to Easily Compare Monthly Payments Fast](https://www.thetruthaboutmortgage.com/use-this-mortgage-payment-chart-to-easily-compare-rates/): One of the things prospective home buyers and existing homeowners seem to care most about is mortgage rates. And for good reason - the interest rate you - [8% Mortgage Rates Look Imminent, But Could That Be Their Peak?](https://www.thetruthaboutmortgage.com/8-mortgage-rates-look-imminent-but-could-that-be-their-peak/): On a day when mortgage rates are officially close to hitting 8%, I decided to write a post about why they might be a lot lower in 2024. Call me a - [Lennar Mortgage Review: Known for Offering Big Mortgage Rate Buydowns](https://www.thetruthaboutmortgage.com/lennar-mortgage-review/): Today we’ll check out “Lennar Mortgage,” which is the financing division of parent company Lennar Corp. If you weren’t aware, Lennar is one of the - [Now You Can Use ADU Income to Qualify for an FHA Loan](https://www.thetruthaboutmortgage.com/adu-income-to-qualify-for-an-fha-loan/): The U.S. Department of Housing and Urban Development (HUD) announced today that lenders will now be able to count income from ADUs when underwriting FHA - [You Can Now Search for Homes for Sale by School District on Zillow](https://www.thetruthaboutmortgage.com/you-can-now-search-for-homes-for-sale-by-school-district-on-zillow/): It’s common for home buyers to purchase a property in a certain school district. This ensures their children can attend a specific school if they’ve got - [Why Did Mortgage Rates Plunge This Week?](https://www.thetruthaboutmortgage.com/why-did-mortgage-rates-plunge-this-week/): If you’ve been keeping track lately, you might be wondering why mortgage rates plunged this week. Last week was a totally different story, with a - [How to Supercharge the Savings of a Mortgage Rate Buydown](https://www.thetruthaboutmortgage.com/how-to-supercharge-the-savings-of-a-mortgage-rate-buydown/): These days, a lot of home buyers are using mortgage rate buydowns to make the deal work. They are particularly prevalent on new home purchases, with - [What Are Caps on Adjustable-Rate Mortgages?](https://www.thetruthaboutmortgage.com/adjustable-rate-mortgage-caps/): The other day I wrote about how adjustable-rate mortgages might soon make a comeback, given how high fixed mortgage rates have become. Now that the - [Are Adjustable-Rate Mortgages Finally a Good Deal?](https://www.thetruthaboutmortgage.com/are-adjustable-rate-mortgages-finally-a-good-deal/): If you visit most bank/lender websites and navigate to their home loans section, you’ll likely only see fixed-rate mortgages advertised. This made perfect - [Mortgage Rates and Home Prices Can Fall Together](https://www.thetruthaboutmortgage.com/mortgage-rates-and-home-prices-can-fall-together/): If you don’t believe mortgage rates and home prices can fall together, just look at what home prices have done in the face of 7% mortgage rates. Despite - [What Happens to Mortgage Rates During a Government Shutdown?](https://www.thetruthaboutmortgage.com/what-happens-to-mortgage-rates-during-a-government-shutdown/): It’s looking more likely that there will be a government shutdown beginning October 1st, which begs the question, what happens to mortgage rates? Do they - [What to Do If Your Adjustable-Rate Mortgage Is About to Adjust Higher](https://www.thetruthaboutmortgage.com/what-to-do-if-your-adjustable-rate-mortgage-is-about-to-adjust/): Recently, a friend of mine with an adjustable-rate mortgage told me his rate was set to adjust significantly higher. His current loan, a 7/1 ARM, has an - [Frost Bank Re-Enters Mortgage Biz with a Zero Down Home Loan](https://www.thetruthaboutmortgage.com/frost-bank-re-enters-mortgage-biz-with-a-zero-down-home-loan/): Frost Bank, long absent from the mortgage industry, is back in the biz and rolling out a zero down home loan for its customers. The Texas-based - [How to Compare HELOCs From One Lender to the Next](https://www.thetruthaboutmortgage.com/how-to-compare-helocs/): Over the past year or so, home equity lines of credit (HELOCs) have become a lot more popular. As a quick refresher, HELOCs are typically taken out as - [Home Prices Least Affordable in Over Three Decades](https://www.thetruthaboutmortgage.com/home-prices-least-affordable-in-over-three-decades/): If you think home prices are too expensive, you wouldn’t be the only one. A new analysis from First American revealed that housing affordability is the - [What Is Cash to Close?](https://www.thetruthaboutmortgage.com/what-is-cash-to-close/): When you take out a mortgage, whether it’s a refinance or a home purchase, you may come across the phrase “cash to close.” Virtually all mortgages require - [Are High Mortgage Rates Here to Stay?](https://www.thetruthaboutmortgage.com/are-high-mortgage-rates-here-to-stay/): Today was a rough day for mortgage rates as the market digested the Fed’s latest outlook, which confirmed its inflation fight is far from over. While they - [Former Ginnie Mae Boss Makes the Case for a Zero Down FHA Loan](https://www.thetruthaboutmortgage.com/former-ginnie-mae-boss-makes-the-case-for-a-zero-down-fha-loan/): Past Ginnie Mae president Ted Tozer has argued that the FHA should lower or completely eliminate its current 3.5% down payment requirement. He discussed - [Who Are All the People Involved in the Home Loan Process?](https://www.thetruthaboutmortgage.com/who-are-all-the-people-involved-in-the-home-loan-process/): One interesting aspect of the home loan process is the sheer number of individuals you’ll work with along the way. You don’t just speak to a salesperson - [Why Are There No Homes for Sale?](https://www.thetruthaboutmortgage.com/why-are-there-no-homes-for-sale/): At last glance, 30-year fixed mortgage rates were sitting above 7%. Despite this, there are virtually no homes for sale. One would assume that after such - [Guaranteed Rate Launches a 5 Minute Approval for Mortgages](https://www.thetruthaboutmortgage.com/guaranteed-rate-5-minute-approval/): How fast is fast enough? Ask Guaranteed Rate, which just launched “5 Minute Approval” for mortgage applications. This new “innovation” from the - [Roam Assumable Mortgage Platform Allows Home Buyers to Snag Mortgage Rates as Low as 2%](https://www.thetruthaboutmortgage.com/roam-home-review-new-assumable-mortgage-platform/): A new startup called “Roam” has launched a service to make assuming a mortgage painless. The company is backed by some prominent real estate figures, - [The Silver Lining of High Mortgage Rates](https://www.thetruthaboutmortgage.com/the-silver-lining-of-high-mortgage-rates/): I don’t think it would be much of a stretch to assume nobody likes high mortgage rates. They make it more difficult for prospective home buyers to get to - [Fannie Mae Chief Economist Calls Current Housing Market Unusual, Doesn’t Expect It to Change Anytime Soon](https://www.thetruthaboutmortgage.com/fannie-mae-chief-economist-calls-current-housing-market-unusual/): It’s time to check in on the state of the housing market. At last glance, mortgage rates were still above 7%, though they did see a little bit of relief - [Homeowners Can Now See How Much They’ll Make Renting a Room on Airbnb](https://www.thetruthaboutmortgage.com/homeowners-can-now-see-how-much-theyll-make-renting-a-room-on-airbnb/): If you peruse real estate listings on Realtor.com, you might come across a new Airbnb integration. This week, the two companies announced a collaboration - [The Typical Home Sold in the Past Three Months Went for $200,000 More Than the Seller Paid](https://www.thetruthaboutmortgage.com/typical-home-sold-for-200000-more-than-seller-paid/): Lately, there’s been a lot of talk about a lack of affordability, even a potential housing bubble. And it comes as no surprise, given the massive shock of - [One Really Simple Way to Offset a Higher Mortgage Rate](https://www.thetruthaboutmortgage.com/one-really-simple-way-to-offset-a-higher-mortgage-rate/): We all know mortgage interest rates have increased tremendously. While there were periods of relief here and there, the trajectory since early 2022 has - [Shark Tank’s Kevin O’Leary Predicts 8% Mortgage Rates](https://www.thetruthaboutmortgage.com/shark-tanks-kevin-oleary-predicts-8-mortgage-rates/): A week ago, it seemed like we were on the fast track to 8% mortgage rates. But then something spectacular happened, nearly a week’s worth of economic data - [Why Are Lower Job Openings Good for Mortgage Rates?](https://www.thetruthaboutmortgage.com/why-are-lower-job-openings-good-for-mortgage-rates/): This morning, the Job Openings and Labor Turnover Survey (JOLTS report) was released by the Labor Department. It revealed that the labor market wasn’t - [Zillow Home Loans Launches a 1% Down Mortgage](https://www.thetruthaboutmortgage.com/zillow-home-loans-1-down-mortgage/): Today, Zillow Home Loans announced its “1% Down Payment” loan program, making them the latest lender to join the near-zero down fray. The move comes as - [What Will It Take for Mortgage Rates to Fall Again?](https://www.thetruthaboutmortgage.com/what-will-it-take-for-mortgage-rates-to-fall-again/): It’s been a rough month or so for mortgage rates. If we zoom out even further, it’s been a horrendous 18 months, with the 30-year fixed as low as 3% in - [It’s Mortgage Principal, Not Principle](https://www.thetruthaboutmortgage.com/its-mortgage-principal-not-principle/): Principal vs. Principle Attention loan officers, mortgage brokers, real estate agents, and so on The words "principal" and "principle" are two very - [Why Are Mortgage Rates Still Going Up If the Fed Is Done Hiking?](https://www.thetruthaboutmortgage.com/why-are-mortgage-rates-still-going-up-if-the-fed-is-done-hiking/): While Fed rate hike forecasts indicate the worst is behind us, mortgage rates are still going up. In fact, they hit a new 52-week high this morning, - [Options Other Than Refinancing Your Mortgage](https://www.thetruthaboutmortgage.com/options-other-than-refinancing-your-mortgage/): With 30-year mortgage rates now above 7%, a refinance likely isn’t in the cards for most homeowners. In fact, the total number of refinance candidates has - [Why Are Mortgage Rates So High?](https://www.thetruthaboutmortgage.com/why-are-mortgage-rates-so-high/): At last glance, the 30-year fixed mortgage was back above 7%, depending on the data source. Prior to late July and early August, the popular loan product - [3 Reasons Why You Need to Compare Mortgage Brokers Too](https://www.thetruthaboutmortgage.com/compare-mortgage-brokers/): While the most advantageous reason to use a mortgage broker might be their ability to shop your rate with multiple lenders, you still need to put in the - [Today’s Housing Market Risk Factors: Is Real Estate in Trouble?](https://www.thetruthaboutmortgage.com/todays-housing-market-risk-factors/): With mortgage rates exceeding 7% again and home prices reaching new heights, some critics are sounding the alarm. The argument is that we’ve got an - [Zillow and Redfin Join Forces to Push More New Construction Home Sales](https://www.thetruthaboutmortgage.com/zillow-and-redfin-join-forces-to-push-more-new-construction-home-sales/): In a clear sign of the times, Zillow has announced a partnership to syndicate new-construction listings on Redfin. This means home shoppers will see more - [The Hidden Danger of a Higher Mortgage Rate](https://www.thetruthaboutmortgage.com/the-hidden-danger-of-a-higher-mortgage-rate/): Everyone knows mortgage rates aren’t as low as they used to be. Understatement of the decade there. But this doesn’t just equate to a higher monthly - [Zillow Says Homeowners Twice as Likely to Sell If Their Mortgage Rate Is Above 5%](https://www.thetruthaboutmortgage.com/zillow-says-homeowners-twice-as-likely-to-sell-if-their-mortgage-rate-is-above-5/): More news on the mortgage rate lock-in effect, this time from Zestimate creator Zillow. The company conducted a survey and found that homeowners with a - [Big Jump in Homeowners Saying They’ll Sell in the Next Three Years](https://www.thetruthaboutmortgage.com/big-jump-in-homeowners-saying-theyll-sell-in-the-next-three-years/): Has residential housing supply finally bottomed? Are we finally going to see more single-family homes hit the market, after years of slim pickings? - [Nearly Half of Homeowners with a Mortgage Are Equity Rich](https://www.thetruthaboutmortgage.com/nearly-half-of-homeowners-with-a-mortgage-are-equity-rich/): While bulls and bears continue to argue the health of the housing market, a new report revealed that most existing homeowners are in a really good spot. - [Guaranteed Rate OneDown: The Latest 1% Down Mortgage + $1,000 Toward Lender Fees](https://www.thetruthaboutmortgage.com/guaranteed-rate-onedown/): Another day, another affordable home loan program launches, this time “OneDown” from Guaranteed Rate. As the name implies, you only need to put 1% down - [Homebuyer Assistance Programs: What's Available These Days and Who Qualifies?](https://www.thetruthaboutmortgage.com/homebuyer-assistance-programs/): It’s no secret that homes just aren’t as affordable as they used to be. An unwelcome combination of significantly higher mortgage rates coupled with - [The National Average Mortgage Rate Lock-In Effect Is Worth $55,000](https://www.thetruthaboutmortgage.com/the-national-average-mortgage-rate-lock-in-effect-is-worth-55000/): You may have heard the phrase mortgage rate lock-in effect lately. As a quick refresher, it’s a homeowner's unwillingness to give up an ultra-low mortgage - [Carrington Mortgage Launches a 40-Year Mortgage to Tackle Affordability Concerns](https://www.thetruthaboutmortgage.com/carrington-mortgage-launches-a-40-year-mortgage/): It’s been a tough year for the mortgage industry, with origination volume down substantially from the boom years of 2020 and 2021. Even 2022 was a pretty - [Wondering Where Home Prices Go Next? Look at Inventory, Not Mortgage Rates](https://www.thetruthaboutmortgage.com/wondering-where-home-prices-go-next-look-at-inventory-not-mortgage-rates/): There’s been a lot of speculation that home prices would crash as mortgage rates surged. The argument was especially convincing after the 30-year fixed - [U.S. Bank Access Home Loan Offers Up to $12,500 in Down Payment Assistance and a $5K Lender Credit](https://www.thetruthaboutmortgage.com/u-s-bank-access-home-loan/): The mortgage deals keep coming, the latest being the new "U.S. Bank Access Home Loan," which comes with up to $12,500 in down payment assistance and a - [Why Are Home Prices Not Dropping?](https://www.thetruthaboutmortgage.com/why-are-home-prices-not-dropping/): Late last year, Zillow said home prices needed to come down about 25% to become affordable again. Around that same time, mortgage rates hit their highest - [Top Mortgage Lenders in Nevada](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-nevada/): It’s time to check out the top mortgage lenders in Nevada based on their total loan volume. Last year, more than 600 mortgage companies funded nearly $33 - [Will Mortgage Rates Go Down in 2023?](https://www.thetruthaboutmortgage.com/will-mortgage-rates-go-down-in-2023/): Well, were about halfway through the year and mortgage rates seem to have settled in around the high 6% range. While averages vary based on the source, - [Guild Mortgage Launches 1% Down Home Loan Combined with a Temporary Rate Buydown](https://www.thetruthaboutmortgage.com/guild-mortgage-launches-1-down-combined-with-a-temporary-buydown/): In the past few months, 1% down payment mortgages have returned with a vengeance. We’ve already seen Rocket Mortgage ONE+ and a similar product from rival - [Chase Offering $200 If It Can’t Meet or Beat Your Mortgage Offer](https://www.thetruthaboutmortgage.com/chase-offering-200-if-it-cant-meet-or-beat-your-mortgage-offer/): 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. - [Navy Federal No-Refi Rate Drop: Lower Your Mortgage Rate for Just $250](https://www.thetruthaboutmortgage.com/navy-federal-no-refi-rate-drop/): Lately, there’s been a lot of talk about buying now and refinancing later, once mortgage rates drop. Of course, that’s if mortgage rates do indeed fall at - [Why Are Mortgage Rates Different?](https://www.thetruthaboutmortgage.com/why-are-mortgage-rates-different/): Mortgage rate Q&A: “Why are mortgage rates different?” Why is the sky blue? Why are clouds white? Why won't your neighbor trim their tree branches? - [Top Illinois Mortgage Lenders](https://www.thetruthaboutmortgage.com/top-illinois-mortgage-lenders/): There was a new top mortgage lender in Illinois in 2022, per the latest HMDA data. And it was Chicago's very own Guaranteed Rate, which was able to knock - [CFPB: Choosing a Cheaper Mortgage Lender Could Save You $100 a Month](https://www.thetruthaboutmortgage.com/cfpb-mortgage-rates-range-by-a-half-percent-among-lenders/): You’ve heard it a million times, but I’ll say it again. It pays to shop around for your mortgage. Freddie Mac told us a while back, and now the Consumer - [Why Are Mortgage Rate Spreads So High Right Now?](https://www.thetruthaboutmortgage.com/why-are-mortgage-rate-spreads-so-high-right-now/): If you haven’t heard, the 30-year fixed has once again surpassed 7%, at least by some accounts. After settling in around 6.5% in early May, mortgage rates - [Movement Mortgage Launches Zero Down FHA Loan](https://www.thetruthaboutmortgage.com/movement-mortgage-launches-zero-down-fha-loan/): As housing affordability wanes, mortgage lenders have gotten increasingly creative to help borrowers qualify. The latest innovative product is “Movement - [Rocket Mortgage ONE+: The Latest 1% Down Home Loan Program](https://www.thetruthaboutmortgage.com/rocket-mortgage-one/): Rocket Mortgage is the latest company to offer a 1% down payment mortgage to address ongoing affordability concerns. The new program, coined “ONE+,” - [What Is the Mortgage Rate Lock-In Effect?](https://www.thetruthaboutmortgage.com/what-is-the-mortgage-rate-lock-in-effect/): Those looking to buy a home, along with existing owners, may have come across the term “mortgage rate lock-in effect” lately. It’s a relatively new phrase - [Temporary vs. Permanent Mortgage Buydowns: Which to Choose and Why](https://www.thetruthaboutmortgage.com/temporary-vs-permanent-mortgage-buydowns/): Mortgage rates aren’t so low these days. In fact, they’ve basically doubled since early 2022. While this clearly isn’t great news for aspiring home buyers - [Top Mortgage Lenders in 2022: Rocket Squeaks Past UWM for #1 Spot](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-2022/): Last year, Rocket Mortgage was the top mortgage lender in the nation, per the latest HMDA data. While that wasn’t a big surprise, as they’ve topped the - [27 States Oppose New Fannie/Freddie Mortgage Fees That Appear to Punish High FICO Score Borrowers](https://www.thetruthaboutmortgage.com/27-states-oppose-new-fannie-freddie-mortgage-fees/): Those new mortgage fees you’ve probably heard about are causing quite a stir. So much so that Pennsylvania State Treasurer Stacy Garrity sent a letter to - [Nearly Half of Home Loan Applicants Paid Mortgage Points in 2022](https://www.thetruthaboutmortgage.com/nearly-half-of-home-loan-applicants-paid-mortgage-points-in-2022/): A new analysis from Zillow revealed that nearly half of mortgage applicants opted to pay points when taking out a home loan last year. These optional - [Fannie Mae Is Predicting Much Lower Mortgage Rates by Year End](https://www.thetruthaboutmortgage.com/fannie-mae-is-predicting-much-lower-mortgage-rates-by-year-end/): In its latest housing forecast, Fannie Mae has become much more optimistic with regard to mortgage rates. We’re talking 30-year fixed rates nearly 0.75% - [Mortgage Rate Shopping: 10 Quick Tips to Score a Better Deal on Your Home Loan](https://www.thetruthaboutmortgage.com/mortgage-rate-shopping-10-tips-to-get-a-better-deal/): It's time to talk mortgage rate shopping, which has become an absolute must in 2023. Simply put, you've got to be more proactive to get your hands on a - [Home Prices Just Experienced the Biggest Annual Decline Since 2012](https://www.thetruthaboutmortgage.com/home-prices-just-experienced-the-biggest-annual-decline-since-2012/): March was a rough month for home prices. The median U.S. home price fell a sizable 3.3% in March to $400,528, the largest year-over-year decrease in more - [We Need 5.5% Mortgage Rates (or Lower) to Attract Home Buyers](https://www.thetruthaboutmortgage.com/we-need-5-5-mortgage-rates-to-attract-home-buyers/): A new survey from John Burns Research & Consulting found that 5.5% is the “magic mortgage rate.” By magic, they mean the threshold for a home buyer - [Nation's Top Mortgage Lender Launches a 1% Down Payment Home Loan](https://www.thetruthaboutmortgage.com/nations-top-mortgage-lender-launches-a-1-down-payment-home-loan/): The nation’s leading mortgage lender, United Wholesale Mortgage, has re-launched the 1% down payment home loan. It comes at a time when housing - [Zillow Now Lets Users Filter Homes by Monthly Payment](https://www.thetruthaboutmortgage.com/zillow-now-lets-users-filter-homes-by-monthly-payment/): Due to ongoing mortgage rate volatility, Zillow has launched a new feature that lets users search by monthly payment. Traditionally, Zillow users would - [Homepoint Exits Mortgage Origination, Sells Wholesale Division to The Loan Store](https://www.thetruthaboutmortgage.com/homepoint-exits-mortgage-origination-sells-wholesale-division-to-the-loan-store/): More mortgage M&A activity today. Homepoint announced this morning that it has entered into a definitive agreement to sell the company’s wholesale - [Home Prices Are Still Too High, But Will They Actually Come Down?](https://www.thetruthaboutmortgage.com/home-prices-are-still-too-high-but-will-they-actually-come-down/): The housing market has been stubbornly frustrating for prospective home buyers. Not only have mortgage rates doubled over the past year, but home prices - [Rocket Mortgage Launches BUY+: Get a 1.5% Credit When Using a Rocket Homes Partner Agent](https://www.thetruthaboutmortgage.com/rocket-mortgage-buy-plus/): Rocket Mortgage has rolled out a new program called "BUY+" that offers a credit of up to $10,000 when you use a Rocket Homes Partner Real Estate Agent to - [Moon Mortgage Launches a Crypto Mortgage to Materialize Digital Wealth](https://www.thetruthaboutmortgage.com/moon-mortgage-crypto-mortgage/): Crypto lending platform Moon Mortgage has launched its own “crypto mortgage.” The move is designed to “help crypto investors materialize their digital - [SoFi Mortgage Review: Pricing Perks and an Online Application But No FHA or VA Loans](https://www.thetruthaboutmortgage.com/sofi-mortgage-review/): Today we’ll do a deep dive into SoFi, short for Social Finance, which offers mortgages, personal loans, student loan refinancing, and even a credit card. - [Top Adjustable-Rate Mortgage Lenders](https://www.thetruthaboutmortgage.com/top-adjustable-rate-mortgage-lenders/): With fixed-rate mortgages no longer on sale, I thought it’d be useful to take a look at the top adjustable-rate mortgage lenders nationwide. These are the - [Rocket Visa Signature Card: Rewards Can Be Used Toward Down Payment on a Home or an Existing Mortgage Balance](https://www.thetruthaboutmortgage.com/rocket-visa-signature-card/): The nation’s largest mortgage lender has launched a credit card, known as the “Rocket Visa Signature Card.” It allows cardholders to earn 5% back toward a - ['California Dream For All' Home Loan Requires Zero Down Payment for Future Appreciation](https://www.thetruthaboutmortgage.com/california-dream-for-all-shared-appreciation-loan/): The California Housing Finance Agency has launched a new shared appreciation loan for home buyers. The program, known as the “Dream For All Shared - [Why Do Mortgage Rates Go Down When the Fed Raises Rates?](https://www.thetruthaboutmortgage.com/why-do-mortgage-rates-go-down-when-the-fed-raises-rates/): Yesterday, the Federal Reserve raised its benchmark federal funds rate a quarter point (.25%). As a result, some may have expected consumer mortgage rates - [Top Mortgage Lenders in Oklahoma](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-oklahoma/): It’s time to check out the top mortgage lenders in Oklahoma based on closed loan volume. These are the companies that funded the largest dollar amount of - [Median Down Payment on a House Falls to 10%, Compared to 14% a Year Ago](https://www.thetruthaboutmortgage.com/median-down-payment-on-a-house-falls-to-10-down-from-14-a-year-ago/): Down payments are falling as the housing market slows and competition wanes. A new report from Redfin revealed that the median down payment in January - [Top Mortgage Lenders in Louisiana](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-louisiana/): Today we’ll check out who the top mortgage lenders in Louisiana were based on the most recent year’s loan volume. In 2021, more than 600 banks and lenders - [What Happens to My Mortgage If My Bank Fails?](https://www.thetruthaboutmortgage.com/what-happens-to-my-mortgage-if-my-bank-fails/): Mortgage Q&A: “What happens to my mortgage if my bank fails?” It's happening again - banks are failing. The latest being Signature Bank and Silicon - [Mortgage Rates Are Very Volatile Right Now. Here’s What to Watch For](https://www.thetruthaboutmortgage.com/mortgage-rates-are-very-volatile-right-now-heres-what-to-watch-for/): Mortgage rates fell. Then mortgage rates rose. Then mortgage rates fell again. What the heck is going on out there? Bank runs, bank failures, no more Fed - [Here's an Argument for the Wait to Buy a Home Crowd](https://www.thetruthaboutmortgage.com/heres-an-argument-for-the-wait-to-buy-a-home-crowd/): A lot of folks have pondered the buy now or buy later question when it comes to a home purchase. The waiters are waiting for home prices to fall, knowing - [Mortgage Rates vs. Bank Failures](https://www.thetruthaboutmortgage.com/mortgage-rates-vs-bank-failures/): You’ve heard about, you know about it. Last week, Silicon Valley Bank was the target of a bank run, prompting the FDIC to take over the troubled company - [Veterans United Home Loans Review: Is the Nation's Largest VA Lender a Good Choice?](https://www.thetruthaboutmortgage.com/veterans-united-home-loans-review/): If you’re an active duty or veteran homeowner (or aspiring home buyer), chances are you’ve heard of Veterans United Home Loans. They are the largest VA - [Guaranteed Rate Same Day Mortgage: Get a Home Loan Approval in 1 Business Day](https://www.thetruthaboutmortgage.com/guaranteed-rate-brings-back-same-day-mortgage-underwriting/): Back in the good old days, pre-mortgage crisis, you could get a fully-underwritten mortgage approval the same day. In fact, you could get approved for a - [94% of Homeowners Who Refinanced Recently Raised Their Mortgage Rate a Lot in the Process](https://www.thetruthaboutmortgage.com/94-of-homeowners-who-refinanced-recently-raised-their-mortgage-rate-a-lot-in-the-process/): Typically, borrowers refinance their home loans to take advantage of lower mortgage rates. But recently, the average refinance has resulted in an interest - [Today’s Homeowners Can’t Afford to Sell](https://www.thetruthaboutmortgage.com/todays-homeowners-cant-afford-to-sell/): The housing bears have ratcheted up their rhetoric lately, calling for an impeding crash. It’s not a crazy notion with home prices clearly unaffordable - [Mortgage Rates vs. Home Prices: Is There Really an Inverse Relationship?](https://www.thetruthaboutmortgage.com/home-prices-vs-mortgage-rates/): Mortgage Q&A: "Mortgage rates vs. home prices." Today, we’ll look at the impact of home prices and mortgage rates on your decision to buy a property, - [Why You Might Still See 5% Mortgage Rates](https://www.thetruthaboutmortgage.com/why-you-might-still-be-seeing-5-mortgage-rates/): It’s been tough sledding for mortgage rates over the past month. They were actually on a roll to start off 2023, falling for the entire month of January - [FHA vs. Conventional Loan: These Charts Can Help You Determine Which Is Cheaper](https://www.thetruthaboutmortgage.com/fha-loan-vs-conventional-loan/): An in-depth look at two of the most popular mortgage options available today, the FHA loan and the conventional loan. - [Better's 'Equity Unlocker' Allows Amazon Employees to Buy Homes with Company Stock](https://www.thetruthaboutmortgage.com/better-equity-unlocker/): Better Mortgage has launched a new product called “Equity Unlocker” to help Amazon employees purchase homes. The innovative loan program allows borrowers - [Top VA Loan Lenders in 2022: Veterans United #1 Thanks to Large Home Purchase Share](https://www.thetruthaboutmortgage.com/top-va-loan-lenders/): If you’re curious who the top VA loan lenders were last year, wonder no longer. The biggest was Veterans United Home Loans. The Columbia, Missouri-based - [Is It Worth Using a Mortgage Lender Now for the Promise of Waived Fees in the Future?](https://www.thetruthaboutmortgage.com/is-it-worth-using-a-mortgage-lender-now-for-the-promise-of-waived-fees-in-the-future/): These days, mortgage rates aren’t as cheap as they used to be. And that is the understatement of the century. The 30-year fixed is currently priced around - [VA Funding Fee Being Reduced for Home Purchases and Cash Out Refis](https://www.thetruthaboutmortgage.com/va-funding-fee-being-reduced-for-home-purchases-and-cash-out-refis/): In an effort to make mortgage costs a little more bearable, the U.S. Department of Veterans Affairs (VA) is lowering the VA funding fee. This applies to - [Can Free and Clear Homeowners Save the Housing Market?](https://www.thetruthaboutmortgage.com/can-free-and-clear-homeowners-save-the-housing-market/): The housing market is in trouble. The latest blow being mortgage rates returning to 7%. But the ongoing issue has been a severe lack of inventory, which - [Annual Mortgage Insurance Premium on FHA Loans Reduced 30 Basis Points](https://www.thetruthaboutmortgage.com/annual-mortgage-insurance-premium-on-fha-loans-reduced-30-basis-points/): In an effort to make homeownership more affordable, the U.S. Department of Housing and Urban Development (HUD) is reducing fees on FHA loans. - [Why Are Mortgage Rates Going Up Again?](https://www.thetruthaboutmortgage.com/why-are-mortgage-rates-going-up-again/): It feels like déjà vu. Mortgage rates are going up again. What gives? I thought they peaked. Not so fast. The Fed warned us time and time again that this - [10 Things You Should Do Before Applying for a Mortgage](https://www.thetruthaboutmortgage.com/10-things-you-should-do-before-applying-for-a-mortgage/): I recently wrote that you should look for a mortgage before searching for a property to buy because unless you have lots of cash, you’re going to need a - [What Time of Year Are Mortgage Rates Lowest? Here's What The Data Says](https://www.thetruthaboutmortgage.com/when-are-mortgage-rates-lowest/): Mortgage Q&A: "What time of year are mortgage rates lowest?" We're all looking for an angle, especially if it’ll save us some money. Whether it’s a - [Why the “It’s the 2008 Housing Crisis All Over Again” Argument Falls Short](https://www.thetruthaboutmortgage.com/why-the-its-the-2008-housing-crisis-all-over-again-argument-falls-short/): There’s been a lot of buzz lately regarding another 2008 housing crisis unfolding in 2023. I’m hearing the phrases underwater mortgage and foreclosure - [There Is No Free Mortgage](https://www.thetruthaboutmortgage.com/there-is-no-free-mortgage/): You’ve heard the term “no free lunch.” Well, the same is true of home loans. There is no “free mortgage.” Sure, banks and lenders will offer deals that - [Better Mortgage Review: They Promise Speed But at What Price?](https://www.thetruthaboutmortgage.com/better-mortgage-review/): One of the first "fintech" mortgage lenders that came into existence in recent years was Better Mortgage. Launched in 2014, they managed to fund more than - [How the Fed Could Benefit from Lower Mortgage Rates](https://www.thetruthaboutmortgage.com/how-the-fed-could-benefit-from-lower-mortgage-rates/): The Fed has played a major role in consumer mortgage rates over the past decade and change. Back in 2008, they began purchasing hundreds of billions in - [What Is the Easiest Type of Mortgage to Get?](https://www.thetruthaboutmortgage.com/what-is-the-easiest-type-of-mortgage-to-get/): Mortgage Q&A: “What is the easiest type of mortgage to get?” Relative to other types of loans, it can be difficult to get approved for a mortgage. - [Top Mortgage Lenders in DC](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-dc/): Now it’s time to check out the top mortgage lenders in DC, the capital of the United States. In 2021, nearly 800 mortgage companies originated roughly - [Why You May Want a 780+ FICO Score When Applying for a Mortgage](https://www.thetruthaboutmortgage.com/780-fico-score-mortgage/): It used to be that a 720 FICO score was all you needed to ensure you qualified for the lowest rate on a mortgage. At least credit-wise. In other words, - [Mortgage Co-Borrower vs. Co-Signer](https://www.thetruthaboutmortgage.com/mortgage-co-borrower-vs-co-signer/): Today we’ll discuss the key differences between a mortgage co-borrower and a mortgage co-signer. While the two phrases sound pretty similar, and are - [A 1% Decrease in Mortgage Rates Is Worth an 11% Drop in Home Prices](https://www.thetruthaboutmortgage.com/a-1-decrease-in-mortgage-rates-is-worth-an-11-drop-in-home-prices/): A recent podcast from First American economists discussed the current state of the housing market. The subject was the rebalancing of the housing market, - [What Are Seller Concessions?](https://www.thetruthaboutmortgage.com/what-are-seller-concessions/): Now that the housing market is turning in favor of home buyers, the phrase “seller concessions” might become a lot more common. Over the past decade, home - [Nearly Half of Homeowners Regret Their Adjustable-Rate Mortgage](https://www.thetruthaboutmortgage.com/nearly-half-of-homeowners-regret-their-adjustable-rate-mortgage/): A new survey from U.S. News & World Report found that nearly half of homeowners with adjustable-rate mortgages regret the decision. This is based on a - [Wells Fargo to Exit Correspondent, Shrink Mortgage Business, Focus on Bank Clients and Minority Borrowers](https://www.thetruthaboutmortgage.com/wells-fargo-to-exit-correspondent-lending-shrink-mortgage-business/): Despite long being the #1 mortgage lender in the country, Wells Fargo has announced plans to shrink its mortgage business. The San Francisco-based bank - [Why Mortgage Lenders Are Requiring Upfront Points](https://www.thetruthaboutmortgage.com/why-do-mortgage-lenders-charge-points/): There’s been a recent phenomenon where mortgage lenders are requiring borrowers to pay upfront points when obtaining a home loan. This runs counter to the - [2023 Mortgage Rate Predictions: All Eyes on Inflation](https://www.thetruthaboutmortgage.com/2023-mortgage-rate-predictions/): Another year has nearly passed, which means it’s time for the 2023 mortgage rate predictions. I think we can all agree that the 2022 predictions were the - [Top Mortgage Lenders in Kentucky](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-kentucky/): It’s time to find out who the top mortgage lenders in Kentucky are, based on total loan volume. More than 750 banks, direct lenders, and credit unions - [Mortgage Broker Magnate Ishbia to Buy the Phoenix Suns and Mercury](https://www.thetruthaboutmortgage.com/uwm-ishbia-to-buy-the-phoenix-suns-and-mercury/): In a rather surprising move, United Wholesale Mortgage president and CEO Mat Ishbia is set to acquire the Phoenix Suns and Phoenix Mercury. The deal is - [Top Mortgage Lenders in Connecticut](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-connecticut/): Let’s talk about the top mortgage lenders in Connecticut, based on their total loan volume. Nearly 700 companies originated home loans in The Constitution - [Cash Out Refinance Fees Are Going Up in Early 2023](https://www.thetruthaboutmortgage.com/cash-out-refinance-fees-are-going-up-in-early-2023/): While most homeowners probably don’t have a refinance on their radar (due to the big jump in interest rates), take note that fees for cash out refis are - [Top Mortgage Lenders in Hawaii](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-hawaii/): Today we’ll check out the top mortgage lenders in Hawaii based on total loan volume. These companies closed the most home loans in The Aloha State last - [Top Mortgage Lenders in Idaho](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-idaho/): Let’s take a look at the top mortgage lenders in Idaho, based on annual loan origination volume. The Gem State was one of the hotter housing markets last - [2023 Mortgage and Real Estate Predictions](https://www.thetruthaboutmortgage.com/2023-mortgage-and-real-estate-predictions/): It's nearly 2023, which means it's time for a fresh batch of mortgage and real estate predictions for the new year. My assumption is everyone wants 2022 - [Top Mortgage Lenders in Alabama](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-alabama/): Today we’ll take a look at the top mortgage lenders in Alabama, based on their most recent year’s loan volume. This is a list of the largest mortgage - [The Beauty of High Mortgage Rates](https://www.thetruthaboutmortgage.com/the-beauty-of-high-mortgage-rates/): High mortgage rates are bad. They reduce affordability, lead to fewer home sales, and can cause lots of industry-related job losses. The year 2022 has - [How to Shop for a Mortgage](https://www.thetruthaboutmortgage.com/how-to-shop-for-a-mortgage/): Mortgage basics: “How to shop for a mortgage.” Every now and then I focus on mortgage 101 because it seems the obvious stuff isn’t always so obvious. - [2023 Conforming Loan Limits Rise to $726,200](https://www.thetruthaboutmortgage.com/2023-conforming-loan-limits/): A dollar ain’t worth what it used to be; just take a look at the newly released 2023 conforming loan limits. Yes, they will exceed $1 million in high-cost - [Mortgage Rates vs. CPI: Less Inflation = Lower Rates](https://www.thetruthaboutmortgage.com/mortgage-rates-vs-cpi/): While it seemed mortgage rates just couldn't catch a break, a positive CPI report has led to a huge rally. This is one of the bright sides to a decidedly - [UWM Becomes Top Mortgage Lender in the Nation](https://www.thetruthaboutmortgage.com/uwm-becomes-top-mortgage-lender-in-the-nation/): Similar to how Rocket Mortgage overtook Wells Fargo, United Wholesale Mortgage (UWM) has now risen above Rocket to become the nation’s top mortgage lender - [loanDepot Digital HELOC Launched: Paperless Process and Funding in as Little as 7 Days](https://www.thetruthaboutmortgage.com/loandepot-digital-heloc/): Direct lender loanDepot has launched a so-called “Digital HELOC” to help homeowners tap into their massive amounts of home equity. The Southern - [Rocket Rewards Loyalty Program Launched by Rocket Mortgage](https://www.thetruthaboutmortgage.com/rocket-rewards-loyalty-program/): The nation’s number one lender, Rocket Mortgage, has launched a new loyalty program called “Rocket Rewards.” Similar to other loyalty programs, consumers - [Top Mortgage Lenders in Wisconsin](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-wisconsin/): Now we’ll rank the top mortgage lenders in Wisconsin, based on the most recent year’s completed loan volume. These are the largest lenders in The Badger - [How Mortgage Interest Works](https://www.thetruthaboutmortgage.com/how-mortgage-interest-works/): A friend of mine asked me over the weekend how mortgage interest works? His coworker had posed a similar question to him, and he was passing it on to me. - [Who Cares What Mortgage Rates Were in the 1980s?](https://www.thetruthaboutmortgage.com/mortgage-rates-in-the-1980s/): Month after month, and week after week, articles continue to focus on mortgage rates in the 1980s, to seemingly paint a picture that rates are still - [FICO 10 T and VantageScore 4.0 Approved for Fannie Mae and Freddie Mac Mortgages](https://www.thetruthaboutmortgage.com/fico-10-t-and-vantagescore-4-0-approved-for-fannie-mae-and-freddie-mac-mortgages/): Two new credit scores will be used if and when you apply for a mortgage backed by Fannie Mae or Freddie Mac in the near future. On October 24th, 2022, the - [Home Prices Need to Fall 25%, But They Probably Won’t](https://www.thetruthaboutmortgage.com/home-prices-need-to-fall-25-but-they-probably-wont/): A new report from Zillow revealed that home prices need to come down by about 25% to become affordable again. But chances are they won’t, despite a lot of - [Top Mortgage Lenders in Missouri](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-missouri/): Today we’ll take a look at the top mortgage lenders in Missouri, based on loan volume. This means the biggest mortgage companies that operate in the The - [The Case for Sub-5% Mortgage Rates by 2023](https://www.thetruthaboutmortgage.com/the-case-for-sub-5-mortgage-rates-by-2023/): While mortgage rates have a good chance of getting worse before they get better, hope might be on the horizon. The long and the short of it is that - [Buy a House Before Mortgage Rates Come Back Down?](https://www.thetruthaboutmortgage.com/buy-a-house-before-mortgage-rates-come-back-down/): There is a plausible scenario where mortgage rates continue higher for a short period and then eventually correct. Possibly as soon as next year. At the - [Are Mortgage Rates Going to 8.5% Next?](https://www.thetruthaboutmortgage.com/are-mortgage-rates-going-to-8-5-next/): The year 2022 has been absolutely dreadful with respect to mortgage rates. We’ve seen the popular 30-year fixed rise from sub-3% levels to around 7% in - [Top Mortgage Lenders in Indiana](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-indiana/): Now let’s talk about the top mortgage lenders in Indiana, based on their most recent year’s loan volume. In 2021, nearly 900 mortgage companies funded - [Now You Can Get a Mortgage at Walmart](https://www.thetruthaboutmortgage.com/walmart-mortgage/): It’s official, you can get a mortgage at Walmart now. So next time you’re grocery shopping, or picking up other essentials, you can apply for a home loan - [Top Mortgage Lenders in South Carolina](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-south-carolina/): It’s time to check out the top mortgage lenders in South Carolina, based on who did the most business. Last year, more than 1,000 mortgage companies - [What Is Inflation Buster from Rocket Mortgage?](https://www.thetruthaboutmortgage.com/what-is-inflation-buster-from-rocket-mortgage/): I was watching some football this weekend and happened upon an ad for “Inflation Buster” from Rocket Mortgage. I’m always intrigued when I see a mortgage - [Top Mortgage Lenders in Minnesota](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-minnesota/): Let’s check out the top mortgage lenders in Minnesota based on the most recent year’s loan volume. Around 750 mortgage companies originated roughly $91 - [The Truth About Falling Home Prices](https://www.thetruthaboutmortgage.com/the-truth-about-falling-home-prices/): Real estate doom and gloom articles are going to ramp up big time in coming months, if they haven’t already. You’re going to hear that the second biggest - [Top Reverse Mortgage Lenders](https://www.thetruthaboutmortgage.com/top-reverse-mortgage-lenders/): If you’re a senior, you might be wondering who the top reverse mortgage lenders in the nation are. Unlike the traditional home loan market, the reverse - [Crowdfunded Zero Down Mortgage Launched as Housing Market Peaks](https://www.thetruthaboutmortgage.com/crowdfunded-zero-down-mortgage-launched/): A credit union out of Cheyenne, Wyoming has launched a crowdfunded, zero down mortgage loan for its customers. It comes at a time when still sky-high home - [Marry the House, Date the Rate. What?](https://www.thetruthaboutmortgage.com/marry-the-house-date-the-rate/): Lately, I’ve been seeing the old “marry the house, date the rate” adage thrown around a lot. The idea is relatively straightforward. You buy a home you - [Top Mortgage Lenders in Tennessee](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-tennessee/): Today we’ll take a hard look at the top mortgage lenders in Tennessee by loan volume. Last year, nearly 1,200 mortgage companies battled it out for first - [Your Credit Score Alone Can Make or Break Your HELOC Rate](https://www.thetruthaboutmortgage.com/heloc-credit-score/): You’ve probably heard that maintaining an excellent credit score is very important when it comes to getting a mortgage. Not only will it help ensure you - [Why Homeowners Aren’t Selling](https://www.thetruthaboutmortgage.com/why-homeowners-arent-selling/): With all the talk of a housing market crash, there’s not a lot of data to support it. Sure, home price gains have moderated significantly after recording - [Watch Out for 8% Mortgage Rates](https://www.thetruthaboutmortgage.com/8-percent-mortgage-rates/): Now that interest rates have resumed their upward climb, do we have to worry about 8% mortgage rates next? Back in July, I questioned if 7% mortgage rates - [Top Mortgage Lenders in Oregon](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-oregon/): Today we’ll take a look at the top mortgage lenders in Oregon, based on total loan volume. Nearly 700 different mortgage companies duked it out last year - [Housing Crash Imminent? The National LTV Is Below 30%](https://www.thetruthaboutmortgage.com/housing-crash-imminent-the-national-ltv-is-below-30/): The topic du jour lately has been a housing market on the edge of disaster. But no one can quite agree whether it’s an affordability crisis, home price - [Top Mortgage Lenders in Utah](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-utah/): If you’re curious who the top mortgage lenders in Utah are, I’ve got some answers. Last year, more than 500 lenders in The Beehive State originated nearly - [Top Mortgage Lenders in Michigan](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-michigan/): Let’s check out the top mortgage lenders in Michigan based on the most recent year’s loan volume. The state of Michigan is an interesting one because it’s - [Top Mortgage Lenders in Maryland](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-maryland/): Today we’ll have a look at the top mortgage lenders in Maryland based on their annual loan volume. Like other states in the nation, it wasn’t a big shock - [Bank of America Launches a Zero Down Mortgage](https://www.thetruthaboutmortgage.com/bank-of-america-zero-down-mortgage/): This week, Bank of America unveiled a zero down mortgage option as part of their Community Homeownership Commitment. In short, they want to help more - [Home Equity Loans 101: Everything You Need to Know](https://www.thetruthaboutmortgage.com/home-equity-loan/): Today we’re going to talk about the “home equity loan,” which is quickly becoming all the rage with mortgage rates so much higher. In short, many - [Top Mortgage Lenders in Pennsylvania](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-pennsylvania/): Today we’ll take a look at the top mortgage lenders in Pennsylvania based on their annual loan volume. The state of Pennsylvania is unique in that it - [The Temporary Buydown: How to Get a Lower Rate the First Couple Years on Your Mortgage](https://www.thetruthaboutmortgage.com/buydown-mortgage/): Today we’re going to talk about a “temporary buydown,” the latest effort by the mortgage industry to provide much-needed payment relief to borrowers. In - [4.5% Mortgage Rates in 2023? That’s the Latest Estimate from Fannie Mae](https://www.thetruthaboutmortgage.com/4-5-mortgage-rates-in-2023/): Might 2023 be good to mortgage rates? If you believe the latest Housing Forecast from Fannie Mae, then yes. Most everyone knows 2022 has wreaked absolute - [Top Mortgage Lenders in the State of Massachusetts](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-massachusetts/): Now let’s check out the top mortgage lenders in Massachusetts, based on loan volume. In 2021, roughly $164 billion in home loans were originated in The - [Orchard Mortgage Review: A Tech-Enabled Mortgage Broker That Wants to Transform the Stale Home Buying Process](https://www.thetruthaboutmortgage.com/orchard-mortgage-review/): Today we’ll check out “Orchard Mortgage,” formerly known as Orchard Home Loans. The direct lender is backed by its parent company Orchard (previously - [Could a 50-Year Fixed Mortgage Finally Solve the Affordability Crisis?](https://www.thetruthaboutmortgage.com/50-year-mortgage/): With mortgage rates nearly double what they used to be, you might wonder if an alternative product like a "50-year mortgage" could improve affordability. - [A Severe Housing Downturn Is Now Possible](https://www.thetruthaboutmortgage.com/a-severe-housing-downturn-is-now-possible/): Sound the alarm. A severe housing downturn may now be in the cards in the United States. That is, if you believe the latest commentary from credit rating - [The Top Refinance Companies By Loan Volume Last Year](https://www.thetruthaboutmortgage.com/top-refinance-companies/): Now it’s time to take a look at the top refinance companies in the country, based on who closed the most loans last year. As you may have guessed, Rocket - [Half of Americans Don’t Even Know What a Mortgage Is?](https://www.thetruthaboutmortgage.com/half-of-americans-dont-even-know-what-a-mortgage-is/): A new shock poll (I just wanted to utter that phrase) found that half of Americans don’t even know what the word “mortgage” means. The findings are based - [Top Mortgage Lenders in New Jersey](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-new-jersey/): Today we’ll do a deep dive into the top mortgage lenders in New Jersey. Using HMDA data, we can see which companies originated the most home loans in the - [Top Mortgage Lenders in Virginia](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-virginia/): Now we’ll check out the top mortgage lenders in Virginia, which like many other states, was led by Rocket Mortgage. The nation’s #1 overall mortgage - [Why Is the Housing Market Cooling? And Should We Worry About a Bubble Bursting?](https://www.thetruthaboutmortgage.com/why-is-the-housing-market-cooling/): The housing market is cooling. There’s really no debate. Things are slowing down. You can mostly thank a doubling in mortgage rates and high home prices - [Top Mortgage Lenders in Colorado](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-colorado/): Today we’ll take a look at the top mortgage lenders in Colorado. Interestingly, the top lender in the state isn’t a direct lender or a depository bank. In - [Top Mortgage Lenders in New York](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-new-york/): Now let’s take a look at the top mortgage lenders in New York, based on overall loan volume produced last year. The state of New York is unique in that - [Mortgage Rate Predictions for the Rest of the Year (2022)](https://www.thetruthaboutmortgage.com/mortgage-rate-predictions-for-the-rest-of-the-year-2022/): With all the seesaw movement in the first eight months of 2022, I wanted to throw out some mortgage rate predictions for the rest of the year. Note that - [Arvest Central Mortgage Review: the Top Mortgage Lender in the State of Arkansas](https://www.thetruthaboutmortgage.com/arvest-central-mortgage-review/): If you reside in Arkansas or a nearby state, chances are you’ve heard of Arvest Central Mortgage. Or perhaps you already have a checking or savings - [Top Mortgage Lenders in Washington State](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-washington-state/): If you reside in the Pacific Northwest, you might wonder who the top mortgage lenders in Washington State are. Yes, I’m referring to the state of - [40-Year Mortgages: Do They Make Any Sense?](https://www.thetruthaboutmortgage.com/do-40-year-mortgages-make-any-sense/): Interested in a 40-Year Fixed Mortgage? If you need even more time to pay off your mortgage Or need to get the monthly payment down to boost affordability - [Top Mortgage Lenders in Arizona](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-arizona/): If you’re curious who the top mortgage lenders in Arizona are, you’ve come to the right place. I’ve compiled several top-10 lists for overall volume, home - [Does Having A Mortgage Help Your Credit Score? Your Mileage May Vary, Here's Why](https://www.thetruthaboutmortgage.com/does-having-a-mortgage-help-your-credit-score/): Mortgage Q&A: "Does Having A Mortgage Help Your Credit Score?" If you’ve ever pulled your credit report and/or viewed your scores, you may have - [Will Mortgage Rates Hit 7% Next?](https://www.thetruthaboutmortgage.com/seven-percent-mortgage-rates/): It seems mortgage rates can’t catch a break in 2022, despite a few pullbacks here and there. However, those moments are often short-lived, and met with - [What Is a Housing Correction? And Are We In One Now?](https://www.thetruthaboutmortgage.com/what-is-a-housing-correction/): Lately, I’ve been hearing a lot about a “housing correction,” which at first glance looks and sounds kind of bad. Not as bad as say a housing crash, but - [An Easy Way to Save Even More Money with an Adjustable Rate Mortgage](https://www.thetruthaboutmortgage.com/how-to-save-money-with-an-adjustable-rate-mortgage/): Because mortgage rates have more than doubled lately, interest in adjustable-rate mortgages has taken off. The popular 30-year fixed, which was priced as - [Mortgage Rates vs. Recessions: Do They Go Up or Down During Hard Times?](https://www.thetruthaboutmortgage.com/mortgage-rates-vs-recessions/): It’s time for another mortgage match-up, the latest installment “mortgage rates vs. recessions.” This is a timely post seeing that mortgage rates have - [AnnieMac Mortgage Review: A New Jersey Mortgage Lender Big on Human Touch](https://www.thetruthaboutmortgage.com/anniemac-mortgage-review/): If you want a more personal home loan experience, take a look at AnnieMac Home Mortgage. The New Jersey-based lender believes the complex mortgage process - [Paying Extra Today Won’t Lower Your Future Monthly Mortgage Payments](https://www.thetruthaboutmortgage.com/paying-more-today-wont-lower-future-monthly-mortgage-payments/): Just about everyone with a home loan ponders the idea of paying a little extra, whether it’s via biweekly mortgage payments, or just once a year after - [The Average Homeowner Now Has $207,000 in Tappable Equity: The Question Is How Do You Tap It?](https://www.thetruthaboutmortgage.com/tappable-equity/): While prospective home buyers continue to grapple with high mortgage rates and limited supply, existing owners are getting richer. A new report from Black - [Can You Still Get an Adjustable Rate Mortgage?](https://www.thetruthaboutmortgage.com/can-you-still-get-an-adjustable-rate-mortgage/): Yes, adjustable-rate mortgages are still available, even though your lender may have hidden them from you for the past few years. Ultimately, ARMs just - [Flat Branch Home Loans Review: Over 1,000 Years of Mortgage Experience](https://www.thetruthaboutmortgage.com/flat-branch-home-loans-review/): If you’re looking for a home purchase lending expert in the Midwest, you may want to check out “Flat Branch Home Loans.” The Columbia, MO-based company is - [NJ Lenders Corp. Review: The 5th Largest Mortgage Lender in the State of New Jersey](https://www.thetruthaboutmortgage.com/nj-lenders-corp-review/): With a name like "NJ Lenders Corp.," there’s no question who they’re focused on; folks in the Garden State! What’s more interesting is the fact that - [What Does It Mean to Be House Poor?](https://www.thetruthaboutmortgage.com/what-does-it-mean-to-be-house-poor/): If you’re an existing homeowner or an aspiring one, you may have heard the phrase “house poor,” typically uttered by an overextended borrower. It may also - [Summit Mortgage Review: If You Want More Than a Call Center Home Loan](https://www.thetruthaboutmortgage.com/summit-mortgage-review/): If you’re looking for personalized service, instead of a call-center home loan, you might want to check out Summit Mortgage. The privately-owned direct - [Top Mortgage Lenders by Volume in 2021: Rocket Zooms Highest Once Again with $100 Billion Gap](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-2021/): Now that the Home Mortgage Disclosure Act (HMDA) data is out, we can check out the top mortgage lenders of 2021. As you may have guessed, Rocket Mortgage - [Top USDA Lenders in 2021: Pennymac Blew Away the Competition](https://www.thetruthaboutmortgage.com/top-usda-lenders/): Today we’ll take a look at the top USDA lenders by loan volume in 2021. In case you need a refresher, USDA loans are reserved for properties located in - [Top FHA Lenders: Pennymac Is #1 Overall, But Is Biggest the Best?](https://www.thetruthaboutmortgage.com/top-fha-lenders/): If you’re in need of an FHA loan, you might be curious who the top FHA lenders are. By top, I mean largest. While biggest certainly doesn’t mean best, or - [Why You Might Not Want to Get Too Excited (or Nervous) About a Housing Crash](https://www.thetruthaboutmortgage.com/why-you-might-not-want-to-get-too-excited-or-nervous-about-a-housing-crash/): As mortgage rates continue their ascent toward 6%, more and more folks are talking housing market crash. But high interest rates aren’t really a catalyst - [Sometimes It’s Actually Better to Choose the Higher Mortgage Rate](https://www.thetruthaboutmortgage.com/sometimes-its-better-to-choose-the-higher-mortgage-rate/): It might not make sense (or save you money) to choose a promotional mortgage rate, such as 2.99%. Learn why. - [Are Home Prices Falling? The Devil Is in the Details](https://www.thetruthaboutmortgage.com/are-home-prices-falling/): How’s this for a dramatic headline: “Home prices are falling!” But before you get too excited, assuming you’re a prospective home buyer, there are some - [10-Year Mortgages vs. the 30-Year Fixed: Are They Worth the Small Discount?](https://www.thetruthaboutmortgage.com/30-year-vs-10-year-mortgages/): It’s time for another mortgage match-up folks. Today, we’ll look at 10-year mortgages versus the 30-year fixed mortgage to see how these home loans stack - [Now That We’ve Got 5% Mortgage Rates, Is the Seller’s Market Finally Over?](https://www.thetruthaboutmortgage.com/now-that-weve-got-5-mortgage-rates-is-the-sellers-market-finally-over/): We’ve got 5% mortgage rates and record high home prices. Does this mean the seller’s market is finally over? You would think so, given the massive - [Is an Adjustable-Rate Mortgage a Good Short-Term Strategy Until Interest Rates Cool Off?](https://www.thetruthaboutmortgage.com/is-an-adjustable-rate-mortgage-a-good-short-term-strategy-until-interest-rates-cool-off/): We know mortgage rates are projected to keep rising, so what’s a cost-effective solution if you need a home loan today? Well, one idea is to look beyond - [Allow Me to Introduce You to the 5% Mortgage Rate](https://www.thetruthaboutmortgage.com/allow-me-to-introduce-you-to-the-5-mortgage-rate/): For those new to mortgages, the number five might feel a bit foreign. Over the past decade and even longer, rates on the popular 30-year fixed mortgage - [Have Mortgage Rates Peaked?](https://www.thetruthaboutmortgage.com/have-mortgage-rates-peaked/): Two weeks ago, I wrote about how mortgage rates jumped, something just about everyone is aware of. But I also attempted to quantify the actual impact in - [Are We Near the Peak of the Current Housing Cycle?](https://www.thetruthaboutmortgage.com/are-we-near-the-peak-of-the-current-housing-cycle/): They say real estate is cyclical, much like the stock market and the wider economy. It ebbs and flows, goes up and down, experiences booms and busts, can - [Are the Housing Bears Being Too Rational?](https://www.thetruthaboutmortgage.com/are-the-housing-bears-being-too-rational/): Now that 30-year fixed mortgage rates are flirting with 5%, there’s been quite the uptick in housing bubble chatter. The basic reasoning is because - [Figure's Crypto Mortgage: Purchase a Home with Nothing Down While You Continue to HODL](https://www.thetruthaboutmortgage.com/figure-crypto-mortgage-review/): For the individual who eschews fiat currency, but still needs a mortgage, look no further than Figure. The company originally came onto the scene by - [Diamond Residential Mortgage Review: No Borrower Is Left Behind Thanks to Their Endless Menu of Loan Programs](https://www.thetruthaboutmortgage.com/diamond-residential-mortgage-review/): Today we’ll check out “Diamond Residential Mortgage Corp.,” a Midwest mortgage lender that’s named after its founder, not the precious gem. The company is - [5/1 ARM vs. 30-Year Fixed: What's the Better Choice and Why?](https://www.thetruthaboutmortgage.com/30-year-fixed-vs-51-arm/): A 5/1 ARM can save you a lot of money versus the more expensive 30-year fixed. Learn how and if it could be a good fit for your situation. - [Mortgage Rates Have Jumped. Just How Bad Is It?](https://www.thetruthaboutmortgage.com/mortgage-rates-have-jumped-just-how-bad-is-it/): In a word, bad. At least in terms of historic interest rate moves, which have rarely rivaled the massive increases we’ve seen in such a short span. But - [Nation’s Largest Wholesale Lender Now Offering Bank Statement Loans](https://www.thetruthaboutmortgage.com/uwm-bank-statement-loans/): What year is it? 2006? The nation’s largest wholesale mortgage lender, United Wholesale Mortgage, has just announced the availability of bank statement - [Is the Best Cure for High Mortgage Rates, High Mortgage Rates?](https://www.thetruthaboutmortgage.com/is-the-best-cure-for-high-mortgage-rates-high-mortgage-rates/): There’s an old adage in the commodities market that says, “the best cure for high prices is, high prices.” No, it’s not a typo. The logic is basically - [Sun West Mortgage Review: Near Instantaneous Underwriting to Get Your Home Loan Closed Fast](https://www.thetruthaboutmortgage.com/sun-west-mortgage-review/): Not many mortgage companies have been around since the 1980s, but “Sun West Mortgage” has. However, that doesn’t mean they operate their business like a - [What Is a Conventional Mortgage Loan?](https://www.thetruthaboutmortgage.com/what-is-a-conventional-mortgage-loan/): Mortgage Q&A: “What is a conventional mortgage loan?” A “conventional loan” simply refers to any residential mortgage loan that is not insured or - [If You Want to Buy a Home, Adjust Your Max Purchase Price Filter a Lot Lower](https://www.thetruthaboutmortgage.com/if-you-want-to-buy-a-home-adjust-your-max-purchase-price-filter-a-lot-lower/): If you’re a prospective home buyer, you need to prepare for the worst. And by worst, I mean a much higher-than-anticipated asking price. Maybe not - [Mortgage Investors Group Review: A Leading Southeast Mortgage Lender with Great First-Time Buyer Loan Programs](https://www.thetruthaboutmortgage.com/mortgage-investors-group-review/): Mortgage Investors Group, or MIG for short, has a familiar story in that they were founded by a small group of loan officers before growing into a - [Mortgage Rates vs. War: The Silver Lining](https://www.thetruthaboutmortgage.com/mortgage-rates-vs-war-the-silver-lining/): Sadly, there's another war taking place, this time Russia's invasion of neighboring Ukraine. While it doesn't involve the United States directly, a - [UpEquity Review: They Can Make You an All-Cash Power Buyer in a Hot Housing Market](https://www.thetruthaboutmortgage.com/upequity-review/): The latest company looking to tackle the buy before you sell quandary goes by the name “UpEquity.” They’re also making it easier for first-time home - [Waterstone Mortgage Review: Home Purchase Loan Experts Who Strive to Close On Time](https://www.thetruthaboutmortgage.com/waterstone-mortgage-review/): Today we’ll take a thorough look at “Waterstone Mortgage,” a residential mortgage lender backed by a billion-dollar depository bank. Despite being the - [Number Who Say It’s a Good Time to Buy a Home Hits an All-Time Low, However…](https://www.thetruthaboutmortgage.com/number-who-say-its-a-good-time-to-buy-a-home-hits-an-all-time-low-however/): You may have heard that home buying sentiment is horrible at the moment, what with home prices and mortgage rates rising in tandem. The continued lack of - [10 Ways to Get a Bigger Mortgage: With Home Prices On the Rise You May Need One](https://www.thetruthaboutmortgage.com/get-a-bigger-mortgage/): With home prices on the rise, and only expected to go higher this year, you might be wondering how to get a bigger mortgage. After all, you might need one - [Is This Mortgage Company Legit? How to Quickly Vet Your Lender](https://www.thetruthaboutmortgage.com/is-this-mortgage-company-legit/): It’s a question I see consumers ask whenever they size up a lender: “Is X mortgage company legit?” Ultimately, borrowers want to know that the company - [Loan Factory Review: They Dare You to Compare Rates Elsewhere](https://www.thetruthaboutmortgage.com/loan-factory-review/): Do you want a low mortgage rate and a good experience to boot while obtaining a home loan? While that basically sounds impossible, a company called “Loan - [InstaMortgage Review: A Minority-Owned Lender That Aims to Provide Legendary Customer Service](https://www.thetruthaboutmortgage.com/instamortgage-review/): Today we’ll deep dive into “InstaMortgage,” formerly known as Arcus Lending, a lender that promises low rates, legendary service, and a mortgage at record - [UWM Offering No-Cost Appraisals on Home Purchase Loans](https://www.thetruthaboutmortgage.com/uwm-offering-no-cost-appraisals-on-home-purchase-loans/): In an effort to make loan closings even faster, United Wholesale Mortgage (UWM) is offering an appraisal credit on home purchase loans submitted through - [Cake Mortgage Review: A Piece of Cake From Start to Finish?](https://www.thetruthaboutmortgage.com/cake-mortgage-review/): Today we’ll check out “Cake Mortgage Corp.,” which as the name implies wants to make the home loan process a piece of, well, cake. They believe cake isn’t - [The Mortgage Refinance Process: Complete Step-by-Step Guide and Timeline](https://www.thetruthaboutmortgage.com/mortgage-refinance-process-steps/): Most homeowners know what a mortgage refinance is, but aren’t necessarily familiar with the process and many steps that take place along the way. If - [How Many Homes Should I Look at Before I Buy? One Could Be Enough But More Is Definitely Better](https://www.thetruthaboutmortgage.com/how-many-homes-should-i-look-at-before-i-buy/): These days, prospective home buyers are spending a lot more time looking at homes virtually rather than in person. This was a trend before COVID-19 reared - [What Is Prepaid Interest? Here's Why You Need to Pay the Mortgage Lender Ahead of Time](https://www.thetruthaboutmortgage.com/what-is-prepaid-interest/): As the name implies, "prepaid interest" is money you owe to a bank or mortgage lender that is paid in advance of when it is actually due. In terms of why - [What Mortgage Term Is Best? Why It Could Pay to Look Beyond the 30-Year Fixed](https://www.thetruthaboutmortgage.com/what-mortgage-term-is-best/): Before you set out to snag the lowest rate on your purchase mortgage or refinance, you’ll need to decide on (or at least narrow down) a mortgage term. - [Do You Need 20% Down to Buy a House? Why This Old Rule No Longer Applies](https://www.thetruthaboutmortgage.com/do-you-need-20-down-to-buy-a-house/): It’s been some time since I’ve done mortgage Q&A, so without further delay, let’s explore the following question: “Do you need 20% down to buy a - [Why You May Want to Act Fast If Taking Out a Mortgage on a Second Home or Expensive Property](https://www.thetruthaboutmortgage.com/new-fees-for-high-balance-loans-and-second-home-loans/): If you own a second home or hold a high balance loan amount, you may want to refinance sooner rather than later. That’s assuming you were thinking of - [2022 Real Estate and Mortgage Predictions](https://www.thetruthaboutmortgage.com/2022-real-estate-predictions/): It's almost mid-December, which means it is time for another round of mortgage and real estate predictions for the upcoming year. I think it's safe to say - [Strong Home Mortgage Review: A Veteran-Owned Mortgage Lender That's Part of the Costco Program](https://www.thetruthaboutmortgage.com/strong-home-mortgage-review/): Today we’ll take a good look at a newer veteran-owned mortgage lender by the name of Strong Home Mortgage. As the name implies, they want to put you in a - [2022 Mortgage Rate Predictions: Is This the Year They Finally Hit 4%?](https://www.thetruthaboutmortgage.com/2022-mortgage-rate-predictions/): Well, just like that it’s December again, which means it’s time for the 2022 mortgage rate predictions. This past year was filled with ups and downs - [NASB Home Loans Review: NerdWallet Ranked Them Best Mortgage Lender Overall](https://www.thetruthaboutmortgage.com/nasb-home-loans-review/): Today we’ll review a Missouri-based community bank that’s big on home loans, North American Savings Bank, or NASB Home Loans for short. The company got - [Mortgage Network Review: One of the Largest Independent Mortgage Lenders in New England](https://www.thetruthaboutmortgage.com/mortgage-network-review/): If you live in New England, or more specifically Massachusetts, there’s a very good chance you’ve heard of Mortgage Network, Inc. They refer to themselves - [2022 FHA Loan Limits: Floor Rises to $420,680, Ceiling to $970,800](https://www.thetruthaboutmortgage.com/2022-fha-loan-limits/): Similar to the FHFA, the U.S. Department of Housing and Urban Development (HUD) announces maximum loan limits each year for FHA loans. Today, they - [2022 Conforming Loan Limit Jumps to $647,200](https://www.thetruthaboutmortgage.com/2022-conforming-loan-limits/): This morning, the 2022 conforming loan limits were officially announced by the FHFA, with the baseline limit hitting a whopping $647,200. Prior to this - [Mortgage Rates vs. Omicron](https://www.thetruthaboutmortgage.com/mortgage-rates-vs-omicron/): Last week, the World Health Organization (WHO) designated Omicron, formally known as B.1.1.529, a variant of concern. This news rocked financial markets - [Lendevity Review: A SoCal Mortgage Broker That Charges $0 Broker Fees and Offers a Loyalty Program](https://www.thetruthaboutmortgage.com/lendevity-review/): Today we’ll check out a Southern California-based mortgage broker named “Lendevity,” which has been earning rave reviews lately. Their name is actually a - [What Will Cause the Next Housing Crash?](https://www.thetruthaboutmortgage.com/what-will-cause-the-next-housing-crash/): I think I finally know what’s going to cause the next major financial collapse. Crypto. Ignore the fact that the word “cry” is part of the word. For the - [Another Reason You Can’t Find a Home to Buy: Investors](https://www.thetruthaboutmortgage.com/cant-find-home-to-buy/): Don’t be fooled by Zillow’s recent iBuying exit. The housing market is alive and well, despite some expected seasonal slowing. Sure, November and December - [FHA-to-Conventional Refinance: How to Drop Mortgage Insurance Once and For All](https://www.thetruthaboutmortgage.com/an-fha-to-conventional-refinance-may-allow-you-to-ditch-mip/): While refinance applications seem to be slowing, there are still some good reasons to refinance your mortgage, even if interest rates aren’t currently at - [Lakeview Loan Servicing Review: A Top Mortgage Lender and Loan Servicer Rolled Into One](https://www.thetruthaboutmortgage.com/lakeview-mortgage-review/): Lakeview Loan Servicing is the nation's fourth largest loan servicer and also a home loan lender that provides purchase and refinance loans. - [Zillow Offers Shuts Down Because It Can't Forecast Future Home Prices, 25% of Workforce to Be Let Go](https://www.thetruthaboutmortgage.com/zillow-offers-shuts-down/): In a somewhat strange turn of events, the iBuying unit of Zillow, known as Zillow Offers, is shutting down after an initial suspension late last month. I - [Zillow Hits Pause on iBuying for the Rest of 2021: Should We Worry?](https://www.thetruthaboutmortgage.com/zillow-hits-pause-on-ibuying-for-the-rest-of-2021-should-we-worry/): In a rather surprising turn, Zillow has suspended new home purchases via its Zillow Offers unit through the end of 2021. It’s actually the second time - [2022 Home Prices: Goldman Sachs Sees Values Rising Another 16%](https://www.thetruthaboutmortgage.com/2022-home-prices/): Think home prices are expensive today? Well, get ready for an even bigger shock. A new report claims 2022 home prices could be 16% by the end of next - [Why Are Mortgages Cheaper Than Rent?](https://www.thetruthaboutmortgage.com/why-are-mortgages-cheaper-than-rent/): Mortgage Q&A: “Why are mortgages cheaper than rent?” Today we’ll discuss why mortgages often appear to be less expensive than a monthly rent payment, - [Mortgages for Doctors: Expanded LTVs and Large Loan Amounts](https://www.thetruthaboutmortgage.com/mortgages-for-doctors-expanded-ltvs-and-large-loan-amounts/): If you’re a doctor, resident, or even a veterinarian, getting a mortgage can be a little bit easier thanks to so-called "physician mortgages" offered by - [Dude, Where’s My Low Mortgage Rate?](https://www.thetruthaboutmortgage.com/dude-wheres-my-low-mortgage-rate/): A Common Mortgage Rate Tale You’ve been shopping mortgage rates and finally found a lender you like. The loan officer asks if you want to lock in your - [It’s Okay to Rent Until You Find a House You Really Like](https://www.thetruthaboutmortgage.com/its-okay-to-rent-until-you-find-a-house-you-really-like/): When deciding between renting and buying, individuals often fret about missing out on home equity if they do the former. In other words, for all those - [What the Names Zillow, Redfin, and Trulia Mean](https://www.thetruthaboutmortgage.com/what-the-names-zillow-redfin-and-trulia-mean/): Nowadays, just about everyone looking to buy or sell real estate begins their search online. And a small handful of websites seem to be dominating the - [What Is Lender-Paid Mortgage Insurance? First Of All, You Still Pay For It](https://www.thetruthaboutmortgage.com/what-is-lender-paid-mortgage-insurance/): While it sounds like you're getting something for free with lender-paid mortgage insurance, it's more about how you pay for this coverage. - [Two Simple Ways to Boost Your Credit Score Before Applying for a Mortgage](https://www.thetruthaboutmortgage.com/two-simple-ways-to-boost-your-credit-score-before-applying-for-a-mortgage/): A while back, I cautioned readers to avoid swiping the credit card before applying for a mortgage. In short, the more you charge, the higher your - [Michigan State Athletes Will Soon Be Paid $500 Per Month to Promote Mortgage Brokers](https://www.thetruthaboutmortgage.com/michigan-state-athletes-will-soon-be-paid-500-per-month-to-promote-mortgage-brokers/): Back in July, the NCAA granted college athletes the opportunity to make money by using their “name, image and likeness” (NIL). This means getting paid to - [6 Ways to Snag a Low Mortgage Rate Even If They Suddenly Jump Higher](https://www.thetruthaboutmortgage.com/six-ways-to-secure-a-low-mortgage-rate-despite-the-recent-jump/): Over the past year, mortgage rates have been relatively steady near their all-time lows. This has continued to benefit existing homeowners who wish to - [Mortgage Insurance vs. Homeowners Insurance: Only One of Them Protects You](https://www.thetruthaboutmortgage.com/mortgage-insurance-vs-homeowners-insurance/): These days, it seems as if you can insure just about anything. Your car, your house, your dog, your phone, and maybe even your hair? At one time, there - [Change Home Mortgage Review: If Homeownership Feels Like a Long Shot, Give Them a Call](https://www.thetruthaboutmortgage.com/change-home-mortgage-review/): If you’ve driven the 405 freeway lately, you may have seen a billboard from “ChangeFi,” a bank that’s looking to eliminate social and racial inequity in - [Neat Loans Will Give You a $500 Discount on Your Mortgage If You Got the COVID-19 Vaccine](https://www.thetruthaboutmortgage.com/neat-loans-covid-19-discount/): This appears to be a first – digital mortgage lender Neat Loans will provide applicants with a $500 discount if they’re vaccinated for COVID-19. The - [ClearPath Lending Review: They're a Big Time VA Loan Lender](https://www.thetruthaboutmortgage.com/clearpath-lending-review/): If you’re in need of a VA loan, one mortgage company that deals almost exclusively in them goes by the name “ClearPath Lending.” Roughly 99% of the home - [Borrowers Don’t Choose Mortgage Lenders for the Best Interest Rate](https://www.thetruthaboutmortgage.com/borrowers-dont-choose-mortgage-lenders-for-the-best-interest-rate/): Conventional wisdom would lead us to believe that consumers go with the mortgage lender that offers the lowest interest rate. After all, who can resist a - [Is the Housing Market Finally Slowing Down? Not So Fast…](https://www.thetruthaboutmortgage.com/is-the-housing-market-finally-slowing-down/): It’s a question a lot of prospective home buyers are asking right now. When will the housing market slow down? When will the bidding wars end and prices - [Nation’s Second Largest Mortgage Lender to Accept Bitcoin Because They Want to Be First](https://www.thetruthaboutmortgage.com/nations-second-largest-mortgage-lender-to-accept-bitcoin-because-they-want-to-be-first/): The nation’s second largest mortgage lender, United Wholesale Mortgage, has plans to accept bitcoin for mortgage payments. The Pontiac, Michigan-based - [Your Positive Rental History Will Now Help You Qualify for a Mortgage](https://www.thetruthaboutmortgage.com/your-positive-rental-history-will-now-help-you-qualify-for-a-mortgage/): In a bid to help more renters become homeowners, Fannie Mae has introduced a new “innovation” that will incorporate rental history into its automated - [Are Mortgage Calculators Accurate? Why Some Totally Miss the Mark](https://www.thetruthaboutmortgage.com/are-mortgage-calculators-actually-accurate/): Time for more mortgage Q&A: “Are mortgage calculators accurate?” Just about anyone looking to buy real estate or apply for a mortgage refinance will - [Rocket Mortgage Launches Detroit Home Loan+: Is It a Good Deal?](https://www.thetruthaboutmortgage.com/detroit-home-loan-plus-rocket-mortgage/): The nation’s largest mortgage lender, Rocket Mortgage, has just rolled out a home loan program exclusively for customers buying homes in Detroit. The goal - [Mortgage Rates vs. Unemployment: Keep a Close Eye on the Jobs Report!](https://www.thetruthaboutmortgage.com/mortgage-rates-vs-unemployment/): It's time for another mortgage match-up: "Mortgage rates vs. unemployment." When it comes to making (or for our purposes saving) money, everyone probably - [Why a Really Cheap Mortgage Might Actually Be Trouble](https://www.thetruthaboutmortgage.com/why-a-really-cheap-mortgage-might-actually-be-trouble/): An ultra-cheap mortgage might give you a false sense of living below your means, pushing you to spend when you otherwise wouldn't. - [Why It's Best to Apply for a Mortgage When Things Are Slow](https://www.thetruthaboutmortgage.com/why-you-may-want-to-apply-for-a-mortgage-when-things-are-slow/): If you apply for a mortgage when it's super busy, you might not get the lowest interest rate, or the best customer service! - [Resetting the Clock When You Refinance: Why It Could Cost You](https://www.thetruthaboutmortgage.com/resetting-the-clock-when-refinancing-your-mortgage/): If you decide to refinance your mortgage, be sure to factor in your new loan term, which could add thousands of dollars in interest. - [How to Lower Your Mortgage Rate Without Refinancing](https://www.thetruthaboutmortgage.com/can-i-lower-my-mortgage-interest-rate-without-refinancing/): There are several ways it might be possible to lower your mortgage rate without a refinance. Find out if one of these methods works for you! - [Why Are Mortgage Payments Mostly Interest?](https://www.thetruthaboutmortgage.com/why-are-mortgage-payments-mostly-interest/): Homeowners often complain that mortgages are mostly interest, despite the low rates offered. But is it true, and if so why? Let's find out! - [New Mortgage Startup Tomo Exists Because Buying a Home Can Be Terrible](https://www.thetruthaboutmortgage.com/tomo-mortgage-review/): The mortgage and real estate industry is no stranger to disruptors, especially over the past few years as scores of companies have tried to change the way - [Fixed-Rate Mortgages vs. ARMs: Which to Choose and Why?](https://www.thetruthaboutmortgage.com/30-year-fixed-vs-arm/): Mongoose vs. Cobra. Coyote vs. Roadrunner. Pirate vs. Ninja? And finally, "fixed-rate mortgage vs. adjustable-rate mortgage."  Yes, we're talking - [Better Will Now Guarantee Your Mortgage Even If the Appraisal Comes in Low](https://www.thetruthaboutmortgage.com/better-appraisal-guarantee/): With the housing market so competitive, and properties often going above asking, getting a mortgage can be a little more stressful. One major component of - [American Express Cardholders Can Get Up to $6,000 Statement Credits If They Use Rocket or Better Mortgage](https://www.thetruthaboutmortgage.com/american-express-mortgage-promotion/): If you happen to be an American Express cardholder, or were thinking about becoming one, they’ve got new a limited-time promotion with Rocket Mortgage and - [If You Want to Be a Homeowner, Go to College and Get a Degree](https://www.thetruthaboutmortgage.com/if-you-want-a-mortgage-go-to-college-and-get-a-degree/): Assuming you want to become a homeowner, it’s probably best to go to college, even if you have to take out costly student loans in the process. You may - [3 Reasons Why Putting Less Down Can Raise Your Mortgage Payment](https://www.thetruthaboutmortgage.com/3-ways-a-low-down-payment-can-raise-your-mortgage-payment/): While a low down payment can make it easier to buy your dream home, it may increase your mortgage payment in three different ways. - [The Mortgage Firm Review: Twice a SocialSurvey Winner for Customer Satisfaction](https://www.thetruthaboutmortgage.com/the-mortgage-firm-review/): Today we’ll check out Florida-based lender “The Mortgage Firm,” which has been originating home loans since the mid-1990s. That’s a lifetime in today’s - [Top Mortgage Lenders by State in 2020: Rocket Claims 19 States and D.C.](https://www.thetruthaboutmortgage.com/top-mortgage-lenders-by-state-2020/): Check out which mortgage lender dominated each state across the nation in 2020. Rocket Mortgage won a whopping 19 states and D.C.! - [Thursday Is the Best Day to List Your House](https://www.thetruthaboutmortgage.com/thursday-is-the-best-day-to-list-your-house/): The best day to list your home is Thursday because they go pending faster and are more likely to sell above asking! - [Directors Mortgage Review: Oregon's Local Mortgage Lender](https://www.thetruthaboutmortgage.com/directors-mortgage-review/): Today we’ll check out “Directors Mortgage,” a Portland, Oregon-based mortgage lender that says it “takes a community-first, people-focused approach” to - [Do Mortgage Payments Go Down Over Time?](https://www.thetruthaboutmortgage.com/do-mortgage-payments-decrease/): While everyone always seems to focus on mortgage payments adjusting higher, there are a number of reasons why a mortgage payment may decrease. - [Supreme Lending Review: A Local Lender That Aims to Close Loans in 20 Days or Less](https://www.thetruthaboutmortgage.com/supreme-lending-review/): Today we’ll check out “Supreme Lending,” a mortgage banker out of Dallas, Texas that is all about speed. In fact, their goal is to close and fund every - [Mortgage vs. Cash: Which Is the Better Option When Buying a Home?](https://www.thetruthaboutmortgage.com/mortgage-vs-cash-which-is-the-better-option-when-buying-a-home/): The pros and cons of using a mortgage to finance your home purchase, or paying all-cash instead to save on interest. - [How Many Mortgage Quotes Should I Get? A Key Study Says the More the Better](https://www.thetruthaboutmortgage.com/how-many-mortgage-quotes-should-i-get/): Mortgage Q&A: “How many mortgage quotes should I get?” When it comes to getting the best deal on your mortgage, you can never shop too much. Just like - [Nation’s Top Wholesale Mortgage Lender Launches New Line of Adjustable-Rate Mortgages](https://www.thetruthaboutmortgage.com/united-wholesale-mortgage-arms/): Declaring that ARMs are back, United Wholesale Mortgage (UWM) has just rolled out a new line of adjustable-rate mortgages for its mortgage broker - [Garden State Home Loans Review: One of the Highest-Rated Lenders I’ve Come Across](https://www.thetruthaboutmortgage.com/garden-state-home-loans-review/): Today we’ll check out East Coast mortgage lender “Garden State Home Loans,” which says it has some of the lowest mortgage rates and most competitive fees - [Quicken Loans Changes Name to Rocket Mortgage](https://www.thetruthaboutmortgage.com/quicken-loans-changes-name-to-rocket-mortgage/): In an effort to perhaps streamline its brand and create a little less consumer confusion, Quicken Loans announced today that it is officially changed its - [Central Bank Mortgage Review: A Modern Home Loan from a 100-Year Old Bank](https://www.thetruthaboutmortgage.com/central-bank-mortgage-review/): Today we’ll review a Midwest-based depository bank that is big on home loans, “Central Bank,” which also operates an online lending division known as - [Why You Shouldn't Swipe Your Credit Card Before You Apply for a Mortgage](https://www.thetruthaboutmortgage.com/dont-swipe-your-credit-card-before-you-apply-for-a-mortgage/): Large Credit Card Purchases Really Can Tank Your Credit Score While missed payments are arguably the worst offense Even racking up a lot of debt can lower - [New Fannie/Freddie Refinance Option Drops Adverse Market Fee, Offers $500 Appraisal Credit](https://www.thetruthaboutmortgage.com/new-fannie-freddie-refinance-option-drops-adverse-market-fee-offers-500-appraisal-credit/): In an effort to undo some of the damage the Federal Housing Finance Agency (FHFA) basically caused itself, it’s throwing a bone to so-called low-income - [Don't Be a Desperate Home Buyer: Be Prepared and Willing to Move On](https://www.thetruthaboutmortgage.com/dont-be-a-desperate-home-buyer/): It’s no secret the housing market is hot at the moment, so much so that just about everyone is wondering when the next housing crash will take place. The - [Why Is the Housing Market So Hot?](https://www.thetruthaboutmortgage.com/why-is-the-housing-market-so-hot/): Real estate Q&A: "Why Is the Housing Market So Expensive Right Now?" If you asked me this same question a few years ago, I would have had the same - [Do Mortgage Brokers Offer Better Rates Than the Competition?](https://www.thetruthaboutmortgage.com/do-mortgage-brokers-offer-better-rates-than-the-competition/): In your endless search to find the lowest mortgage rates on the planet, you may be wondering which route will lead to the biggest savings. Should you go - [Jim Cramer Just Paid Off His Mortgage with Bitcoin Gains](https://www.thetruthaboutmortgage.com/jim-cramer-just-paid-off-his-mortgage-with-bitcoin-gains/): File this one under bizarre, for several different reasons. Mad Money host Jim Cramer disclosed yesterday that “he recently paid off a mortgage using - [When Will the Next Housing Market Crash Take Place? All Eyes on 2024](https://www.thetruthaboutmortgage.com/when-will-the-next-housing-market-crash-take-place/): I’ve noticed a trend lately. Everyone’s a real estate expert. It seems the most recent crisis and recovery has turned just about every single person into - [How to Pay for Home Renovations: Pros and Cons to Different Methods](https://www.thetruthaboutmortgage.com/how-to-pay-for-home-renovations-pros-and-cons-to-different-methods/): Most properties require some amount work to get into their desired shape, even newer ones. And just about everyone knows that home renovation projects - [10 Reasons to Buy a House Other Than for the Investment](https://www.thetruthaboutmortgage.com/10-reasons-to-buy-a-house-other-than-for-the-investment/): There are a lot of good reasons to buy a house, and probably a lot of bad ones too. But all too often, folks seem to get fixated on the investment side of - [11 Ways to Build Home Equity](https://www.thetruthaboutmortgage.com/10-ways-to-build-home-equity/): These days, home equity is booming thanks to rapidly appreciating property values. At last glance, total equity on mortgaged properties exceeded $10 - [Spring EQ Review: Need a Second Mortgage?](https://www.thetruthaboutmortgage.com/spring-eq-review/): With the weather warming up, I thought it’d be prudent to check out “Spring EQ,” a lender that specializes in getting cash out of your home. By that, I - [10 Reasons Why You Can't Refinance Your Mortgage](https://www.thetruthaboutmortgage.com/7-reasons-why-you-cant-refinance-your-mortgage/): A look at some of the most common refinance roadblocks and what you can do to overcome them now. - [21 Things That Can Drive Your Mortgage Rate Higher](https://www.thetruthaboutmortgage.com/21-things-that-can-drive-your-mortgage-rate-higher/): Wondering why you didn’t receive the low mortgage rate you saw advertised on TV or the Internet? Well, there are a ton of reasons why the quote you - [Marriage and Mortgage May Not Mix](https://www.thetruthaboutmortgage.com/marriage-and-mortgage/): Marriage or Mortgage? The premise of the new Netflix show "Marriage or Mortgage" is simple. It pits a wedding planner against a real estate agent. The - [Demystifying How Mortgages Are Calculated](https://www.thetruthaboutmortgage.com/demystifying-how-mortgages-are-calculated/): The Importance of Knowing How to Calculate a Mortgage While there are plenty of mortgage calculators out there that do all the heavy lifting for you It - [Condo vs. Townhouse: Why It Matters](https://www.thetruthaboutmortgage.com/condo-vs-townhouse-why-it-matters/): It’s been a while since I’ve done a matchup, so let’s talk about an important one if you’re in the market to buy real estate. Today, we’ll breakdown the - [Sunnyhill Financial Review: A Mortgage Broker That Makes Things Simple](https://www.thetruthaboutmortgage.com/sunnyhill-financial-review/): Today we’ll check out a large-scale mortgage broker by the name of Sunnyhill Financial that’s looking to start a “Doc Less Revolution.” By that, they mean - [Why You May Want to Switch Mortgage Companies](https://www.thetruthaboutmortgage.com/more-than-half-of-consumers-switch-mortgage-companies/): Loyalty? Not in the mortgage business. That is, if you actually want to save money on your home loan. A few years back, an HSBC survey revealed that 52% - [What Is the Loan-to-Value Ratio? (LTV) How to Easily Calculate It Fast](https://www.thetruthaboutmortgage.com/what-is-loan-to-value/): The loan-to-value ratio (LTV) is your mortgage loan amount divided by the current appraised value or sales price. - [Why Every Mortgage Lender Will Disappoint You](https://www.thetruthaboutmortgage.com/why-every-mortgage-lender-will-disappoint-you/): People constantly ask me if a particular lender is good, bad, or should be avoided at all costs. They also ask who the best mortgage lender is, often - [Summit Funding Review: Highly Rated 'Home Loan Experts'](https://www.thetruthaboutmortgage.com/summit-funding-review/): It’s time for another mortgage review, this time we’ll take hard look at Summit Funding Inc., which bills itself as “The Home Loan Experts.” There might - [18 Reasons to Refinance Your Mortgage](https://www.thetruthaboutmortgage.com/18-reasons-to-refinance-your-mortgage/): There are many reasons to refinance your mortgage, some obvious and some a bit more obscure and/or different. I figured I’d compile a list of the many - [Own Up Review: The Mortgage You Deserve?](https://www.thetruthaboutmortgage.com/own-up-review/): Today we’ll check out “Own Up,” a new technology company that wants to be your mortgage co-pilot. By that, they mean help you comparison shop for a home - [Zillow Will Now Buy Your Home for Its Zestimate Price](https://www.thetruthaboutmortgage.com/zillow-will-now-buy-your-home-for-its-zestimate-price/): Zillow appears to be putting its money where its mouth is by offering to buy properties at their Zestimate price. No longer is the Zestimate just a number - [Look for a Mortgage Before You Search for a Home](https://www.thetruthaboutmortgage.com/look-for-a-mortgage-before-you-search-for-a-home/): While it might look and sound counterintuitive at first glance, it could actually make perfect sense. Instead of assuming that home loan financing is just - [Why Does Everyone Want Us to Pay Down Our Mortgages?](https://www.thetruthaboutmortgage.com/why-does-everyone-want-us-to-pay-down-our-mortgages/): You may have come across one of those articles lately that talks about how a couple paid off their mortgage in five years. Or some other absurdly-fast - [Why Do Mortgage Companies Want You to Refinance So Badly?](https://www.thetruthaboutmortgage.com/why-do-mortgage-companies-want-you-to-refinance-so-badly/): If you already have a mortgage, there’s a good chance you receive junk mail on a regular basis urging you to refinance. You may receive solicitations from - [Do I Qualify for a Mortgage?](https://www.thetruthaboutmortgage.com/do-i-qualify-for-a-mortgage/): Sometimes I tend to skip past the seemingly basic mortgage questions, assuming everyone already knows the simple stuff. Unfortunately, that’s not the - [Should You Buy a New Home or an Old Home? There Are Pros and Cons to Both](https://www.thetruthaboutmortgage.com/should-you-buy-a-new-home-or-an-old-home/): New Home vs. Old Home It’s time for another match-up, this time we’ll compare buying a new home versus purchasing an old one. For the record, some home - [You Can Now Request COVID-Related Mortgage Forbearance for Up to 18 Months](https://www.thetruthaboutmortgage.com/covid-mortgage-forbearance-15-months/): Some good news for homeowners struggling to make ends meet thanks to COVID-19, which as the name implies has been going on for a while now. The Federal - [The CEO of a Tech-Enabled Loan Servicer Believes We Might Be on the Cusp of Another Foreclosure Crisis](https://www.thetruthaboutmortgage.com/valon-loan-servicer-cusp-of-another-foreclosure-crisis/): The co-founder and CEO of a so-called “tech-enabled residential mortgage servicer” named Valon (formerly Peach Street) has warned we could be on the brink - [Sage Home Loans Review: A Fully-Digital Refinance Lender](https://www.thetruthaboutmortgage.com/sage-mortgage-review/): Today we’ll check out “Sage Home Loans,” a digital mortgage lender startup backed by Red Ventures, which refers to itself as a portfolio of internet - [Carrington Mortgage Review: Might Be a Good Option for Hard-to-Close Loans](https://www.thetruthaboutmortgage.com/carrington-mortgage-review/): Today we’ll check out “Carrington Mortgage,” a top-50 mortgage lender nationally that is based in Anaheim, California. They recently launched “Vylla - [Does a Refinance Require an Appraisal?](https://www.thetruthaboutmortgage.com/does-a-refinance-require-an-appraisal/): Mortgage Q&A: “Does a refinance require an appraisal?” A reader recently asked if they needed an appraisal to refinance their existing mortgage, - [The 2021 Housing Market Is Kind of Like the Toilet Paper Shortage](https://www.thetruthaboutmortgage.com/the-2021-housing-market-is-kind-of-like-the-toilet-paper-shortage/): To say residential real estate is on fire would be a huge understatement. In fact, it’s so popular that we’re literally running out of homes. Simply put, - [Optimum First Mortgage Review: #1 in Price and Customer Service?](https://www.thetruthaboutmortgage.com/optimum-first-mortgage-review/): You’ve got to pretty confident to say you’re #1 in both price and customer service, but that’s exactly how “Optimum First Mortgage” describes itself. The - [What Is a Streamline Refinance?](https://www.thetruthaboutmortgage.com/what-is-a-streamline-refinance/): If you simply want a lower interest rate on your existing home loan, look into a “streamline refinance” that requires limited paperwork. - [How to Get a Wholesale Mortgage Rate](https://www.thetruthaboutmortgage.com/how-to-get-a-wholesale-mortgage-rate/): Mortgage Q&A: “How to get a wholesale mortgage rate?” Wholesale mortgage rates tend to be considerably cheaper than their retail counterparts, though - [Nations Lending Review: A Human Home Loan?](https://www.thetruthaboutmortgage.com/nations-lending-review/): While tech has taken center stage in the mortgage world, Nations Lending still strives to make home loans human. That’s their motto, and it means looking - [How to Move Out of Your Parents House](https://www.thetruthaboutmortgage.com/how-to-move-out-of-your-parents-house/): There’s nothing inherently wrong with living with your parents, other than EVERYTHING! So let’s talk about how to GET OUT! To be clear, I’m going to - [First Republic Bank Mortgage Review: Big on Jumbo Lending](https://www.thetruthaboutmortgage.com/first-republic-bank-mortgage-review/): One of the more unique mortgage originators out there is First Republic Bank, due to both their large volume of jumbo home loans and adjustable-rate - [PenFed Mortgage Review: Competitive Rates with No Lender Fees](https://www.thetruthaboutmortgage.com/penfed-mortgage-review/): Today we’ll take a deep dive into a major credit union that's also a sizable mortgage lender, Pentagon Federal Credit Union, or PenFed for short. While - [Ruoff Mortgage Review: Enjoy a Stress-Free Mortgage Process?](https://www.thetruthaboutmortgage.com/ruoff-mortgage-review/): If you live in Indiana, there’s a very good chance you either got your home loan from Ruoff Mortgage, or at least considered them if you’re a homeowner. - [2021 Mortgage and Housing Market Predictions](https://www.thetruthaboutmortgage.com/2021-mortgage-and-housing-market-predictions/): Welp, it’ll be nice to close out 2020 and look ahead to a brand-new year that hopefully features a lot less drama and much more good news. While the - [Paramount Residential Mortgage Group Review: A Top-50 Lender Chock Full of Loan Programs](https://www.thetruthaboutmortgage.com/paramount-residential-mortgage-group-review/): While searching for a home loan, you may have come across “Paramount Residential Mortgage Group,” or PRMG for short, along the way. It’s also possible - [2021 Mortgage Rate Predictions: Mostly Flat But New Record Lows Possible](https://www.thetruthaboutmortgage.com/2021-mortgage-rate-predictions/): Yet another year is about to come to an end, and that means it's time to look ahead to what next year has in store. I think just about everyone wants to - [Partial Claim May Be Option for VA Borrowers Exiting COVID-19 Forbearance](https://www.thetruthaboutmortgage.com/partial-claim-va-loan-covid-19-forbearance/): The Department of Veterans Affairs (VA) has proposed a new loss mitigation method to help homeowners with VA loans in COVID-19 related forbearance get - [United Wholesale Mortgage Now Offering FHA Loans with Rates Below 2%](https://www.thetruthaboutmortgage.com/uwm-fha-loans-mortgage-rates-below-2/): The leading wholesale mortgage lender in the nation has brought the heat once again, this time offering 30-year fixed mortgage rates below 2% on FHA - [American Financial Network Mortgage Review: In the Top-3 on LendingTree](https://www.thetruthaboutmortgage.com/american-financial-network-mortgage-review/): American Financial Network Inc. bills itself as one of the fastest growing mortgage bankers in the United States, and is indeed ranked in the top 50 - [Lower Mortgage Review: A Techy Mortgage Lender in Love with Everything Low](https://www.thetruthaboutmortgage.com/lower-mortgage-review/): Today we’ll check out another one of the newcomers in the mortgage industry that is all about technology and low rates, aptly named "Lower Mortgage." - [American Financing Mortgage Review: Peyton Manning Is a Fan](https://www.thetruthaboutmortgage.com/american-financing-mortgage-review/): If you live in Colorado, you may have heard a radio ad for "American Financing," a direct-to-consumer mortgage lender based in Aurora. You may also know - [2021 Conforming Loan Limit Rises to $548,250](https://www.thetruthaboutmortgage.com/2021-conforming-loan-limits/): Thanks to another year of stellar home price appreciation, the 2021 conforming loan limit will increase to $548,250, per the Federal Housing Finance - [Don’t Let Your Current Lender Talk You Out of a Mortgage Refinance](https://www.thetruthaboutmortgage.com/dont-let-your-current-lender-talk-you-out-of-a-refinance/): What I’ve seen and heard through the years is certain lenders not being so forthcoming with existing customers wanting to refinance their mortgage. For - [USA Mortgage Review: Nearly a Top-5 Mortgage Lender in Missouri](https://www.thetruthaboutmortgage.com/usa-mortgage-review/): If you live in the USA and need a mortgage, perhaps you’ve thought about applying at "USA Mortgage." Makes sense, right? It just so happens that USA - [Why Joe Biden and Kamala Harris Haven't Paid Off Their Mortgages](https://www.thetruthaboutmortgage.com/why-joe-biden-and-kamala-harris-havent-paid-off-their-mortgages/): You’d think presumably wealthy politicians like Joe Biden and Kamala Harris would own their homes free and clear. But that’s not the case, per their 2019 - [If a Mortgage Lender Reaches Out to You, Reach Out to Other Lenders](https://www.thetruthaboutmortgage.com/if-a-mortgage-lender-reaches-out-to-you-reach-out-to-other-lenders/): A lot of homeowners are looking to refinance their mortgages at the moment. That’s abundantly clear based on the record volume of refis expected this - [FBC Mortgage Review: A Florida Lender with a Simple Loan Process](https://www.thetruthaboutmortgage.com/fbc-mortgage-review/): Today we’ll take a look at FBC Mortgage, which is a Florida-based mortgage lender that does a ton of business in its home state. In fact, they originated - [An Alternative to Paying Mortgage Points: Just Be a Little 'Extra'](https://www.thetruthaboutmortgage.com/alternative-to-paying-mortgage-points/): If and when you take out a mortgage, you’ll be faced with an important choice. To pay or not pay mortgage points. In short, those who pay points should - [Watch Out for Low Mortgage Rates You Have to Pay For](https://www.thetruthaboutmortgage.com/watch-out-for-low-mortgage-rates-you-have-to-pay-for/): Mortgage rates keep on marching lower and lower, with new records broken seemingly every week. But with all the fervor surrounding mortgage rates, some - [When to Refinance a Home Mortgage: Now, Later, or Never?](https://www.thetruthaboutmortgage.com/when-to-refinance-a-mortgage/): A mortgage refinance can result in big savings, but it's not always the right move. Learn when to refinance your mortgage to maximize your benefit and when you may want to pump the brakes. - [Royal United Mortgage Review: A Faster, Friendlier Mortgage Lender?](https://www.thetruthaboutmortgage.com/royal-united-mortgage-review/): If customer satisfaction is your thing, and you happen to need a home loan, you might want to check out Royal United Mortgage. The company recently topped - [Record Home Purchase Activity Expected in 2021 Despite Higher Mortgage Rates](https://www.thetruthaboutmortgage.com/record-home-purchase-activity-expected-in-2021-despite-higher-mortgage-rates/): While mortgage rates are projected to be slightly higher next year, home purchase activity should hit a new record high, per the latest forecast from the - [Synergy One Lending Review: They've Got an App But How Is the Pricing?](https://www.thetruthaboutmortgage.com/synergy-one-lending-review/): Today, we’ll take a look at Synergy One Lending, a company whose mission is to create a modern mortgage experience for its clients. To achieve this goal, - [Loan Simple Mortgage Review: A Boutique Mortgage Lender](https://www.thetruthaboutmortgage.com/loan-simple-mortgage-review/): One mortgage lender that’s been around a while, but is beginning to shake things up is Loan Simple. As the name suggests, they’re all about simplicity, - [Should You Prepay the Mortgage or Invest Instead? How to Earn a Better Return](https://www.thetruthaboutmortgage.com/prepay-the-mortgage-or-invest-instead/): It’s been a while since I last posted a mortgage match-up, so without further ado, here’s the latest installment: "Prepay the mortgage or invest instead?" - [Will Mortgage Rates Go Up or Down If Trump/Biden Wins the Election?](https://www.thetruthaboutmortgage.com/will-mortgage-rates-go-up-or-down-if-trump-biden-wins-the-election/): As everyone knows, we have a very important U.S. presidential election just around the corner. In fact, it’s now less than three weeks away. It could be - [Is Refinancing Worth It? Consider the Costs and How Long You'll Keep the Loan](https://www.thetruthaboutmortgage.com/is-refinancing-worth-it/): With mortgage rates at or near record lows, a lot of existing homeowners are probably asking themselves, “Is refinancing worth it?” The problem is there’s - [What Mortgage Rate Can I Expect? Answer These Questions First](https://www.thetruthaboutmortgage.com/what-mortgage-rate-can-i-expect/): Mortgage Q&A: “What mortgage rate can I expect?” The thing with mortgage rates is that they can vary greatly depending on a number of market forces - [Costco Mortgage Review: Yes, They Do Home Loans Too, Kind Of](https://www.thetruthaboutmortgage.com/costco-mortgage-review-what-dont-they-do/): Costco, the well-known mega wholesaler that runs a chain of membership warehouses internationally, rolled out it’s so-called “Mortgage Services” program - [Redfin: 2020 Home Sales Will Be Highest Since 2006](https://www.thetruthaboutmortgage.com/redfin-2020-home-sales-will-be-highest-since-2006/): While 2020 continues to surprise us, somehow, someway, home sales are expected to hit their highest point since 2006 this year. This, despite an ongoing - [You Can Buy More House If You Put More Money Down](https://www.thetruthaboutmortgage.com/you-can-buy-more-house-if-you-put-more-money-down/): I was reading through the latest quarterly home price report from the National Association of Realtors yesterday and stumbled upon an interesting nugget. - [What Will Happen When the CARES Act Forbearance Option Ends?](https://www.thetruthaboutmortgage.com/cares-act-forbearance-option-end-date/): While it’s still possible to request mortgage forbearance via the CARES Act if you’re having trouble making monthly payments, this option will eventually - [Should You Use Experian Boost Before Applying for a Mortgage? How It Can Help](https://www.thetruthaboutmortgage.com/should-you-use-experian-boost-before-applying-for-a-mortgage/): You may have seen commercials lately for “Experian Boost,” a program that says it can increase your credit scores instantly. Their latest ad spot features - [Union Home Mortgage Review: Ohio's Mortgage Lender](https://www.thetruthaboutmortgage.com/union-home-mortgage-review/): If you’ve watched a Cleveland Guardians baseball game lately, you may have noticed a big sign for “Union Home Mortgage” out in center field. That’s - [The Mortgage Broker Comeback](https://www.thetruthaboutmortgage.com/the-mortgage-broker-comeback/): Once left for dead, the mortgage broker is alive and well. And in fact, thriving. There are now more than 100,000 mortgage brokers in business, per the - [UWM Offering 50 Basis Point Discount on VA Streamline Loans Through Veterans Day](https://www.thetruthaboutmortgage.com/uwm-offering-50-basis-point-discount-on-va-streamline-loans-through-veterans-day/): United Wholesale Mortgage continues to bring the heat, this time shaving 50 basis points off streamline VA loans from now until Veterans Day on November - [Regions Mortgage Review: A Mortgage Leader in the Southeast](https://www.thetruthaboutmortgage.com/regions-mortgage-review/): If you live in Texas or the Southeast, you’ve likely heard of Regions Mortgage. In fact, you might already be a banking customer with parent company - [Primary Residential Mortgage Inc. (PRMI) Review: Faster, Simpler, Smarter?](https://www.thetruthaboutmortgage.com/primary-residential-mortgage-review-prmi/): Primary Residential Mortgage, Inc., or PRMI for short, is a direct mortgage lender based out of Salt Lake City, Utah that has been around since 1998. - [Beeline Loans Mortgage Review: Using Tech to Make Mortgages Painless](https://www.thetruthaboutmortgage.com/beeline-loans-mortgage-review/): In early 2019, a new mortgage lender called Beeline Loans, or Beeline for short, was launched. Their mission: to completely transform the home loan - [United Wholesale Mortgage Going Public](https://www.thetruthaboutmortgage.com/united-wholesale-mortgage-going-public/): Despite the ongoing pandemic, it’s turning out to be a very good time for companies to go public, especially mortgage lenders, which are seeing record - [Zillow Homes: Zillow Launches a Real Estate Brokerage](https://www.thetruthaboutmortgage.com/zillow-homes-zillow-launches-a-real-estate-brokerage/): Zillow has officially launched a real estate brokerage, known as “Zillow Homes.” The move is intended to “simplify and streamline” the company’s Zillow - [Is It a Bad Idea to Buy a Home During a Pandemic?](https://www.thetruthaboutmortgage.com/is-it-a-bad-idea-to-buy-a-home-during-a-pandemic/): A recent op-ed said buying a home during a pandemic was a terrible idea. The author, Teresa Ghilarducci, noted that both home prices and uncertainty are - [Cardinal Financial Mortgage Review: A High-Octane Mortgage Lender](https://www.thetruthaboutmortgage.com/cardinal-financial-mortgage-review/): One of the “most senior lenders in the industry,” in their own words, is Charlotte, North Carolina-based Cardinal Financial. The retail mortgage lender - [Mortgage Lending Volume Hits Highest Level on Record Despite COVID-19](https://www.thetruthaboutmortgage.com/mortgage-lending-volume-hits-highest-level-on-record-despite-covid-19/): It makes sense that the mortgage industry would see its best quarter in history during a global pandemic. Okay, it doesn’t make sense, but that’s what - [NOVA Home Loans Review: Arizona's Mortgage Lender](https://www.thetruthaboutmortgage.com/nova-home-loans-review/): If you reside in Arizona, there’s a really good chance you’ve driven by a billboard advertising NOVA Home Loans. I don’t even live in Arizona but always - [Rounding Up Your Mortgage Payment: Can It Really Save You Money?](https://www.thetruthaboutmortgage.com/rounding-up-your-mortgage-payment-does-it-actually-work/): There are all sorts of gimmicks, tips, and tricks out there to pay down the mortgage a little (or a lot) quicker. And one that sounds relatively painless - [Beware the New Mortgage Fee Fearmongering](https://www.thetruthaboutmortgage.com/new-mortgage-fee-refinance/): You may have heard there’s a “new mortgage fee.” And you might have been told to hurry up and refinance NOW to avoid said fee. While there is some truth - [When Do Mortgage Payments Start? It Depends When You Close](https://www.thetruthaboutmortgage.com/when-do-mortgage-payments-start/): A little bit of mortgage Q&A: “When do mortgage payments start?” New homeowners (and those refinancing a mortgage) often wonder when mortgage payments - [CMG Financial Mortgage Review: Is Their All In One Loan for You?](https://www.thetruthaboutmortgage.com/cmg-financial-mortgage-review/): CMG Financial isn’t new to the mortgage industry, having been around since 1993. That makes them a veritable veteran in the home loan space, as many of - [U.S. Bank Mortgage Review: Is Their Smart Refinance a Wise Choice for You?](https://www.thetruthaboutmortgage.com/us-bank-mortgage-review/): While there are thousands of mortgage companies nationwide, only a select few land in the top 10. Today, we’ll examine U.S. Bank Mortgage, which ranked - [Fannie Mae and Freddie Mac Mortgage Refinances Just Got More Expensive](https://www.thetruthaboutmortgage.com/fannie-mae-and-freddie-mac-mortgage-refinances-just-got-more-expensive/): Way to rain on our parade, Fannie Mae and Freddie Mac. Just when mortgage rates were hitting record lows, the pair decided to add a new fee to mortgage - [How Low Will Mortgage Rates Go?](https://www.thetruthaboutmortgage.com/how-low-will-mortgage-rates-go/): It seems that lately we reach a new all-time low for mortgage rates just about every week, which begs the question, how low can they go? Indeed, mortgage - [Prosperity Home Mortgage Review: A Berkshire Hathaway Backed Mortgage Lender](https://www.thetruthaboutmortgage.com/prosperity-home-mortgage-review/): Prosperity Home Mortgage based out of Chantilly, Virginia originally got started in the Carolinas back in 2006. While that was probably the last good year - [Do Mortgage Inquiries Affect Your Credit Score? Yes, But You Can Still Shop](https://www.thetruthaboutmortgage.com/do-mortgage-inquiries-affect-credit-score/): Mortgage Q&A: “Do mortgage inquiries affect credit score?” When preparing to take out a mortgage, you may have concerns about your credit report being - [COVID-19 Is Pushing Home Buyers to Move Sooner](https://www.thetruthaboutmortgage.com/covid-19-is-pushing-home-buyers-to-move-sooner/): Sometimes you need a little push to get things going, especially when it’s a big something like purchasing a home. Well, it turns out a pandemic can be - [UWM’s Exact Rate Lets Borrowers Choose Exact Mortgage Rates](https://www.thetruthaboutmortgage.com/uwms-exact-rate-lets-borrowers-choose-exact-mortgage-rates/): The mortgage industry can be a little bit old school. Similar to how the stock market used to operate in sixteenths, and later eighths, mortgage rates are - [Is a 2.25% 30-Year Fixed Mortgage Rate in the Cards?](https://www.thetruthaboutmortgage.com/is-a-2-25-30-year-fixed-mortgage-rate-in-the-cards/): One of the problems with refinancing a home loan right now is that mortgage rates keep falling. As such, you might find the need to refinance again - [Homespire Mortgage Review: Now Waiving Lender Fees for Healthcare Workers](https://www.thetruthaboutmortgage.com/homespire-mortgage-review/): Today we’ll learn more about "Homespire Mortgage," which has made the Inc. 5000’s List of America’s Fastest-Growing Private Companies for the past four - [Homeowners in Forbearance Plans Have Lower Credit Scores, Higher DTI Ratios](https://www.thetruthaboutmortgage.com/homeowners-in-forbearance-plans-have-lower-credit-scores-higher-dti-ratios/): The latest weekly Forbearance and Call Volume Survey from the Mortgage Bankers Association (MBA) revealed that 7.80% of outstanding home loans were in - [What Is a Gift of Equity? One Way to Buy Your Parents House](https://www.thetruthaboutmortgage.com/what-is-a-gift-of-equity/): One of the biggest hurdles to homeownership is down payment. Most people can afford a monthly mortgage payment, especially with interest rates so low, - [Is Mortgage a Good Debt or a Bad Debt? It Can Be the Absolute Best Debt](https://www.thetruthaboutmortgage.com/is-mortgage-a-good-debt-or-a-bad-debt/): You may have heard that mortgage is a “good debt,” in that it’s okay to carry a multi-hundred-thousand-dollar loan for decades on end. While that may - [Knock Home Swap: Buy, Sell, a Get a Mortgage with Just One Company](https://www.thetruthaboutmortgage.com/knock-home-swap-buy-sell-a-get-a-mortgage-with-just-one-company/): One of the trickiest aspects of homeownership is unloading an existing property while acquiring a replacement. Aside from being stressful, it can also be - [A Look Inside the Books of Rocket Companies, Inc.](https://www.thetruthaboutmortgage.com/a-look-inside-the-books-of-rocket-companies-inc/): Thanks to a newly released SEC Form S-1 associated with their upcoming initial public offering (IPO), we now know a lot more about closely held Quicken - [Now Home Prices Are Expected to Fall By 2021 Thanks to COVID-19](https://www.thetruthaboutmortgage.com/now-home-prices-are-expected-to-fall-by-2021-thanks-to-covid-19/): While the housing market has been coming up roses lately, even in the face of COVID-19, it might turn out to be a short-lived affair as widespread - [The Top 25 Mortgage Lenders of 2019](https://www.thetruthaboutmortgage.com/the-top-25-mortgage-lenders-of-2019/): If you’re curious which mortgage lender closed the most home loans in 2019, I’ve got your answer. You probably already guessed that the top mortgage - [Veterans Can Now Get Rates as Low as 2.25% on a 30-Year Fixed Mortgage](https://www.thetruthaboutmortgage.com/veterans-can-now-get-rates-as-low-as-2-25-on-a-30-year-fixed-mortgage/): It seems mortgage rates keep moving lower and lower, and now some veterans and active duty military might be able to snag a 30-year fixed as low as 2.25%! - [COVID-19 May Have Just Been a Speed Bump for Surging Housing Market](https://www.thetruthaboutmortgage.com/covid-19-may-have-just-been-a-speed-bump-for-surging-housing-market/): We’re starting to get a better picture of how COVID-19 affected the housing market, with the National Association of Realtors’ existing-home sales report - [Quicken Loans IPO: Top Mortgage Lender Reportedly Going Public](https://www.thetruthaboutmortgage.com/quicken-loans-ipo-going-public/): Some very big news in the mortgage world – Quicken Loans is reportedly going public, with an IPO currently being worked on by Credit Suisse, Goldman - [NewRez Mortgage Review: Are They the Home of Your Perfect Loan?](https://www.thetruthaboutmortgage.com/newrez-mortgage-review/): Newrez is one of the fastest growing mortgage lenders in the nation, currently offering a $1,000 closing cost credit to home buyers. - [Planet Home Lending Review: 3 Trees Planted for Every Closed Loan](https://www.thetruthaboutmortgage.com/planet-home-lending-review/): Planet Home Lending is a mortgage lender and loan servicer that was recently named one of the fairest lenders based on HMDA data. - [5 Things to Know If Considering Mortgage Forbearance](https://www.thetruthaboutmortgage.com/5-things-to-know-if-considering-mortgage-forbearance/): If you’re a homeowner, or just became one during the pandemic, you’ve likely heard of mortgage forbearance. Not to be confused with mortgage forgiveness, - [Home Equity Could Prevent Flood of Forbearance-Related Foreclosures](https://www.thetruthaboutmortgage.com/home-equity-could-prevent-flood-of-forbearance-related-foreclosures/): The latest Mortgage Monitor report from Black Knight reveals that many homeowners in forbearance plans are sitting on a healthy amount of home equity, - [FHA Will Insure Mortgages in Forbearance, With a Catch](https://www.thetruthaboutmortgage.com/fha-will-buy-mortgages-in-forbearance-with-a-catch/): The Federal Housing Administration (FHA) finally announced a new policy, which is temporary, to endorse mortgages where the borrower has requested or - [On Q Financial Mortgage Review: The Simple Way to Get a Mortgage?](https://www.thetruthaboutmortgage.com/on-q-financial-mortgage-review/): Today we’ll take a good look at On Q Financial, a direct mortgage lender based in Tempe, Arizona that wants to make getting a mortgage simple. In fact, - [PennyMac Mortgage Review: A Top-3 Mortgage Lender Nationally](https://www.thetruthaboutmortgage.com/pennymac-mortgage-review/): One of the fastest growing and largest mortgage lenders in the country goes by the name PennyMac, not to be confused with Freddie Mac. If you're wondering - [Eagle Home Mortgage Review: Should You Get a Mortgage from the Nation’s Largest Homebuilder?](https://www.thetruthaboutmortgage.com/eagle-home-mortgage-review/): Update: Eagle Home Mortgage is now known as Lennar Mortgage. If you’re thinking about buying a home or refinancing an existing mortgage, you may have come - [46% of Homeowners in Forbearance Plans Still Made Their Mortgage Payments](https://www.thetruthaboutmortgage.com/46-of-homeowners-in-forbearance-plans-still-made-their-mortgage-payments/): Another interesting trend has emerged from the latest mortgage forbearance data, this time courtesy of a new report from data analytics company Black - [Fairway Independent Mortgage Review: A Top-20 Lender Big on Home Purchase Financing](https://www.thetruthaboutmortgage.com/fairway-independent-mortgage-review/): One of the largest mortgage lenders in the country you may not have heard of is Fairway Independent Mortgage Corp., based out of Madison, Wisconsin. They - [Despite COVID-19, You Can Still Get a Jumbo Home Loan](https://www.thetruthaboutmortgage.com/despite-covid-19-you-can-still-get-a-jumbo-home-loan/): While lots of lenders have recently cut back on offerings that aren’t backed explicitly by the government, some are rolling out new loan programs to help - [Only 5% of Homeowners Who Got Approved for Mortgage Forbearance Needed It](https://www.thetruthaboutmortgage.com/only-five-percent-who-requested-mortgage-forbearance-needed-it/): Just five percent of homeowners who recently got approved for mortgage forbearance actually needed it, according to a shocking survey from home loan - [There Will Be a 3-Month Waiting Period to Get a Mortgage After Forbearance](https://www.thetruthaboutmortgage.com/mortgage-forbearance-waiting-period/): We’ve finally got some clarity regarding what happens after mortgage forbearance in terms of obtaining a subsequent home loan. The Federal Housing Finance - [Mortgage Forbearance Rate Only Rises 3% From a Week Ago, But Second Wave Could Be Coming](https://www.thetruthaboutmortgage.com/mortgage-forbearance-rate-only-rises-3-from-a-week-ago-but-second-wave-could-be-coming/): Maybe there’s some good news out there, or maybe it’s just the calm before another storm. The mortgage forbearance rate barely budged during the week - [Payment Deferral Will Be an Option to Repay Mortgage Forbearance](https://www.thetruthaboutmortgage.com/covid-19-payment-deferral/): The Federal Housing Finance Agency (FHFA) announced today that Fannie Mae and Freddie Mac have launched a new payment deferral option in light of the - [Home Buyer Demand Bounces Back, Small Towns Become Hot](https://www.thetruthaboutmortgage.com/home-buyer-demand-bounces-back-small-towns-become-hot/): Well that didn’t take long – demand to buy a home is now back above its so-called 
“pre-coronavirus levels,” per a new analysis from real estate brokerage - [It’s Now Possible to Get a 1.99% Mortgage Rate on a 30-Year Fixed](https://www.thetruthaboutmortgage.com/its-now-possible-to-get-a-2-5-mortgage-rate-on-a-30-year-fixed/): Here's a good sign mortgage rates might be moving even lower than they already are. Pontiac, Michigan-based United Wholesale Mortgage (UWM), which refers - [Will Forbearance Prevent You from Getting a Mortgage in the Future?](https://www.thetruthaboutmortgage.com/will-forbearance-prevent-you-from-getting-a-mortgage-in-the-future/): Since the CARES Act rolled out in early April, more than four million Americans have reportedly put their mortgage payments on hold for up to 12 months. - [Mortgage Forbearance Rate Up Near 8%, Housing Assistance Fund Proposed](https://www.thetruthaboutmortgage.com/mortgage-forbearance-rate-up-near-8-housing-assistance-fund-proposed/): The mortgage forbearance rate increased again last week, rising to 7.91% from 7.54% a week earlier, per the Mortgage Bankers Association (MBA). That - [Home Prices vs. COVID-19: Will They Go Up or Down?](https://www.thetruthaboutmortgage.com/home-prices-vs-covid-19-will-they-go-up-or-down/): It’s time to take a look at how COVID-19 could impact home prices given the massive disruption to the local, state, national, and global economy. On the - [Nearly 4 Million Homeowners Now in Mortgage Forbearance Plans, Servicers May Get $500 Payments](https://www.thetruthaboutmortgage.com/nearly-4-million-homeowners-now-in-mortgage-forbearance-plans-servicers-may-get-500-payments/): The mortgage forbearance rate worsened yet again compared to last week, though as expected the increase has slowed as the pool of borrowers grows larger. - [Loan Servicers Accused of Providing Unclear and Dated Mortgage Forbearance Information](https://www.thetruthaboutmortgage.com/loan-servicers-accused-of-providing-unclear-and-dated-mortgage-forbearance-information/): While some have complained that the mortgage forbearance program under the CARES Act is far too liberal, a new report claims some loan servicers aren’t - [NewDay USA Mortgage Review: A Mortgage Company Designed for Veterans](https://www.thetruthaboutmortgage.com/newday-usa-mortgage-review-a-mortgage-company-designed-for-veterans/): Today we’ll review NewDay USA, a mortgage lender that is geared specifically toward veterans and active duty military. Like other mortgage companies, they - [Mortgage Forbearance Rate Hits 7%, Fannie/Freddie May Offer Partial Claim to Repay](https://www.thetruthaboutmortgage.com/mortgage-forbearance-rate-hits-7-fannie-freddie-may-offer-partial-claim-to-repay/): Here we go again – the latest Forbearance and Call Volume Survey from the Mortgage Bankers Association's (MBA) revealed that the total number of loans in - [FHFA Says No Lump Sum Due Once Mortgage Forbearance Ends](https://www.thetruthaboutmortgage.com/fhfa-says-no-lump-sum-due-once-mortgage-forbearance-ends/): It’s Monday and I’ve got some good news for homeowners regarding mortgage forbearance. This morning, the Federal Housing Finance Agency (FHFA) announced, - [12 Reasons Today’s Housing Market Is Not the Great Recession All Over Again](https://www.thetruthaboutmortgage.com/12-reasons-todays-housing-market-is-not-the-great-recession-all-over-again/): While it’s becoming easier to compare the housing bust that sparked the Great Recession with today’s uncertain climate, the two just aren’t the same. - [Quicken Loans Officially the Biggest Mortgage Lender in the Country](https://www.thetruthaboutmortgage.com/quicken-loans-officially-the-biggest-mortgage-lender-in-the-country/): Back in early 2018, Quicken Loans proclaimed it was the largest mortgage lender in the country, thanks to a solid fourth quarter in 2017. It managed to - [It’s Going to Be Harder to Get a Mortgage Thanks to COVID-19](https://www.thetruthaboutmortgage.com/its-going-to-be-harder-to-get-a-mortgage-thanks-to-covid-19/): While the first quarter was booming for many mortgage lenders (see Quicken's record month), the second quarter and beyond might be a different story as - [Fannie Mae and Freddie Mac Agree to Buy Mortgages in Forbearance](https://www.thetruthaboutmortgage.com/fannie-mae-and-freddie-mac-agree-to-buy-mortgages-in-forbearance/): While the CARES Act has allowed millions of homeowners nationwide to put their mortgage payments on hold, doing so has left lots of questions for mortgage - [Nearly 6% of Mortgages in Forbearance as FHFA Provides Relief to Loan Servicers](https://www.thetruthaboutmortgage.com/nearly-6-of-mortgages-in-forbearance-as-fhfa-provides-relief-to-loan-servicers/): With each week that goes by, the mortgage forbearance rate climbs to new highs thanks to the coronavirus (COVID-19). The more or less complete shutdown of - [Introducing the Livestream Open House](https://www.thetruthaboutmortgage.com/introducing-the-livestream-open-house/): Necessity is the mother of innovation, and with that comes the so-called “Livestream Open House,” which has just been launched by Realtor.com in the face - [Nearly 3 Million Homeowners Already Receiving Mortgage Forbearance](https://www.thetruthaboutmortgage.com/nearly-3-million-homeowners-already-receiving-mortgage-forbearance/): We’re now getting more information on just how many Americans might be receiving mortgage relief due to the crippling effects of coronavirus. It’s only - [Could a Cash Out Refinance Be a Better Solution Than Mortgage Forbearance?](https://www.thetruthaboutmortgage.com/could-a-cash-out-refinance-be-a-better-solution-than-mortgage-forbearance/): The current solution for those struggling to make mortgage payments due to COVID-19 is mortgage forbearance. It allows homeowners to “pause” mortgage - [Stimulus Checks Barely Make Dent in Mortgage](https://www.thetruthaboutmortgage.com/stimulus-checks-barely-make-dent-in-mortgage/): The so-called “coronavirus checks” have begun to hit Americans’ bank accounts this week, providing relief to those whose income has been curtailed or - [Quicken Loans Just Had Its Biggest Month in History](https://www.thetruthaboutmortgage.com/quicken-loans-just-had-its-biggest-month-in-history/): The nation’s top retail mortgage lender just knocked it out of the park, despite the ongoing coronavirus pandemic. Quicken Loans CEO Jay Farner was on - [Mortgage Forbearance Rate Worsens, But Most Probably Won’t Lose Their Homes](https://www.thetruthaboutmortgage.com/mortgage-forbearance-rate-worsens-but-most-probably-wont-lose-their-homes/): Well, another week has gone by, and with that a new wave of mortgage forbearance requests. The total number of home loans now in forbearance is 3.74%, up - [Chase Now Requires a 700 FICO and 20% Down to Get a New Mortgage](https://www.thetruthaboutmortgage.com/chase-now-requires-a-700-fico-and-20-down-to-get-a-new-mortgage/): Following in the footsteps of many other mortgage lenders of late, JP Morgan Chase has upped its minimum requirements to get a home loan. Once again, it - [Citizens Bank Mortgage Review: Digital Process and a Smartphone App](https://www.thetruthaboutmortgage.com/citizens-bank-mortgage-review/): Today we’ll take a hard look at Citizens Bank Mortgage, which is operated by one of the oldest and largest banks in the United States (Citizens Financial - [Which Housing Markets Are Most at Risk From COVID-19?](https://www.thetruthaboutmortgage.com/which-housing-markets-are-most-at-risk-from-covid-19/): While it’s hard to compare the current possible housing crisis to the very real one experienced about a decade ago, there are fears of negative market - [How Is Mortgage Forbearance Paid Back? Lump Sum Now or Never?](https://www.thetruthaboutmortgage.com/how-is-mortgage-forbearance-paid-back/): At this point, most homeowners have probably heard of the CARES Act and its massive 12-month forbearance option for those with federally-backed mortgages. - [Number of Mortgages in Forbearance Jumps Nearly 1000%](https://www.thetruthaboutmortgage.com/number-of-mortgages-in-forbearance-jumps-by-nearly-1000/): While estimates have ranged from two million to 12.5 million, we’re now getting our first clues as to just how many homeowners will request mortgage - [Wells Fargo Will Only Give You a Jumbo Loan If You Have $250k in Their Bank](https://www.thetruthaboutmortgage.com/wells-fargo-will-only-give-you-a-jumbo-loan-if-you-have-250k-in-their-bank/): In yet another sign that the mortgage market is completely volatile and far from liquid, top mortgage lender Wells Fargo has severely tightened its jumbo - [How Do I Know If Fannie Mae or Freddie Mac Owns My Mortgage?](https://www.thetruthaboutmortgage.com/how-do-i-know-if-fannie-mae-or-freddie-mac-owns-my-mortgage/): Quick mortgage tip: “How do I know if Fannie Mae or Freddie Mac owns my mortgage?” One of the key requirements to getting approved under the CARES Act to - [Generate a Mortgage Forbearance Request Letter with This Free Tool](https://www.thetruthaboutmortgage.com/generate-a-mortgage-forbearance-request-letter-with-this-free-tool/): You may (or may not) have heard that the CARES Act is allowing a huge chunk of homeowners to request forbearance for six to 12 months of mortgage - [Real Estate Delistings Increase 148% From a Year Ago as COVID-19 Impact Grows](https://www.thetruthaboutmortgage.com/home-delistings-increase-148-from-a-year-ago-as-covid-19-impact-grows/): Housing supply was bad before the coronavirus epidemic reared its ugly head, and now it has gotten even worse, per new data from real estate brokerage - [I’ve Been Offered the Opportunity to Skip Two Mortgage Payments](https://www.thetruthaboutmortgage.com/ive-been-offered-the-opportunity-to-skip-two-mortgage-payments/): So I received an unmarked piece of mail the other day, and whenever that happens, I know it’s going to contain some kind of nonsense. Upon opening the - [How Many Homeowners Are Expected to Miss Mortgage Payments Due to Coronavirus?](https://www.thetruthaboutmortgage.com/how-many-homeowners-are-expected-to-miss-mortgage-payments-due-to-coronavirus/): It’s the first of the month, and with that comes fear and uncertainty that both homeowners and renters won’t be able to make payments due to loss of - [Fannie Mae and Freddie Mac Roll Out New Payment Deferral Option](https://www.thetruthaboutmortgage.com/fannie-mae-and-freddie-mac-roll-out-new-payment-deferral-option/): To further complicate the complicated mortgage relief picture surrounding the coronavirus outbreak, Fannie Mae and Freddie Mac have released their new - [Clear Capital’s New OwnerInsight Tool Lets Homeowners Fill in Appraisal Gaps](https://www.thetruthaboutmortgage.com/clear-capitals-new-ownerinsight-tool-lets-homeowners-fill-in-appraisal-gaps/): As reported earlier this week, some important pieces of the home loan process have been disrupted by the ongoing and seemingly intensifying coronavirus - [California Homeowners Now Eligible for 90-Day Mortgage Payment Relief Due to Coronavirus](https://www.thetruthaboutmortgage.com/california-homeowners-now-eligible-for-90-day-mortgage-payment-relief/): California Governor Gavin Newsom has announced a “major financial relief package” that gives homeowners in the Golden State a three-month mortgage - [Streamlined Mortgage Relief Program Could Mean No Payments for 12 Months](https://www.thetruthaboutmortgage.com/streamlined-mortgage-relief-program-could-suspend-payments-for-12-months/): A group of mortgage industry heavyweights have sent a letter to the Federal Reserve, HUD, FHFA, CFPB, Treasury Department, and the White House advocating - [Top iBuyers Stop Buying Homes: Zillow, Redfin, Opendoor Purchases All on Hold](https://www.thetruthaboutmortgage.com/top-ibuyers-stop-buying-homes-zillow-redfin-opendoor-all-on-hold/): The real estate market carnage continues with all the major iBuyers pausing home purchases thanks to the coronavirus. Zillow Offers Pauses Purchases This - [Quicken Loans Warns Some Parts of Loan Process May Not Proceed Due to Shelter-in-Place](https://www.thetruthaboutmortgage.com/quicken-loans-warns-some-parts-of-loan-process-may-not-proceed-due-to-shelter-in-place/): Quicken Loans told customers certain parts of the loan process “can’t proceed” in areas of the country affected by shelter-in-place orders. Specifically, - [Bank of America, Ally Home, Quicken Loans, Wells Fargo Offer to Defer Mortgage Payments Due to Coronavirus](https://www.thetruthaboutmortgage.com/bank-of-america-ally-home-offer-to-defer-mortgage-payments-due-to-coronavirus/): Here comes the mortgage assistance! I honestly thought I wouldn’t be writing about this sort of stuff anytime soon, but here we are. It feels like 2009 - [Mortgage Lenders Now Providing Payment Relief Due to Coronavirus](https://www.thetruthaboutmortgage.com/mortgage-lenders-may-provide-payment-relief-due-to-coronavirus/): CARES Act permits 6-12 month forbearance for mortgage payments on federally-backed home loans HUD has announced a foreclosure and eviction moratorium for - [Is Now the Time to Pull Cash Out of Your Home and Buy Stocks?](https://www.thetruthaboutmortgage.com/is-now-the-time-to-pull-cash-out-of-your-home-and-buy-stocks/): There’s been lots of chatter around Wall Street that this could be an unprecedented time to buy stocks on the cheap, given the market carnage related to - [RedfinNow Temporarily Halts Offers as Housing Market Takes Turn for the Worse](https://www.thetruthaboutmortgage.com/redfinnow-temporarily-halts-offers-as-housing-market-takes-turn-for-the-worse/): We're now getting our first indication of how the coronavirus may affect the once booming housing market, thanks to a blog post from Redfin boss Glenn - [Landed: Helping Educators Buy Homes in the Expensive Areas They Serve](https://www.thetruthaboutmortgage.com/landed-review/): There are tons of mortgage lenders out there, certainly too many to count, but Landed Home Loans is a little more unique than the rest. You see, their - [No, You Aren’t Getting a 0% Mortgage Rate](https://www.thetruthaboutmortgage.com/no-you-arent-getting-a-0-mortgage-rate/): At least not yet… As you probably know, the Fed slashed the federal funds rate to near-zero yesterday afternoon to prop up the economy as it contends with - [The Federal Reserve Has Swooped In to Save Mortgage Rates](https://www.thetruthaboutmortgage.com/the-federal-reserve-has-swooped-in-to-save-mortgage-rates/): In light of the ongoing coronavirus outbreak, which were the Federal Reserve’s very own words, the Committee took bold action to lower the target range - [CrossCountry Mortgage Review: The Nation's Third Largest Retail Lender](https://www.thetruthaboutmortgage.com/crosscountry-mortgage-review/): Today we’ll do an in-depth review of CrossCountry Mortgage, which as the name implies, is a nationally-licensed mortgage lender that offers its home loan - [Lenox Financial / WesLend Mortgage Review: The Biggest No-Brainer?](https://www.thetruthaboutmortgage.com/lenox-financial-weslend-mortgage-review/): Today we’ll take a look at Southern California-based Lenox Financial Mortgage Corp., which also does business as WesLend Financial. First things first, be - [Quicken Loans CEO Doesn’t See the 30-Year Fixed Falling Below 3%](https://www.thetruthaboutmortgage.com/quicken-loans-ceo-doesnt-see-the-30-year-fixed-falling-below-3/): Call him a party pooper, but the CEO of top retail mortgage lender Quicken Loans doesn’t expect mortgage rates to decline any further from their new - [Churchill Mortgage Review: Dave Ramsey's Favorite Mortgage Lender](https://www.thetruthaboutmortgage.com/churchill-mortgage-review/): If you’ve heard of Dave Ramsey, you might have come across Churchill Mortgage, which happens to be his mortgage lender of choice. Why? Because like Dave, - [Just How Popular Has iBuying Become?](https://www.thetruthaboutmortgage.com/just-how-popular-has-ibuying-become/): In 2019, one out of every 100 homes were purchased by an iBuyer, short for instant buyer, per a new report from real estate brokerage Redfin. While it - [AmeriHome Mortgage Review: A Lender with a Countrywide Mortgage Pedigree](https://www.thetruthaboutmortgage.com/amerihome-mortgage-review/): Today we’ll take a hard look at AmeriHome Mortgage Company, LLC, which is a direct mortgage lender based out of Southern California. Their current company - [Mortgage APR: Why It's More Important Than Just Looking at the Mortgage Rate](https://www.thetruthaboutmortgage.com/mortgage-rate-vs-apr/): An in-depth look at the difference between the mortgage interest rate and APR, including the limitations of each. - [LemonBrew Launches Real Estate Agent Match and Rebate](https://www.thetruthaboutmortgage.com/lemonbrew-launches-real-estate-agent-match-and-rebate/): A new tech company called LemonBrew has launched its so-called “custom matching platform” to link up home buyers (and sellers) with local, expert real - [The Next Big Thing in Mortgage Is Keeping in Touch](https://www.thetruthaboutmortgage.com/the-next-big-thing-in-mortgage-is-keeping-in-touch/): I wrote a while back that more than half of consumers switched mortgage companies when obtaining a subsequent home loan. The message was pretty clear – - [Mortgage Rates vs. the Coronavirus: We Might Test New All-Time Lows](https://www.thetruthaboutmortgage.com/mortgage-rates-vs-the-coronavirus/): Mortgage rates can be pretty volatile. Just like stocks, they can change daily depending on what’s happening in the economy. Beyond that, mortgage rates - [Mortgage Delinquencies Have Fallen to the Lowest Level on Record](https://www.thetruthaboutmortgage.com/mortgage-delinquencies-have-fallen-to-the-lowest-level-on-record/): What a difference a decade makes, at least when it comes to paying the mortgage on time. A new report from Black Knight revealed that mortgage - [Quontic Bank Launches No Doc Streamline Mortgage Refinance](https://www.thetruthaboutmortgage.com/quontic-bank-launches-no-doc-streamline-mortgage-refinance/): Quontic Bank, which bills itself as an “adaptive digital bank,” has launched what they refer to as a “first of its kind” no doc home loan with loan - [Mortgage Due Dates 101: Is There Really a Grace Period?](https://www.thetruthaboutmortgage.com/mortgage-due-dates-101/): If you recently took out a mortgage, or have been thinking about purchasing real estate, you may be wondering when your mortgage payments will be due each - [Quicken Loans’ One Reverse Mortgage to Pause Operations](https://www.thetruthaboutmortgage.com/quicken-loans-one-reverse-mortgage-to-pause-operations/): One Reverse Mortgage, a Quicken Loans company, is reportedly pausing operations, according to a statement delivered to Reverse Mortgage Daily. While it’s - [More Than a Quarter of Millennial Homeowners Want to Go Back to Renting](https://www.thetruthaboutmortgage.com/more-than-a-quarter-of-millennial-homeowners-want-to-go-back-to-renting/): I guess homeownership isn’t for everyone, at least if you consider a new study from LendingTree. When respondents were asked if they would “ever go back - [loanDepot Mortgage Review: Their Digital Process Helps You Close 17 Days Faster](https://www.thetruthaboutmortgage.com/loandepot-mortgage-review/): One of the largest nonbank mortgage lenders in the country is loanDepot, typically landing on the top-10 list overall year after year. In fact, they’ve - [AmeriSave Mortgage Review: Pioneer of the Digital Mortgage?](https://www.thetruthaboutmortgage.com/amerisave-mortgage-review/): An in-depth look at Atlanta, GA-based direct lender AmeriSave Mortgage Corp., which claims to have launched digital origination. - [A Fast Mortgage Isn’t Necessarily the Best Mortgage](https://www.thetruthaboutmortgage.com/a-fast-mortgage-isnt-necessarily-the-best-mortgage/): These days, all the mortgage advertisements I see promote speed. Get your loan fast. Get it with the push of a button. Get approved in minutes, close in a - [HomeLight Cash Close: Make All-Cash Offers and Trade-In Your Old Home for a New One](https://www.thetruthaboutmortgage.com/homelight-cash-close-review/): Real estate agent matchmaker HomeLight has launched two new programs for homeowners in California (and now Texas) that make it easier to buy and sell by - [New American Funding Review: A Direct Lender That Isn't Shy About Sharing Its Mortgage Rates](https://www.thetruthaboutmortgage.com/new-american-funding-review/): New American Funding is a direct mortgage lender based in Tustin, CA that refers to itself as the #1 Hispanic mortgage lender in the United States. - [You Can Refinance a Mortgage with Bad Credit, However…](https://www.thetruthaboutmortgage.com/refinance-a-mortgage-with-bad-credit/): For some reason, folks always want to know if you can do X, Y, and Z with bad credit. Which begs the question, why not improve your credit first! Okay, I - [Point Home Equity Review: Get Payment-Free Cash In Exchange for Future Home Price Appreciation](https://www.thetruthaboutmortgage.com/point-home-equity-review/): A company called Point wants to give you “early access to your home equity” without ever having to make monthly payments, similar to how a reverse - [Figure Review: The Fastest Way to Tap Home Equity?](https://www.thetruthaboutmortgage.com/figure-review-home-equity/): I received a letter in the mail the other day from a fintech company called “Figure” that claims it can approve me for a home equity line of credit - [Credible Mortgage Review: An Online Mortgage Broker Owned by Fox](https://www.thetruthaboutmortgage.com/credible-mortgage-review/): There are lots of different ways to get a mortgage these days – you can walk into a physical bank branch, call a mortgage broker, or even start a loan - [Third Federal Mortgage Review: Is Their Smart Rate Right for You?](https://www.thetruthaboutmortgage.com/third-federal-mortgage-review/): Take a closer look at their Smart Rate ARMs and Low Cost mortgages that require just $295 out-of-pocket at closing. - [Don’t Take Out a Mortgage to Buy Super Bowl Tickets](https://www.thetruthaboutmortgage.com/dont-take-out-a-mortgage-to-buy-super-bowl-tickets/): I came across a new partnership between ticket marketplace Stubhub and fintech company Affirm that lets you pay for purchases over time. They launched the - [Are Home Prices Going to Surge in 2020?](https://www.thetruthaboutmortgage.com/are-home-prices-going-to-surge-in-2020/): It’s a new year, and with that comes old questions, like will mortgage rates go up or down in 2020? And will home prices rise or fall? Well, a few months - [Quicken Loans Review: Should You Get Your Home Loan from the Top Mortgage Lender in the Country?](https://www.thetruthaboutmortgage.com/quicken-loans-review/): If you’re looking to buy a home, or refinance an existing home loan you already have, you will undoubtedly come across Quicken Loans during your search. - [There Is No Mortgage Trick](https://www.thetruthaboutmortgage.com/there-is-no-mortgage-trick/): Over the years, I’ve seen tons of ads and articles about a so-called “mortgage trick,” only to click on the associated hyperlink and see nothing regarding - [LendingTree Review: Compare Multiple Mortgage Offers Without Leaving Your House](https://www.thetruthaboutmortgage.com/lendingtree-review/): If you’ve been even remotely interested in taking out a home loan, you’ve undoubtedly heard of LendingTree, which bills itself as the leading online loan - [Rocket Mortgage Becomes Official NFL Sponsor, Launches Super Bowl Squares Game](https://www.thetruthaboutmortgage.com/rocket-mortgage-becomes-official-nfl-sponsor-launches-super-bowl-squares-game/): If you’re into football squares, there’s a new game available via Rocket Mortgage by Quicken Loans related to them becoming an “official mortgage sponsor” - [Mortgage Rates vs. a Potential War with Iran](https://www.thetruthaboutmortgage.com/mortgage-rates-vs-a-potential-war-with-iran/): Well, it’s a new year and it certainly didn’t begin quietly. Might as well address the elephant in the room when it comes to your mortgage. This isn’t the - [2020 Real Estate and Mortgage Predictions](https://www.thetruthaboutmortgage.com/2020-real-estate-and-mortgage-predictions/): Well, 2019 is set to come to a close. It's certainly been an interesting year (and decade), surely one to remember. But now it's time to look forward to - [2020 Mortgage Rate Predictions: Expect Flat to Better](https://www.thetruthaboutmortgage.com/2020-mortgage-rate-predictions/): As 2019 wraps up, it’s time once again to consider what the future holds for mortgage rates. Looking back over the past 12 months, it was another great - [2020 FHA Loan Limits Rise Five Percent from a Year Earlier](https://www.thetruthaboutmortgage.com/2020-fha-loan-limits-rise-five-percent-from-a-year-earlier/): Another year, another increase in FHA loan limits, thanks to yet another rise in home prices. This is good news if you’re thinking about taking out an FHA - [2020 Loan Limits Rise Above $500,000 for Conforming Mortgages](https://www.thetruthaboutmortgage.com/2020-loan-limits-rise-above-500000-for-conforming-mortgages/): It’s that special time of the year again when the Federal Housing Finance Agency (FHFA) adjusts the conforming loan limit for the upcoming year. As - [Offerpad: Sell Your Home in 10 Days Without Even Listing It](https://www.thetruthaboutmortgage.com/offerpad-review/): If you’re thinking about selling your home, you may have come across a company by the name of Offerpad. They are one of the original iBuyers, or instant - [Apple Pledges $1 Billion in Mortgage Assistance to First-Time Home Buyers in California](https://www.thetruthaboutmortgage.com/apple-pledges-1-billion-in-mortgage-assistance-to-first-time-home-buyers-in-california/): You know them for your computer, your phone, your TV streaming device, your TV programs (soon), maybe your credit card, and now possibly your mortgage - [Divvy Homes Review: Rent Now, Buy Later](https://www.thetruthaboutmortgage.com/divvy-homes-review/): Yet another disruptor, known as Divvy Homes, is out to change the rent-to-own space so more renters can become homeowners. Divvy says it’s like a lease, - [Are Closing Costs Included In a Mortgage?](https://www.thetruthaboutmortgage.com/are-closing-costs-included-in-mortgage/): Mortgage Q&A: “Are closing costs included in a mortgage?” There seems to be a great deal of confusion when it comes to closing costs and mortgages, so - [RealSure Review: Guaranteed Cash Offer While Your Home Is Listed](https://www.thetruthaboutmortgage.com/realsure-review-guaranteed-cash-offer/): There’s no question real estate is in full disruption mode, with endless companies vying to turn the age-old model of buying and selling homes on its - [Compass Launches Bridge Loan Services to Close Gap Between Selling and Buying a Home](https://www.thetruthaboutmortgage.com/compass-bridge-loan-services-review/): Real estate brokerage Compass has launched a unique new offering known as “Compass Bridge Loan Services” that solves the buy before you sell conundrum. - [Should I Use an iBuyer to Sell My Home?](https://www.thetruthaboutmortgage.com/what-is-an-ibuyer/): If you’re thinking about selling your home, you’ve got a lot of options. It’s not 2012 anymore, when you simply enlisted the services of a real estate - [If You Took Out a VA Loan in the Past 20 Years, Look Out for a Possible Refund](https://www.thetruthaboutmortgage.com/va-loan-funding-fee-refund/): Over the past few years, VA loans have been at the center of controversies related to loan churning and high prepayment speeds. In short, some veterans - [Curbio Review: Renovate Today, Pay When You Sell](https://www.thetruthaboutmortgage.com/curbio-review/): A startup named Curbio wants to help homeowners sell for more by improving their properties before they go to market. The twist is that the homeowner - [The Number One Reason Mortgages Were Denied in 2018](https://www.thetruthaboutmortgage.com/the-number-one-reason-mortgages-were-denied-in-2018/): Hint: It wasn’t because of a low credit score. Some say a mortgage (homeownership) is a privilege, not a right. In other words, you have to display some - [2012 Was a Really Good Year to Buy a Home](https://www.thetruthaboutmortgage.com/2012-was-a-really-good-year-to-buy-a-home/): A new report from Redfin revealed 2012 was an absolutely fantastic time to purchase a home. Collectively, that crop of home buyers earned $203 billion in - [Blend Launches One Tap Pre-Approvals for Mortgages](https://www.thetruthaboutmortgage.com/blend-launches-one-tap-pre-approvals-for-mortgages/): The thing about mortgages is they continue to be difficult to obtain relative to just about everything else out there. Today, it’s easy to buy anything - [20-Year vs. 30-Year Mortgages: Is It Possible to Get an Even Lower Rate?](https://www.thetruthaboutmortgage.com/20-year-vs-30-year-mortgages/): It’s time for a new mortgage match-up. Since paying down the mortgage early seems to be so en vogue these days, it makes sense to compare “20-year - [Borrowers with Low Credit Scores Should Shop Their Mortgage More](https://www.thetruthaboutmortgage.com/borrowers-with-low-credit-scores-should-shop-their-mortgage-more/): Most people don’t bother shopping around for their mortgage, despite the tremendous potential savings involved. In fact, nearly half of consumers only - [Mortgages for Self-Employed Borrowers: Tips to Qualify](https://www.thetruthaboutmortgage.com/mortgages-for-self-employed-borrowers-tips-to-qualify/): It can be more difficult to get a mortgage if you're self-employed. Learn about the special requirements and loan programs available to business owners. - [Opendoor Home Loans Review: Quick Closings, No Fees](https://www.thetruthaboutmortgage.com/opendoor-home-loans-review/): On August 29th, 2019, major iBuyer Opendoor launched a mortgage lending division known as “Opendoor Home Loans” to create a one-stop shop for home buyers - [What Is a Lender Overlay? And How to Avoid Them](https://www.thetruthaboutmortgage.com/what-is-a-lender-overlay/): Mortgage Q&A: “What is a lender overlay?” If you’ve been studying underwriting guidelines recently to determine if you’re eligible for a mortgage, - [FHA Approved Condos: Individual Units Now Eligible for Financing!](https://www.thetruthaboutmortgage.com/fha-approved-condos-individual-units-now-eligible-for-financing/): People looking to buy a condo with FHA financing rejoice. HUD has released a new condominium approval process that, among other things, brings back spot - [You Might Get a Better Deal If You Buy a House Where Kids Live](https://www.thetruthaboutmortgage.com/you-might-get-a-better-deal-if-you-buy-a-house-where-kids-live/): It’s common knowledge that home buyers are interested in purchasing properties in good school districts. After all, many individuals purchase homes - [Mortgage Rates vs. the Stock Market](https://www.thetruthaboutmortgage.com/mortgage-rates-vs-stock-market/): Mortgage match-ups: "Mortgage rates vs. the stock market." With all the recent stock market volatility, you may be wondering what effect such events have - [Wait, Home Buying Is the Cheapest It’s Been in 20 Years?](https://www.thetruthaboutmortgage.com/wait-home-buying-is-the-cheapest-its-been-in-20-years/): If you happen to be in the market to buy a home, you’re probably not giddy with delight over today’s sky-high listing prices. After all, home prices - [Why a Low Down Payment Mortgage Might Be the Safer Move](https://www.thetruthaboutmortgage.com/why-a-low-down-payment-mortgage-might-be-the-safer-move/): If you ask most people, they’ll probably say you should save up a good chunk of money before buying a home, possibly even 20% of the purchase price. A - [One Quick Reason to Avoid the 30-Year Fixed](https://www.thetruthaboutmortgage.com/one-quick-reason-to-avoid-the-30-year-fixed/): Here’s a hint – a moving van. While the 30-year fixed is the most common home loan program utilized by borrowers today, it might not be the most - [Amazon TurnKey: Get Free Stuff If You Use a Realogy Agent](https://www.thetruthaboutmortgage.com/amazon-turnkey-review/): While they’re not yet directly involved in the mortgage industry, Amazon has now dipped its toes in the real estate pool via a new home buying program - [37% of American Homeowners Are Now Free and Clear](https://www.thetruthaboutmortgage.com/37-of-american-homeowners-are-now-free-and-clear/): What a difference a decade makes. Back in 2009, it was a lot more common to hear about underwater mortgages than free and clear homeowners. In fact, a - [Mortgage Down Payment Requirements: What's the Minimum You Need to Put Down on a House?](https://www.thetruthaboutmortgage.com/a-primer-on-mortgage-down-payment-requirements/): An overview of down payment requirements for a variety of different mortgages, including what's required for conventional and government-backed home loans. - [How to Get a Mortgage with a Low Credit Score](https://www.thetruthaboutmortgage.com/how-to-get-a-mortgage-with-a-low-credit-score/): If you’ve got a low credit score, but are determined to buy a new home (or looking to refinance your existing mortgage), you may be wondering how to get a mortgage. - [How Soon Can You Refinance a Mortgage? Know the Waiting Periods](https://www.thetruthaboutmortgage.com/how-soon-can-i-refinance-my-mortgage/): Mortgage Q&A: “How soon can I refinance my mortgage?” With mortgage rates marching toward new all-time lows again, a lot of recent home buyers are - [Owning Review: Not Your Nana's Mortgage Company](https://www.thetruthaboutmortgage.com/owning-review/): An online lender called "Owning" is looking to shake up the mortgage industry with what it refers to as "ridiculously low rates." In the past, they - [Freddie Mac CHOICERenovation Mortgage Review](https://www.thetruthaboutmortgage.com/freddie-mac-choicerenovation-mortgage-review/): Freddie Mac has just launched a new renovation loan product known as the “Freddie Mac CHOICERenovation Mortgage.” While the name is a bit of a mouthful, - [A Startup Called ZeroDown Just Launched to Help Home Buyers Lease to Own](https://www.thetruthaboutmortgage.com/startup-zerodown-lease-to-own/): It’s starting to feel a little like 2006 again. Recently, we’ve seen mortgage lenders launching interest-only mortgages, 40-year mortgage terms, and now a - [What Is Home Equity?](https://www.thetruthaboutmortgage.com/what-is-home-equity/): Mortgage Q&A: “What is home equity?” You've probably heard the phrase "home equity" get thrown around, likely during a fast-paced radio or TV - [Young Homeowners Are Having More Mortgage Regrets](https://www.thetruthaboutmortgage.com/young-homeowners-are-having-more-mortgage-regrets/): While homeowners of all ages are mostly happy they purchased a property, younger borrowers seem to be regretting their mortgages more than the rest of the - [Why You Should Live in Your Home Until It Sells](https://www.thetruthaboutmortgage.com/why-you-should-live-in-your-home-until-it-sells/): A new study from Redfin proved what we probably all assumed was the case; vacant homes sell for less than those filled with stuff. There’s something - [Redfin Direct: Buy a Redfin-Listed Home Without a Real Estate Agent](https://www.thetruthaboutmortgage.com/redfin-direct-buy-a-redfin-listed-home-without-a-real-estate-agent/): First Redfin brought us the 1% listing fee, which disrupted the traditional 2.5% to 3% listing agents charge(d) to sell a home. But that still meant the - [What Credit Score Do You Need to Get a Mortgage? Learn the Key FICO Thresholds](https://www.thetruthaboutmortgage.com/what-credit-score-do-i-need-to-get-a-mortgage/): Mortgage Q&A: “What credit score do I need to get a mortgage?” If you're thinking about purchasing a new home or refinancing an existing mortgage, you - [Why You Might Want to Skip the Starter Home](https://www.thetruthaboutmortgage.com/why-you-might-want-to-skip-the-starter-home/): Some 45 million Americans are expected to reach the typical first-time home buyer age in the next decade, which is a fresh 34 years old. This is 7.4% more - [Study: Open Houses Result in Faster, More Expensive Home Sales](https://www.thetruthaboutmortgage.com/study-open-houses-result-in-faster-more-expensive-home-sales/): Aside from tracking mud through your beautiful home, it turns out open houses actually lead to higher sales prices and less time on market, per a new - [Zillow Home Loans Is Now Live](https://www.thetruthaboutmortgage.com/zillow-home-loans-review-live/): Following the announcement made last summer to acquire Mortgage Lenders of America, “Zillow Home Loans” is now officially open for business. The new - [PITI: Find Out All That Goes Into Your Mortgage Payment](https://www.thetruthaboutmortgage.com/what-does-a-mortgage-payment-consist-of/): More fun and exciting mortgage Q&A: “What does a monthly mortgage payment consist of?” Have you ever been curious what you’re paying each month to - [loanDepot’s Mello Smartloan Can Shorten Mortgage Closing to Just 8 Days](https://www.thetruthaboutmortgage.com/loandepot-mello-smartloan/): In yet another effort to push mortgage lending firmly into the 21st century, loanDepot has debuted its proprietary “mello smartloan” technology, an - [Is the 30-Year Fixed Mortgage Going Extinct?](https://www.thetruthaboutmortgage.com/is-the-30-year-fixed-mortgage-going-extinct/): It’s that time again when we fret about the viability of the 30-year fixed mortgage. This last occurred in 2014 when Dick Bove warned that the Fed’s - [Is the Real Estate Market Going to Crash in 2019?](https://www.thetruthaboutmortgage.com/is-the-real-estate-market-going-to-crash-in-2019/): There have been a lot of unpleasant headlines regarding the state of the real estate market lately. Earlier this week, Redfin noted that only 1 in 8 - [What Is a Good Price for a First-Time Home Buyer?](https://www.thetruthaboutmortgage.com/what-is-a-good-price-for-a-first-time-home-buyer/): How to figure out a good price to pay for a home as a first-time home buyer, and ensuring you qualify for that loan amount. - [The Cost of Property Taxes and Hazard Insurance](https://www.thetruthaboutmortgage.com/the-cost-of-property-taxes-and-hazard-insurance/): As home prices continue to flirt with record highs nationwide, the cost of property taxes and hazard insurance can be the tipping point. For example, if - [Chase Launches Free Biweekly Mortgage Payment Option](https://www.thetruthaboutmortgage.com/chase-launches-free-biweekly-mortgage-payment-option/): In an effort to make life a little easier for its mortgage customers, Chase has launched a new suite of “flexible automatic payments,” including a - [15 Things to Do After Your Mortgage Funds Besides Buy New Furniture](https://www.thetruthaboutmortgage.com/15-things-to-do-after-your-mortgage-funds/): Getting a mortgage can be pretty exciting, especially if it's your first time. It can also be a very daunting process fraught with the potential for - [What Is a Non-Conforming Mortgage Loan? And How Does It Affect You?](https://www.thetruthaboutmortgage.com/what-is-a-non-conforming-mortgage-loan/): If you’ve been doing some mortgage shopping/research lately and happened to come across the phrase “non-conforming loan,” you might have some questions. - [2019 Mortgage Rate Forecast: We Could Be in for a Big Surprise](https://www.thetruthaboutmortgage.com/2019-mortgage-rate-forecast-we-could-be-in-for-a-big-surprise/): Just like that another year has passed, well almost, so it’s time once again to look forward to what the next 365 days might bring. Will 2019 be a winner - [2019 FHA Loan Limits Rise: Floor Climbs Above $300k](https://www.thetruthaboutmortgage.com/2019-fha-loan-limits-rise-floor-climbs-above-300k/): Following the release of the 2019 conforming loan limit, HUD announced the 2019 FHA loan limits, which like the former will move higher next year. Similar - [Home Prices vs. Recessions](https://www.thetruthaboutmortgage.com/home-prices-vs-recessions/): There have been three recessions since the 1990s, including the Great Recession, which took place from 2007 and 2009 and lasted about a year and a half. - [2019 Mortgage and Real Estate Predictions](https://www.thetruthaboutmortgage.com/2019-mortgage-and-real-estate-predictions/): First off, here are my 2018 predictions in case you want to see how they panned out. Overall, I think I did alright, though my call for the 30-year fixed - [2019 Conforming Loan Limit Will Be $484,350 for Mortgages Backed by Fannie and Freddie](https://www.thetruthaboutmortgage.com/2019-conforming-loan-limit-will-be-484350-for-mortgages-backed-by-fannie-and-freddie/): As expected, the conforming loan limit for 2019 has increased thanks to an ongoing rise in property values, according to a news bulletin released by the - [What Is Verification of Employment for a Mortgage? Proving Your Job History](https://www.thetruthaboutmortgage.com/what-is-verification-of-employment-for-a-mortgage/): When you apply for a mortgage, underwriters will comb through your finances to determine if you’re a good candidate for a loan. This includes verifying a - [Guaranteed Rate Mortgage Review: A Fast-Growing Top-10 Lender](https://www.thetruthaboutmortgage.com/guaranteed-rate-mortgage-review/): If you haven’t heard of "Guaranteed Rate," there’s a good chance you’ve never applied for a home loan before. Or maybe you just don’t live in the Midwest, - [Wells Fargo the Top Mortgage Lender in 2017, Quicken Tops for Number of Loans](https://www.thetruthaboutmortgage.com/wells-fargo-the-top-mortgage-lender-in-2017-quicken-tops-for-number-of-loans/): Despite closing a higher number of mortgage loans last year, Quicken Loans was unable to wrestle the coveted top spot away from Wells Fargo, per HMDA data - [PrimeLending Mortgage Review: Committed to Customer Satisfaction](https://www.thetruthaboutmortgage.com/primelending-mortgage-review-committed-to-customer-satisfaction/): Today let’s talk about PrimeLending, a PlainsCapital Company, which is a top-10 mortgage lender that does business in all 50 states. Perhaps their biggest - [Sell Your House or Rent It Out? The Pros and Cons](https://www.thetruthaboutmortgage.com/sell-your-house-or-rent-it-out/): If you already own some real estate, perhaps a house or a condo, and are looking to move on, you might ask yourself if it’s better to sell it or rent it - [How to Get Cash Out of Your Home in a Rising Rate Environment](https://www.thetruthaboutmortgage.com/how-to-get-cash-out-of-your-home-in-a-rising-rate-environment/): In a perfect world, you could tap into your home equity and lower your mortgage interest rate at the same time. But because interest rates rise and fall - [Redfin Launches the Owner Estimate to Give Homeowners Control](https://www.thetruthaboutmortgage.com/redfin-launches-the-owner-estimate-to-give-homeowners-control/): Are you sick and tired of your Redfin Estimate or Zillow Zestimate being too low? Do you feel your property is worth much, much more than they say it is? - [Quicken Launches Rocket Homes to Compete with Zillow and Redfin](https://www.thetruthaboutmortgage.com/quicken-launches-rocket-homes-to-compete-with-zillow-and-redfin/): Following the recent trend of real estate and mortgage link-ups, Quicken Loans has launched “Rocket Homes” to fill in the real estate gap and - [The Largest Nonbank Home Purchase Lender in the Nation Is a Wholesaler](https://www.thetruthaboutmortgage.com/the-largest-nonbank-home-purchase-lender-in-the-nation-is-a-wholesaler/): Everyone wants to be #1 these days. I guess that’s no different than any other days, but the battle to be on top is growing more and more contentious, - [5 Things Home Buyers Are Doing If They Haven’t Found a Property After 3 Months](https://www.thetruthaboutmortgage.com/5-things-home-buyers-are-doing-if-they-havent-found-a-property-after-3-months/): If you’re a prospective home buyer, life isn’t fun right now. The real estate market remains red hot (despite those headlines about it cooling) and - [Zillow Enters the Mortgage Originating Business](https://www.thetruthaboutmortgage.com/zillow-enters-the-mortgage-originating-business/): In what seemed like a pretty inevitable move, Zillow has gotten into the mortgage originating business via its acquisition of Mortgage Lenders of America, - [Don’t Make the Mistake of Calling the Housing Top Too Early](https://www.thetruthaboutmortgage.com/dont-make-the-mistake-of-calling-the-housing-top-too-early/): It’s that time of year again, when we enter the housing doldrums and everyone in the industry begins to panic. Further exacerbating things this time - [Freedom Mortgage Review: Specialize in VA Loans But Offer Everything Else Too](https://www.thetruthaboutmortgage.com/freedom-mortgage-review-specialize-in-va-loans-but-offer-everything-else-too/): While "Freedom Mortgage" might not be a household name like Quicken Loans or Wells Fargo, the company often finds itself in top-10 lists when it comes to - [Getting a Mortgage with a Gig Economy Job](https://www.thetruthaboutmortgage.com/getting-a-mortgage-with-a-gig-economy-job/): If you’re one of many people out there who happens to bring in money from a so-called “gig economy” job, you might be wondering if such income can be used - [Redfin Compete Score: How Hard Is It to Win That Home?](https://www.thetruthaboutmortgage.com/redfin-compete-score-how-hard-is-it-to-win-that-home/): Redfin just launched its so-called “Compete Score,” a tool designed to help prospective home buyers determine how hard it’ll be to “win a home” in a - [Flagstar Mortgage Review: Tons of Loan Programs to Choose From](https://www.thetruthaboutmortgage.com/flagstar-mortgage-review-tons-of-loan-programs-to-choose-from/): One of the larger, but perhaps lesser-known mortgage lenders out there is Flagstar Bank, which was just acquired by New York Community Bancorp in late - [Average Home Seller in 2017 Made Only $39,000](https://www.thetruthaboutmortgage.com/average-home-seller-in-2017-made-only-39000/): While all the headlines paint a really rosy picture for the real estate market where sellers are cashing in mega gains, the average takeaway isn’t all - [Laurel Road: Truly Digital Mortgages Built Entirely Online](https://www.thetruthaboutmortgage.com/laurel-road-truly-digital-mortgages-built-entirely-online/): Another Millennial or even Gen-Z focused mortgage lender has come online, literally, to offer you a mortgage. I’m talking about Laurel Road, which sounds - [Should You Pay Off Your Mortgage Before Retirement? There Are Pros and Cons](https://www.thetruthaboutmortgage.com/should-you-pay-off-your-mortgage-before-retirement/): If you speak to any financial planners or so-called experts on the matter, they’ll probably say, “Yes, pay off your mortgage before you retire.” But is it - [PNC Mortgage Review: Low Rates Maybe, and Now a Digital Application Process Too](https://www.thetruthaboutmortgage.com/pnc-mortgage-review-low-rates-maybe-but-not-much-else/): If you haven’t heard of PNC Mortgage before, you probably will soon. They’re a rapidly growing mortgage lender just outside the top-10 list. - [Citi Is Offering .50% Off Your Mortgage Rate If You Deposit a Million Bucks](https://www.thetruthaboutmortgage.com/citi-is-offering-50-off-your-mortgage-rate-if-you-deposit-a-million-bucks/): Okay, it sounds a little silly, but it’s not a bad deal if you happen to have a million dollars lying around the house. CitiMortgage has so-called - [Freddie Mac HomeOne Mortgage: New 3% Down Mortgage with No Income Restrictions](https://www.thetruthaboutmortgage.com/freddie-mac-homeone-mortgage-new-3-down-mortgage-with-no-income-restrictions/): A new home loan program is being rolled out this July by Freddie Mac, known as “HomeOne Mortgage,” which features a 3% down payment and no income - [Mortgage Rates Vary by Lender, So Take the Time to Shop Around](https://www.thetruthaboutmortgage.com/mortgage-rates-vary-by-lender-so-shop-around/): While mortgages are largely a commoditized product, unlike perhaps a TV or a smartphone with unique technology, their cost can still vary considerably by - [Carrington Mortgage Launches Line of Subprime Mortgages](https://www.thetruthaboutmortgage.com/carrington-mortgage-launches-line-of-subprime-mortgages/): Here we go again? Maybe, maybe not. Regardless, Carrington Mortgage has launched a new line of subprime mortgages available to the 100 million odd U.S. - [Getting a Mortgage on a Duplex, Triplex, or Fourplex](https://www.thetruthaboutmortgage.com/getting-a-mortgage-on-a-duplex-triplex-or-fourplex/): One trend I’ve been seeing lately is buying a multi-unit property, such as a duplex, and renting out one unit while living in the other. The cool kids are - [What Will Happen to Home Sales If Mortgage Rates Rise to 9%?](https://www.thetruthaboutmortgage.com/what-will-happen-to-home-sales-if-mortgage-rates-rise-to-9/): There’s been a lot of hubbub about mortgage rates since the start of the year. It’s not unwarranted, given the fact that 30-year fixed rates increased - [MassHousing Launches Zero Down Mortgage](https://www.thetruthaboutmortgage.com/masshousing-launches-zero-down-mortgage/): There is yet another zero down mortgage option available to prospective home buyers, the latest being offered by The Massachusetts Housing Finance Agency - [Guild Mortgage Review - A Mortgage Lender Big on Customer Satisfaction](https://www.thetruthaboutmortgage.com/guild-mortgage-review/): Guild Mortgage is one name you may have come across lately while searching for a mortgage. They’re a rapidly growing independent mortgage banker with over - [USAA Mortgage Review: VA Loans, Jumbo, and More](https://www.thetruthaboutmortgage.com/usaa-mortgage-review-va-loans-jumbo-and-more/): USAA Mortgage, technically known as USAA Bank Home Loans, is one of the larger mortgage lenders out there, though not quite in the top 10. They’re - [Amazon Mortgage Might Be a Thing Soon](https://www.thetruthaboutmortgage.com/amazon-mortgage-might-be-a-thing-soon/): There have been a lot of so-called mortgage disruptors entering the space of late, but this might be the biggest yet. Could Amazon Mortgage be in the - [What Is a Gift Letter for a Mortgage? Know the Key Requirements](https://www.thetruthaboutmortgage.com/what-is-a-gift-letter-for-a-mortgage/): Mortgage Q&A: “What is a gift letter?” A reader recently inquired about mortgage gift letters, so instead of simply answering their question, I - [Ideal Credit Union Is Offering a Zero Down Mortgage with a Catch](https://www.thetruthaboutmortgage.com/ideal-credit-union-is-offering-a-zero-down-mortgage-with-a-catch/): Ideal Credit Union, which has six locations scattered across Minnesota, is the latest mortgage company to offer a no down payment mortgage. But theirs is - [2017 Was the Best Year for Home Purchase Mortgages Since the Market Peak](https://www.thetruthaboutmortgage.com/2017-was-the-best-year-for-home-purchase-mortgages-since-the-market-peak/): It turns out 2017 was a banner year for mortgages, just not all of them. A total of $1.148 trillion in home purchase mortgages were funded last year, the - [HUD Homes: Buy a Foreclosed Home for a Potential Discount](https://www.thetruthaboutmortgage.com/hud-homes-buy-a-foreclosed-home-for-a-potential-discount/): With the red hot real estate market showing no signs of letting up, prospective home buyers need to get increasingly creative in order to land their dream - [There Are Still Nearly 90,000 Borrowers Who Could Benefit from a HARP Refinance](https://www.thetruthaboutmortgage.com/there-are-still-nearly-90000-borrowers-who-could-benefit-from-a-harp-refinance/): Before mortgage rates began their recent upward trajectory to start off 2018, quite a few mortgage refinances squeaked through the door. Some 446,295 - [loanDepot Has a 150-Day Rate Lock for Those Who Want Today’s Rates This Summer](https://www.thetruthaboutmortgage.com/loandepot-has-a-150-day-rate-lock-for-those-who-want-todays-rates-this-summer/): I came across a flyer today from loanDepot advertising a 150-day rate lock for borrowers interested in today’s mortgage rates, who are worried (like - [Higher Mortgage Rates Likely to Have Little Effect on Housing Market](https://www.thetruthaboutmortgage.com/higher-mortgage-rates-likely-to-have-little-effect-on-housing-market/): Well, it’s been a stressful couple of weeks, and the way the stock market is swinging at the moment, it doesn’t appear to be abating. Grab your Tums, - [Airbnb Income Can Officially Be Used to Qualify for a Mortgage Refinance](https://www.thetruthaboutmortgage.com/airbnb-income-can-officially-be-used-to-qualify-for-a-mortgage-refinance/): Call it a sign of the times, or perhaps the power of the sharing, or “gig” economy. You can now officially use Airbnb income to qualify for a mortgage - [Top Reverse Mortgage Lender AAG Now Offering Forward Mortgages](https://www.thetruthaboutmortgage.com/top-reverse-mortgage-lender-aag-now-offering-forward-mortgages/): File this one under: why didn’t we (they) think of this sooner. While it might seem like a no-brainer in hindsight, top reverse mortgage lender American - [Quicken Loans Is the Largest Home Loan Lender for the First Time Ever](https://www.thetruthaboutmortgage.com/quicken-loans-is-the-largest-home-loan-lender-for-the-first-time-ever/): Anyone watching this space knew it was going to happen, but perhaps not this fast. Quicken Loans officially became the largest mortgage lender in the - [Better Mortgage Is Giving Home Buyers Pre-Offer Appraisals to Help Them Compete](https://www.thetruthaboutmortgage.com/better-mortgage-is-offering-pre-offer-home-appraisals-to-its-customers/): In a bid to get a leg up on the competition, Better Mortgage is allowing prospective home buyers to get an appraisal on a property before actually making - [PHH Mortgage to Provide Borrowers with $30.4 Million for Improper Loan Servicing](https://www.thetruthaboutmortgage.com/phh-mortgage-to-provide-borrowers-with-30-4-million-for-improper-loan-servicing/): It’s 2018 and the mortgage settlements continue. As part of an agreement reached today with 49 states and Washington D.C., PHH Mortgage Corp. will pay out - [Guaranteed Rate Launches New Jumbo Loan with Interest-Only Option](https://www.thetruthaboutmortgage.com/guaranteed-rate-launches-new-jumbo-loan-with-interest-only-option/): Well, it’s a new year, and with that comes new and exciting home loan programs to help borrowers purchase homes or refinance existing mortgages. The - [2018 Real Estate and Mortgage Predictions](https://www.thetruthaboutmortgage.com/2018-real-estate-and-mortgage-predictions/): Just like that, another year has gone by, well, almost. There are still a few days left and anything can happen. In the meantime, I present my latest - [See How Exuberant Your Housing Market Is](https://www.thetruthaboutmortgage.com/see-how-exuberant-your-housing-market-is/): Back in the mid-1990s, former Federal Reserve Board chairman Alan Greenspan used the phrase “irrational exuberance,” which served as a warning that the - [2018 Mortgage Rate Forecast: Overall It’s Looking Pretty Good](https://www.thetruthaboutmortgage.com/2018-mortgage-rate-forecast-overall-its-looking-pretty-good/): It’s that time of the year again, when we take a look at what’s in store for mortgage rates the following year. So without further ado, here is the “2018 - [Will 2018 Be the Last Great Year for This Real Estate Boom?](https://www.thetruthaboutmortgage.com/will-2018-be-the-last-great-year-for-this-real-estate-boom/): A new survey of housing experts and economists led by Zillow sees home prices rising 4.1% in 2018 before annual gains normalize at around three percent - [2018 FHA Loan Limit Floor Increased to $294,515](https://www.thetruthaboutmortgage.com/2018-fha-floor-loan-limit-increased-to-294515/): Just like the 2018 conforming loan limits, the FHA will see its 2018 loan limits increase as well, which is welcome news for home buyers in more expensive - [Can You Pay the Mortgage with Bitcoin?](https://www.thetruthaboutmortgage.com/can-you-pay-the-mortgage-with-bitcoin/): Mortgage Q&A: "Can you pay the mortgage with bitcoin?" First off, I apologize for writing an article about bitcoin. I know it’s all the rage right now - [New Program Allows Renters to Get a Mortgage with as Little as a Security Deposit](https://www.thetruthaboutmortgage.com/new-program-allows-renters-to-get-a-mortgage-with-as-little-as-a-security-deposit/): Home Partners of America and New Penn Financial have joined forces to offer renters the ability to get a mortgage with as little as their security - [2018 Conforming Loan Limit Jumps to $453,100](https://www.thetruthaboutmortgage.com/2018-conforming-loan-limit-jumps-to-453100/): It’s that time of year again, when the FHFA announces the conforming loan limit for the upcoming year. And like last year, it’s going up! This marks just - [Are Mortgages Simple Interest and Compounded Monthly?](https://www.thetruthaboutmortgage.com/are-mortgages-simple-interest-and-compounded-monthly/): People seem to be fascinated with how mortgages are calculated and paid off, but when it comes down to it, there’s nothing too mind-blowing happening. - [Flagstar Offering Zero Down Mortgages to Michigan Home Buyers](https://www.thetruthaboutmortgage.com/flagstar-offering-zero-down-mortgages-to-michigan-home-buyers/): Flagstar Bank is the latest mortgage lender to offer a home loan with zero down payment requirement. They even go a step further by offering to pay the - [Capital One to Stop Offering Mortgages](https://www.thetruthaboutmortgage.com/capital-one-to-stop-offering-mortgages/): It’s feeling a little like 2007 today. Back then, I was writing posts like this on a daily basis. Capital One has announced that it is exiting the - [OfferPad Home Loans: iBuyer Links Up with loanDepot to Provide Bridge Financing](https://www.thetruthaboutmortgage.com/offerpad-home-loans-ibuyer-links-up-with-loandepot-to-provide-bridge-financing/): A so-called direct home buyer by the name of OfferPad that agrees to purchase homes in as little as 24 hours has announced a new joint venture with - [The Five Most Common Uses of Home Equity Lines of Credit](https://www.thetruthaboutmortgage.com/the-five-most-common-uses-of-home-equity-lines-of-credit/): In case you hadn’t heard, home equity lines of credit are expected to get a lot more popular in coming years as homeowners take advantage of all that - [10 Takeaways from the Annual Realtor Survey](https://www.thetruthaboutmortgage.com/10-takeaways-from-the-annual-realtor-survey/): The National Association of Realtors just released its 2017 Profile of Home Buyers and Sellers, and there are lots of interesting tidbits. Let’s explore - [New Bill Aims to End FHA Mortgage Insurance Premiums for Life Policy](https://www.thetruthaboutmortgage.com/new-bill-aims-to-end-fha-mortgage-premiums-for-life-policy/): Back in 2013, FHA home loans became a lot less attractive because most newly originated mortgages required mortgage insurance to be paid for the entire - [FHA 203k Loan Program: The All-in-One Renovation Mortgage](https://www.thetruthaboutmortgage.com/fha-203k-loan-program-the-all-in-one-renovation-mortgage/): In a nutshell, the FHA 203k loan program allows prospective home buyers to finance the cost of a property and improvements in one convenient mortgage. - [Imagine Getting a Mortgage with Just a Couple Clicks](https://www.thetruthaboutmortgage.com/imagine-getting-a-mortgage-with-just-a-couple-clicks/): Wouldn’t it be nice if your mortgage lender could gather your income, asset, and employment information from a single digital document, similar to a - [Freddie Mac Revises Student Loan Guidelines](https://www.thetruthaboutmortgage.com/freddie-mac-revises-student-loan-guidelines/): It’s one of the more common dilemmas these days – you graduated college and you’re ready to start a family (or at least buy a home for your dog), but - [While Mortgages Go Digital, People Still Matter, a Lot](https://www.thetruthaboutmortgage.com/while-mortgages-go-digital-people-still-matter-a-lot/): The latest buzz in the mortgage world is e-mortgages, or digital mortgages, or paperless mortgages. Or mortgages that don’t require human interaction, or - [Millennials Are Buying Homes to Give Their Dogs Room to Roam](https://www.thetruthaboutmortgage.com/millennials-are-buying-homes-to-give-their-dogs-room-to-roam/): Curious what’s driving Millennial homeownership? Is it marriage or the prospect of a little one crawling around? Nope. Aside from more living space and - [Mortgage Originations by Product Type: What’s Most Popular?](https://www.thetruthaboutmortgage.com/mortgage-originations-by-product-type-whats-most-popular/): Ever wonder what share of borrowers are taking out a 15-year mortgage as opposed to a standard 30-year fixed? Or an ARM instead? Well, I was, and so I - [HomeFundMe: Now You Can Crowdfund a Mortgage Down Payment](https://www.thetruthaboutmortgage.com/homefundme-now-you-can-crowdfund-a-mortgage-down-payment/): Don’t have the required down payment to purchase your dream home? No problem. There’s now a service that lets you crowdfund your mortgage down payment. - [Synovus Mortgage Offering 100% Financing via Affordable Mortgage Program](https://www.thetruthaboutmortgage.com/synovus-mortgage-offering-100-financing-via-affordable-mortgage-program/): You’ve probably heard of HAMP, otherwise known as the Home Affordable Modification Program, which was very popular post-housing crisis. But what about - [Lennar Offers to Pay Your Student Loans If You Buy a New Home](https://www.thetruthaboutmortgage.com/lennar-offers-to-pay-your-student-loans-if-you-buy-a-new-home/): One of the more common problems young home buyers face these days is student loan debt, which can complicate a mortgage approval (and a successful home - [A 30-Year Fixed Mortgage That Is Adjustable, Self-Refinancing, and Ideally Paid Off Early](https://www.thetruthaboutmortgage.com/a-30-year-fixed-mortgage-that-is-adjustable-self-refinancing-and-ideally-paid-off-early/): Confused yet? Yeah, me too. Let’s dive in. For a while now, the 30-year fixed-rate mortgage has been under attack. In short, opponents of the popular loan - [ZHome Lets You Sell Your Current Home in 24 Hours So You Can Buy a Brand New One](https://www.thetruthaboutmortgage.com/zhome-lets-you-sell-your-current-home-in-24-hours-so-you-can-buy-a-brand-new-one/): A company called ZHome, which can apparently generate an offer to buy your home within 24 hours, is also making it easier for existing homeowners to buy - [Wells Fargo Hit with Lawsuit Related to Improper Mortgage Lock Fees](https://www.thetruthaboutmortgage.com/wells-fargo-hit-with-lawsuit-related-to-improper-mortgage-lock-fees/): It’s been a tough year or so for Wells Fargo, the undisputed king of mortgages. While they continue to lead the nation in home loan origination volume, - [360 Mortgage Group Touting 15-Minute Mortgage Approval Sans Loan Officer](https://www.thetruthaboutmortgage.com/360-mortgage-group-touting-15-minute-mortgage-approval-sans-loan-officer/): A mortgage bank by the name of "360 Mortgage Group" is making some lofty claims, one being a 15-minute full mortgage approval. The company says its - [Jay-Z and Beyoncé Take Out $52.8 Million Mortgage on Bel Air Home](https://www.thetruthaboutmortgage.com/jay-z-and-beyonce-take-out-52-8-million-mortgage-on-bel-air-home/): Think you can’t get a jumbo home loan these days? Think again. Power couple Jay-Z and Beyoncé somehow managed to get a $52.8 million-dollar mortgage from - [Mr. Cooper Mortgage Review: The Lender Formerly Known as Nationstar](https://www.thetruthaboutmortgage.com/mortgage-lender-nationstar-becomes-mr-cooper-will-offer-home-rewards-credit-card/): Nationstar Mortgage, which was once on the brink of failure, officially announced its name change to “Mr. Cooper” in August 2017. The move appeared to be - [Primary Residence vs. Second Home vs. Investment: Know the Key Differences](https://www.thetruthaboutmortgage.com/primary-residence-vs-second-home-vs-investment/): Sometimes I’m surprised I miss the most basic of mortgage definitions, seeing that this blog has been around for more than a decade, but alas, I’ve never - [Soon You May Be Able to Buy a House Without an Appraisal](https://www.thetruthaboutmortgage.com/soon-you-may-be-able-to-buy-a-house-without-an-appraisal/): Here’s something that may finally speed up the typically slow home loan process: an appraisal-less home purchase. Yep, it’ll be a reality for some folks - [These Six Things Will Happen If Mortgage Rates Go Up](https://www.thetruthaboutmortgage.com/these-six-things-will-happen-if-mortgage-rates-go-up/): We’ve been worrying that mortgage rates would go up for years now, but it just hasn’t happened yet. Sure, they’re up a little bit from record levels, but - [Millennials Favor Conventional Mortgages Over FHA](https://www.thetruthaboutmortgage.com/millennials-favor-conventional-mortgages-over-fha/): I’ve got more Millennial mortgage data for you, courtesy of the monthly Ellie Mae Millennial Tracker. This is a heavily watched group because they’re - [What Will Happen to Your Mortgage When the LIBOR Goes Away? Hello SOFR!](https://www.thetruthaboutmortgage.com/what-will-happen-to-your-mortgage-when-the-libor-goes-away/): If you have an adjustable-rate mortgage, I’ve got some important news for you. The London Interbank Offered Rate, or LIBOR as it’s known to most, is going - [1% Down Payment Mortgages Come Under Fire](https://www.thetruthaboutmortgage.com/1-down-payment-mortgages-come-under-fire/): While we’ve come a long way since housing bottomed, the memories of how we got there still don’t feel very distant. A lot of things contributed to the - [Ally Home Launches Price Match Guarantee for Mortgages](https://www.thetruthaboutmortgage.com/ally-home-launches-price-match-guarantee-for-mortgages/): Mortgage industry newcomer Ally Home is getting into the price match game with its just launched promotion called, you guessed it, “Price Match - [How Long Does It Take to Get a Mortgage? Think a Month, Not Minutes](https://www.thetruthaboutmortgage.com/how-long-does-it-take-to-get-a-mortgage/): Mortgage Q&A: “How long does it take to get a mortgage?” This is a fairly common mortgage question because we humans aren’t very patient. This is - [For Some Reason, Homeowner Regrets Are on the Rise](https://www.thetruthaboutmortgage.com/for-some-reason-homeowner-regrets-are-on-the-rise/): Despite the red-hot real estate market, more Americans are regretting their home purchases, per a new Trulia survey. It’s a bit odd because home prices - [Millennials Seem to Like Adjustable Rate Mortgages](https://www.thetruthaboutmortgage.com/millennials-seem-to-like-adjustable-rate-mortgages/): It's not just avocado toast. A new anecdotal report from the WSJ reveals that Millennials who are buying homes are increasingly choosing adjustable-rate - [RedfinNow: Get an Offer on Your Home Within 24 Hours (Shut Down Nov. 22)](https://www.thetruthaboutmortgage.com/redfin-now-get-an-offer-on-your-home-within-24-hours/): Are you the impatient type? Well, have I’ve got news for you. A new service dubbed “RedfinNow” will get you a “top offer” for your property within 24 - [One Third of Home Buyers Made Offers Without Actually Visiting the Property](https://www.thetruthaboutmortgage.com/one-third-of-home-buyers-made-offers-without-actually-visiting-the-property/): Is the housing market getting stupid again, or is technology changing the way we buy homes? That’s still up for debate, but there are some troubling signs - [Fannie Mae Increasing Max DTI to 50%, Upping LTVs for ARMs](https://www.thetruthaboutmortgage.com/fannie-mae-increasing-max-dti-to-50-dti-upping-ltvs-for-arms/): There’s been a lot of talk lately about mortgage lenders easing credit standards as refinance volume wanes and purchase activity remains constrained by - [Homie: A Startup Is Eliminating Real Estate Agent and Loan Officer Commissions](https://www.thetruthaboutmortgage.com/homie-a-startup-is-eliminating-real-estate-agent-and-loan-officer-commissions/): There’s a new startup out there called “Homie” that transforms the old way people buy and sell homes by harnessing today’s technology and (kind of) - [Guild Mortgage Latest to Offer a 1% Down Payment Mortgage](https://www.thetruthaboutmortgage.com/guild-mortgage-latest-to-offer-a-1-down-payment-mortgage/): It seems 1% down is the new zero down in the mortgage world, with San Diego-based Guild Mortgage the latest to join the fray. The independent mortgage - [Movement Mortgage Launches Zero Down Mortgage Called MAP](https://www.thetruthaboutmortgage.com/movement-mortgage-launches-zero-down-mortgage-called-map/): Movement Mortgage is the latest of many mortgage lenders to offer a zero down option for prospective home buyers, referred to as the Mortgage Assistance - [Magilla Lets You Shop Mortgage Lenders Anonymously](https://www.thetruthaboutmortgage.com/magilla-lets-you-shop-mortgage-lenders-anonymously/): There’s a new disruptor in the mortgage space called Magilla that lets you shop for a mortgage anonymously, assuming you don’t want lenders to bug you. - [Zillow Offers: For Those Who Want to Sell Their Home Fast](https://www.thetruthaboutmortgage.com/zillow-instant-offers-for-those-who-want-to-sell-their-home-fast/): The online real estate marketplace Zillow has just launched a new feature called “Zillow Offers,” formerly known as Zillow Instant Offers, aimed at - [Traditional 20% Mortgage Down Payment Could Be Cut in Half](https://www.thetruthaboutmortgage.com/traditional-20-mortgage-down-payment-could-be-cut-in-half/): I recently wrote about the need to put down 20% when buying a home, which although often recommended, isn’t a necessity these days. There are programs - [Can Credit Card Churning Hurt Your Chances of Getting a Mortgage?](https://www.thetruthaboutmortgage.com/can-credit-card-churning-hurt-your-chances-of-getting-a-mortgage/): These days, it’s not uncommon for individuals to open a bunch of credit cards in a short span of time to acquire lots of points and/or cash back. Those - [The Best Time to Buy a Home Is in August and September](https://www.thetruthaboutmortgage.com/the-best-time-to-buy-a-home-is-in-august-and-september/): Wondering when the best time to buy a home is? And the worst time? Well, thanks to data science, we no longer have to guess whether it's fall and winter, - [Chase Is Offering 75,000 Ultimate Rewards Points When You Take Out a Mortgage](https://www.thetruthaboutmortgage.com/chase-is-offering-100000-ultimate-rewards-points-when-you-take-out-a-mortgage/): It’s not very common for mortgage lenders to offer cash back or some other sort of reward for taking out a mortgage. Generally, you might get some sort of - [What Is Mortgage Protection Insurance? And Do You Actually Need to Buy It?](https://www.thetruthaboutmortgage.com/what-is-mortgage-protection-insurance-and-do-you-need-it/): You just closed your home loan and now a company is trying to sell you "mortgage protection insurance." What is it and should you buy it? - [Today’s Mortgages Are Not Your Older Sibling’s Mortgages](https://www.thetruthaboutmortgage.com/todays-mortgages-are-not-your-older-siblings-mortgages/): While pundits and fusspots continue to question whether we’re headed for another housing bubble, consider this: The most recent mortgages were among the - [Credit Bureau Experian Launches Real-Time Asset and Income Verification for Mortgages](https://www.thetruthaboutmortgage.com/credit-bureau-experian-launches-real-time-asset-and-income-verification-for-mortgages/): Mortgage lenders have come a long way in the past decade. They used to approve loans without the need for income, asset, or employment documentation, and - [Warren Buffett Just Listed a Home for $11 Million That He Paid $150,000 For](https://www.thetruthaboutmortgage.com/warren-buffett-just-listed-a-home-for-11-million-that-he-paid-150000-for/): At first glance, I’m wondering why he didn’t list it for $10,999,999, but shoot, he probably has a reason. Legendary investor Warren Buffett has finally - [The 5/5 ARM Is an Adjustable-Rate Mortgage for the Faint of Heart](https://www.thetruthaboutmortgage.com/the-55-arm-is-an-adjustable-rate-mortgage-for-the-faint-of-heart/): There’s a popular new loan in town that a lot of credit unions seem to be offering known as the “5/5 ARM,” which essentially replaces the more aggressive - [Pay Down Your Debts Before You Apply for a Mortgage to Increase Purchasing Power](https://www.thetruthaboutmortgage.com/pay-down-your-debts-before-you-apply-for-a-mortgage-to-increase-purchasing-power/): With home prices (and interest rates) on the rise, it’s getting more and more difficult to qualify for a mortgage. One simple strategy you can employ to - [BurkeyLoan: A 120% LTV Mortgage That’s Portable and Can Pay Off Student Loans](https://www.thetruthaboutmortgage.com/burkeyloan-a-120-ltv-mortgage-thats-portable-and-can-pay-off-student-loans/): It sounds like magic, doesn’t it? A mortgage that allows for a loan-to-value ratio as high as 120%, portability, and can be used to pay off student loans. - [Guaranteed Rate Affinity: Another Mortgage Lender and Real Estate Company Link Up](https://www.thetruthaboutmortgage.com/guaranteed-rate-affinity-another-mortgage-lender-and-real-estate-company-link-up/): The mortgage and real estate marriage trend continues, this time with Realogy and Guaranteed Rate joining forces to create a new venture known as - [Chase Wants You to Have a Digital Mortgage Experience](https://www.thetruthaboutmortgage.com/chase-wants-you-to-have-a-digital-mortgage-experience/): While they might be better known for credit cards at this point, Chase also offers mortgages. And now they want to offer digital mortgages, or at least a - [Loftium Offers Mortgage Assistance If You Airbnb Your Extra Bedroom](https://www.thetruthaboutmortgage.com/loftium-offers-mortgage-assistance-if-you-airbnb-your-extra-bedroom/): Here’s a strange one – a new company by the name of Loftium is offering down payment money and “monthly mortgage assistance” if you agree to Airbnb one - [2017 Mortgage Rates Are Expected to Stay in the 4% Range](https://www.thetruthaboutmortgage.com/2017-mortgage-rates-are-expected-to-stay-in-the-4-range/): Before you panic, take comfort in the fact that mortgage rates probably won’t do too much in 2017, just as they haven’t in recent years, despite stark - [Black Knight Is Working on Its Own Mortgage Credit Score](https://www.thetruthaboutmortgage.com/black-knight-is-working-on-its-own-mortgage-credit-score/): Black Knight Financial Services is apparently working on its own “mortgage-specific FICO score” to better determine individual mortgage borrower risk, - [Redfin Mortgage Now Available in 20 States and DC](https://www.thetruthaboutmortgage.com/redfin-mortgage-just-launched/): Whoa. In an unexpected turn of events, online real estate brokerage Redfin has launched a new mortgage service called, you guessed it, “Redfin Mortgage.” - [The Pros and Cons of Trump’s FHA Premium Cut Freeze](https://www.thetruthaboutmortgage.com/the-pros-and-cons-of-trumps-fha-premium-cut-freeze/): You’ve heard the news. President Trump announced a freeze on the expected 25-basis point FHA premium cut just a week or so after it was announced. For - [Would You Rather Have a Low Mortgage Rate or Pay a Lower Price for a Home?](https://www.thetruthaboutmortgage.com/would-you-rather-have-a-low-mortgage-rate-or-pay-a-lower-price-for-a-home/): My friend asked me the other day if I’d rather have a low mortgage rate or pay a lower price for a home. I paused briefly, then said I’d rather pay less - [Mortgage Rates vs. Presidential Inaugurations: Is There a Correlation?](https://www.thetruthaboutmortgage.com/mortgage-rates-vs-presidential-inaugurations-is-there-a-correlation/): Let’s get political – just kidding. Let’s talk about data that involves presidential elections and mortgage rates, more specifically, what happens to - [2017 Mortgage and Real Estate Predictions](https://www.thetruthaboutmortgage.com/2017-mortgage-and-real-estate-predictions/): Well, another year has passed, and not just any year. Some have referred to 2016 as the worst year ever, though I’m a little more optimistic. Anyway, it’s - [Home Prices Rise at Fastest Pace Since 2006](https://www.thetruthaboutmortgage.com/home-prices-rise-at-fastest-pace-since-2006/): Just when you thought things were cooling off, home prices surprised us with yet another killer year. Tomorrow, Zillow will release the November edition - [Fannie and Freddie Launch Flex Modification Program: No Paperwork Required in Some Cases](https://www.thetruthaboutmortgage.com/fannie-and-freddie-launch-flex-modification-program-no-paperwork-required-in-some-cases/): Fannie Mae and Freddie Mac have launched a new loan modification program for troubled mortgages known as “Flex Modification.” In a nutshell, the new - [Fairway Mortgage App: Close Your Mortgage with Your Phone](https://www.thetruthaboutmortgage.com/fairway-mortgage-app-close-your-mortgage-with-your-phone/): Fairway Independent Mortgage Corp. plans to launch a new smartphone app designed to make the home loan process a lot faster (and easier). The company will - [Ally Home Loans: Bank Now Offers Retail Mortgages to Its Customers](https://www.thetruthaboutmortgage.com/ally-home-bank-now-offers-retail-mortgages-to-its-customers/): You may remember GMAC Bank, which was taken down by its fateful mortgage arm Residential Capital (ResCap) before eventually requiring a government - [Caliber Home Loans Unveils Ultimate Homebuying Experience: Close Your Mortgage in 10 Days](https://www.thetruthaboutmortgage.com/caliber-home-loans-unveils-ultimate-homebuying-experience-close-your-mortgage-in-10-days/): Caliber Home Loans out of Irving, Texas wants to close your mortgage faster than anyone else, and thinks it can accomplish the feat in less than 10 days. - [Post-Election Mortgage Rate Surge Crushes Refi Candidates, Puts Home Prices on Watch](https://www.thetruthaboutmortgage.com/post-election-mortgage-rate-surge-crushes-refi-candidates-puts-home-prices-on-watch/): It’s been an eventful three weeks or so since the U.S. presidential election took place, that is, if you keep an eye on mortgage rates. They’ve moved in - [Is the 30-Year Fixed Mortgage Actually a Lot of Work?](https://www.thetruthaboutmortgage.com/is-the-30-year-fixed-mortgage-actually-a-lot-of-work/): I typically refer to the 30-year fixed mortgage as a set-it-and-forget-it type of mortgage because it’s fixed for the entire duration of the loan. The - [Is Now the Time to Slow Down Mortgage Repayment?](https://www.thetruthaboutmortgage.com/is-now-the-time-to-slow-down-mortgage-repayment/): Now that mortgage rates have jumped, it might be time to take a look at how you’re repaying your mortgage. Put simply, if your mortgage rate is fixed and - [President-Elect Trump vs. Mortgage Rates](https://www.thetruthaboutmortgage.com/president-elect-trump-vs-mortgage-rates/): You may have already read the headlines. Things like Trump-fueled Treasury surge and the so-called Trump Effect, all driving mortgage rates higher. And - [SoFi Wants You to Pay Off Your Student Loans with a Mortgage](https://www.thetruthaboutmortgage.com/sofi-wants-you-to-pay-off-your-student-loans-with-a-mortgage/): Often times student loans get in the way of a mortgage because of the tremendous monthly debt, but fintech lender SoFi wants to create the opposite - [HomeBridge Financial to Acquire Prospect Mortgage Loan Platform](https://www.thetruthaboutmortgage.com/homebridge-financial-to-acquire-prospect-mortgage-loan-platform/): HomeBridge Financial Services announced this morning that it plans to acquire the operating assets of Prospect Mortgage, LLC headquartered in Sherman - [FHA Lowers Owner-Occupancy Requirement to 35% for Certain Condos](https://www.thetruthaboutmortgage.com/fha-agrees-to-lower-owner-occupancy-requirement-to-35-for-certain-condos/): Effective immediately, the FHA will lower its owner-occupancy requirement for certain approved condominium complexes to just 35%. That means a given - [Home Purchase Mortgage Volume to Exceed $1 Trillion in 2017](https://www.thetruthaboutmortgage.com/home-purchase-mortgage-volume-to-exceed-1-trillion-in-2017/): Good News for Real Estate Agents The Mortgage Bankers Association (MBA) expects home purchase lending to hit $1.1 trillion next year, per their latest - [Motto Mortgage Looks to Save the Mortgage Broker](https://www.thetruthaboutmortgage.com/motto-mortgage-looks-to-save-the-mortgage-broker/): Today, RE/MAX Holdings announced the launch of a new one-of-a-kind franchised mortgage brokerage known as Motto Mortgage. In a nutshell, the plan is to - [Your Mortgage Is About to Get More Paperless, Finally](https://www.thetruthaboutmortgage.com/your-mortgage-is-about-to-get-more-paperless-finally/): They say the average mortgage application contains some 500 pages, which explains part of the frustration mortgage borrowers feel when going through the - [Plastiq Lets You Charge the Mortgage for a Fee](https://www.thetruthaboutmortgage.com/plastiq-lets-you-charge-the-mortgage-for-a-fee/): A company called Plastiq enables consumers to make payments with their credit cards that might not otherwise be accepted by the recipient. One such - [Check Out the Top 40 Mortgage Lenders in 2015](https://www.thetruthaboutmortgage.com/check-out-the-top-40-mortgage-lenders-in-2015/): If you’re wondering which mortgage company originated the most home loans last year, stop wondering and take a look. Most people know Wells Fargo is king - [Why Your USDA Loan Just Got Cheaper](https://www.thetruthaboutmortgage.com/why-your-usda-loan-just-got-cheaper/): After increasing the price of a USDA-insured mortgage last year, the Rural Housing Service has now slashed the associated fees to make them much more - [Why Don’t More People with High-Rate Mortgages Refinance?](https://www.thetruthaboutmortgage.com/why-dont-more-people-with-high-rate-mortgages-refinance/): If you have a mortgage, you’ve undoubtedly had some company urge you to refinance, especially right now with mortgage rates being as low as they are. And - [Mortgage Lender Offers to Share Servicing Income with Its LOs](https://www.thetruthaboutmortgage.com/mortgage-lender-to-share-servicing-income-with-loan-officers/): A Virginia-based mortgage lender has launched a loan officer compensation plan that provides originators with a piece of the loan servicing fee. - [It's Now Easier to Get a Mortgage Without a Credit Score](https://www.thetruthaboutmortgage.com/its-now-easier-to-get-a-mortgage-without-a-credit-score/): Fannie Mae has rolled out a new version of its automated writing system, known as Desktop Underwriter® (DU®) Version 10.0. The new version has a number of - [See Which Phase of the Housing Cycle Your City Is In](https://www.thetruthaboutmortgage.com/see-which-phase-of-the-housing-cycle-your-city-is-in/): Recently, I wrote about when the next housing crash might take place. For opportunists, it’s something to look forward to. For others, and frankly most - [Morty: The Mortgage Broker 2.0](https://www.thetruthaboutmortgage.com/morty-the-mortgage-broker-2-0/): There’s yet another mortgage disruptor in town, the latest goes by the name of “Morty.” Sounds like a play on the word mortgage...or someone's last name, - [Women Are Better at Paying the Mortgage Despite Worse Terms](https://www.thetruthaboutmortgage.com/women-are-better-at-paying-the-mortgage-despite-worse-terms/): A new study from the Urban Institute reveals that women are better at paying the mortgage despite receiving less favorable terms than men. This despite - [Mortgage Recasting 101: How It Works and What It Does](https://www.thetruthaboutmortgage.com/mortgage-recasting-101-how-it-works-and-what-it-does/): You may have heard that you can lower your monthly mortgage payment without refinancing via a "mortgage recast." These two financial tools are quite - [Permanent HARP Refinance Replacements Have Been Unveiled](https://www.thetruthaboutmortgage.com/permanent-harp-refinance-replacements-have-been-unveiled/): A little over a year ago, I wrote that HARP had received its final extension. I affixed the word “probably” to the end of it because the program kept - [Airbnb Is Reportedly Messing Up Mortgage Applications](https://www.thetruthaboutmortgage.com/airbnb-is-reportedly-messing-up-mortgage-applications/): If you’ve been renting out your own house or condo via Airbnb, or a similar service like HomeAway or FlipKey, you might have more difficulty securing a - [Zillow: Homes Would Be Worth More Without the Housing Bubble](https://www.thetruthaboutmortgage.com/zillow-homes-would-be-worth-more-without-the-housing-bubble/): A new analysis from Zillow reveals that many homes would actually be worth a lot more today had there been no housing bubble back in the early 2000s. The - [Quicken Loan’s 1% Down Mortgage Program](https://www.thetruthaboutmortgage.com/quicken-loans-1-down-mortgage-program/): It seems just about everyone is lowering mortgage down payment requirements to deal with rising home prices, this despite the near-record low mortgage - [Mortgage Origination Volume Expected to Hit $2 Trillion This Year](https://www.thetruthaboutmortgage.com/mortgage-origination-volume-expected-to-hit-2-trillion-this-year/): While many expected the mortgage market to cool off this year thanks to both rising home prices and higher mortgage rates, the complete opposite seems to - [Buy a Home in a Good School District Even If You Don’t Have or Want Kids](https://www.thetruthaboutmortgage.com/buy-a-home-in-a-good-school-district-even-if-you-dont-have-or-want-kids/): Over the years, we’ve learned that buying homes near certain types of businesses can boost the value quite substantially. For example, homes near - [This Blog Is 10 Years Old Today: What’s Different Today in the Mortgage Industry?](https://www.thetruthaboutmortgage.com/this-blog-is-10-years-old-today-whats-different-today-in-the-mortgage-industry/): A week or so ago, I was scanning through my archived posts and it occurred to me that my blog's 10-year anniversary was just days away. I found the first - [New Guaranteed Rate Double Match Mortgage Gives You 2% of the Down Payment for Free](https://www.thetruthaboutmortgage.com/new-guaranteed-rate-double-match-mortgage-gives-you-2-of-the-down-payment-for-free/): No it’s not déjà vu, or Groundhog Day. Guaranteed Rate has launched yet another 1% down payment mortgage in the span of about a month. However, their new - [Time Heals All Real Estate Wounds If You Let It](https://www.thetruthaboutmortgage.com/time-heals-all-real-estate-wounds-if-you-let-it/): Let’s talk about real estate investment for a moment. A recent commentary from mortgage financier Freddie Mac revealed that those aged 54 and older --- # # Detailed Content ## Pages > A "conforming mortgage" is a home loan with a loan amount up to $806,500 that also meets the underwriting guidelines set forth by Fannie Mae and Freddie - Published: 2025-03-19 - Modified: 2025-03-19 - URL: https://www.thetruthaboutmortgage.com/conforming-mortgage-loans/ A "conforming mortgage" is a home loan with a loan amount up to $806,500 that also meets the underwriting guidelines set forth by Fannie Mae and Freddie Mac. This maximum loan amount is up from $766,550 in 2024 after increasing from $726,200 in 2023. It typically adjusts each year in January, as long as property values increase, based on home price movement during the year prior. Aside from adhering to maximum loan amounts, conforming loans generally require a minimum FICO score of 620 from all borrowers. They are the most common type of mortgage, accounting for around half of all home loans originated. Conforming Home Loan Requirements Must meet underwriting guidelines set by Fannie Mae or Freddie Mac Including a minimum credit score (generally 620 FICO or higher) And a maximum debt-to-income (DTI) ratio of 43% Home buyers can obtain a loan with as little as 3% down payment Income, assets, and employment will be evaluated for loan approval Loan amount must be at/below the conforming loan limit As noted, conforming home loans adhere to underwriting standards set by Fannie Mae and Freddie Mac. This includes credit and income requirements, such as a minimum 620 FICO score and full doc underwriting, which considers income, assets, and employment history. A maximum DTI ratio of 43% is permitted, though ratios up to 50% may be allowed with compensating factors. Both home buyers and those refinancing an existing mortgage can get a mortgage for up to 97% loan-to-value (LTV). Conforming loans are subject... --- > See current mortgage rates and learn about the many factors that drive them higher and lower so you can get a better rate. - Published: 2025-03-13 - Modified: 2025-07-10 - URL: https://www.thetruthaboutmortgage.com/what-causes-mortgage-interest-rates-to-move/ The Mortgage Rates Puzzle A lot of factors go into determining your mortgage rate Things like credit score are huge (if not the most important) As are down payment, property type, and transaction type (refi vs. purchase) Along with any points you're paying to obtain said rate The state of the economy will also come into play This means there are some things you can control, and others you cannot If you do a web search for “mortgage rates” you’ll likely see a list of interest rates from a variety of different banks and lenders. Unfortunately, this won’t tell you much without actually knowing why the rates are what they are and if they’re actually available to YOU. It’s really just a bunch of numbers on a page. Shouldn’t you know how lenders come up with them before you start shopping for a home loan and buying real estate? Simply put, the more you know, the better you'll be able to negotiate! Or call out the nonsense... Many homeowners tend to just go along with whatever their bank or mortgage broker puts in front of them, often without researching mortgage lender rates or inquiring about how it all works. Whether you’re interested in rates or not, it’s wise to get a better understanding of how mortgage rates move and why. One of the most important aspects to successfully obtaining a mortgage is securing a low interest rate. After all, the lower the rate, the lower the mortgage payment each month.... --- > An age old question: "Which mortgage is right for me?" When shopping for a home loan, whether it’s a new purchase-money mortgage or a refinance, knowing - Published: 2025-03-11 - Modified: 2025-03-21 - URL: https://www.thetruthaboutmortgage.com/which-mortgage-is-right-for-me/ An age old question: "Which mortgage is right for me? " When shopping for a home loan, whether it’s a new purchase-money mortgage or a refinance, knowing which loan type to pick and why is absolutely paramount. After all, the choice you make today will affect your checkbook for years to come. Possibly even 30. So it’s important to put some thought behind your decision. Yes, it will involve a mortgage calculator, research, note taking, and not least of which, your precious time. We're not shopping for a microwave here folks. We're talking about one the bigger financial decisions of your life. Lots of Mortgage Options: There are countless mortgage types to choose from — conventional, conforming, FHA, VA, USDA, jumbo, fixed-rate (FRM), adjustable-rate (ARM), and more. The "right mortgage" depends on individual financial circumstances and goals. Or even what you qualify for. It's a Personal Choice: No one-size-fits-all mortgage exists. An FHA loan might be suitable for a low-credit score home buyer, while VA loans benefits military/veterans, USDA loans are great for rural areas, and ARMs appeal to wealthy home buyers (or those looking to refi/sell soon thereafter). Key Factors to Consider: Choosing the right mortgage involves assessing your credit scores, down payment, income, debt-to-income (DTI) ratio, property type, and how long you plan to stay in the home (and with the loan). The Decision Might Be Made for You: For example, if your FICO score is below 620, you might have no choice but to go with an... --- > A cash-out refinance is a home loan where the borrower takes out additional cash beyond the amount of the existing loan balance. It can be used for things like home improvements, to pay for college tuition, or to pay off credit cards. - Published: 2025-03-06 - Modified: 2025-03-06 - URL: https://www.thetruthaboutmortgage.com/cash-out-refinance/ Let's talk mortgage basics. There are two main types of mortgage refinances available to homeowners. There is the standard rate and term refinance, which allows a borrower to obtain a lower mortgage rate and/or shorten their loan term, while keeping their existing loan balance intact. And then there is the "cash-out refinance," which allows a borrower to tap into the equity (or cash) in their home. Cash Out Refinance 101: Key Takeaways Definition: A cash-out refinance is a mortgage transaction where you borrow more than your current loan balance and receive the proceeds in cash for purposes such as home improvements, debt consolidation, or other expenses. How it works: Replaces your existing mortgage with a larger loan, paying off the outstanding balance and leaving you with the difference in cash, minus closing costs. Larger mortgage balance: The new loan will be larger than the original one, often leading to higher monthly payments unless you can secure a lower interest rate and/or extend the loan term. Equity required: You need sufficient home equity (typically at least 20% after the refinance) to qualify for a cash-out refinance, as lenders cap the loan-to-value (LTV) ratio at 80% for conforming loans. Potential benefits: Provides a lump sum of cash at a low interest rate (relative to other options), and if rates drop in the process, you could lower your mortgage interest rate too, making it a "home run. " Flexibility of funds: Cash can be used for anything, including home renovations, college tuition, paying... --- > Unless you live under a rock (like I do), you've probably heard the term "mortgage broker" get thrown around on more than one occasion. You may have heard - Published: 2025-02-27 - Modified: 2025-02-27 - URL: https://www.thetruthaboutmortgage.com/what-is-a-mortgage-broker/ Unless you live under a rock (like I do), you've probably heard the term "mortgage broker" get thrown around on more than one occasion. You may have heard good things, and you may have heard bad things... Opinions aside, a mortgage broker is an intermediary that works between the borrower and the bank to help the former obtain home loan financing. Instead of contacting a retail bank or mortgage lender directly, you have the option of enlisting a broker instead, who will act as your liaison and loan guide. Brokers can help you apply for a mortgage and do most of the heavy lifting along the way, whether it be a home purchase loan or a mortgage refinance. Key Points About Mortgage Brokers A mortgage broker acts as an intermediary connecting borrowers with lenders Differs from captive loan officers who work directly with one single bank Brokers shop third-party lenders on your behalf to find competitive rates (so you don't have to) Can also provide expert guidance for tricky loans and access to diverse loan options They handle the application, loan processing, and lender coordination to simplify the process Paid via lender compensation (e. g. 1-2% of loan amount) or directly via borrower (your choice) Studies suggest brokers can secure lower rates (or lower costs) but your experience may vary Possible bias toward lender partners that offer higher commissions so you need to shop brokers too! Jump to mortgage broker topics: - How does a mortgage broker work? - Comparison... --- > A par rate loan doesn't require the payment of discount points, nor does it come with lender credits. - Published: 2025-02-26 - Modified: 2025-02-26 - URL: https://www.thetruthaboutmortgage.com/mortgage-dictionary/par-rate-loan/ In the mortgage world, the "par rate" is the mortgage rate a borrower qualifies for assuming there is no interest rate manipulation of any kind. This means no discount points should be paid by the borrower to get a below-market rate. And there should not be a lender credit OR lender-paid compensation, as either would push the interest rate above the true market price. This par mortgage rate, otherwise known as the base rate, is also determined by a borrower’s particular loan scenario. It may include mortgage pricing adjustments for things such as loan amount, credit score, property type, loan-to-value ratio, and so on. As such, a high-risk borrower will have a higher par rate than a low-risk borrower because of said adjustments. Let’s look at an example of a par mortgage rate: - 6. 5% = -1. 00 - 6. 25% = -0. 50 - 6% = 0. 00 (par rate) - 5. 75% = 0. 50 In the example above, we see a list of mortgage interest rates with corresponding fees or rebates. Let's pretend the loan amount is $500,000. On the surface, a rebate is a good thing because it means you get a credit toward your closing costs. For example, -1. 00 for a rate of 6. 5% means you get 1% of the loan amount in money back, or $5,000. That money could be used to pay the lender and/or other third-party costs. However, it also means the interest rate is higher than par as... --- > Compare today's mortgage rates from dozens of banks, lenders, and credit unions. - Published: 2025-02-19 - Modified: 2025-03-11 - URL: https://www.thetruthaboutmortgage.com/todays-mortgage-rates/ As I often say around here, it’s important to compare mortgage rates to ensure you receive favorable pricing on your home loan. The table below contains today’s mortgage rates from a variety of local and national home loan lenders, along with select banks and credit unions. Your rate and payment can greatly affect your home buying decision, so it’s something that should be taken very seriously. iFrameResize({ log: false, checkOrigin: false }, '#bbm_widget') Why It’s Important to Compare Mortgage Rates Actual studies have proven that those who obtain more than one mortgage quote can save money Getting just a second quote can produce savings between $966 and $2,086 And 5+ quotes may result in average expected savings of nearly $3,000 over the loan term Aside from saving money, it’s important to use a competent mortgage lender that can successfully close your loan with few hiccups If you only gather a single mortgage rate quote, which many individuals seem to do, especially first-time home buyers, you won’t know if it’s good or bad relative to what else is out there. This isn’t just casual advice – there are studies (Freddie Mac) that prove those who gather more than one mortgage quote actually save money on their home loan. And not just a little, potentially thousands via years of lower monthly payments! While mortgages are mostly a commodity (similar if not the same product from lender to lender), the mortgage rates they offer can vary for one reason or another, just like... --- > You might be wondering what the point of this website is. Many websites sell a product or offer a service. I don’t sell anything nor do I offer any sort - Published: 2024-08-09 - Modified: 2024-08-09 - URL: https://www.thetruthaboutmortgage.com/mission-statement/ You might be wondering what the point of this website is. Many websites sell a product or offer a service. I don’t sell anything nor do I offer any sort of paid service. Instead, I just write about mortgages. And I’ve been doing it for the past 20 years (almost! ). The reason I created this website is simple: to help consumers better understand how mortgages work. That’s it. Plain and simple. That’s still the main goal and raison d'être. “Your guide to a smarter home loan. ” I want visitors to walk away (or click away) knowing more about mortgages than when they arrived. And ideally make more informed choices when dealing with real estate agents, loan officers, and brokers when buying a home or refinancing their loan. As noted on my about me page, I used to work in the mortgage industry as an Account Executive for a wholesale mortgage lender. While employed there, I learned a ton about the business, gained invaluable experience, and also discovered that many people were asking a lot of questions about how it all worked. That led to the creation of TheTruthAboutMortgage. com in 2006, just before the housing market happened to tank. Good timing I know. I began writing about types of mortgages, mortgage terminology, how-to articles, and general mortgage tips I thought would be useful. Today, that’s what I still do on this site. In fact, not a whole lot has changed in that regard. Just new topics and ideas... --- > First a brief history. I created The Truth About Mortgage all the way back in 2006. My mission statement continues to be helping prospective home buyers - Published: 2024-07-02 - Modified: 2024-08-09 - URL: https://www.thetruthaboutmortgage.com/editorial-standards/ First a brief history. I created The Truth About Mortgage all the way back in 2006. My mission statement continues to be helping prospective home buyers and existing homeowners navigate the home loan process. One day at work in the early 2000s, the thought came to me. At the time, I was employed by a mortgage lender and often heard the same questions being asked over and over again. I realized there wasn't a good place to find basic information on mortgages. That was my lightbulb moment to take what I knew and share it with the world. And hopefully avoid hearing the same questions get asked more than once! Over the years, I have crafted thousands of pages of content focused solely on mortgages, home buying, and the housing market. And in the process, The Truth About Mortgage has become one of the top resources on the internet with millions of visits. I am fully dedicated to demystifying mortgages and that is what you will find when exploring my website. My Editorial Process and Quality Standards Knowing mortgages are a very important and complex subject, I have carefully and tirelessly created the content on this site to ensure it is of the utmost quality. That means being accurate, thorough, honest, remaining objective (despite having opinions that I openly share), and simply ensuring it’s helpful. And perhaps most importantly, getting information direct from the source, whether it’s Fannie Mae, Freddie Mac, the FHA, the VA, or private companies like First... --- > If you’re still determining if it’s time to move on from renting to homeownership, you may want to do the math with the "rent vs. buy calculator" below to - Published: 2018-03-07 - Modified: 2019-11-19 - URL: https://www.thetruthaboutmortgage.com/rent-vs-buy-calculator/ If you’re still determining if it’s time to move on from renting to homeownership, you may want to do the math with the "rent vs. buy calculator" below to calculate the costs. I understand that the rent or buy question is not just a financial decision, but as we all know, money does have a lot to do with. As I once pointed out, there are many reasons to buy a home beyond the investment. So be sure to consider all factors, both financial and personal (and emotional) before you dive in. // Developers: If you should have any questions or concerns // regarding the use of this script, please call // TimeValue Software Support at 800-426-4741 TEMPLATE_ID = "WWW. THETRUTHABOUTMORTGAGE. COM_1"; CALCULATORID = "HF05"; PASSTHROUGH = ""; HIDEFORMTAG = ""; TVCMOBILE = ""; ACCORDIANINPUT = ""; if (document. location. href. substring(0,5) == "https") { URL = "https://"; } else { URL = "https://";} URL += "www. TimeValueCalculators. com/timevaluecalculators/includes/calculators_script. js"; scriptTag = 'SCRIPT '; languageAttr = 'LANGUAGE="JavaScript" '; srcAttr = 'SR' + 'C="' + URL + '" '; //split for DNN typeAttr = 'TYPE="text/javascript" '; document. write(''); How to Use the Rent vs. Buy Calculator I’ll be the first one to admit that this mortgage calculator is a little complex, but then so is home buying. You aren’t buying a toaster, after all. And you’re not applying for a credit card. You’ll probably need a big old mortgage on your dream home. Most real estate will set you back at... --- > One of the most important things you can do when shopping for real estate is determine how much mortgage you can afford (assuming you aren’t paying - Published: 2018-02-21 - Modified: 2019-11-19 - URL: https://www.thetruthaboutmortgage.com/mortgage-affordability-calculator/ One of the most important things you can do when shopping for real estate is determine how much mortgage you can afford (assuming you aren’t paying all-cash). The best way to do this is with a mortgage calculator, not a bar napkin. After all, if you don’t know what you can actually afford to spend, you could be in a for a rude awakening when it comes time to apply for a mortgage. Or you might just waste a lot of your time. In reality, you probably won’t get that far without at least getting a mortgage pre-approval. Real estate agents won’t take you seriously, and home sellers likely won’t give you the time of day. Use a Mortgage Affordability Calculator as a Starting Point Before you start perusing real estate listings Use an affordability calculator to determine if homeownership Makes sense financially and is within reach Then you can look into a pre-qual or pre-approval to fine-tune the numbers and make sure all red flags are addressed The mortgage affordability calculator below can give you a head start in front of other prospective home buyers competing for the same property. // Developers: If you should have any questions or concerns // regarding the use of this script, please call // TimeValue Software Support at 800-426-4741 TEMPLATE_ID = "WWW. THETRUTHABOUTMORTGAGE. COM_1"; CALCULATORID = "HF08"; PASSTHROUGH = ""; HIDEFORMTAG = ""; TVCMOBILE = ""; ACCORDIANINPUT = ""; if (document. location. href. substring(0,5) == "https") { URL = "https://"; } else {... --- > Wondering if it makes sense to refinance your mortgage? Check out the refinance calculator below to determine the potential savings (or lack thereof). - Published: 2018-02-20 - Modified: 2019-11-19 - URL: https://www.thetruthaboutmortgage.com/refinance-calculator/ Wondering if it makes sense to refinance your mortgage? Check out the refinance calculator below to determine the potential savings (or lack thereof). Believe it or not, it doesn't always make sense to a refinance a home loan, even if mortgage interest rates are stellar. One must consider the cost to refinance, along with the expected tenure in the property. If you plan on staying put in the home for life, you still must determine if the loan is a keeper long term or just for a little while. Let this calculator do the heavy lifting so you don't have to. It's probably better that you do the calculations as opposed to an interested party, who only gets paid when you refinance! // Developers: If you should have any questions or concerns // regarding the use of this script, please call // TimeValue Software Support at 800-426-4741 TEMPLATE_ID = "WWW. THETRUTHABOUTMORTGAGE. COM_1"; CALCULATORID = "HF01"; PASSTHROUGH = ""; HIDEFORMTAG = ""; TVCMOBILE = ""; ACCORDIANINPUT = ""; if (document. location. href. substring(0,5) == "https") { URL = "https://"; } else { URL = "https://";} URL += "www. TimeValueCalculators. com/timevaluecalculators/includes/calculators_script. js"; scriptTag = 'SCRIPT '; languageAttr = 'LANGUAGE="JavaScript" '; srcAttr = 'SR' + 'C="' + URL + '" '; //split for DNN typeAttr = 'TYPE="text/javascript" '; document. write(''); How to Use the Refinance Calculator To start, enter your original loan amount when you first took out your mortgage (not your current lower loan amount) and the original loan term. For example,... --- > If you own real estate and are considering making extra mortgage payments, the "early mortgage payoff calculator" below could be helpful in determining - Published: 2018-02-20 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/early-mortgage-payoff-calculator/ If you own real estate and are considering making extra mortgage payments, the "early mortgage payoff calculator" below could be helpful in determining how much you'll need to pay and when to meet a certain financial goal. Put simply, it's a standard mortgage calculator with extra payments built-in, so it's really easy to use. But also very powerful. You input your original mortgage amount and can quickly see what paying extra will do in terms of both interest savings and shaving years off your mortgage. Use the Early Mortgage Payoff Calculator to Determine the Actual Savings This calculator will illustrate the potential savings Of paying off your home loan ahead of schedule Knowing the actual numbers can help you determine if it makes sense To make extra payments based on your financial goals For example, if you're interested in paying off your mortgage off in 15 years as opposed to 30, you generally need a monthly payment that is 1. 5X your typical mortgage payment. So if you're currently paying $1,000 per month in principal and interest payments, you'd have to pay roughly $1,500 per month to cut your loan term in half. Of course, that's just a ballpark estimate. It will depend on the mortgage rate and the loan balance. This early payoff calculator will also show you how much you can save in interest by making larger mortgage payments. You might be surprised at the potential savings, but be sure to consider where you'd put that money elsewhere.... --- > If you're looking for a basic mortgage payment calculator, you've come to the right place. The mortgage rate calculator below will give you the monthly - Published: 2018-02-20 - Modified: 2025-03-06 - URL: https://www.thetruthaboutmortgage.com/mortgage-payment-calculator/ If you're looking for a basic mortgage payment calculator, you've come to the right place. The mortgage rate calculator below will give you the monthly principal and interest payment after inputting just a little bit of information. This can come in handy if you find other loan calculators too complex, or just want to run some quick loan scenarios. It also doubles as a mortgage amortization calculator if you tick the "Show payment schedule" box. So you'll be able to view the entire amortization table as well. A Simple and Easy to Use Mortgage Payment Calculator This calculator will quickly compute a monthly mortgage payment Including principal and interest only (not incl. taxes/insurance/PMI) Useful if you're considering a refinance and want to know the monthly savings Or if you want to calculate payments for a potential home purchase // Developers: If you should have any questions or concerns // regarding the use of this script, please call // TimeValue Software Support at 800-426-4741 TEMPLATE_ID = "WWW. THETRUTHABOUTMORTGAGE. COM_1"; CALCULATORID = "HF02"; PASSTHROUGH = ""; HIDEFORMTAG = ""; TVCMOBILE = ""; ACCORDIANINPUT = ""; if (document. location. href. substring(0,5) == "https") { URL = "https://"; } else { URL = "https://";} URL += "www. TimeValueCalculators. com/timevaluecalculators/includes/calculators_script. js"; scriptTag = 'SCRIPT '; languageAttr = 'LANGUAGE="JavaScript" '; srcAttr = 'SR' + 'C="' + URL + '" '; //split for DNN typeAttr = 'TYPE="text/javascript" '; document. write(''); How to Use the Mortgage Payment Calculator For a home purchase enter the price and down payment... --- > When you see or hear the acronym “USDA,” the first image that probably comes to mind is a big, juicy steak. As in, USDA Prime or Choice. But the U.S. - Published: 2016-06-15 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/usda-home-loans-eligibility-and-program-requirements/ When you see or hear the acronym “USDA,” the first image that probably comes to mind is a big, juicy steak. As in, USDA Prime or Choice. But the U. S. Department of Agriculture isn’t just in the farming business... They also run a pretty substantial home loan program that offers mortgage financing with zero money down. These "USDA loans" are offered to home buyers throughout the country who purchase properties in so-called "rural areas. " What Is a USDA Home Loan? A government home loan that provides 100% financing to home buyers Available to borrowers in rural areas throughout the United States Must have a household income at/below a certain threshold to qualify Offered by private sector banks and lenders on behalf of the USDA A USDA home loan is a government-backed mortgage that allows home buyers to purchase a property in a rural region of the United States with no down payment. It is overseen and managed by the USDA Rural Development (RD) division, whose mission is to promote homeownership in order to create thriving communities and improved quality of life in rural areas. Since program inception in 1991, the USDA Single Family Housing Guaranteed Loan Program has helped roughly 2 million low-to-moderate income residents realize the dream of homeownership. At first glance, a USDA loan (also known as a rural development loan or an RD loan) might not seem like the right fit for you and your real estate needs. But the program actually has fairly high... --- > A “purchase money mortgage” is a home loan used to purchase a piece of property, whether it be a principal residence, a second home, or an investment - Published: 2010-11-11 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/purchase-money-mortgage/ A “purchase money mortgage” is a home loan used to purchase a piece of property, whether it be a principal residence, a second home, or an investment property. If you're looking to buy a home, you'll generally need to apply for a purchase money mortgage to obtain financing, unless of course, you plan to pay with cash. Most of us aren't lucky enough to have the necessary amount of funds on hand to buy a home outright, so we must turn to a bank or mortgage lender for financing. Purchase Money Mortgage Loans Are Easier to Qualify For Purchase mortgages have the most flexible underwriting guidelines Including the highest LTV limits available And the lowest credit score requirements Home purchase interest rates may also be cheaper than refinance rates The good thing about home purchase loans is that they generally come with the most flexible mortgage underwriting guidelines relative to refinance loans. In other words, you'll be able to borrow the most amount of money at the highest loan-to-value ratio (LTV ratio) if the purpose of the loan is a home purchase. For example, the FHA allows home purchase financing with as little as 3. 5% down, and specialty programs such as Fannie Mae's HomeReady program only require 3% down, with gifts or grants permitted to cover the small down payment. You can also get USDA loans and VA loans with no money down. Conversely, those looking to pull equity from their homes via a cash-out refinance may be limited... --- > A “balloon mortgage” is a home loan that does not fully amortize over the life of the loan, leaving a large balance at the end of the shortened term. What - Published: 2010-10-04 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/balloon-mortgage/ A “balloon mortgage” is a home loan that does not fully amortize over the life of the loan, leaving a large balance at the end of the shortened term. What Is a Balloon Mortgage? It's like a standard home loan In that you make principal and interest payments each month Based on a 30-year amortization (or similar) But differs in that the loan is due in full in just a fraction of the time Put simply, monthly mortgage payments are based on a typical 30-year loan term, but the loan itself is due in full after just five or seven years, instead of 30. As a result, the final payment on a balloon mortgage will be significantly larger than the regular monthly mortgage payments. Of course, most borrowers expect to either refinance before the balloon mortgage term ends, or sell the associated property. So the final payment likely won't even come into play in the real world. Let's look at an example of a balloon mortgage: 7-Year Balloon Mortgage Interest Rate: 5. 00% Amortization: 30 Years Loan Amount: $250,000 In the above scenario, the monthly mortgage payment would be $1,342. 05 per month, which is the same exact amount as a standard 30-year fully-amortizing payment. This monthly payment would remain in effect for the first 84 months, leaving a remaining balance of $221,204. 98 left over at the end of the seven-year term. This outstanding balance is the balloon mortgage payment that is due in full after seven years. It... --- > I think it goes without saying that everyone with a mortgage (or thinking about getting one) wants the lowest interest rate possible. After all, who - Published: 2010-08-17 - Modified: 2024-03-16 - URL: https://www.thetruthaboutmortgage.com/mortgage-discount-points/ I think it goes without saying that everyone with a mortgage (or thinking about getting one) wants the lowest interest rate possible. After all, who wouldn't want to save money each month for the next 30 years or so of their life? Remember, this isn't a one-off purchase, it's a decision that will affect your pocketbook month after month for the foreseeable future. So getting the pricing right is imperative. Let's say you qualify for a mortgage at a rate of 5%, but you're not happy with the rate. Assuming any attempt to negotiate your mortgage rate lower fails, you do have another option. What are mortgage discount points? Discount points are a form of prepaid interest Instead of paying more interest monthly via a higher interest rate You pay more at closing in one lump sum In exchange for a lower interest rate for the life of the loan That brings us to the topic of “mortgage discount points,” which can be paid at closing to reduce your mortgage rate. Simply put, you have the option to pay a percentage of the loan amount, also known as a mortgage point, to lower your interest rate by a certain amount. For the record, the ratio of points to rate discount is never perfectly proportional. So I can't tell you that one discount point will equate to a . 25% reduction in rate. It always varies. But I can mention that discount points are considered a form of prepaid interest because... --- > Mortgage Q&A: “How to get a mortgage?” If you already know what a mortgage is, you may be wondering how to obtain one. To refresh your memory, a - Published: 2010-04-27 - Modified: 2024-05-26 - URL: https://www.thetruthaboutmortgage.com/how-to-get-a-mortgage/ Mortgage Q&A: “How to get a mortgage? ” If you already know what a mortgage is, you may be wondering how to obtain one. To refresh your memory, a mortgage is just another way of saying a home loan. Of course, mortgages serve different purposes – some are used to purchase a home and others are used to refinance an existing mortgage. You may even open a second mortgage behind an existing first mortgage to tap into the equity of your home (e. g. a home equity line of credit). It's important to have a basic understanding of mortgages before you set out to get one, just like anything else you might shop for. If you're more knowledgeable on the subject, chances are you'll secure a lower rate and choose a more suitable loan product that fits your needs. Let's discuss what the process might look it. First Educate Yourself on Mortgages Always start by educating yourself on the topic at hand This includes understanding how real estate works and if it's right for you Far too many people rush into homeownership without grasping the basics Take the time to research both mortgages and real estate before diving in I've made this plea countless times because I feel like not enough time is devoted to education on personal finance. If you're putting in hours to research a new big screen TV, don't you think a mortgage decision deserves days, if not weeks of research? The interest rate you receive on... --- > A “short refinance” is a transaction in which your bank or mortgage lender agrees to pay off your existing mortgage and replace it with new a loan with a - Published: 2010-02-09 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/what-is-a-short-refinance/ A “short refinance” is a transaction in which your bank or mortgage lender agrees to pay off your existing mortgage and replace it with new a loan with a reduced balance, essentially helping you avoid foreclosure. In that sense, it's more a loss mitigation tool than it is a standard refinance loan. It benefits both the bank and the homeowner, as the bank ideally loses less than they would via foreclosure, and the homeowner gets to stick around in their property. A Short Refinance to Save Your Home A short refinance may allow you to keep your home Even if you can't afford your existing mortgage(s) The lender provides a principal reduction That lowers your monthly mortgage payments to affordable levels A short refinance is a cross between a short sale, which involves selling your home for less than the existing lien(s), and a rate and term refinance, where you replace an old loan with a new one. So why would someone want to execute a short refinance anyway? Well, if property values plummet, and millions of homeowners are upside down on their mortgages, meaning they owe more on their home loan(s) than the property is worth. Short Refinance Example Purchase price: $500,000 Mortgage balance: $450,000 Current home value: $400,000 Short refinance loan amount: $380,000 Forgiven debt: $70,000 In the above scenario, the homeowner wouldn't be able to refinance without bringing in at least the $50,000 difference between current appraised value and existing mortgage balance. In reality, the homeowner would... --- > Mortgage Q&A: "Pre-Qualification vs. Pre-Approval" When you initially set out to purchase a new home, the real estate agent(s) and home seller will - Published: 2010-02-09 - Modified: 2024-05-23 - URL: https://www.thetruthaboutmortgage.com/pre-qualification-vs-pre-approval/ Mortgage Q&A: "Pre-Qualification vs. Pre-Approval" When you initially set out to purchase a new home, the real estate agent(s) and home seller will want to know you can actually afford the thing. Heck, you should want to know too. After all, if you can't afford to buy it, you'll be wasting everyone's time, including your own. Aside from affordability concerns, you may find other issues that disqualify you from obtaining a mortgage (do I qualify for a mortgage? ). And these issues aren't always obvious, especially to the first-time home buyer who has never obtained a home loan before. You might think you're good to go, but because of the nuanced and ever-changing mortgage landscape, it's better to know for sure. You Won't Get Very Far Without a Mortgage Pre-Approval... As noted, real estate agents and home sellers will want to be certain that you're committed to buying a home, as opposed to those just casually browsing, so they don't miss out on a legitimate buyer in the process. After all, if it's between you and another qualified buyer, and they pick you, without knowing you can obtain a mortgage, it'll be a tough sell to go back to that other buyer after the fact. They'll lose a lot of leverage, assuming that other buyer sticks even around. For these reasons, most real estate agents will demand that you get pre-approved for a mortgage loan before they even begin showing you potential properties. Additionally, most agents have a preferred mortgage... --- > Mortgage Q&A: “What is title insurance?” When you apply for a mortgage, keep in mind you'll need to pay a number of closing costs, including a variety - Published: 2010-01-26 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-is-title-insurance/ Mortgage Q&A: “What is title insurance? ” When you apply for a mortgage, keep in mind you'll need to pay a number of closing costs, including a variety of insurance policies to protect the underlying asset, your home. A charge you may have overlooked is title insurance, though it's often one of the largest costs associated with taking out a home loan. As the name suggests, it is a cost associated with and paid to an insurance company, not the mortgage lender. That makes it a third-party fee, and a costly one at that. On the Loan Estimate (LE) disclosure you receive, you'll see it under Section C of Loan Costs, labeled, "Services You Can Shop For. " In other words, you are able to and encouraged to shop around for title insurance, though my assumption is most homeowners just go with the company recommended to them. To make matters even more complicated, there are two types of title insurance policies you may need when you take out a home loan. There is lender's title insurance and owner's title insurance. Let's explore both in depth so you better understand what you're buying here. Lender's Title Insurance Is a Must If You Have a Mortgage There are two types of title insurance The lender's title insurance policy is required when you take out a mortgage It protects the bank/lender from any lawsuits or claims That arise from the chain of title on the subject property If you take out a mortgage... --- > Mortgage Q&A: “What do mortgage lenders look for?” Most banks and mortgage lenders are looking for the same basic thing when they review your - Published: 2009-10-06 - Modified: 2024-01-20 - URL: https://www.thetruthaboutmortgage.com/what-mortgage-lenders-look-for/ Mortgage Q&A: “What do mortgage lenders look for? ” Most banks and mortgage lenders are looking for the same basic thing when they review your financials; your ability to repay the home loan. After all, as long as you make your mortgage payments on time each month, there isn't much else for them to worry about. You hold up your end of the bargain and they'll be more than happy to extend financing. Keep in mind that this differs from the priorities of some loan originators, who are more concerned with your ability to qualify for a loan (so they can get paid a commission), as opposed to actually being able to afford it. Lenders want to make money as well, but not by writing bad loans. And they certainly don't want to let any fraudulent activity make its way through their doors. Here are some useful tips to help you boost your odds of mortgage approval. Pinpoint Potential Red Flags Before the Mortgage Lender Does A home loan application is kind of like a job interview You only get one chance to make a good first impression Make sure you take a hard look at all your financials before the lender does This will allow you to resolve anything beforehand and avoid any major missteps Think of a home loan application like a job interview. You want to put your best foot forward. You also only get one chance to make a first impression, so make it a good... --- > As of 2024, there are lots of options to get a mortgage with no money down, which is surprising given the devastating financial crisis that took place - Published: 2009-08-25 - Modified: 2024-01-25 - URL: https://www.thetruthaboutmortgage.com/mortgages-with-no-money-down/ As of 2024, there are lots of options to get a mortgage with no money down, which is surprising given the devastating financial crisis that took place just over a decade ago. The housing crash in 2008 forced lenders to require larger down payments because home prices plummeted and borrowers simply walked away. Simply put, if homeowners don’t have any skin in the game, otherwise known as home equity, there’s a better chance they’ll walk away from their homes if they fall behind on payments, leading to costly foreclosures. Conversely, if a borrower is required to put down say 10% of the purchase price, the lender has a safety buffer, and the homeowner is more likely to continue making payments, as they won’t want to lose that initial investment. Despite this logic, underwriting guidelines have since loosened and there are countless home loan programs that require zero down payment. The two most common zero-down mortgages are VA loans and USDA loans, though both have limitations that I'll discuss below. There are also zero down options available on conventional loans, typically facilitated via a gift or grant. No Money Down Mortgages Used to Be the Norm It used to be common to buy a home with nothing down But the mortgage crisis changed that in a hurry Now many borrowers are required to bring in a minimum of 3% or 3. 5% down Though no down payment mortgages still exist Back in 2006 and 2007, you could easily obtain 100 percent... --- > Since the mortgage crisis took flight, “loan modification programs” have become all the rage. Instead of originating new loans, former mortgage brokers - Published: 2009-03-08 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/loan-modification-programs/ Since the mortgage crisis took flight, “loan modification programs” have become all the rage. Instead of originating new loans, former mortgage brokers and loan officers are shifting focus to rework outstanding loans that have fallen behind in payments or are in danger of doing so. Ironically, many are getting paid to reverse the damage they caused to begin with. In the past couple years, millions of borrowers have fallen behind on their monthly mortgage payments, creating an unprecedented foreclosure epidemic. And because home prices are falling, many are seeing their home equity sucked dry or even worse, finding themselves underwater on their mortgages. This environment has forced banks and mortgage lenders to begin modifying loans in an effort to recoup losses and prevent foreclosures, which puts even more downward pressure on home prices. Things have become so dire that a number of banks have initiated their own proprietary streamlined loan modification programs to complement their standard loss mitigation efforts. There are also foreclosure prevention coalitions, such as Hope Now, which provide free assistance to struggling homeowners through a streamlined process using existing loss mitigation tools. So now that we have a little background, let’s take a look at some of the most common loan modification options available to at-risk borrowers. Mortgage Repayment Plan Used to get borrowers back on track if they fall behind on payments By adding portion of unpaid balance to monthly payments Until borrower is current on their home loan again A repayment plan is one the... --- > So, "what caused the mortgage crisis" anyway? In case you hadn’t heard, we went through one of the worst housing busts in our lifetimes, if not ever. - Published: 2009-01-20 - Modified: 2024-04-10 - URL: https://www.thetruthaboutmortgage.com/what-caused-the-mortgage-crisis/ So, "what caused the mortgage crisis" anyway? In case you hadn’t heard, we went through one of the worst housing busts in our lifetimes, if not ever. After home prices skyrocketed to all-time highs in the early 2000s, they began to take a dive around 2008. And didn't start to recover until around 2012. It was so bad that it set off the Great Recession, leading to countless real estate short sales and foreclosures. And though that much is clear, the reason behind it is much less so. As you might suspect, there has been a lot of finger pointing. But in reality, there wasn’t just one cause, rather a combination of forces behind the housing crisis. I’ll attempt to list as many as I can think of here. The Originate-to-Distribute Model Banks weren't keeping the home loans they originated Instead they're were quickly selling them to investors on the secondary market Who were then slicing and dicing them into high-risk securities for those thirsty for "yield" The transfer of risk allowed more risky loans to be made In the old days, banks used to make mortgages in-house and keep them on their books. Because they held onto the loans they made, stringent underwriting guidelines were put in place to ensure quality loans were made. After all, if something went wrong with the loans, they’d be accountable. And they’d lose lots of money. Recently, a new phenomenon came along where banks and mortgage lenders would originate home loans and quickly... --- > An extensive list of mortgage help topics you can use to better understand the home loan process and get a better deal on your mortgage. - Published: 2008-10-03 - Modified: 2024-09-23 - URL: https://www.thetruthaboutmortgage.com/mortgage-help/ Getting a mortgage can be complicated, I know because I used to work directly in the business. For that reason (and many others), I recommend that you learn as much as possible about the process before even thinking about buying a piece of property. After all, it is likely the largest purchase you'll ever make, so why not take the time to make sense of it all (beforehand, not during, or worse, after)? Mortgage Help Categories - Types of Mortgages to Choose From (and How They Work) - The Home Loan Process from Start to Finish - Mortgage Calculators Are Helpful, Use Them - Everything You've Ever Wanted to Know About Mortgage Rates - Mortgage Refinance Questions and Answers - Home Builder Lender Reviews - Top 10 Lists for Those Who Like Lists - Top Mortgage Lenders by Loan Type - Top Mortgage Lenders by City and State - Forbearance, Foreclosure, and Short Sale FAQs - Miscellaneous Mortgage Goodies Below is a list of "mortgage help" topics I feel are beneficial to anyone thinking about buying real estate, getting a mortgage, currently going through the mortgage process, or even those who already have a mortgage. It's not something most folks do very often, so even if you're a seasoned homeowner, it doesn't hurt to brush up on your knowledge, especially as the industry evolves over time. I liken the mortgage process to a visit to your local body shop (assuming you know nothing about cars). Most people don't know the... --- > You may have heard the phrase “payment shock” get thrown around by your loan officer or mortgage broker, and for good reason. It plays an important role - Published: 2008-04-15 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/payment-shock/ You may have heard the phrase “payment shock” get thrown around by your loan officer or mortgage broker, and for good reason. It plays an important role in the underwriting and eventual outcome of your mortgage application, and can sometimes even make or break your chances of approval. Payment shock can be defined in a number of ways, but it is essentially any significant increase in monthly liability that heightens the risk of loan default. In simple terms, the more you need to pay out each month to creditors, the higher the chance you’ll be unable to make a payment, especially if you’re not used to making large payments to begin with. Payment Shock Example Let’s assume your only history of carrying debt involves a car lease payment of $199 per month and rent of $1,000. Over the past few years, you got used to paying roughly $1,200 per month, plus other minor expenses. If you later applied for a home loan that carried a monthly payment of $4,000, payment shock would occur as you wouldn’t be used to shelling out such a large amount of money each month. Would you be able to handle paying $4,000 per month when you were only accustomed to paying $1,200? This is what the loan underwriter will want to figure out. This jump in monthly outlay could be reason enough to get denied that mortgage you've got your eye on. Payment Shock Threshold Might be a set payment increase Such as 200% of... --- > The privacy of our visitors at TheTruthAboutMortgage.com is very important to us. As with most other websites, we collect and use the data contained in - Published: 2008-03-15 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/privacy-policy/ The privacy of our visitors at TheTruthAboutMortgage. com is very important to us. As with most other websites, we collect and use the data contained in log files. The information in the log files include your IP (internet protocol) address, your ISP (internet service provider, such as AOL or Roadrunner), the browser you use to visit our site (such as Internet Explorer or Firefox), the time you visited our site and the pages you visited throughout our site. Keep in mind that we may use cookies to store information, such as your personal preferences when you visit our site. This could include only showing you a popup once in your visit, or the ability to login to some of our features, such as forums. We never sell your personal information to third parties. We also serve third party advertisements on TheTruthAboutMortgage. com to support our site. Some of these advertisers may use technology such as cookies and web beacons when they advertise on our site, which will also send these advertisers (such as Google through the Google AdSense program) information including your IP address, your ISP, the browser you used to visit our site, and in some cases, whether you have Flash installed. This is generally used for geotargeting purposes (showing New York real estate ads to someone in New York, for example) or showing certain ads based on specific sites visited (such as showing mortgage ads to someone who frequents mortgage websites). You can chose to disable or selectively... --- > Stated income loans allow borrowers to simply state their monthly income on a mortgage application instead of verifying their salary by furnishing pay stubs and/or tax returns. - Published: 2008-01-25 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/stated-income-loans/ In short, stated income loans allow borrowers to simply state their monthly income on a mortgage application instead of verifying the actual amount by furnishing pay stubs and/or tax returns. This simplified method was originally intended for self-employed borrowers with complicated tax schedules. It became widespread in the lead-up to the financial crisis, often because borrowers found it that much easier to qualify for a loan by stating their income. For that reason, stated income loans are also occasionally referred to as “liar’s loans” because it is suspected that many borrowers fudge the numbers in order to qualify for a home loan. Back to that in a minute. How Does a Stated Income Loan Work? Instead of documenting and verifying your income when obtaining a home loan By providing the lender with IRS tax returns and employment pay stubs A gross monthly income figure is simply inputted on the home loan application And not actually verified by anyone! Prior to the housing crisis in the early 2000s, it was very common to use stated income to qualify for a mortgage loan. Instead of providing tax returns and pay stubs from your employer, you could verbally state your gross monthly income and that is what would be used for qualification. Clearly this was a high-risk approach to home loan lending, which is why it's basically a thing of the past. However, there are new versions of stated income lending, which I'll discuss below. A Mortgage Doc Type for Every Situation To... --- > The term “Alt-A mortgage” gets thrown around a lot, and for good reason. It’s kind of the generic term for any loan that isn’t prime (A-paper) or - Published: 2008-01-22 - Modified: 2019-11-01 - URL: https://www.thetruthaboutmortgage.com/alt-a-mortgages-alt-a-lending/ The term “Alt-A mortgage” gets thrown around a lot, and for good reason. It’s kind of the generic term for any loan that isn’t prime (A-paper) or subprime. In other words, it falls somewhere in between, but that can result in quite a range in loan quality. Ultimately, its definition is really dependent on the investor who sets the guidelines and how it’s packaged and sold on the secondary market. As such, it’s one of those mortgage terms that isn’t easily defined. It means different things to different banks and lenders, and many characteristics that make up an Alt-A loan are often gray. But I’ll do my best to give you the general idea. Alt-A Loans Typically Feature Limited Documentation Most Alt-A loans aren't full doc (verified tax returns and assets) This means income is either stated r it's some kind of asset-based loan A popular option these days relies on bank statements instead of tax returns While it's an acceptable measure of a borrower's ability to repay the loan, it's perhaps not as sound as traditional underwriting methods Perhaps one of the most overwhelming characteristics of Alt-A mortgages is their tendency to be limited documentation loans. Most so-called Alt-A loans are not full doc, meaning income is not verified, but rather stated or thrown out altogether. The same goes for asset or employment documentation. If a borrower prefers not to verify asset reserves or disclose employment history, the loan may also be referred to as an Alt-A loan. These... --- > A "fixed-rate mortgage" is the most basic and uncomplicated home loan available to borrowers today. It is far and away the most popular choice for - Published: 2007-09-05 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/fixed-rate-mortgage/ A "fixed-rate mortgage" is the most basic and uncomplicated home loan available to borrowers today. It is far and away the most popular choice for homeowners because of its conservative and affordable nature. Something like 90% of home buyers (and existing homeowners who refinance) go with a fixed-rate loan. The most common variety is the 30-year fixed, which features a term long enough to keep monthly payments relatively inexpensive. What Is a Fixed-Rate Mortgage? A fixed-rate mortgage is a home loan with an interest rate that does not change during the entire duration of the loan term, which is typically 30 years. This means borrowers don't have to worry about their mortgage rates adjusting higher, which would cause their monthly payments to increase. However, 30-year mortgage rates do come at a premium relative to other loan types in exchange for this assurance. Still, given their predictability and relatively low rates, they remain far and away the most popular type of mortgage. Let's learn more about the features of a fixed-rate mortgage, along with key advantages and disadvantages. Jump to fixed-rate mortgage topics: - Fixed Mortgage Rates Are More Expensive - How Much Cheaper Is an ARM? - Are Fixed-Rate Mortgages a Good Idea? - Why Did My Mortgage Go Up If I Have a Fixed-Rate? - Types of Fixed-Rate Mortgages Available - Fixed Mortgages with Interest-Only Options - Fixed-Rate Mortgage Benefits - Fixed-Rate Mortgage Cons - Can I Refinance a Fixed-Rate Mortgage Fixed-Rate Mortgages Are Easy to Understand and Surprise-Free... --- > When you hear the phrase “second mortgage,” a negative connotation may come to mind. You could be thinking, "Why would I need a second mortgage? I’m not - Published: 2007-08-14 - Modified: 2025-01-29 - URL: https://www.thetruthaboutmortgage.com/second-mortgages/ When you hear the phrase “second mortgage,” a negative connotation may come to mind. You could be thinking, "Why would I need a second mortgage? I’m not in financial distress! " You might even ask yourself if it's possible to have two mortgages on one house at the same time. These are normal reactions. After all, one mortgage is bad enough, right? Well, there are some reasons why you'd have two, which I'll explain in detail below. What Is a Second Mortgage? It's a home loan that is subordinate to a first mortgage on the same property Typically taken out to extend financing for a home purchase (less money down) Or to tap home equity after you obtain your primary financing Not necessarily a sign of distress or being stretched too thin A second mortgage is simply a home loan that is subordinate to a first mortgage on the same property. For example, if you already have a mortgage on your home, and take out another one, it would be considered a second mortgage. It is also known as a "junior lien" because it paid off second in the event of a foreclosure. The senior lien, which is in the first position, has priority in this regard. A common reason to take out a second loan is to extend financing if purchasing a home. You can get two loans to reduce or completely eliminate the down payment required. Or you might want to tap your home equity without losing the... --- > You’ve probably already heard the claims. That a "biweekly mortgage" can save you thousands of dollars. And that biweekly mortgage payments can shave - Published: 2007-08-14 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/biweekly-mortgage-payments/ You’ve probably already heard the claims. That a "biweekly mortgage" can save you thousands of dollars. And that biweekly mortgage payments can shave years off the life of your loan and help you accrue equity in your home super fast. Well, it’s true! Pardon the exclamation point. You probably thought I was going to say it was a bunch of baloney like most gimmicks you hear about. But no, it's legit, and it's pretty straightforward too. It's just basic math, which we'll get into below. It's also fairly easy to set up a biweekly mortgage plan, which requires a payment every two weeks as opposed to every month. In short, biweekly mortgage payments are a sort of accelerated mortgage payoff system that allow you to make an extra monthly payment each year and in turn save money on interest and pay your mortgage faster. As noted, the way it works is rather simple. How Biweekly Mortgage Payments Work Monthly mortgage payment: $2,000 Total paid annually: $24,000 Biweekly payment (payment made every 2 weeks): $1,000 Total paid annually: $26,000 Result: One extra payment made each year! Instead of making a single monthly mortgage payment each month, or 12 payments per year, you make a half mortgage payment every two weeks. And because there are 52 weeks in a year, that equates to 26 half payments annually, or 13 total monthly mortgage payments. Let's pretend you've got a 30-year fixed mortgage; if your monthly payment were $2,000 per month, under one of... --- > When the mortgage crisis struck in the early 2000s, missed monthly payments and notices of defaults increased dramatically, leading to the rise of the - Published: 2007-07-30 - Modified: 2021-08-23 - URL: https://www.thetruthaboutmortgage.com/real-estate-short-sales/ When the mortgage crisis struck in the early 2000s, missed monthly payments and notices of defaults increased dramatically, leading to the rise of the "short sale. " A combination of plummeting property values and a lack of home equity forced many homeowners to look for a way out, hoping to avoid foreclosure along the way. What Is a Real Estate Short Sale? In short, it's the sale of a property for less than its associated mortgage balance, which allows both the homeowner and mortgage lender to cut their losses if a traditional sale isn't possible. Simply put, if what you owe on your mortgage exceeds the current value of your property, a traditional home sale will be difficult. After all, you'll need to make the lender whole, and if you can't sell for what you owe, that won't be possible. Typically, a home seller will use the proceeds of their sale to pay off the loan amount in full, with the excess going into their pocket. The short sale is essentially a loss mitigation option for a struggling homeowner who wants to sell, but can't. And doesn't want the black-eye of a foreclosure on their credit report. Real Estate Short Sale Example Original purchase price: $500,000 Current appraised value: $350,000 Outstanding mortgage balance: $450,000 In this example, the homeowner wouldn't be able to sell their home and satisfy their outstanding loan balance. Not only do they owe $100,000 more than the home is worth, but there would also be transactional... --- > You’ve probably heard the term “negative amortization” by now, as the subprime industry goes down the drain and option-arm mortgages get replaced by - Published: 2007-07-27 - Modified: 2018-06-11 - URL: https://www.thetruthaboutmortgage.com/negative-amortization-loan/ You’ve probably heard the term “negative amortization” by now, as the subprime industry goes down the drain and option-arm mortgages get replaced by 30-year fixed mortgages. What Is Negative Amortization? Amortization is the reduction of debt by regular principal and interest payments Negative amortization is the accrual of debt thanks to monthly payments That aren't large enough to cover the total amount of interest due each month The result is a loan balance that grows over time until a certain maximum is reached Negative amortization is a complicated and highly scrutinized subject, but I’ll try to simplify it here. Let me start by defining amortization as the reduction of debt by regular payments of interest and principal sufficient to pay off a loan by maturity. Now that we know that, negative amortization must be the result of a mortgage repayment plan in which the borrower makes monthly payments that are less than the minimum amount of interest due. This difference in interest is then added to the outstanding loan balance, causing the overall loan balance to increase. Negative amortizing loans are also known as option-arms or "neg-ams," as well as other creative names such as "flex-saver" or "power option" and similar low payment, money-saving titles. Let’s look at an example of negative amortization: Loan Amount: $650,000 Actual interest rate: 6. 5% ($3,520. 83 interest-only payment) Minimum interest rate: 1% ($2,090. 66 minimum payment) Difference in payment: $1430. 17 In our example above, the difference between the interest-only mortgage payment and... --- > Before the mortgage crisis, it was common practice for borrowers short on down payment funds or home equity to take out two mortgages simultaneously to - Published: 2007-05-22 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/private-mortgage-insurance-vs-combo-loans/ Before the mortgage crisis, it was common practice for borrowers short on down payment funds or home equity to take out two mortgages simultaneously to finance their home purchase or home refinance. This was known as a "combo loan. " There is some indication that this practice is becoming popular again, and if you decide to go with a combo, the way you structure your loans could save you a ton of money on your mortgage payment every month. Most banks and mortgage lenders only allow loan-to-value ratios (LTVs) up to 80% because loan amounts exceeding 80% LTV aren't eligible to be purchased or securitized by Fannie Mae and Freddie Mac, which makes them less liquid on the secondary market. This is important, seeing that most banks quickly sell off their loans shortly after origination. Additionally, loans with a LTV ratio greater than 80% typically require private mortgage insurance (PMI), making them a more expensive option compared to loans kept at or below 80% LTV. When private mortgage insurance (PMI) was tax-deductible (from around 2006 through 2016), many borrowers opted for a single home loan instead of tacking on a “piggyback” second mortgage because of the perceived savings. In short, PMI is required for any single home loan over 80% loan-to-value, though it can be avoided if you structure a combo loan, keeping the first mortgage at 80% LTV, while putting the remainder of the balance on a second mortgage. Put simply, if a homeowner breaks up their mortgage into... --- > "Subprime mortgage lending" is best defined as offering financing to an individual with poor credit, low income, limited documentation, or a combination - Published: 2007-04-19 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/subprime-lending-and-subprime-lenders/ "Subprime mortgage lending" is best defined as offering financing to an individual with poor credit, low income, limited documentation, or a combination of all those things, who generally wouldn’t qualify for a mortgage at standard market interest rates or at all. If a borrower fails to meet the underwriting requirements of traditional banks and lending institutions out there, they must resort to using a subprime lender who in turn will offer a higher interest rate in exchange for elevated risk. Seems fair, right? Well, as we know from the massive financial crisis that took place, the subprime market as it was had some major flaws. The Subprime Mortgage Catch-22 Subprime loans are designed for those who may have difficulty paying their bills They feature higher interest rates than standard prime loans To compensate lenders for the increased default risk Unfortunately the higher monthly payment makes the loans even more risky The inherent problem in offering subprime mortgages is that the very people who need them are the same individuals who will probably have the most trouble making their mortgage payments each month. Simply put, if you present a higher risk of default to the lender, you must pay a higher rate of interest to compensate, otherwise lenders wouldn't offer these types of loans to begin with. Unfortunately, this is a bit of a catch-22, seeing that subprime borrowers saddled with even higher interest rates are more likely to default. Think about that for a minute. Subprime Mortgage Definition Varies, But... --- > Let’s face it, selling your home can be pretty difficult, and even if you do find a willing buyer, who knows if they can actually obtain financing to - Published: 2007-03-17 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/seller-carryback-financing/ Let’s face it, selling your home can be pretty difficult, and even if you do find a willing buyer, who knows if they can actually obtain financing to purchase it. In a buyer's market, home sellers often entice buyers with special concessions such as seller paid closing costs and seller carryback financing. Carryback Financing: The Seller Acts as the Bank for the Buyer Sometimes a home seller can also be the bank/lender Assuming the home buyer needs help with financing They may agree to carry a second mortgage Which supplements the first mortgage obtained via a traditional bank or mortgage lender Seller carryback financing is basically when a seller acts as the bank or lender and carries a second mortgage on the subject property, which the buyer pays down each month along with their first mortgage. It may also be referred to as owner financing or seller financing. Not only is it offered as a means to getting the home sold, but often it’s necessary to get the deal done if conventional banks and lenders won’t offer the total amount of financing needed. For example, if a borrower only has a 5% down payment, but the bank requires 10% down, they could get that additional five percent from the home seller. By offering seller carryback financing, more prospective borrowers will be able to qualify to buy your home. It also makes your home more attractive to buyers, and can boost the sales price of your home as well. In addition... --- > A hard money loan is a mortgage with a higher-than-market interest rate that usually serves as a source of short-term financing for borrowers who can’t - Published: 2007-03-14 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/hard-money-loans/ A hard money loan is a mortgage with a higher-than-market interest rate that usually serves as a source of short-term financing for borrowers who can’t qualify for a home loan with a traditional bank or mortgage lender. The phrase could have something to do with the fact that these lenders provide hard-to-find solutions you probably won't find elsewhere. Or possibly because the borrower has fallen on hard times. Either way, many associate these types of loans with a bridge loan because it’s often a quick-fix loan that serves to fill a gap in financing. For example, an investor may need short-term financing to rehab and flip a property, but might not have good credit or the necessary documentation to get approved with a retail bank. Additionally, our investor may not have 30 days at their disposal to get the necessary financing in order. These types of loans can be closed both quickly (say 7-10 days) and more easily (less documentation). Hard money loans might be described as a notch below subprime offerings, and often the last possible way of securing financing. Hard Money Loans Are Often a Last Resort Because the interest rates are high And the terms generally not very attractive Hard money loans are a loan of last resort But it might be your only choice and ideally temporary As noted, they are typically the last resort for borrowers who simply can’t find home loan financing due to poor credit profiles, unverifiable income and/or assets, unique properties, and... --- > A no cost refinance is a home loan where the lender pays all closing costs in exchange for a higher mortgage rate. Find out if it's a good deal. - Published: 2007-03-04 - Modified: 2024-11-02 - URL: https://www.thetruthaboutmortgage.com/no-cost-refinance-loans/ You may have seen or heard ads for a “no cost refinance” lately, a mortgage loan program that promises no fees or out-of-pocket expenses when you refinance your existing mortgage. While this type of offer is by no means a new concept, or unique to any one lender, it’s definitely a subject worth visiting to ensure you understand what you’re getting when you choose this option. Ultimately, you'll be given the choice to pay lender fees and third party closing costs out of pocket, or have them absorbed via a lender credit. If you opt for the latter, you may not have to pay anything at closing, but in exchange your interest rate will be higher. That's the "catch" I suppose, but that doesn't necessarily mean it's a bad thing. Read on to learn more. What Is a No Cost Refinance? A mortgage refinance usually results in out-of-pocket costs To account for things like lender fees and third-party services A no cost version means you don't pay these fees directly But you might wind up with a higher mortgage rate as a result A no cost refinance is a home loan transaction in which the mortgage lender pays some or all settlement costs on your behalf. This includes typical lender fees such as processing and underwriting fees, the appraisal fee, and loan origination fees, along with third party costs like title/escrow fees and so on. You may be asking yourself how banks and lenders make up for the absence of... --- > Mortgages Are Very Paperwork Intensive If you plan to refinance your home loan or purchase a property with a mortgage, you will be required to fill out a - Published: 2007-02-17 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/documents-needed-during-the-loan-process/ Mortgages Are Very Paperwork Intensive If you plan to refinance your home loan or purchase a property with a mortgage, you will be required to fill out a loan application and sign a set of disclosures to initiate the process. This bundle of documents includes things like the Loan Estimate (LE), an authorization to run credit, a Social Security release form, the USA Patriot Act disclosure, a homeownership counseling disclosure, and many more. They provide important details about your loan and the company you're working with, and allow the bank or mortgage broker to gather sensitive information about you. Without them, lenders wouldn't be able to access your employment and credit history, bank statements, pay stubs, tax returns, and so forth. When all the initial disclosures are signed, the loan process can formally begin. The Uniform Residential Loan Application (1003) The actual home loan application is known as a Uniform Residential Loan Application (URLA), or 1003 for short (you can see a sample page above and in full here). It contains a ton of information about you and the subject property, including your name, social security number, date of birth, marital status, and more. There is also a section that pertains to employment history, a section dedicated to your assets and bank accounts, and a section that outlines your monthly liabilities (car payments, credit cards, other mortgages). And if you own other real estate, it will be listed below that section, along with the corresponding loan balance, monthly payment, and... --- > Investment properties, also known as non-owner occupied properties, can be very profitable for everyday homeowners and real estate investors alike. While - Published: 2007-01-19 - Modified: 2024-03-27 - URL: https://www.thetruthaboutmortgage.com/investment-properties/ Investment properties, also known as non-owner occupied properties, can be very profitable for everyday homeowners and real estate investors alike. While there is no guarantee that you’ll be successful, extensive research and the right timing could result in a tidy profit. That said, it’s important to know the demographics of a particular neighborhood, and whether the market is set to improve or decline in the near and long term. It’s equally important to find a tenant to rent out your property to ensure you’ll achieve positive cash flow immediately and continuously. Achieving Positive Cash Flow on an Investment Property A good investment property is one where you can easily achieve positive cash flow Effortlessly find a good tenant And realize healthy home price appreciation Year after year for the foreseeable future While it’s not imperative, positive cash flow will allow you to invest in other properties by minimizing losses and out-of-pocket expenses, which will keep your DTI ratio low. It's also quite important if the property you buy isn't expected to increase in value significantly. Cash flow isn't as important if the property is expected to surge in value, but finding a property on the cheap with the potential to appreciate should be the ultimate goal. Discovering that “hot property” is often the impetus for real estate investment. Just take your time to investigate before diving in. Certainly pay attention to local area rents to determine if buying makes more sense than renting. If the price-to-rent ratio is considerably favorable,... --- > TheTruthAboutMortgage.com is a free Internet resource that provides information to consumers about residential mortgages and related financial products. - Published: 2007-01-12 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/terms-of-service/ TheTruthAboutMortgage. com is a free Internet resource that provides information to consumers about residential mortgages and related financial products. The content posted on TheTruthAboutMortgage. com is for informational purposes only and not an advertisement for any products mentioned. The views and opinions expressed herein are those of the respective authors and do not reflect the policy or position of any third-party companies, advertisers, or affiliates. By using this Web site you assume all responsibility and risk for the use of this Web Site. The information provided is “as is”, without any express or implied warranty of any kind. In no event shall TheTruthAboutMortgage. com or its affiliates be liable for any damages whatsoever (including without limitation any special, indirect, or consequential damages, and damages resulting from loss of use, data, profits) arising out of the use of or the inability to use the materials provided, even if TheTruthAboutMortgage. com or its affiliates have been advised of the possibility of such damages. TheTruthAboutMortgage. com will not be responsible for any errors or omissions on the Web Site or information provided on this Web site, any articles or postings, or for hyperlinks embedded in messages, nor for any loss or damage caused by your reliance on information obtained on this Web site or in a hyperlinked site. While TheTruthAboutMortgage. com believes such information to be reliable, we make no claims or representations about the accuracy, reliability, timeliness, usefulness or completeness of such information. Your financial situation is unique and the information on... --- > An interest-only mortgage can make monthly payments a lot more affordable, but you won't actually pay down your principal balance. - Published: 2006-12-26 - Modified: 2024-02-07 - URL: https://www.thetruthaboutmortgage.com/interest-only-home-loans/ Let's take a moment to talk about "interest-only mortgages. " A decade ago, very few individuals seemed to be interested in actually paying off their mortgages. Many prospective and existing homeowners alike just wanted to get the cheapest financing available, with the lowest monthly payment options, regardless of the consequences. That meant buying real estate with 100% financing and throwing in an interest-only option on top. Oh, and these loans were typically adjustable-rate mortgages, not 30-year fixed mortgages. However, they were available on pretty much any loan program, from a one month adjustable-rate mortgage to a 30-year fixed rate mortgage. And the once very popular pick-a-pay loan had an interest-only option available as well. Jump to interest-only loan topics: - How Does an Interest-Only Mortgage Work? - Pay Off Your Loan or Keep Payments Low - Interest-Only Home Loans Eventually Adjust Higher - You Pay for the Interest-Only Privilege - How to Calculate an Interest-Only Mortgage - Interest-Only Mortgage Qualification - Can You Still Get an Interest-Only Mortgage? - Pros and Cons of Interest-Only Mortgages With so many exotic mortgage programs available, such as negative-amortization loans and loan programs with introductory teaser rates, it was easy to understand why borrowers did what they did. In fact, interest-only options used to be almost a given on mortgages back then. But we all know how things turned out. We experienced the worst housing crisis in modern history, driven largely by loose mortgage lending. Fortunately, times have changed, and these days it's pretty... --- > A "teaser rate" is a low, introductory interest rate that is typically offered for the first few months or years as an incentive to choose a certain - Published: 2006-12-26 - Modified: 2024-10-06 - URL: https://www.thetruthaboutmortgage.com/teaser-rates/ A "teaser rate" is a low, introductory interest rate that is typically offered for the first few months or years as an incentive to choose a certain mortgage program. The concept is somewhat similar to offers you see for 0% APR credit cards. You get a discount for X amount of time before the actual, higher rate kicks in. Teaser rates are common in adjustable-rate mortgages, as most are now hybrid ARMs. In other words, they're fixed for a certain period of time before becoming adjustable. The same could be said of temporary buydowns where you get a discounted rate in year one, two, or three, before the rate reverts to the higher note rate for the remainder of the loan term. While you can save some money during the teaser rate period, be sure you can afford the actual interest rate once it goes away! What Is a Teaser Rate? A short-term promotional interest rate that is lower than the note rate Examples include adjustable-rate mortgages (ARMs) and temporary buydowns Rate is fully-amortizing, but will increase once the teaser rate period ends Designed to lure borrowers into a certain loan program or home purchase Watch out for the initial rate adjustment and be sure you can afford the higher payment! A common example is the 5/1 ARM, which comes with a teaser rate for the first five years of the mortgage term before becoming an annually adjustable-rate mortgage (ARM). During those initial five years, you receive a "discount" for... --- > The housing market was on fire in the early 2000s before it eventually burnt to a crisp. This led to rampant speculation and greed as a larger group of - Published: 2006-12-05 - Modified: 2019-01-13 - URL: https://www.thetruthaboutmortgage.com/no-doc-2nd-mortgage/ The housing market was on fire in the early 2000s before it eventually burnt to a crisp. This led to rampant speculation and greed as a larger group of prospective home buyers emerged. Unfortunately, because home prices had increased so significantly, many would-be borrowers were forced to go “No Doc” in order to actually qualify for a mortgage. Whether that's really qualifying is a question for another day, or perhaps just too enigmatic. What Are NINJA Loans? A NINJA loan is ironically named Seeing that it requires Very little of the borrower Anyway, the term "No Doc" is usually defined as no income, no asset, and no employment verification. Some silly loan officers refer to these types of loans as NINJA loans, with the "J" representing the word job. It doesn't mean the borrower doesn't have a job, it just means the lender doesn't ask any questions related to their employment. So in essence, the borrower could potentially be unemployed. And that might explain a lot of the trouble these loans eventually caused. Essentially, all the borrower must document with a no-doc loan is their credit history (in the form of a credit report), and the bank or lender will use this alone to determine if they are suitable for home loan financing. Sound scary? It is/was. Most Mortgages Were No Doc Prior to the Crisis Before the housing crisis in the early 2000s It was pretty common just to go stated doc or no doc Because it was far... --- > I'm sure most prospective homeowners like the idea of putting little to nothing down when purchasing real estate, but doing so isn't without its - Published: 2006-11-30 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/pmi-private-mortgage-insurance/ I'm sure most prospective homeowners like the idea of putting little to nothing down when purchasing real estate, but doing so isn't without its drawbacks. In fact, it can cost you quite a bit of money if you don't come to the closing table with a sizable down payment, not to mention a higher loan balance. Aside from having a larger mortgage payment, and a higher mortgage rate, you might also be hit with an extra form of insurance to offset the risk you present to the lender. It's known as "private mortgage insurance," or PMI for short. Let's talk about what it is, and more importantly, how you can avoid PMI! What is private mortgage insurance? PMI is coverage that protects the bank/lender from borrower default It is NOT protection for the homeowner (but you have to pay for it! ) Safeguards the lender in the event you're unable to pay your home loan Allows them to offer low-down payment mortgages that are historically more risky In short, mortgage insurance is all about risk and protection. Simply put, a mortgage with no down payment is more likely to default than one with a large down payment. And even if a borrower with a huge down payment misses their payments, the lender can probably still sell the home for a profit if it falls into foreclosure. If it's a no-down payment mortgage and home prices take a dive, it could turn into an underwater mortgage, which would equate to a... --- > If you fail to make your mortgage payments each month, your bank or mortgage lender may take action to repossess your home. After all, it's not - Published: 2006-11-28 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/foreclosure-help/ If you fail to make your mortgage payments each month, your bank or mortgage lender may take action to repossess your home. After all, it's not technically your home until you've paid the mortgage in full. Until that time, you AND the bank own the home. So if you don't hold up your end of the bargain, the bank could come knocking. And the news won't be good! The legal proceeding is known as a "foreclosure," and will result in the loss of your home, foreclosure fees, additional legal fees, and possibly a deficiency judgment if your outstanding liens exceed the current value of your home. Your credit will also be shot when all is said and done. The foreclosure process usually goes something like this: Become ill or lose your job (or mortgage adjusts significantly higher) Fall behind on monthly payments Once you've missed 3 mortgage payments lenders can file NOD And begin foreclosure proceedings At any point you can try to save your home in a number of ways You lose your job, become ill, or simply fall behind on your mortgage payments after your adjustable-rate mortgage resets. Unfortunately, these aren’t typically valid reasons to miss your mortgage payment(s). When you originally applied for your mortgage, you probably verified asset reserves to prove to the bank that you could afford to pay the loan for a certain period of time, even if you failed to receive additional income for some period of time. Once you miss your first... --- > Learn how an adjustable-rate mortgage works and determine if one might be a good fit for you. - Published: 2006-11-27 - Modified: 2025-02-04 - URL: https://www.thetruthaboutmortgage.com/adjustable-rate-mortgage/ An "adjustable-rate mortgage" is a type of home loan that features a variable interest rate that can move higher or lower during the loan term. It differs from a fixed-rate mortgage, such as the 30-year fixed, which features an interest rate that does not change. All adjustable-rate mortgage programs come with a pre-set margin, and are tied to a major mortgage index. Together, these two numbers determine the fully-indexed rate on the ARM once it becomes adjustable. Common mortgage indexes today include the Secured Overnight Financing Rate (SOFR), which replaced the London Interbank Offered Rate (LIBOR), the Cost of Funds Index (COFI), and the Monthly Treasury Average (MTA). Many of today's ARMs are fixed for some period of time initially before becoming adjustable, typically five or seven years. After that, the interest rate is subject to change on a semi-annual or annual basis. ARMs Got a Bad Name in the Early 2000s Prior to the housing crisis in 2008, adjustable-rate mortgages were synonymous with subprime mortgages. But they aren't inherently bad, especially today's hybrid ARMs. Those older adjustable-rate mortgages were often option ARMs, which allowed for negative amortization. This meant homeowners back then weren't even paying down their mortgages. Instead, they were actually accruing interest. And many of those home buyers then had insufficient income, bad credit, and/or put little to nothing down. Today's ARMs are much more sound, and mortgage lenders actually qualify borrowers properly. In fact, even FHA loans are offered with adjustable rates! In addition, most come... --- > A "bridge loan" is essentially a short term loan taken out by a borrower against their current property to finance the purchase of a new property. Also - Published: 2006-11-25 - Modified: 2020-01-20 - URL: https://www.thetruthaboutmortgage.com/bridge-loan/ A "bridge loan" is essentially a short term loan taken out by a borrower against their current property to finance the purchase of a new property. Also known as a swing loan, gap financing, or interim financing, a bridge loan is typically good for a six month period, but can extend up to 12 months. Most bridge loans carry an interest rate roughly double the average fixed-rate product and come with equally high closing costs. Bridge loans are generally taken out when a borrower is looking to upgrade to a bigger home, and haven’t yet sold their current home. A bridge loan essentially “bridges the gap” between the time the old property is sold and the new property is purchased. Bridge Loans Can Help You Drop Home Buying Contingencies If the home you want is in a competitive housing market Home sellers typically won't agree to contingencies from the buyer To solve the buy before you sell quandary A bridge loan might be a good solution to fill the gap Many purchase contracts have contingencies that allow the buyer to agree to the terms only if certain actions occur. For example, a buyer may not have to go through with the purchase of the new home they are in contract for unless they're able to sell their old home first. This gives the home buyer protection in the event no one buys their old home, or if nobody is willing to buy the property at the terms they desire. But... --- > So you need a job and you’re thinking about becoming a residential mortgage loan officer? Or a mortgage loan originator (MLO) as they're now known. Well, - Published: 2006-11-22 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/loan-officer-jobs/ So you need a job and you’re thinking about becoming a residential mortgage loan officer? Or a mortgage loan originator (MLO) as they're now known. Well, there are probably job openings right this very second, but it's not for the faint of heart. It’s true, loan officer jobs pay more than most any other occupation out there, assuming you haven’t passed the bar or made your way through medical school. Or happen to be a financial advisor or a pro athlete. But it can’t be that easy, could it? To make six figures without a high school diploma you would think you'd have to invent something or start your own business. Not so - the prospect of being a loan officer has changed conventional thought, especially as the housing market shot off in recent years like a bottle rocket. Jump to loan officer topics: - Loan Officer Job Description - Loan Officer Educational Requirements - Loan Officer Salary - Loan Officer Career Advancement - How to Be a Top Producing Loan Officer - What the Future Holds for Loan Officers So now as we lie in the wake of another possible housing bubble bust, are loan officers still making money? The answer is MAYBE. But the number of loan officers has probably been cut in half, if not more in the past year or so. At the same time, the quality (and quantity) of mortgage loans at the moment isn’t what is once was a few years ago. It seems... --- > So you got a "mortgage late." You thought you paid your home loan on time, but for some reason the bank or loan servicer never got your mortgage payment. - Published: 2006-11-13 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/how-to-remove-mortgage-lates/ So you got a "mortgage late. " You thought you paid your home loan on time, but for some reason the bank or loan servicer never got your mortgage payment. It happens every day. Homeowners fail to pay their mortgage on time for one reason or another. I've heard every excuse in the book as a former Account Executive. Unfortunately, most fall on deaf ears. Typically, mortgage lates occur when homeowners are struggling financially or between homes. It's understandable when you move from one home to another, paying off one mortgage and acquiring a new one. But you need to be extremely careful during that period to ensure everything is paid as agreed. Again, any excuse you throw out probably won't cut it, even if it was someone else's fault, which it sometimes is. Mortgage Lates Will Sink Your Credit Scores Late mortgage payment(s) must be 30+ days past due to impact credit scores If you're only a few days (or even weeks) late you'll likely only have to pay a late fee So a 30-day late typically doesn't happen by accident (you get a lot of time to sort it out) Impact will vary based on credit history and number/severity of late payments Aside from having to pay any late fee associated with the overdue payment, you'll also see your credit scores sink big time if you're 30 days late (or more) on the mortgage. Depending on where your scores stood prior to the mortgage late, they could fall... --- > If you're working with a bank or broker, you can easily buy down your mortgage interest rate by expressing what rate you'd like to pay, and inquiring about the cost to acquire such a rate. - Published: 2006-11-04 - Modified: 2022-08-25 - URL: https://www.thetruthaboutmortgage.com/buying-down-your-interest-rate/ Some existing and prospective homeowners out there are fixated on obtaining the lowest possible mortgage interest rate, even if it means pulling money out of their own pocket at the time of financing. Though most borrowers usually opt for a slightly higher mortgage rate to avoid paying closing costs when buying a home or refinancing a mortgage, some homeowners will pay the one-time fees in exchange for a lower interest rate to save money over the long term. Of course, this strategy only really makes sense if you plan to stay with the mortgage for a decent chunk of time, as associated savings aren't usually realized for several years into the loan. How Buying Down Your Mortgage Rate Works When you apply for a home loan you'll be given the opportunity to buy down your rate This requires paying mortgage discount points out-of-pocket at closing These points are a form of prepaid interest that reduce your interest rate It's totally optional and ultimately boils down to whether you want an even lower rate If you're working with a bank or mortgage broker, you can easily buy down your interest rate by asking for a series of different rates and associated costs. This is known as "buying down the rate," and is a common practice in the mortgage industry. In short, if you pay mortgage discount points at closing, aside from any commissions and any other lender fees, you can bring your interest rate down to a lower level. And then... --- > Homeowners Insurance provides coverage in the event that your home is damaged or destroyed, and also provides liability for injuries incurred by visitors to your property. - Published: 2006-10-25 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/homeowners-insurance/ Homeowners insurance provides coverage in the event your home is damaged or destroyed, and also provides liability for injuries incurred by visitors to your property. In addition, the loss or damage of property in and around the dwelling is covered as well (the contents). The amount of money your home is insured for is called the dwelling limit coverage. It is one of the most important and overlooked aspects of the mortgage process, and most homeowners fail to shop around for it. Mortgage Lenders Typically Require Homeowners Insurance While homeowners insurance might be optional if you own your home free and clear Most mortgage lenders require a specific amount of coverage if you carry a home loan This protects their financial interest in your property Because remember, they let you finance a large chunk of it Most banks and lenders require that homeowners buy enough insurance to cover the amount of their mortgage. And your mortgage broker or loan officer will usually comply with the lender, and ask that you get a policy that simply covers the value of the loan amount. But you should also ensure that your homeowners insurance policy covers the cost of rebuilding your property in the event of serious damage. Your home is probably your greatest liability, and for many its also their nest egg, so full coverage is a must. What is covered by homeowners insurance? - Dwellings and other structures on your property - Personal property - Personal liability What is not covered... --- > There are a variety of different types of mortgage lenders out there that originate home loans, from small mom and pop shops that only offer mortgages to - Published: 2006-10-18 - Modified: 2025-02-07 - URL: https://www.thetruthaboutmortgage.com/types-of-mortgage-lenders/ There are a variety of different types of mortgage lenders out there that originate home loans, from small mom and pop shops that only offer mortgages to institutional, dare I say too-big-to-fail banks that also pitch student loans and credit cards. There are also online mortgage lenders with no brick-and-mortar presence, along with a new breed of so-called mortgage disruptors that are trying to digitize the home loan process. Additionally, there are home loan lenders that specialize in certain types of loans, such as FHA loans and VA loans, or home loans for those with bad credit. Ultimately, you have a lot of options when it comes to getting a mortgage loan, even though it's mostly a commoditized product. By that, I mean mortgages aren't all that different and many lenders offer the same exact loan products, regardless of the channel in which they are obtained. Nor does the branding really matter (no one can see your mortgage and can't you openly flaunt it), though how and where you get one can make a big difference in terms of interest rate and closing costs and saving money! Additionally, there are some nuances that I'll discuss below to give you a better idea of the mortgage ecosystem. Mortgage Bankers A mortgage banker is a generic, all-encompassing term Used to describe an entity or individual that originates mortgages It can refer to banks, non-banks, or even individuals running their own shop Some of the bigger names include Chase, loanDepot, Quicken Loans, and... --- > Ever wonder how the economy goes 'round? Or how inflation is controlled and recessions are avoided? Or at least attempted to be avoided. Much of it has to - Published: 2006-10-18 - Modified: 2024-12-18 - URL: https://www.thetruthaboutmortgage.com/discount-rate-prime-rate-and-the-federal-funds-rate/ Ever wonder how the economy goes 'round? Or how inflation is controlled and recessions are avoided? Or at least attempted to be avoided. Much of it has to do with the Federal Reserve and its tight control of the money supply. Whenever the Fed gets together and makes a so-called announcement, a lot can change that directly affects your pocketbook. So it's important to have some idea of what it all means. Let's take a closer look to better understand how it works. And how it affects mortgage rates. (Latest rate movement DOWN 0. 25% on 12/18/24) Discount Rate (Currently 4. 50%) The discount rate is the interest rate the Fed explicitly sets Money can be borrowed overnight via the "discount window" By member banks and thrifts that are in need of funds Used to prevent their reserves from falling below mandated levels The "discount rate" or "primary credit rate" is the interest rate the Federal Reserve sets and offers to member banks and thrifts that need to borrow money in order to prevent their reserves from dipping below the legally required minimum. This situation can arise if a bank lends too much and/or has too many withdrawals on a given day. Money is borrowed overnight via the "discount window. " As a rule of thumb, the higher the discount rate, the higher mortgage interest rates will be. The two tend to correlate over time, though not as strongly as the 10-year bond yield due to its longer maturity. When... --- > The use of a "mortgage calculator" can be very helpful when trying to figure out monthly housing payments, how much one can afford, and how one should - Published: 2006-10-04 - Modified: 2018-06-12 - URL: https://www.thetruthaboutmortgage.com/mortgage-calculators/ The use of a "mortgage calculator" can be very helpful when trying to figure out monthly housing payments, how much one can afford, and how one should structure a mortgage. You really should use these one (or two or three) before you consider buying real estate. Check Out My Web-Based Mortgage Calculators Mortgage payment calculator How much house can I afford calculator Refinance calculator Early mortgage payoff calculator Rent vs. buy calculator There are a number of different mortgage calculators available that serve all types of different purposes. Some are very simple, while others are very involved, including things like property taxes, homeowners insurance, HOA dues, and so forth. There's also the question of accuracy, as some may underestimate the true cost of homeownership. I'd say they more often underestimate rather than overestimate, which is an obvious problem for would-be home buyers, especially first-timers who may also downplay the many hidden costs involved. Anyway, let's stop worrying and start calculating, shall we? You may want to start with the classic mortgage payment calculator, which as the name implies, allows you to calculate a monthly mortgage payment. This is ultra-basic, but also a good first step in determining how much a given loan amount will set you back. And this is before we even factor in insurance, taxes, and utilities. It can really add up. You can use it to calculate a 30-year fixed mortgage, a 15-year fixed, or any other loan term of your choosing. It's very simple to use... --- > A "reverse mortgage" is a tax-exempt home loan that allows a homeowner to take cash-out of their home using their existing home equity, without taking on - Published: 2006-10-03 - Modified: 2025-01-15 - URL: https://www.thetruthaboutmortgage.com/reverse-mortgage/ A "reverse mortgage" is a tax-exempt home loan that allows a homeowner to take cash-out of their home using their existing home equity, without taking on a monthly payment or having to sell their property. These types of mortgage loans are only available to homeowners aged 62 or older, who occupy a property as their principal residence. Eligible property types include single-family homes, condominiums, townhouses, and even manufactured homes built after June 1976. Additionally, multi-unit properties are permitted, including duplexes, triplexes, and fourplexes (1-4 unit properties) as long as you occupy one of the units as your primary residence. Reverse mortgage loans come with a variety of terms, including both fixed and variable rate plans, and with varying associated fees such as loan origination fees and servicing fees, as well as other closing costs. With a fixed-rate reverse mortgage, you need to take your loan proceeds as a lump sum. With a variable-rate reverse mortgage, you get the option of taking your proceeds as a monthly payment, line of credit, or lump sum. How a Reverse Mortgage Works It's similar to a "forward mortgage" In that you borrow money from the bank But with a reverse mortgage you don't have a monthly payment Nor does the loan need to be paid back A reverse mortgage works in quite the opposite way of a traditional mortgage, allowing a homeowner with accrued equity in their home to pull cash out on a monthly or lump sum basis with no associated payment. The... --- > So you're thinking about buying your first piece of real estate? Congratulations! It's an exciting time...and a nerve-racking one. But before you even - Published: 2006-09-27 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/tips-for-first-time-homebuyers/ So you're thinking about buying your first piece of real estate? Congratulations! It's an exciting time... and a nerve-racking one. But before you even begin to comb through real estate listings and attend open houses, you need to make sure you actually qualify for a mortgage on your dream home. And I hope you took a moment to compare renting to buying just to make sure you're cut out for it. By the way, I recommend searching for a mortgage before a home to ensure you actually qualify to buy one! The following are some useful tips for both newbies (first-time home buyers) and seasoned home buyers alike who are looking to experience a mortgage process with as few surprises as possible. Because those types of surprises aren't fun... First-Time Home Buyer Tip #1: Check Your Credit Report and Know Your Credit Scores! Check all 3 of your credit reports from Equifax, Experian, and TransUnion Do this several months before you apply for a home loan (90+ days in advance) Get all 3 credit scores from these bureaus as well to see where you stand numerically Scour the reports and resolve anything that needs fixing ASAP Aim for a FICO score of 780 or above to obtain the best loan pricing The first thing any prospective homeowner should do, especially a first-time home buyer, is obtain a free credit report and view their credit scores. This can be accomplished either from AnnualCreditReport. com (which is backed by the CFPB) or... --- > In the mortgage world, a "rate and term refinance" refers to the replacement of an existing mortgage(s) with a brand new home loan. The refinance loan - Published: 2006-09-22 - Modified: 2024-05-10 - URL: https://www.thetruthaboutmortgage.com/rate-and-term-refinance/ In the mortgage world, a "rate and term refinance" refers to the replacement of an existing mortgage(s) with a brand new home loan. The refinance loan comes with a new interest rate (ideally lower) and a fresh mortgage term, such as another 30 years, or a shorter 15 years. The existing mortgage is effectively paid off by the opening of the new refinance loan, with the old loan balance transferred to the new loan. Jump to rate and term refinance topics: - What Is a Rate and Term Refinance? - Which Type of Mortgage Refinance Do You Need? - Rate and Term Refinance Example - Your Mortgage Rate May Rise If You Don't Refinance - Rate and Term Refinance Rates - Consider Closing Costs Associated with a Mortgage Refinance - Is My Refinance Rate and Term or Cash Out? - Why Do a Rate and Term Refinance? Think of it this way – you are re-financing your mortgage, meaning you are obtaining new financing terms for an existing home loan. Some might refer to it as a mortgage "redo. " The issuer of the new mortgage pays off the old loan with the proceeds from the new loan so everyone is square. What Is a Rate and Term Refinance? The act of replacing your existing home loan(s) with a brand new one In order to obtain a lower mortgage rate and/or different term Which results in a cheaper monthly payment and possibly interest savings over the loan term A product... --- > Let's talk mortgage stocks for a moment, shall we? During the early and mid 2000s, the housing market was on fire in the United States. As a result, the - Published: 2006-09-22 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-stocks/ Let's talk mortgage stocks for a moment, shall we? During the early and mid 2000s, the housing market was on fire in the United States. As a result, the mortgage industry expanded at an unheard of rate, and so did the amount of players in the sector. Alongside the big banks in the industry came a great number of specialty lenders that dealt only with originating home loans. While these companies raked in profits during the mortgage refinance boom, many eventually saw their numbers drop tremendously, with floundering growth, massive mortgage layoffs, and eventual closures. Many investors might have seen this as an opportunity. The low PE ratios. The fresh 52-week lows. The huge earnings just months earlier. Just one little problem. No clear growth trajectory. And a whole lot of risk. We all know the stock market relies on growth to boost ticker prices, right? The problem is that the market got spread too thin when every bank in town wanted a piece of the hot mortgage market. And more players chasing fewer home loans meant tighter margins and lower profits. Once again, the housing market is hot and mortgage interest rates are low, resulting in record mortgage origination volume. But there's a big fear that interest rates will rise and business that is very price-sensitive will dry up. This might explain Rocket Mortgage's P/E ratio of around 6. Still, there are opportunities for investment in the mortgage space just like any industry, especially since it's a very cyclical... --- > An option ARM is a mortgage that gives homeowners four payment choices, including a 1% rate, interest-only, and a 15- or 30-year option. - Published: 2006-09-12 - Modified: 2024-01-10 - URL: https://www.thetruthaboutmortgage.com/option-arm-mortgage/ The "option ARM" loan program was one of the most popular mortgage choices for borrowers in the United States during the lead up to the mortgage crisis thanks to its forgiving payment flexibility. This same payment flexibility also made it one of the most scrutinized loan programs in history because of its misleading ability to qualify borrowers for a home they truly couldn't afford. It was offered by some of the biggest former mortgage lenders, including Countrywide Mortgage and Washington Mutual, both of which failed during the Great Recession. I believe Bear Stearns also offered the product. They also failed. What Is An Option ARM? It's a home loan with four payment options That provides for greater payment flexibility In the event the borrower is paid unevenly throughout the year Or simply wants a variety of choices when it comes to paying back their mortgage The option ARM, or pick-a-pay mortgage, is a monthly adjustable rate mortgage tied to one of the major mortgage indexes, including the LIBOR, MTA, or COFI. The program allows a borrower to pay off their loan balance using four payment options, including the following: - 15 year term payment (Principal and interest) - 30 year term payment (Principal and interest) - Interest-only payment (Usually available first 10 years) - Minimum monthly payment (Negative amortization payment) In other words, borrowers can make the standard 30-year fixed payment, an accelerated 15-year fixed payment, a 30-year interest-only payment, or a negative amortization payment. That last option was what... --- > A "home appraisal" is a comprehensive report that determines the value of your property based on a number of factors, ranging from gross living space, to - Published: 2006-09-06 - Modified: 2025-02-06 - URL: https://www.thetruthaboutmortgage.com/appraisals-and-appraised-value/ A "home appraisal" is a comprehensive report that determines the value of your property based on a number of factors, ranging from gross living space, to the view and the year a property was built. If you plan on purchasing a new home with a mortgage or refinancing your current loan (or even getting a reverse mortgage), you will most likely need to order an appraisal. It might also be required for a home equity loan. Typically, a bank or mortgage broker will handle this for you, but you will still have to foot the bill unless the cost is built into your mortgage rate. The appraisal is a key component of the home buying process, and important to both you and your lender. The bank will want to know that the home financing they provide can be supported by the collateral, and you'll want to make sure you're not paying more than the home is worth, within reason. Home Appraisal Costs The cost of a home appraisal can vary Based on property type, location, and size And by bank and mortgage lender But most range from $300 to $600 Often when you apply for a mortgage, a deposit is requested by the lender early on to cover the cost of the appraisal. This is how they keep you invested so you don't go elsewhere during the process. Home appraisals typically cost anywhere from $250 to $750, with most falling somewhere in between $300 and $600. The cost will vary... --- > Predatory mortgage lending is hard to define, but essentially occurs any time a borrower is taken advantage of, whether it be an inflated interest rate or higher than usual fees. - Published: 2006-08-30 - Modified: 2022-09-16 - URL: https://www.thetruthaboutmortgage.com/predatory-mortgage-lending/ Predatory mortgage lending means different things to different people. To some, it may involve charging too much to obtain a mortgage. For others, it may come down to withholding important information that the borrower has a right to know. Material information that could affect their decision to go through with the loan or go elsewhere. It can also involve more cut and dry shady practices such as deceiving borrowers by failing to include all associated costs upfront, forging documentation, or simply leaving out required loan documents such as the Loan Estimate and Closing Disclosure. Either way, what's clear is that predatory lending involves unethical practices that may harm the borrower. Charging Too Much for a Home Loan? There can be a gray area when it comes to predatory mortgage lending Because lenders and loan originators don't like to be told what they can charge for their work/time This revolves around what people feel is right/fair to charge a borrower Fortunately there are some max fees/caps for certain types of mortgages This is always a touchy subject because individuals, especially those working for themselves, don't like to be told what their time and energy is worth. However, most banks and lenders put a cap on what a broker or loan originator can earn on a given home loan. For prime (A-paper) mortgage companies, this number usually falls between 2-3% of the loan amount. That is still a very hefty payout for a single loan. Imagine a $750,000 loan amount with a... --- > The phrase "loan origination" refers to the initiation/completion of the home loan process, while the "loan origination fee" is the cost of the associated - Published: 2006-08-30 - Modified: 2024-10-14 - URL: https://www.thetruthaboutmortgage.com/mortgage-dictionary/loan-origination/ The phrase "loan origination" refers to the initiation/completion of the home loan process, while the "loan origination fee" is the cost of the associated service. Yes, mortgage lenders and brokers need to make a living, they aren't working for free, so they must charge fees and/or sell their loans for a profit. It begins when a borrower submits their financial information to a bank or mortgage lender for loan processing. Depending on documentation type, a borrower will have to supply certain credit, income, asset, and employment information to a specified bank or lender to initiate the underwriting of the loan application. Along with that, the borrower will have to sign forms that allow the mortgage broker (if applicable) and bank or lender to pull a credit report and release information about the borrower. Once the information is submitted to the bank or lender, an underwriter will decision the application, either approving, suspending, or declining the loan. To sum it up, loan origination is simply the creation of a mortgage. It may begin with a phone call, an e-mail, a mortgage rate quote, or a referral from a real estate agent. Loan Originators Are Salespeople Those who make homes loans for a living are known as "loan originators" Just a fancy way of saying loan officer or mortgage broker It is simply the individual who helps you get a home loan One way these folks make money is by charging loan origination fees So who's behind all this loan origination activity... --- > A "HELOC" or "home equity line of credit," is a type of home loan that allows a borrower to open a line of credit using their home equity as collateral. - Published: 2006-08-29 - Modified: 2025-02-26 - URL: https://www.thetruthaboutmortgage.com/home-equity-line-of-credit-heloc/ A "HELOC" or "home equity line of credit," is a type of home loan that allows a borrower to open a line of credit using their home equity as collateral. They can then draw upon it to pay for anything they wish, such as home improvements, or to pay off credit card debt or student loans. The money can even be used for a down payment on a subsequent home purchase. HELOCs are typically taken out as second mortgages that are subordinate to an existing loan. This means you wind up with two monthly payments, but can access cash without disturbing the interest rate or loan term on the first mortgage. As such, you can continue to enjoy your low fixed-rate if you secured a very cheap 30-year fixed mortgage at some point in the past. Jump to HELOC topics: - What Is a HELOC? - How to Get a HELOC? - Accessing Your Funds with a HELOC - HELOC Interest Rates - Downsides of Home Equity Lines of Credit - Term of a Home Equity Line of Credit - Can You Refinance a HELOC? - Types of HELOCs - Home Equity Line of Credit vs. Home Equity Loan - Common HELOC Fees - HELOC Pros and Cons What Is a HELOC? A home loan with a twist because it's actually a line of credit (as opposed to a set loan amount) Your property acts as collateral for the loan similar to a traditional mortgage Can draw upon it when... --- > Have you ever made a decision you later regretted, only to wish you could have taken it all back? Well, you might be in luck if we're talking about a - Published: 2006-08-25 - Modified: 2022-01-16 - URL: https://www.thetruthaboutmortgage.com/right-of-rescission/ Have you ever made a decision you later regretted, only to wish you could have taken it all back? Well, you might be in luck if we're talking about a mortgage. The "right of rescission" period is a provision under the Truth in Lending Act that essentially gives homeowners who are refinancing their mortgages a chance to mull things over before committing to the new loan terms. Are You Sure You Want to Refinance Your Mortgage? When refinancing a mortgage on a primary residence you get 3 days to think it over at the end of the process This is known as a "cooling off" period intended to protect consumers from financing they may not actually want/need It begins the day after you sign loan documents and ends three business days later (including Saturdays) If you have cold feet or simply change your mind you have a right to cancel the loan before it is scheduled to fund If a homeowner decides to refinance their mortgage, once loan documents are signed, they will have the right to rescind the transaction for a period of three business days. The right to rescind is essentially the "right to cancel" the mortgage transaction and have any fees refunded if they aren't happy with the loan for any reason. It's basically a consumer protection mechanism. Technically, all fees should be refunded to the consumer if they choose to rescind the mortgage. This includes all lender fees (application, processing, etc. ), broker fees, and third... --- > A jumbo loan is a mortgage that exceeds the maximum loan amount (conforming loan limit) set by the Federal Housing Finance Agency (FHFA). - Published: 2006-08-24 - Modified: 2025-01-15 - URL: https://www.thetruthaboutmortgage.com/jumbo-mortgage-loans/ What Is a Jumbo Mortgage Loan? A "jumbo loan" is a mortgage with a loan amount that exceeds the conforming loan limit. It is set by the Federal Housing Finance Agency (FHFA), which oversees Fannie Mae and Freddie Mac. This limit can change annually and is currently $806,500 for a one-unit property in the contiguous United States for 2025, up from $766,550 last year If your loan amount is $806,501 or higher, your home loan is considered jumbo unless it's a multi-unit property and/or located in a high-cost area. Among other things, this means it's not eligible for purchase by Fannie Mae or Freddie Mac. As such, it could be more difficult to obtain/qualify, and the interest rate might be higher too. Jump to jumbo loan topics: - Jumbo Loan Limits - Jumbo Loans vs. Conforming Loans - Getting a Jumbo Loan Can Be More Difficult - Jumbo Loans Tend to Be More Expensive - Jumbo Mortgage Rates - Minimum Down Payments on Jumbo Loans - High Balance Loans - Super Jumbo Loans - Jumbo Mortgage FAQ Determining the Size of a Jumbo Mortgage Each November, the FHFA announces the conforming loan limit for the following year, based on annual home price changes from October to October. If the housing market does well and home prices rise, the conforming limit will go up and so will the minimum loan amount for a jumbo. If home prices happen to fall, which is rare, the loan limits will simply remain flat. Higher... --- > A VA loan is a mortgage guaranteed by the Dept. of Veterans Affairs that features no down payment or minimum credit score requirement. - Published: 2006-08-23 - Modified: 2025-01-15 - URL: https://www.thetruthaboutmortgage.com/va-mortgage-loans/ A "VA loan" is a government-backed mortgage guaranteed by the Department of Veterans Affairs (VA) available to both veterans and active duty servicemembers. The loan program was created all the way back in 1944 and signed into law by then President Franklin D. Roosevelt. Perhaps the most notable aspect of a VA home loan is its zero down payment requirement, which is also available to surviving spouses. It's one of the few places (other than a USDA loan) a prospective homeowner can still buy a property with no money down. Other options such as conventional loans require 3% down or more, while the FHA requires at least 3. 5% down. The popular loan program, also referred to as the GI Bill, has been highly successful and has helped millions of American veterans and their families purchase a home. Let's learn more about it. Jump to VA loan topics: - VA Loan Eligibility Requirements - Types of VA Loans - VA Mortgage Rates - VA Loan Closing Costs - Is There a Maximum VA Loan Amount? - Do VA Loans Require a Minimum Credit Score? - Pros and Cons of VA Loans - VA Loan FAQ - VA Loan Highlights VA Loan Eligibility Requirements Must be active duty or veteran in the U. S. Armed Forces Or a surviving spouse or member of the National Guard Requires Certificate of Eligibility from the VA to determine financing available Must occupy property as your primary residence If you serve (active duty) or served... --- > Mortgage Q&A: "What is an Islamic mortgage?" There are a variety of different types of home loans out there, some pretty conventional and some a - Published: 2006-08-23 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/islamic-mortgage/ Mortgage Q&A: "What is an Islamic mortgage? " There are a variety of different types of home loans out there, some pretty conventional and some a little less so. One you may have heard about, but might not be clear on is an "Islamic mortgage," which as the name implies, is intended for someone of the Muslim faith. The Problem Mortgage Lenders Face Most home buyers need a mortgage to purchase a property Since home prices are so expensive and very few people have ample cash on hand But the payment or receipt of interest is prohibited according to certain religious beliefs Which requires different alternatives to finance the property If you're wondering why a mortgage would need to be crafted based on someone's religion, take note of the following. Under the Sharia law of Islam, the payment or receipt of riba (also known as interest) is prohibited, and thus a conventional mortgage that charges interest each month cannot be utilized by a practicing Muslim. Obviously, this poses a potential problem, as home prices are typically far too expensive to allow a prospective home buyer to purchase outright with cash. The Solution(s) There are three ways this issue can be resolved One being to sell the property at a higher price under an installment plan Another being a "lease to purchase" contract Or to create an LLC and own shares in the property However, this can be solved by having the bank purchase the property and sell it back to... --- > What Is an FHA Loan? “FHA loans” are government-backed mortgages insured by the Federal Housing Administration (FHA). Congress established the FHA in 1934 - Published: 2006-08-23 - Modified: 2025-05-27 - URL: https://www.thetruthaboutmortgage.com/fha-loans/ What Is an FHA Loan? “FHA loans” are government-backed mortgages insured by the Federal Housing Administration (FHA). Congress established the FHA in 1934 in conjunction with President FDR's New Deal aimed at overcoming the Great Depression. The goal was to free up credit for home buyers and help lower-income borrowers obtain a mortgage who would otherwise have trouble qualifying. In 1965, the FHA became part of the Department of Housing and Urban Development's (HUD) Office of Housing. Before the FHA was created, it was common for homeowners to put down a staggering 50% of the value of the property as a down payment on short-term balloon mortgages, which clearly wasn't practical going forward. The FHA changed this by insuring the loans if lenders offered long-term fixed-rate, fully-amortizing mortgages, such as the now popular 30-year fixed. Unlike conventional home loans, FHA loans are government-backed, which protects lenders against defaults, making it possible to for them to offer prospective borrowers more competitive interest rates on traditionally more risky loans. How Does an FHA Loan Work? An FHA home loan works like any other mortgage in that you borrow a certain amount of money from a lender to purchase a home and pay it back monthly. Typically, the term on an FHA loan is 30 years and the most common type of mortgage is a 30-year fixed. They can be issued by any FHA-approved lender in the United States. And the majority of banks and lenders out there offer them. As noted, they... --- > Common Mortgage Mistakes Borrowers Make Not getting pre-approved for a mortgage Not shopping around for a lower interest rate Failing to check credit - Published: 2006-08-23 - Modified: 2024-01-17 - URL: https://www.thetruthaboutmortgage.com/mortgage-mistakes/ Common Mortgage Mistakes Borrowers Make Not getting pre-approved for a mortgage Not shopping around for a lower interest rate Failing to check credit scores in advance Opening new credit cards or other loans before/during the mortgage process Making late mortgage payments or worse, filing foreclosure/BK Not saving enough for a down payment and closing costs Not seasoning assets beforehand in a verifiable bank account Applying with limited or inconsistent employment history Changing jobs prior to or during loan process Forgetting to lock your mortgage rate Lying to the bank or lender! I've put together a list of what I feel are the top 10 "mortgage mistakes" individuals should avoid if they're planning to apply for a home loan. These apply whether you're financing a new home purchase or refinancing an existing mortgage. Avoiding these missteps will ensure your home loan process is a smooth one. Or at least not a complete train wreck. Some are obvious. Some less so. But it never hurts to brush up on the basics before an important life event. Otherwise you could end up with a higher-than-necessary mortgage rate, or worse, see your loan application get declined! 1. Filing Bankruptcy or Being Foreclosed Upon While this may be a no-brainer, it still reigns supreme. Avoid bankruptcy and foreclosure, plain and simple. Either could keep you out of the mortgage game for several years (up to seven years in fact! ) for obvious reasons. Also steer clear of late mortgage payments. I'm talking about 30+ day... --- > A "mortgage rate lock" is essential to ensure you actually receive the interest rate you are quoted by a bank or mortgage broker. When you purchase real - Published: 2006-08-22 - Modified: 2022-12-30 - URL: https://www.thetruthaboutmortgage.com/mortgage-rate-lock/ A "mortgage rate lock" is essential to ensure you actually receive the interest rate you are quoted by a bank or mortgage broker. When you purchase real estate or refinance an existing mortgage, you'll need to lock in a mortgage interest rate at some point during the loan process. You can do this early on or later in the process, depending on your preference. While comparing lenders, you'll you be presented with a mortgage rate quote, but it will mean very little until it's actually secured, or "locked" by a bank or lender. It's kind of like a car dealer telling you a price over the phone, then you show up at the dealership and the price is a lot different for whatever reason. Until you have it in writing, it doesn't carry much weight. What Is a Mortgage Rate Lock? When you lock in a mortgage rate, you are guaranteed that interest rate, assuming your loan actually qualifies under said lender or bank's guidelines. And as long as you close by the lock expiration date. By locking your home loan, you secure a specific interest rate for a given loan program based on the day it is locked. For example, you may be told that the 30-year fixed is being offered at 3. 5% today for your desired loan amount and loan-to-value ratio (LTV). Once you formally apply, you'll be given the opportunity to lock in that quoted rate so it doesn't change if market conditions worsen. Just know... --- > If you choose to verify assets, banks and lenders will ask for a certain reserve requirement that must be met to qualify for the loan, including a mortgage down payment - Published: 2006-08-18 - Modified: 2024-01-10 - URL: https://www.thetruthaboutmortgage.com/assets-and-reserve-requirements/ When applying for a mortgage, a mortgage broker or lender will likely inquire about your assets, and more specifically, your liquid assets. They'll want to know what you've squirreled away in order to come up with a down payment, pay closing costs, and make monthly mortgage payments going forward once you close your loan. Unless you're relying on a documentation type that doesn't require the verification of assets, it's very important to make sure you've got plenty of assets in your personal bank accounts. Jump to mortgage assets and reserve requirements topics: - Season Your Assets for Two Months! - Beware of Large Deposits - Asset Reserve Requirements for a Mortgage - Reserves Needed by Loan and Property Type - Allowable Types of Assets - Ineligible Types of Assets - Useful Tips Regarding Assets Needed for a Mortgage Along with that, you'll want to ensure those assets are "seasoned" for at least two months (60 days) in most cases. Season Assets Two Months Before You Apply for a Mortgage! It's important to have your assets in a verified account At least two months prior to applying for a home loan Because banks and lenders generally ask for your two most recent bank statements To verify your assets for down payment, closing costs, and reserves Many prospective homeowners and those looking to refinance make mistakes when handling their assets prior to a mortgage transaction. They may falsely assume they can just shuffle some assets from a friend or family member's account... --- > The debt-to-income ratio, or DTI, is an important calculation used by banks to determine how large of a mortgage payment you can afford based on your gross monthly income and monthly liabilities. - Published: 2006-08-17 - Modified: 2025-05-27 - URL: https://www.thetruthaboutmortgage.com/dti-debt-to-income-ratio/ The "debt-to-income ratio" or "DTI ratio" as it's known in the mortgage industry, is the way a bank or lender determines what you can afford in the way of a mortgage payment. By dividing all of your monthly liabilities (including the proposed housing payment) by your gross monthly income, they come up with a percentage. This key figure is known as your DTI, and must fall under a certain number in order to qualify for a mortgage. The maximum debt-to-income ratio will vary by mortgage lender, loan program, and investor, but the number generally ranges between 40-50%. Update: Thanks to the new Qualified Mortgage rule, most mortgages have a maximum back-end DTI ratio of 43%. However, there is a temporary exemption for many loans, but a lot of lenders still want this number to be under 43%! Jump to DTI topics: - Front-End and Back-End Debt-to-Income Ratios - Max DTI for Conforming Loans - Max DTI Ratio for FHA Loans - Max DTI Ratio for VA Loans - Max DTI Ratio for USDA Loans - How to Calculate Your DTI Ratio - What's Included in the Debt-to-Income Ratio - What’s Not Included in Your DTI - What Is a Good Debt-to-Income Ratio? - Stated Income to Avoid Debt-to-Income Ratio Problems - Qualifying Rate for Debt-to-Income Ratio Let's look at a basic example of the debt-to-income ratio: Annual gross income (as reported on your tax returns/W-2 form): $120,000 Monthly gross income: $10,000 Monthly liabilities: $3,500 35% debt-to-income ratio In this example,... --- > If you have an adjustable-rate mortgage, your interest rate may vary from month-to-month, or year-to-year, based on the index associated with your home - Published: 2006-08-17 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-indexes/ If you have an adjustable-rate mortgage, your interest rate may vary from month-to-month, or year-to-year, based on the index associated with your home loan. It is not fixed, like the 30-year fixed mortgage (or 15-year fixed mortgage). As such, when you take out an ARM your loan will be assigned a corresponding "mortgage index. " This index will come into play once your loan becomes adjustable, which could be as quickly as six months, or as long as seven years. There are a variety of "mortgage indexes" in use today that mortgage loans are tied to, which are discussed at greater length below. Be sure to research the mortgage index assigned to your ARM before you close your loan. This way you'll know what the fully-indexed rate could be in the future. Common Mortgage Indexes In Use Today - Prime rate - (For home equity lines of credit. ) - CODI - Certificate of Deposit Index - COFI- 11th District Cost of Funds Index - COSI - Cost of Savings Index - LIBOR - London Interbank Offered Rate - CMT - Constant Maturity Treasury - MTA - Monthly Treasury Average - SOFR - Secured Overnight Financing Rate (now the most common mortgage index) When you take out an ARM, you are assigned an index, which is variable, along with a pre-determined margin, which is fixed. The margin is the lender markup, which together with the index makes up your fully-indexed rate (FIR). The FIR is your mortgage rate once your... --- > A "1031 exchange," also known as a real estate exchange or a tax-deferred exchange, was created by the IRS in 1990. Simply put, the exchange occurs when - Published: 2006-08-17 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/1031-exchange-help-rules/ A "1031 exchange," also known as a real estate exchange or a tax-deferred exchange, was created by the IRS in 1990. Simply put, the exchange occurs when the proceeds from one sale are used in the subsequent purchase. It is named after IRS Code section 1031. In terms of real estate and/or mortgage, when a homeowner sells one investment property to buy another, like property, they can offset or even fully defer capital gains tax. The main idea here is you shouldn't have to pay capital gains if your intention is to immediately turn around and buy a similar property with the proceeds. How a 1031 Exchange Works If you plan to buy another investment property shortly after selling one It may be possible to defer any capital gains taxes from the sale Replacement property must be identified within 45 days and purchased 180 days from prior sale Process must be overseen by a qualified intermediary In a 1031 exchange, the property sold is referred to as the "relinquished property" and the property acquired is called the "replacement property". Prior to the introduction of the 1031 exchange, a homeowner had to simultaneously sell one property while purchasing the new property, a practice which proved to be very difficult. The IRS finally proposed a solution with the introduction of the 1031 exchange, which effectively allowed a homeowner to sell their relinquished property and use the proceeds to buy the replacement property later. However, for the exchange to work, it must be... --- > If you ever get your hands on a mortgage lender rate sheet, you’ll probably get confused in a hurry. The reason being is that they're intended to be read - Published: 2006-08-16 - Modified: 2024-07-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-pricing-adjustments/ If you ever get your hands on a mortgage lender rate sheet, you’ll probably get confused in a hurry. The reason being is that they're intended to be read by mortgage professionals, not everyday Joes. They're jam-packed with endless combinations of numbers, columns, loan programs, and confusing industry jargon. They also include the many pricing adjustments you might be charged, which can affect both your mortgage interest rate and closing costs. Allow me to give you a peek behind the curtain of the mortgage industry so you can make sense of these cryptic documents and perhaps gain a better grasp as to why you're being quoted a certain rate on your home loan. Jump to mortgage pricing adjustment topics: - How to Read a Mortgage Rate Sheet - Pricing Adjustments Grouped by LTV - 8 Key Factors to Determine a Borrower’s Overall Credit Risk - Credit Score Adjustments - Occupancy and Property Type - Mortgage Transaction Type - Documentation Type - Other Pricing Hits How to Read a Mortgage Rate Sheet Look at the following sample tables from a mortgage rate sheet: You'll see a series of interest rates with corresponding prices across different lock periods Those closest to 100 are known as par rates meaning little/no cost or credit If the number is over 100, the excess is provided as a credit to the borrower If the number is under 100, the borrower must pay discount points (or a fraction thereof) for the given rate Although each bank or... --- > Many people don't seem to understand what a "prepayment penalty" is, much to their own detriment months or years after signing mortgage loan documents. - Published: 2006-08-09 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/prepayment-penalty-mortgage/ Many people don't seem to understand what a "prepayment penalty" is, much to their own detriment months or years after signing mortgage loan documents. This is especially true because it is often poorly explained, or not brought up altogether. Instead, it's buried in the paperwork and glossed over by borrowers who are eager to close on their mortgages and move on. Unfortunately, this can be a costly mistake if you happen to break the rules, whether you realize it or not. There Are Two Types of Prepayment Penalties There are soft prepays and hard prepays A soft prepay allows for the sale of the home without penalty But penalizes you if you refinance the mortgage A hard prepay penalizes you for a home sale or a mortgage refinance A prepayment penalty, also known as a "prepay" in the industry, is an agreement between a borrower and a bank or mortgage lender that regulates what the borrower is allowed to pay off and when. Most mortgage lenders allow borrowers to pay off up to 20 percent of the loan balance each year. At this point, you might be wondering why would anyone pay more than 20 percent of their home loan off in one year? Well, thinking outside the box a bit, paying off a mortgage early can happen in a variety of different ways. If you sell your home, that is one way to paying off the loan in full. And if you refinance the loan, you effectively pay off... --- > How Mortgage Amortization Works While your mortgage payment stays the same each month The composition changes over time as the outstanding balance falls - Published: 2006-08-09 - Modified: 2023-09-22 - URL: https://www.thetruthaboutmortgage.com/amortization/ How Mortgage Amortization Works While your mortgage payment stays the same each month The composition changes over time as the outstanding balance falls Early on in the loan term most of the payment is interest And late in the term it's mostly principal that you're paying back Ever wonder how your home loan goes from a pain in your neck to real estate free and clear? Well, it all has to do with a magical little thing called "mortgage amortization," which is defined as the reduction of debt by regular payments of interest and principal sufficient to pay off a loan by maturity. In simple terms, it’s the way your mortgage payments are distributed on a monthly basis, dictating how much interest and principal will be paid off each month for the duration of the loan term. Jump to amortization topics: - Principal vs. Interest - Fully Amortized vs. Interest-Only - Mortgage Amortization Example - How to Shorten the Amortization Period - How to Pay Off My Mortgage in 10 Years or Less Understanding the way your mortgage amortizes is a great way to understand how different loan programs work. And an amortization calculator will show you how your balance is paid off on a monthly or yearly basis. It will also show you how much interest you'll pay over the life of your loan, assuming you hold it to maturity. Trust me, you'll be surprised at how much of your payment goes toward interest as opposed to the principal... --- > Quickly learn about the different types of mortgages available to home buyers today. Options include fixed-rate loans, ARMs, and many more. - Published: 2006-08-08 - Modified: 2025-01-15 - URL: https://www.thetruthaboutmortgage.com/mortgage-loan-types-home-loan-types/ There Are Many Different Types of Mortgages A variety of home loan programs exist today to serve different needs But most borrowers just go with the 30-year fixed mortgage It holds a near-90% market share for home purchase loans (and also a large share of refinances) Take the time to learn about other products that could save you a substantial amount of money Types of Mortgages by Category Conforming Loan: A mortgage backed by Fannie Mae or Freddie Mac (most common) Jumbo Loan: A mortgage with a loan amount that exceeds the conforming loan limit (currently $806,500) for the year 2025. Government Loan: A home loan backed by a government agency (includes FHA, VA, and USDA loans) Conventional Loan: A non-government home loan (can be conforming or jumbo based on loan amount) Fixed-Rate Mortgage: A home loan that features a fixed interest rate (does not change entire loan term) Adjustable-Rate Mortgage: A home loan with a variable interest rate (can adjust higher/lower during loan term) Popular Home Loan Programs Available Today 30-Year Fixed: Interest rate never changes during entire 30-year term 15-Year Fixed: Interest rate never changes during entire 15-year term 5/1 ARM: Interest rate is fixed for first 5 years and adjustable for 25 7/1 ARM: Interest rate is fixed for first 7 years and adjustable for 23 10/1 ARM: Interest rate is fixed for first 10 years and adjustable for 20 Let's talk about the many different types of mortgages and loan programs available to prospective home buyers... --- > A "mortgage point" is a fancy term used in the industry to describe a percentage point of the loan amount. So if you're paying one point on a $100,000 mortgage, it's simply $1,000. Learn more about how it works and why it's charged. - Published: 2006-07-31 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/mortgage-dictionary/mortgage-loan-points-mortgage-discount-points/ Mortgage Q&A: "What are mortgage points? " The mortgage process can be pretty stressful and hard to make sense of at times, what with all the crazy terminology and stacks of paperwork. Further complicating matters is the fact that banks and lenders do things differently. Some charge so-called loan application fees while others ask that you pay points. Then there are those that tack on lender fees and points. While shopping for a home loan, you'll likely hear the term "mortgage point" on more than one occasion. Jump to mortgage point topics: - How Much Is a Mortgage Point - How Do You Calculate Points on a Mortgage? - There Are Two Types of Mortgage Points - Paying Mortgage Points for a Lower Interest Rate - How Do Negative Points Work on a Mortgage? - Mortgage Point Examples - Mortgage Points Cost Chart Be sure to pay special attention to how many points are being charged (if any), as it will greatly affect the true cost of your loan. How Much Is a Mortgage Point? It's just another way of saying 1% of the loan amount So for a $100,000 loan one point equals $1,000 And for a $200,000 loan one point equals $2,000 The higher the loan amount, the more expensive a point becomes Wondering how mortgage points are calculated? Don't worry, it's actually really easy. You don't even need a mortgage calculator! Or a so-called mortgage points calculator, whatever that is... When it comes down to it, a... --- > Use this mortgage dictionary to quickly define mortgage terminology you may encounter when buying a home or refinancing your loan. - Published: 2006-07-31 - Modified: 2024-10-22 - URL: https://www.thetruthaboutmortgage.com/mortgage-dictionary/ Is your bank or broker confusing you with big words? Do you want to sound a whole lot savvier when handling your home loan transaction? This mortgage glossary is a good place to hone up on your mortgage vocabulary to make sense of what can be a very confusing process. The more you know about seemingly complicated mortgage terms, the more fear you'll instill in your lender. Outsmart them early on and they'll think twice before trying to overcharge you or put you in a bad loan. Check out the ever-expanding "mortgage dictionary" below. Be sure to click on the hyper-linked terms to get a more detailed definition where applicable. 1031 Exchange - a tax-deferred exchange of real estate employed to offset or even avoid capital gains tax. 15-Year Fixed Mortgage - a fixed-rate home loan that has half the typical term of 30 years. 203k Loan - an FHA loan that allows you to finance home improvements and permanent financing in a single mortgage loan. 3/1 ARM - An ARM that is fixed for the first three years (36 months) of the loan term before becoming annually adjustable. 5/1 ARM - An ARM that doesn't have its first adjustment until year six, and then adjusts once annually thereafter. 7/1 ARM - An ARM that doesn't have its first adjustment until year eight, and then adjusts once annually thereafter. Account Executive - a mortgage salesperson employed by a wholesale mortgage lender. Works with mortgage brokers to close loans via the... --- > The "yield spread premium," or YSP as it was known in the industry, was a fee paid by a mortgage lender to a mortgage broker in exchange for a higher - Published: 2006-07-31 - Modified: 2024-01-11 - URL: https://www.thetruthaboutmortgage.com/mortgage-dictionary/yield-spread-premium/ The "yield spread premium," or YSP as it was known in the industry, was a fee paid by a mortgage lender to a mortgage broker in exchange for a higher interest rate, or an above market mortgage rate. It was a common form of compensation prior to the Great Recession, at which point it was banned. Though the borrower may have qualified for a mortgage at a lower interest rate, the broker or loan officer could charge this fee and give the borrower a slightly higher rate in order to make more commission. This practice was originally intended as a way to avoid charging the borrower any out-of-pocket fees, as brokers could earn their commission AND cover closing costs with the YSP. However, as expected, the yield spread premium wound up as just another fee the borrower got stuck paying. Instead of being charged YSP only, borrowers were often charged YSP and an upfront origination fee. Effectively, borrowers were charged twice on their home loans, which explains why this practice has been outlawed. Careful You Aren't Charged Twice on Your Home Loan A mortgage broker or loan officer could effectively charge a borrower twice Once on the back-end via the yield spread premium And also on the front-end of the loan via origination fees This allowed them to make a ton of money per loan (but cost the borrower way too much! ) The big problem with yield spread premiums was homeowners were charged twice on a single transaction. This... --- > When shopping for a home loan, you may come across the term "risk-based pricing". It's a method the mortgage industry uses to measure risk and deliver - Published: 2006-07-31 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/mortgage-dictionary/risk-based-pricing-loan/ When shopping for a home loan, you may come across the term "risk-based pricing". It's a method the mortgage industry uses to measure risk and deliver appropriate interest rates based on a borrower's ability to repay their loan. To mitigate the risk of default, banks and mortgage lenders have created pricing adjustments for a variety of loan criteria. In simple terms, a borrower deemed more risky by a bank or lender will receive a higher mortgage interest rate to offset the greater probability of default. Conversely, a more qualified borrower will be granted a lower interest rate seeing that there's a smaller chance of them actually missing a mortgage payment. Less Risk = Lower Mortgage Rate Mortgage lenders use risk-based pricing Which means the less risk you present to the lender The lower your interest rate will be The opposite is also true There are a number of risk-based factors that can affect the pricing of your home loan. One of the most important factors will always be credit score. FICO scores range from 300-850, and can greatly impact the interest rate you ultimately receive. Credit scores of 760 and above are generally considered to be in the highest tier, and may result in a pricing incentive. Look at this example of risk-based pricing: FICO score ≥740 score = . 375% rebate FICO score 680-739 = no fee/rebate FICO score 660-679 = . 25% cost As you can see, FICO scores of 740 and above receive a "rebate" of .... --- > In the early 2000s, I worked as an Account Executive for a large wholesale mortgage lender based in Los Angeles, California. This meant connecting - Published: 2006-07-28 - Modified: 2024-11-11 - URL: https://www.thetruthaboutmortgage.com/about-the-author/ In the early 2000s, I worked as an Account Executive for a large wholesale mortgage lender based in Los Angeles, California. This meant connecting mortgage brokers and their borrowers with financing from my company or the correspondent lenders we worked with. Our company originated billions in loan volume each month as home prices across the United States ascended to new heights. Day in and day out, I discussed loan scenarios, scoured credit reports, reviewed appraisals, compared countless loan programs, submitted files to underwriting, found workarounds, put out fires, and much more. During this time, I saw the good times and the very bad. I experienced the boom years and the doom years before deciding to walk away from the gig while other colleagues were being laid off. Behemoths like Countrywide Financial, IndyMac, and Washington Mutual all disappeared before our very eyes. My old company did too... which is why I began tracking industry layoffs and the mortgage crisis firsthand. It was truly a time like no other in the real estate/mortgage world. I Created This Website Because I Learned a Lot on the Job That I Wanted to Share But all was not lost. In fact, after several grueling, monotonous years in the industry, something occurred to me... I knew a lot about mortgages! Because I had learned so much about the process while working on the frontlines, I decided to share my knowledge and experience with the public. That led to the launch of this very blog in 2006.... --- > A mortgage is a loan offered by a bank to a borrower that allows them to acquire a piece of real estate, such as a house or condo. - Published: 2006-07-28 - Modified: 2025-03-05 - URL: https://www.thetruthaboutmortgage.com/what-is-a-mortgage-definition/ Mortgage Definition The word "mortgage" is French in origin And literally means death pledge in their native language (mort = death, gage = pledge) Yet the French use a different word for mortgage (they say hypothèque) Go figure, right... Let’s start with the ultra basic: "What is a mortgage? " Over here at The Truth About Mortgage, this is always the word of the day, as you might have guessed. Fortunately, the definition of mortgage has a somewhat interesting origin. You've undoubtedly heard the word "mortgage" thrown around a million times. But you may not know that in the literal sense, it is defined as a "death pledge" in the French language. Ironically, the French don't actually use the word themselves (they use hypothèque, while Spanish speakers use the similar word hipoteca). Broken down, the mort part (pronounced more) means death and the gage part (pronounced gahj) means pledge. This pledge dies (is terminated) when the mortgage is either paid off in full or the property is repossessed (foreclosed) by the bank if not paid as agreed (borrower defaults). So that's the literal definition of mortgage; now let's look at the real-world application. The Many Different Ways to Say Mortgage Home loan Lien Deed of trust Death pledge A mortgage can be referred to in a variety of different ways, with the most common being a "home loan. " Some may refer to a mortgage as a "lien," which represents a security interest by a lender on a piece of... --- > There are a variety of different ways to obtain a mortgage, but let's focus on two specific channels, "mortgage brokers versus banks." There are mortgage - Published: 2006-07-27 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-brokers-vs-banks/ There are a variety of different ways to obtain a mortgage, but let's focus on two specific channels, "mortgage brokers versus banks. " There are mortgage brokers, who work as middlemen between banks/mortgage lenders and borrowers on the wholesale end to secure financing for homeowners. And there are banks/lenders that work directly with homeowners to provide financing on the retail level, known as consumer-direct lending. Mortgage brokers are a big part of the mortgage business, accounting for more than 10 percent of all home loan originations, give or take. In fact, their share of the mortgage pie was as high as 30 percent during the mortgage boom, but fell precipitously after the mortgage crisis ensued. But brokers still serve an important role in the industry, and can be quite beneficial for both prospective homeowners and those looking to refinance a mortgage. There Are Pros and Cons to Both Both can be a good choice for home buyers and existing homeowners But it depends on your loan scenario and your individual needs It doesn't need to be an either/or discussion when shopping for a home loan Compare the two to ensure you receive the lowest interest rate and fees There are pros and cons to both, and sometimes you will have little choice between the two if you have poor credit or a tricky loan scenario. The majority of homeowners turn to banks or large mortgage lenders when it comes time to get a mortgage. They are the most obvious choice,... --- > When considering a home purchase, or a mortgage refinance for that matter, knowing the true value of the subject property is paramount. Getting a precise - Published: 2006-07-27 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/home-value-house-value/ When considering a home purchase, or a mortgage refinance for that matter, knowing the true value of the subject property is paramount. Getting a precise assessment of what a property is worth is one of the most important aspects of real estate, and especially critical to the bank or lender providing financing. After all, it is the bank that technically owns your home until the mortgage is paid off, so they too have a financial interest in the property in question, often a far bigger one than the borrower. For example, if you only come in with a 3% down payment on the purchase, the bank is on the hook for the remaining 97% of the home value. That's a big chunk of change. The House Is the Collateral How much of your home do you actually own? If you have a large mortgage on your property The lender might technically own most of it Until you pay it down substantially and/or home prices increase From the lender's standpoint, the house itself acts as collateral, so it is imperative to have an accurate appraised value when providing mortgage financing. This is also very important to the seller, who will want to list their home for the highest price possible, but also to the buyer who will want to acquire the home for the lowest price. Real estate agents will also want to get this right so they can maximize their commission. And while a buyer and seller can agree to... --- > If the term mortgage has crossed your mind recently and you're in the market to purchase a new home, you've probably asked yourself, "How much house can I - Published: 2006-07-27 - Modified: 2025-01-15 - URL: https://www.thetruthaboutmortgage.com/how-much-can-i-afford/ If the term mortgage has crossed your mind recently and you're in the market to purchase a new home, you've probably asked yourself, "How much house can I afford"? This is a very important question all prospective homeowners should know the answer to well before they begin looking for a property, whether it's a single-family home, condo, or townhouse. Knowing how much mortgage you can afford will streamline your property search so you focus only on listings you can afford to buy. This can save you time and make you more productive. And hopefully successful in finding your dream home. In reality, if you don't already have a mortgage pre-approval in hand, which essentially details how much house you can afford, most real estate agents won't even take you seriously. Why? Because home sellers won't want to waste their time with a prospective buyer that isn't actually qualified in a given price range. Jump to mortgage affordability topics: - Your Salary Alone Doesn’t Answer the Question - Your Down Payment and Affordability - Income vs. Liabilities - Figure Out Your DTI - What You’re Comfortable With vs. What the Lender Will Allow - A Lower Mortgage Rate Means You Can Borrow More How Much Mortgage Can I Afford On... 50k, 100k, 200k You can't just plug in your income to determine mortgage affordability You have to consider your other monthly expenses against your salary And factor in your down payment and current mortgage rates Don't forget local property taxes and... --- --- ## Posts > Another big tie-up has been announced in the mortgage space, this time between the nation’s top mortgage lender and a credit card company. Bilt announced - Published: 2025-07-12 - Modified: 2025-07-12 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lender-uwm-invests-100m-in-bilt-credit-card-to-drive-more-leads/ - Categories: Mortgage News Another big tie-up has been announced in the mortgage space, this time between the nation’s top mortgage lender and a credit card company. Bilt announced that is raised another $250 million at a mouthwatering $10. 75B valuation, with United Wholesale Mortgage (UWM) investing $100M. That’s a pretty big chunk of money, which appears to be tied to mortgage expansion plans at Bilt. One of those plans seems to be allowing homeowners to pay the mortgage with a credit card, or at least via the Bilt network. And chances are UWM will look to tap into their big renter customer base to turn those folks into future homeowners. Bilt Card 2. 0 Arrives in February 2026, Will You Be Able to Pay the Mortgage with It? As part of the announcement, the company said the Bilt Card 2. 0 will launch in February of next year. It actually comes in three flavors and is being developed by a company called Cardless, which was behind the new American Express Coinbase card. The lineup will include a no annual fee option, along with two premium versions of the card with a $95 and $495 annual fee. Bilt will also move away from Wells Fargo as the card issuer as a result of this change, and details regarding the new issuing partner will be announced in early fall. While it’s unclear what each version will offer, one thing they did say is there will be “enhanced rewards including points on both rent and mortgage.... --- > You’ve heard the news. FHFA Director Bill Pulte has ordered Fannie Mae and Freddie Mac to begin accepting VantageScore credit scores immediately. The - Published: 2025-07-11 - Modified: 2025-07-11 - URL: https://www.thetruthaboutmortgage.com/will-paying-rent-on-time-really-make-it-easier-to-get-a-mortgage/ - Categories: Mortgage News You’ve heard the news. FHFA Director Bill Pulte has ordered Fannie Mae and Freddie Mac to begin accepting VantageScore credit scores immediately. The notice was informal, and has been the case lately, fired off via a tweet on the social media platform X. It allows mortgage lenders to use VantageScore 4. 0, with no requirement to build out any “new infrastructure. ” The big question though is how many lenders will adopt the FICO score alternative, and will it really lead to lower costs for consumers. In addition, will it actually result in a sizable increase in mortgage lending volume, or is it being blown out of proportion. VantageScore Has Been Approved for Use by Mortgage Lenders Since 2022 First some quick background. The Federal Housing Finance Agency (FHFA), which oversees Fannie Mae and Freddie Mac, approved the use of VantageScore all the way back in October 2022. Yes, you read that correctly. Nearly three years ago. Yet pretty much every bank, lender, credit union, and broker continues to use FICO scores only. Even before 2022, there was the 2018 Credit Score Competition Act, ironically signed into law by President Trump during his first term, which paved the road for alternative credit scores. Despite that, the VantageScore never got adopted commercially, at least on a wide scale, and again, FICO was the only game in town. However, that 2022 directive did require Fannie Mae and Freddie Mac to begin accepting mortgages scored with VantageScore within three years, which would be... --- > Somewhat amazingly, the 30-year fixed is once again priced back near 7% thanks to a hot jobs report. While many expected a soft report that would have - Published: 2025-07-08 - Modified: 2025-07-08 - URL: https://www.thetruthaboutmortgage.com/for-mortgage-rates-lts-all-eyes-on-labor-at-this-point/ - Categories: Mortgage Rates Somewhat amazingly, the 30-year fixed is once again priced back near 7% thanks to a hot jobs report. While many expected a soft report that would have aligned with the most recent negative ADP report, it wasn’t in the cards. Instead, job gains beat forecasts, with 147,000 new jobs reported in June, higher than the 110,000 expected. The unemployment rate also ticked down to 4. 1% from 4. 2%, per the Bureau of Labor Statistics. And with the big beautiful bill complete and the tariff stuff seemingly more tame, jobs data will likely be key to getting mortgage rates lower. Mortgage Rates Back Near 7% After Hot Jobs Report With the spending bill signed, and the tariffs losing steam despite continued flip flopping, labor appears to be focal point. What I mean by that is if you want mortgage rates to move lower, you need the jobs data to turn more negative. Thus far, the economy has continued to look resilient and fend off any implied weakness or recession talk thanks to more strong jobs data. Of course, many including perhaps myself, think it’s just a matter of time. Not if, but when. You’re hearing about a lot more layoffs, you’re hearing about people having a really hard time getting a job. You’re hearing about AI displacing all types of workers, whether it’s white-collar jobs or even the trades. And the jobs report wasn’t so hot once it was dissected, with private payrolls (excluding government jobs) seeing a pretty weak... --- > A lot of people (even industry folks) speak about HELOCs and home equity loans interchangeably. As if they’re essentially the same thing and not even - Published: 2025-07-07 - Modified: 2025-07-07 - URL: https://www.thetruthaboutmortgage.com/a-key-difference-between-helocs-and-home-equity-loans-could-matter-again-soon/ - Categories: Mortgage Tips A lot of people (even industry folks) speak about HELOCs and home equity loans interchangeably. As if they’re essentially the same thing and not even different. After all, both allow you to tap into your home equity for cash needs, and they’re often second mortgages. But while they do share some commonalities, they’re also vastly distinct products. One thing I thought of recently that’s critically different is that a HELOC can be turned off. Yes, the issuing bank can close the tap on your HELOC at any time, at which you won’t be able to borrow from it anymore. HELOCs Can Be Frozen or Reduced by the Bank I got to thinking that now with the economy arguably on shaky ground, banks and lenders might get a little more conservative in coming years. While layoffs seem to be rising, the unemployment rate has been fairly steady for the past year or so. But there’s a lot of worry that job losses could accelerate, especially as AI begins to eliminate a lot of positions, whether it's white-collar jobs or even the trades. There’s also been the threat of a recession for years now, though it hasn’t yet materialized. At the same time, home prices are beginning to feel the pressure, and in some markets big price drops are happening. One potentially serious downside to a home equity line of credit (HELOC) is that it can be frozen or reduced, especially during turbulent times. This actually took place in the early 2000s... --- > The popular trading platform Robinhood has teamed up with Sage Home Loans to offer big mortgage rate discounts to its Gold members. While Robinhood hasn't - Published: 2025-07-03 - Modified: 2025-07-04 - URL: https://www.thetruthaboutmortgage.com/robinhood-partners-with-sage-home-loans-to-offer-mortgage-rate-discounts-to-gold-members/ - Categories: Mortgage News The popular trading platform Robinhood has teamed up with Sage Home Loans to offer big mortgage rate discounts to its Gold members. While Robinhood hasn't entered the loan origination game, they are referring members to Sage and the rate discount appears to be sizable. However, membership to Robinhood Gold does cost $5 per month (or $50 per year), so there is a cost. But it comes with a variety of other perks as well, such as 4% APY on uninvested cash. Not too shabby. Let’s take a look at this new mortgage perk to see if it’s worth exploring. Robinhood x Sage Home Loans Partnership If you’re already a Robinhood Gold member, or thinking about becoming one, their latest perk includes discounted mortgage rates with a third-party, unaffiliated mortgage lender called Sage Home Loans. So first and foremost, Robinhood isn’t making mortgages all of a sudden. They have simply partnered with a mortgage lender to provide a potential benefit to their customers. And I assume they earn a referral fee of some kind for doing so. What’s interesting though is you might be able to get a better deal with Sage Home Loans if you’re a Robinhood Gold member as opposed to simply contacting them directly. On top of that, they also provide a $500 closing cost credit when you use the company to buy a home or refinance an existing property. Taken together, you could potentially save a good deal of money, assuming the interest rate is also significantly... --- > I was thinking about mortgage rates, as I often do, when I decided to pose a question to Grok, the LLM chatbot owned by xAI. So many folks debate which - Published: 2025-07-02 - Modified: 2025-07-02 - URL: https://www.thetruthaboutmortgage.com/will-mortgage-rates-be-higher-or-lower-by-the-end-of-2025-i-asked-ai/ - Categories: Mortgage Rates I was thinking about mortgage rates, as I often do, when I decided to pose a question to Grok, the LLM chatbot owned by xAI. So many folks debate which way interest rates are going that I decided to just ask the chatbot instead. Why bother debating with humans when I can just ask the super intelligent computer to spit out an answer for me based on data. Specifically, I asked the following: “Is there a higher likelihood of U. S. mortgage rates being higher or lower than current levels by December 31st, 2025? ” And lo and behold, Grok told me “the consensus leans toward a modest decline. ” A Modest Decline for Mortgage Rates? In what felt like a pretty safe answer (apparently chatbots are so like us), Grok summed up a much longer response I won’t bore you with by saying a “modest decline” was likely. This modest decline was based upon “expert forecasts” from about a dozen institutions and economists, including the likes of Fannie Mae, the Mortgage Bankers Association, NAHB, NAR, Wells Fargo, and several others. Grok arrived at the answer by taking an average of all these forecasts it compiled, noting that most of them ranged from 6. 1% to 6. 6% by December 31st, 2025. Given that the current 30-year fixed rate is 6. 77%, according to Freddie Mac (who incidentally doesn’t have a forecast), this would indicate that we’re going lower by year end. Among the forecasts cited, S&P Global’s 5. 5%... --- > The Rocket Mortgage acquisition of Redfin is now complete. You might notice changes if you visit the Redfin website, or if you update the app on your - Published: 2025-07-01 - Modified: 2025-07-01 - URL: https://www.thetruthaboutmortgage.com/rocket-mortgage-completes-redfin-takeover-offers-6000-home-buyer-credit/ - Categories: Mortgage Tips The Rocket Mortgage acquisition of Redfin is now complete. You might notice changes if you visit the Redfin website, or if you update the app on your smartphone. The website now says, “Powered by Rocket” below the Redfin logo, which has also integrated the Rocket red person artwork. In addition, the mortgage tab on Redfin’s website now leads to Rocket’s daily mortgage rates and the ability to get pre-qualified for a home loan with Rocket. So the third-party mortgage lenders have now been removed from the Redfin website, and it’s all Rocket moving forward. Redfin Powered by Rocket Is Now Live The new Redfin website has a prominent “Powered by Rocket” text below the new Redfin logo. The smartphone app also received a fresh look, and when you open the app, it says “Redfin is now part of Rocket Companies. ” “It’s the same great app you love, now with more ways to make owning a home more affordable with Rocket Mortgage. ” There’s also a “Get prequalified” button that directs you to Rocket Mortgage, at which point you’re ported to a Rocket Mortgage lead form (or asked to log in if already a user). This was largely what I expected from the merger. All the places where Redfin used to feature third-party mortgage lenders have been replaced by Rocket. So any time you get to a mortgage-related portion of the Redfin website or app, it will be powered by Rocket. The aim is to capture as much Redfin home... --- > President Trump’s latest salvo against Fed Chair Jerome Powell called for 1% interest rates. And he added that he’d “love him to resign if he wanted to, - Published: 2025-06-30 - Modified: 2025-06-30 - URL: https://www.thetruthaboutmortgage.com/trump-wants-interest-rates-cut-to-1-what-would-that-mean-for-mortgage-rates/ - Categories: Mortgage Rates President Trump’s latest salvo against Fed Chair Jerome Powell called for 1% interest rates. And he added that he’d “love him to resign if he wanted to, he’s done a lousy job. ” Thing is, if the Fed were to cut its own fed funds rate to 1%, how would that actually affect mortgage rates? There’s not a clear correlation between the short-term FFR and the long-term 30-year fixed. So there’s no guarantee Powell’s replacement, if he/she were to lower rates aggressively, would lead to lower mortgage rates too. Trump Wants 1% Interest Rates and a Powell Resignation The President told reporters that “I think we should be paying 1% right now, and we're paying more because we have a guy who suffers from, I think, Trump Derangement Syndrome. ” He also posted this image on his Truth Social account saying rates should be in the 1% or less range. This isn’t the first time Trump has called on Powell to lower rates, nor will it be the last, but I found it interesting he explicitly asked for 1% rates this time around. To put that in perspective, the FFR is currently at a range of 4. 25% to 4. 50%. It was effectively set at zero from 2009 to 2015, and again during the pandemic, before rising above 5% to combat out-of-control inflation. Last year, the Fed cut its key policy rate 100 basis points (bps) via four rate cuts, but has since taken their foot off the pedal.... --- > While President Trump and FHFA Director Pulte continue to call for lower rates, mortgage rates have quietly marched down to their 2025 lows. It’s kind of - Published: 2025-06-30 - Modified: 2025-06-30 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-quietly-fall-to-lows-of-2025/ - Categories: Mortgage Rates While President Trump and FHFA Director Pulte continue to call for lower rates, mortgage rates have quietly marched down to their 2025 lows. It’s kind of funny to see it play out because they’ve been barking up the wrong tree, yet still seeing desired results. That wrong tree is Fed Chair Powell, who along with the other Fed members does not set consumer mortgage rates. Despite that, it seems that almost daily he’s lambasted for waiting to cut rates, which makes you wonder if it’s a more elaborate move to cast blame if things go sideways. In any event, the 30-year fixed is now near its best levels of 2025, and could get even better. The 30-Year Fixed Mortgage Is Inching Back Toward 6. 50% Sure, 6. 50% didn’t sound too hot back in 2022 when the 30-year fixed was still in the 3-4% range, but what a difference a few years make. This is the beauty of the human mind, which makes adjustments after being exposed to changing conditions. With regard to mortgage rates, once you see 8%, 6-something doesn’t sound half bad anymore. You might forget (to be fair, not completely) where mortgage rates used to be, and just be happy they aren’t as bad as they were. For reference, the 30-year fixed ascended past 8% in October 2023, before beginning to enter a falling rate trajectory. Albeit one with ups and downs along the way. Now mortgage rates are just about at their lows for the year,... --- > There’s been a lot of hubbub about crypto-backed mortgages in the past 24 hours. But the excitement (of crypto enthusiasts) might be a little overdone. - Published: 2025-06-26 - Modified: 2025-06-27 - URL: https://www.thetruthaboutmortgage.com/what-the-fannie-mae-and-freddie-mac-crypto-order-really-means/ - Categories: Mortgage News There’s been a lot of hubbub about crypto-backed mortgages in the past 24 hours. But the excitement (of crypto enthusiasts) might be a little overdone. It's time to explain. When it comes down to it, all that happened was FHFA Director Bill Pulte ordered Fannie Mae and Freddie Mac to “consider cryptocurrency” in their risk assessments. And to allow so-called HODLers to qualify for a mortgage without actually having to sell their crypto holdings, maybe. In other words, it’s only a starting point in the discussion and it’s not really a crypto-backed mortgage. Current Mortgage Guidelines Require Virtual Currency to Be Sold First If Used for Qualifying First a quick background on the matter. As it stands now, Fannie Mae and Freddie Mac require mortgage loan applicants to sell any virtual currency they wish to use for qualifying purposes. For example, if you have $100,000 in bitcoin holdings, and want to use it for the down payment, closing costs, or for asset reserves, it must be sold into U. S. dollars in order to be counted. At that point, it’s considered “acceptable for the down payment, closing costs, and financial reserves,” per Fannie Mae guideline B3-4. 1-04. Specifically, this means providing documented evidence that the virtual currency you’d like to pledge toward the mortgage has been exchanged into U. S. dollars and is then held in a U. S. or state regulated financial institution. In addition, the funds must be verified to be in U. S. dollars prior to the... --- > In testimony to the House Financial Services Committee today, Federal Reserve Chair Jerome Powell said they haven’t cut rates this year because of the - Published: 2025-06-25 - Modified: 2025-06-25 - URL: https://www.thetruthaboutmortgage.com/powell-says-theyd-still-be-cutting-if-there-werent-tariffs-and-chances-are-mortgage-rates-would-be-lower-too/ - Categories: Mortgage Rates In testimony to the House Financial Services Committee today, Federal Reserve Chair Jerome Powell said they haven’t cut rates this year because of the tariffs. And if there wasn’t the looming threat of inflation due to the tariffs, the data would say to keep cutting, as the Fed did in 2024. They cut the fed funds rate three times last year, including a 50-basis point cut in September, followed by a 25-bp cut in both November and December. Then they stopped cutting as President Trump came into office and shortly after announced sweeping global tariffs. Many expect those tariffs to result in some level of inflation, which makes it difficult for the Fed to continue cutting. That could also be why mortgage rates are having a tough time coming down too. The Tariffs Are Expected to Be Inflationary, One Way or Another While there’s been plenty of debate about tariffs since the start of the year, most expect them to be inflationary. And if you to speak to anyone who operates a small business, which relies to some extent on imports, they’ll tell you prices are going to rise. It’s pretty straightforward. If it costs companies more money to bring products into the United States, the price must go up for consumers. But the importer won’t foot the entire bill, nor will the retailer, or the consumer for that matter. It’ll be split up to some degree to lessen the blow, but even with a friendly arrangement of cost splitting,... --- > The nation’s second largest mortgage lender has launched a new bridge loan product to help buyers move before selling their existing home. It allows them - Published: 2025-06-24 - Modified: 2025-06-24 - URL: https://www.thetruthaboutmortgage.com/rocket-mortgage-launches-bridge-loan-to-help-customers-buy-now-sell-later/ - Categories: Mortgage News The nation’s second largest mortgage lender has launched a new bridge loan product to help buyers move before selling their existing home. It allows them to tap into their often enormous amount of equity while avoiding having to make a contingent offer. This could improve their odds of a winning bid, as sellers will typically favor their offer over others that require the sale of the departing residence. Of course, it merely buys them some time and eventually they’ll need to sell their old home to pay back the loan. But it is yet another option for those looking to move, especially in markets that continue to experience tight inventory. Rocket Mortgage Bridge Loan Provides Up to Six Months to Sell The new bridge loan from Rocket Mortgage makes it easier to buy before selling your existing home by unlocking home equity prior to a sale. That money can then be used to fund the down payment on the new purchase, and/or go toward closing costs on the new loan. There are lots of move-up home buyers with a ton of home equity thanks to rapidly rising home prices and record low mortgage rates, which increased the speed of principal repayment. But you don’t have access to that equity unless you took out a home equity loan or a HELOC. The bridge loan gives you access to some of that money to put toward the home purchase while you attempt to sell your existing residence. Once sold, you can use... --- > While one may have worried that mortgage rates would move higher after the U.S. bombed Iran nuclear facilities, so far things have gone the other way. - Published: 2025-06-23 - Modified: 2025-06-23 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-move-lower-despite-evolving-iran-conflict/ - Categories: Home Buying, Mortgage Rates While one may have worried that mortgage rates would move higher after the U. S. bombed Iran nuclear facilities, so far things have gone the other way. Perhaps it helped to have a day or two to assess the impact and the ramifications. One being the cost of oil, which could rise if Iran decides to close the Strait of Hormuz and disrupt the flow of ships through the narrow channel. However, many seem to think such a move would be unlikely, and that any spike in oil prices would be short-lived. Indeed, oil prices were falling today as 10-year bond yields also eased, meaning the 30-year fixed mortgage will also be cheaper today. Bond Yields Lowest Since Early May, Mortgage Rates Should Follow At last glance, the 10-year bond yield, which serves as a bellwether for 30-year fixed mortgage rates, was the lowest it has been since early May. It was down about seven basis points to 4. 30%, not far from the lowest levels of 2025 other than a couple blips along the way. That will translate to lower mortgage rates as well, though it won’t signal any major relief. And given the situation at hand, which can evolve and shift directions quickly, I can’t imagine mortgage lenders will get too loose on pricing. Even if lower bond yields mean mortgage rates should be lower, we might see muted movement and higher mortgage rate spreads to account for increased uncertainty. In other words, don’t get your hopes up... --- > It’s no secret certain folks don’t like Fed Chair Powell. You may have heard of one of them, President Donald Trump, who refers to him as a “Too Late - Published: 2025-06-20 - Modified: 2025-06-20 - URL: https://www.thetruthaboutmortgage.com/pulte-blames-powell-for-high-mortgage-rates-and-trapping-borrowers-in-their-homes/ - Categories: Mortgage News, Mortgage Rates It’s no secret certain folks don’t like Fed Chair Powell. You may have heard of one of them, President Donald Trump, who refers to him as a “Too Late Powell. ” He also calls him other names that I won’t repeat here. Now he’s got another strong critic in FHFA Director Bill Pulte, whose agency oversees Fannie Mae and Freddie Mac. These two companies are responsible for most of the mortgages in existence, with conforming loans far and away the most common loan type out there. For this reason, Pulte has called on Powell to lower rates or resign, the strongest words he’s uttered since taking the helm at the FHFA. Cut Rates or Resign Powell Pulte went off in a series of posts on X, saying very directly, “I am calling for Federal Reserve Chairman, Jay Powell, to resign. ” He followed that tweet with more one-liners, including, “There is no legitimate factual basis to keep rates high. None. ” And this one: “Americans are sick and tired of Jerome Powell. Let’s move on! ” But he was just getting started. He went on to write, “... he is hurting Americans and hurting the mortgage market, which I am responsible for regulating. ” Then explained how Powell is “the main reason” we have a so-called housing supply crisis in our country. That “by improperly keeping interest rates high,” Powell has trapped homeowners in low-rate mortgages while choking off for-sale supply. He ended that tweet by repeating that “He must... --- > The big Fed decision yesterday was keeping rates unchanged. Everyone knew that was going to be the case and didn’t bat an eye. However, things are always - Published: 2025-06-19 - Modified: 2025-06-19 - URL: https://www.thetruthaboutmortgage.com/powell-signals-there-wont-be-shortcuts-on-rate-cuts-or-path-to-lower-mortgage-rates/ - Categories: Housing Market, Mortgage Rates The big Fed decision yesterday was keeping rates unchanged. Everyone knew that was going to be the case and didn’t bat an eye. However, things are always a bit more interesting because we get to hear from the Fed Chair after they release their FOMC statement. Chair Powell actually touched on the housing market directly, despite the Fed not being explicitly concerned with housing. Or with mortgage rates for that matter either. But the takeaway seemed to be that the Fed continues to be in no rush to get too accommodative, despite pleas from the President and FHFA Director. And that any changes, i. e. cuts, need to foster a sustainable housing market with better equilibrium between buyers and sellers. Restoring Price Stability in a Sustainable Way First some quick background. The Fed raised rates (their own fed funds rate) back in 2022 as inflation began to spiral out of control. The housing market was also extremely overheated, in Powell's own words, after a couple pandemic years pushed prices up another 50% (from already high levels) in many cities nationwide. While the Fed couldn’t go out and build more houses to alleviate the supply shortage, and thus stabilize prices, they could do their best to cool demand. The best way to cool demand would be by raising rates. The Fed doesn’t control mortgage rates, but their monetary policy can indirectly affect the price of bonds, like the 10-year Treasury. This can cause bond yields to rise or fall, and 30-year... --- > I got to thinking that one way mortgage rates could come down is due to housing market weakness. The thought is layered in all types of irony because the - Published: 2025-06-18 - Modified: 2025-06-18 - URL: https://www.thetruthaboutmortgage.com/is-housing-market-weakness-what-finally-brings-down-mortgage-rates/ - Categories: Mortgage Rates I got to thinking that one way mortgage rates could come down is due to housing market weakness. The thought is layered in all types of irony because the Fed arguably raised rates back in 2022 due mostly to an overheated housing market. Back then, they knew the only way to push back demand was to end QE, raise their own fed funds rate, and hope mortgage rates followed. Mortgage rates did indeed follow, rising from around 3% to over 7% in less than a year. And now the longer-term result of that rate hiking campaign could finally lead to more easing. The Housing Market Is Teetering, Finally It took a lot longer than anticipated, but the housing market is finally showing real signs of stress. Affordability has been a problem for a couple years now, due largely (again) to mortgage rates. But now we’re finally seeing for-sale inventory grow and home prices begin to fall or move sideways in many markets. The latest weak data was housing starts, which came in below expectations. Housing starts, which represent the breaking ground of new builds, fell almost 10% in May and were off nearly 5% from a year ago. Meanwhile, building permits, the step proceeding starts, slid to a seasonally adjusted annual rate of 1. 393 million in May, per the Census Bureau, the lowest level in almost five years. Then there was home builder sentiment, which dropped to its third lowest point since 2012, which was around the time the... --- > In yet another mortgage tie-up, Guild Mortgage has agreed to be acquired by Bayview Asset Management. It’s pretty big news in the mortgage world because - Published: 2025-06-18 - Modified: 2025-06-18 - URL: https://www.thetruthaboutmortgage.com/guild-mortgage-to-be-acquired-by-bayview-asset-management-for-1-3b/ - Categories: Mortgage News In yet another mortgage tie-up, Guild Mortgage has agreed to be acquired by Bayview Asset Management. It’s pretty big news in the mortgage world because Guild was the 11th largest mortgage lender in 2024, per HMDA data. And ultimately not that far off from being in the top-5 nationally if they had mustered just a little more loan volume. Once combined with their acquirer, who happens to own a major loan servicer, they could make an even bigger splash and grow to be closer to other elite names in the space. The deal also takes Guild private for about $20 per share, which could change how they operate going forward. Guild Mortgage Will Combine with Lakeview Loan Servicing for Recapture Opportunity The story is a familiar one lately. A mortgage lender linking up with a loan servicer, similar to Rocket’s acquisition of Mr. Cooper. What’s interesting here is Bayview Asset Management happens to own the nation’s largest mortgage loan servicer, Lakeview Loan Servicing. Slightly confusing given all the views in the names, and the bay versus lake, but stay with me here. This is a similar play to the Rocket/Mr. Cooper merger, with a loan originator (Guild) combining with a loan servicer (Lakeview Loan Servicing). While Lakeview is a major loan servicer (and their website still says “Largest mortgage loan servicer in the U. S. ”), I believe Mr. Cooper is technically bigger. Mr. Cooper also says on their website, “We're the largest mortgage servicer in the country-with over 5... --- > Lately, I've been highlighting loan programs beyond the 30-year fixed now that interest rates on fixed-rate mortgages are no longer favorable. Today, - Published: 2025-06-17 - Modified: 2025-06-17 - URL: https://www.thetruthaboutmortgage.com/30-year-fixed-vs-7-year-arm/ - Categories: Mortgage Matchups, Mortgage Tips Lately, I've been highlighting loan programs beyond the 30-year fixed now that interest rates on fixed-rate mortgages are no longer favorable. Today, we'll compare two popular loan programs, the 30-year fixed versus the 7-year ARM. Everyone is familiar with the traditional 30-year fixed – it's a home loan with a 30-year term and an interest rate that never adjusts the entire loan term. Pretty simple, right? But what about the 7-year ARM, or more specifically, the 7/1 ARM? It's an adjustable-rate mortgage and a fixed-rate mortgage, all rolled into one. Sounds a little bit more complicated... Let's dig in and determine if it's time to start looking beyond the 30-year fixed to potentially save some money on your home loan. Key Facts About 7-Year ARMs They are hybrid home loans that are fixed for 7 years and adjustable for the remaining 23 years Offer an interest rate discount for the risk of future (higher) rate adjustments 7/1 ARM is fixed for seven years and annually adjustable thereafter 7/6 ARM is fixed for seven years and adjusts every six months thereafter Pay attention to the difference in start rate to determine if it's worth it vs. a 30-year fixed Plan for the worst seven years from date of loan funding (if rates jump a lot higher) How the 7/1 ARM Works You get a fixed interest rate for the first seven years of the loan term After that the rate becomes annually adjustable for the remaining 23 years of the 30-year... --- > As if mortgage rates didn’t have enough problems lately, now they’ve got the threat of rising oil prices. And the inflation that could come with them, - Published: 2025-06-16 - Modified: 2025-06-16 - URL: https://www.thetruthaboutmortgage.com/rising-oil-prices-could-be-yet-another-headwind-for-mortgage-rates/ - Categories: Mortgage Rates As if mortgage rates didn’t have enough problems lately, now they’ve got the threat of rising oil prices. And the inflation that could come with them, further pushing out any expected mortgage rate relief. While the price of oil has eased a bit after spiking Friday due to the Israel-Iran conflict, it could exacerbate an already difficult global economic situation. Coupled with the uncertainty of tariffs, the Fed will have an even more difficult assignment on their hands. The result might be elevated-for-longer bond yields and no Fed rate cuts this year if things get worse. More Uncertainty for Mortgage Rates Due to the Middle East Conflict The keyword lately has been uncertainty. Ever since Trump won the election and the trade war got underway, the Fed has been in a veritable holding pattern. The constant flip-flopping on trade and tariffs has made economic projections extremely difficult for them and everyone else. And that means monetary policy is basically stuck, even if the (cooler) data supports lower interest rates. As such, the 30-year fixed has been hovering closer to 7% than 6% ever since Trump got into office. On Friday, yet another layer of uncertainty was added to the list after Israel struck oil facilities in Iran. While outright war could actually lead to Fed rate cuts if the economy falls into a dire situation, a more likely scenario is just more inflation. Higher oil prices are inflationary and if they stay elevated, consumers will pay the price, literally. One... --- > It’s time to check out the top mortgage lenders in Georgia based on their 2024 home lending volume. These mortgage companies outranked about 960 other - Published: 2025-06-16 - Modified: 2025-06-16 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-georgia/ - Categories: Mortgage Tips It’s time to check out the top mortgage lenders in Georgia based on their 2024 home lending volume. These mortgage companies outranked about 960 other lenders in the state to take the top honors. Overall, about $60 billion in home loans was funded in The Peach State last year, making it one of the bigger states volume-wise nationwide. And taking the #1 spot was United Wholesale Mortgage (UWM), also the nation’s largest mortgage lender. Read on to see which other companies ranked in the top 10. Top Mortgage Lenders in Georgia (Overall) Ranking Company Name 2024 Loan Volume 1. UWM $4. 9 billion 2. Rocket Mortgage $4. 4 billion 3. Ameris Bank $2. 0 billion 4. Fairway Independent $1. 3 billion 5. Veterans United $1. 2 billion 6. DHI Mortgage $1. 1 billion 7. New American $1. 1 billion 8. Freedom Mortgage $1. 1 billion 9. Pennymac $1. 1 billion 10. Truist $1. 0 billion While the state of Georgia is one of the heavier hitters for mortgage lending, their volume has come down a lot. For comparison, $160 billion was funded in 2021 when mortgage rates hit record lows. Despite that, Pontiac, Michigan-based UWM, which happens to be the top mortgage lender nationally, led the way with $4. 9 billion funded. It beat out crosstown rival Detroit-based Rocket Mortgage, which originated a relatively close $4. 4 billion in home loans in Georgia last year. That was more than double their nearest competitor, Atlanta-based Ameris Bank, per HMDA data from... --- > Mortgage rates came down after a softer-than-expected CPI print. But only a little bit. Instead of a 30-year fixed quote of 7%, you might see 6.875% - Published: 2025-06-12 - Modified: 2025-06-12 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-lower-as-inflation-eases-but-only-a-little/ - Categories: Mortgage Rates Mortgage rates came down after a softer-than-expected CPI print. But only a little bit. Instead of a 30-year fixed quote of 7%, you might see 6. 875% instead. It’s not a big difference, but it does provide some savings as buyers grapple with poor affordability. Problem is rates continue to stay in a range and can’t break meaningfully lower with so many unknowns still unresolved. Weak data is great for rates, but can only do so much when tariff impact is yet to be seen. CPI Cools, Pushing Mortgage Rates Back Away from 7% The much anticipated CPI report came in favorably for mortgage rates yesterday. Prices rose just 0. 1% in May, per the Bureau of Labor Statistics (BLS), down from 0. 2% in April. The monthly tally also beat the 0. 2% forecast. At the same time, prices climbed 2. 4% annually, which was in line with expectations. Core CPI, which strips out food and energy, beat expectations both by month and by year. That led to a bit of a bond rally, with the 10-year yield falling about six basis points to 4. 41%. It was enough to push mortgage rates down to around 6. 875% from closer to 7%. Certainly good news for prospective home buyers after a hot jobs report last Friday. But not enough to make a huge impact. For your typical homeowner it’s a negligible difference in monthly payment. The issue at hand is tariffs, which have yet to be resolved or reflected... --- > As hard as they try, mortgage rates keep hovering around the 7% level. It appears any time progress is made, they climb right back to 7%, or very close to - Published: 2025-06-09 - Modified: 2025-06-09 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-cant-shake-7/ - Categories: Mortgage Rates As hard as they try, mortgage rates keep hovering around the 7% level. It appears any time progress is made, they climb right back to 7%, or very close to it. After the jobs report on Friday was a tad hotter than expected, they turned higher after what was looking like a winning week. At last glance, they made their way to 6. 97%, just shy of 7%, per Mortgage News Daily. They’re having a difficult time getting away from those levels, though relief could still come later in the year. Jobs Report Pushes Mortgage Rates Back Toward 7% It wasn’t necessarily a hot jobs report, but it still beat expectations. Some 139,000 nonfarm payrolls were added in May, well below April’s levels, but more than the 126,000 expected. At the same time, there were revisions for the April and March numbers. It makes you wonder if May will be revised too, but in the meantime bond traders took it as a cue to sell. The 10-year bond yield went up as a result and the 30-year fixed followed. After it appeared mortgage rates were trending down again, they were right back by 7% again. The culprit has been steady enough employment, rising wages, and the thought that the Fed will push back rate cuts. While the Fed doesn’t set mortgage rates, bond traders pay attention to their monetary policy. As such, rates are higher and may stay that way for longer. First Fed Rate Cut Not Until December? Now... --- > Despite being a big banking hub, the top mortgage lenders in North Carolina are mostly nonbanks. In fact, just two of the top 10 are depository banks, - Published: 2025-06-05 - Modified: 2025-06-02 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-north-carolina/ - Categories: Mortgage Tips Despite being a big banking hub, the top mortgage lenders in North Carolina are mostly nonbanks. In fact, just two of the top 10 are depository banks, with one credit union and the rest nonbank lenders. However, several of the top lenders in the state also happen to be headquartered in North Carolina. Those names include Bank of America, Truist Financial, and State Employees’ Credit Union. Read on to see who topped the list in 2024 for mortgage lending overall. Top Mortgage Lenders in North Carolina (Overall) Ranking Company Name 2024 Loan Volume 1. Rocket Mortgage $3. 7 billion 2. UWM $3. 5 billion 3. State Employees CU $3. 4 billion 4. Movement Mortgage $2. 6 billion 5. Atlantic Bay Mortgage $1. 7 billion 6. DHI Mortgage $1. 5 billion 7. Truist Bank $1. 4 billion 8. First-Citizens Bank & Trust $1. 4 billion 9. Veterans United $1. 3 billion 10. CrossCountry $1. 1 billion While you probably guessed that the nation's top mortgage lender, UWM, was first, you'd be wrong. Instead, Rocket Mortgage was the top mortgage lender in North Carolina last year with $3. 7 billion funded, per HMDA data from Richey May. In second was Pontiac-based UWM with a close $3. 5 billion, followed by Raleigh based-State Employees’ Credit Union with an even closer $3. 4 billion. Next up was South Carolina-based Movement Mortgage, followed by Virginia-based Atlantic Bay Mortgage. Then we had DHI Mortgage, the in-house lender for home builder D. R. Horton, followed by Charlotte-based... --- > Lately, the best single word to sum up mortgage rates has been “stuck.” Ever since early April when they jumped higher as the trade war escalated, they’ve - Published: 2025-06-03 - Modified: 2025-06-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-will-be-stuck-for-longer-if-tariffs-keep-getting-pushed-back/ - Categories: Mortgage Rates Lately, the best single word to sum up mortgage rates has been “stuck. ” Ever since early April when they jumped higher as the trade war escalated, they’ve basically gone nowhere fast. Sure, they ebb and flow every day, similar to the stock market, but they’ve been in very tight range. Basically hovering between 6. 875% and 7. 125%, or just one quarter of one percent, but at a crucial time during the home buying season. If you’re looking for rate relief, like the tariff situation, you might just need to be patient. Is the TACO Trade Keeping Mortgage Rates Higher for Longer? In case you haven’t heard, there’s a new acronym known as TACO, or Trump Always Chickens Out. Simply put, it refers to the President’s waffling (sorry for a different food analogy) on the tariffs, but often capitulating when there's any whiff of a bad day on the stock market. One day, he wakes up and says the tariffs are on. The next day, they’re off. Then they’re back on again. This has also led to Karate Kid memes that say Tariff on, Tariff off. The stock market seems to cheer this, but bonds seem a little less enthused, and mortgage rates might be suffering as a result. Just check out the MND chart above, which shows mortgage rates jumped in early April when tariffs ratcheted up, and have been stuck higher ever since. My theory is that the longer this back-and-forth goes on, the longer it will... --- > A new report found that the typical monthly payment to borrow $50,000 via a home equity line of credit (HELOC) has dropped by about $100 since 2024. And - Published: 2025-06-02 - Modified: 2025-06-02 - URL: https://www.thetruthaboutmortgage.com/cheaper-heloc-rates-cash-needs-might-finally-lead-to-a-home-equity-lending-boom/ - Categories: Housing Market, Mortgage News A new report found that the typical monthly payment to borrow $50,000 via a home equity line of credit (HELOC) has dropped by about $100 since 2024. And that payment could drop a further $50 per month if the Fed cuts rates as expected. Despite some near-term headwinds related to tariffs, trade, and government spending, the Fed is still projected to cut rates three times by January. Unlike long-term mortgage rates, which the Fed doesn’t control, HELOCs are tied to the prime rate, which moves up and down whenever the Fed cuts or hikes. This could lead to more home equity withdrawals as the spread between HELOCs and 30-year fixed rates narrows. When Is the Home Equity Lending Boom Going to Happen? I’ve been saying for a while that homeowners just haven’t been tapping equity this cycle. In the early 2000s, homeowners were maxed out, meaning they borrowed up to 100% of the value of their home, whether it was a cash-out refinance or a second mortgage. But this go around, homeowners (and lenders) have been a lot more conservative, which has kept the housing market in check. Part of it has to do with interest rates, which just aren’t that attractive for someone in need of cash. As you can see from the chart above from ICE, the spread between HELOCs and 30-year mortgage rates widened significantly in 2023 and 2024. This made it unattractive to take out a second mortgage such as a HELOC, especially when the first... --- > Now it’s time to take a look at the top mortgage lenders in Florida based on 2024 volume. The Sunshine State is the biggest mortgage market outside of - Published: 2025-05-30 - Modified: 2025-05-30 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-florida/ - Categories: Mortgage Tips Now it’s time to take a look at the top mortgage lenders in Florida based on 2024 volume. The Sunshine State is the biggest mortgage market outside of California, with about a 9% share of the national market (tied with Texas). In 2024, roughly $143 billion in home loans were originated there during what was a rough year for mortgage lenders. For comparison sake, lenders closed about $350 billion in 2021 when mortgage rates hit record lows. Let’s take a look at which lenders dominated the state, broken down by different categories. As I always say, biggest doesn’t necessarily mean best, but it’s good to know who the key players are. Top Mortgage Lenders in Florida (Overall) Ranking Company Name 2024 Loan Volume 1. UWM $17 billion 2. Rocket Mortgage $7. 6 billion 3. DHI Mortgage $4. 4 billion 4. CrossCountry $3. 9 billion 5. Lennar Mortgage $3. 8 billion 6. Chase $3. 0 billion 7. Freedom Mortgage $2. 2 billion 8. Bank of America $2. 0 billion 9. loanDepot $1. 9 billion 10. Pennymac $1. 8 billion Pontiac, Michigan-based United Wholesale Mortgage (UWM) was the top mortgage lender in the state of Florida last year, per HMDA data visualized by Richey May. They were also the largest mortgage lender in America in 2024, so this wasn't too surprising. They easily beat out Rocket Mortgage, who had been #1 nationally for years before UWM unseated them, by nearly $10 billion. UWM funded roughly $17 billion in home loans, while Rocket... --- > This morning, the National Association of Realtors (NAR) reported that pending home sales dropped 6.3% in April from a month earlier. They were also 2.5% - Published: 2025-05-29 - Modified: 2025-05-29 - URL: https://www.thetruthaboutmortgage.com/high-mortgage-rates-are-delaying-home-purchases/ - Categories: Mortgage Rates This morning, the National Association of Realtors (NAR) reported that pending home sales dropped 6. 3% in April from a month earlier. They were also 2. 5% lower than levels seen at the same time last year, dampening any hope of 2025 being a comeback year for home sales. The culprit? High mortgage rates. You can argue they aren’t that high historically, but they remain much higher than a few years ago. And they increased from levels seen in March, taking the wind out of the housing market’s sails during the critical spring buying session. As such, existing home sales will likely see soft prints in future releases (though a bump higher might be expected for May based on the lower rates seen in February and March). It’s All About Mortgage Rates We can argue until the cows come home, that it’s high home prices not high mortgage rates, but the data continues to make the argument it’s the latter (see chart above from MND) Even NAR chief economist Lawrence Yun said, "At this critical stage of the housing market, it is all about mortgage rates. " He added that “lower mortgage rates are essential to bring home buyers back into the housing market. " I tend to agree with him here (though I don’t always agree with him). At the same time, I’ve acknowledged that home prices are “high” too. Problem is, home prices are sticky and even if they do ease somewhat, which they probably will, the impact... --- > Long out of favor, adjustable-rate mortgages are quietly making a comeback. To be fair, they are still pretty fringe, but the 30-year fixed is beginning - Published: 2025-05-29 - Modified: 2025-05-29 - URL: https://www.thetruthaboutmortgage.com/nations-top-mortgage-lender-rolls-out-arms-why-now/ - Categories: Mortgage Tips Long out of favor, adjustable-rate mortgages are quietly making a comeback. To be fair, they are still pretty fringe, but the 30-year fixed is beginning to lose market share again. At last glance, the ARM-share of mortgage applications was 7. 5%, per the Mortgage Bankers Association (MBA). This is still pretty low, but it has been on the rise over the past year – it was 6. 4% a year ago. Of course, back during the early 2000s it hovered between 25% to 35% at one point! UWM Launches a 5/1 ARM for FHA and VA Loans The nation’s largest mortgage lender by loan volume, United Wholesale Mortgage, announced the arrival of new adjustable-rate mortgage (ARM) products this week. The offering includes a 5/1 ARM for both FHA loans and VA loans, both of which have seen their market share rise in recent months. In fact, government purchase loan applications have risen about 40% year-over-year, per the MBA, possibly due to more lenient debt-to-income ratio (DTI) requirements. Or maybe because mortgage rates on government-backed loans tend to be cheaper than conforming loans backed by Fannie Mae and Freddie Mac. Now home buyers who work with a mortgage broker (who works with UWM) will be able to get their hands on an ARM. As noted, it’s just one variety, which comes with a fixed interest rate for the first five years of the loan term. After those five years are up, it becomes annually adjustable for the remaining 25 years. Like... --- > A few months ago, Redfin proclaimed that a buyer’s market had finally arrived. It was the first time home sellers didn’t have the upper hand this decade, - Published: 2025-05-28 - Modified: 2025-05-28 - URL: https://www.thetruthaboutmortgage.com/redfin-expects-flat-mortgage-rates-falling-home-prices-for-remainder-of-2025/ - Categories: Housing Market, Mortgage Rates A few months ago, Redfin proclaimed that a buyer’s market had finally arrived. It was the first time home sellers didn’t have the upper hand this decade, ostensibly since 2019. That take was based on growing for-sale inventory, which hit a six-year high back in January. There were 3. 7 months of for-sale supply on the market to begin 2025, the most since February 2019 and a decent year-over-year rise from 3. 3 months in early 2024. Now the real estate brokerage is predicting that home prices will go negative by the fourth quarter as mortgage rates remain elevated. Home Prices Expected to Slip 1% By Year End Redfin economists said they now expect the median home price to fall from +3% year-over-year to -1% by the fourth quarter. It’s not a massive decline, but it’s not a rosy outlook either given the strong home price appreciation seen since values bottomed around 2012. In fact, other than a brief downturn in 2023, home prices have risen year-over-year since 2012 due to a lack of for-sale inventory. That created one of the longest seller’s markets in recent history, despite mortgage rates that nearly tripled from their all-time lows in less than two years. As for why home prices are expected to dip, it’s simple supply and demand. Basically, more homes for sales and fewer able or willing buyers. Redfin noted that demand has fallen and sales of existing homes slipped 1. 1% year-over-year in April to a six-month low. Meanwhile, it’s... --- > Fed chair Jerome Powell has had no shortage of critics, not least being President Donald Trump. A month ago, there were even rumblings of Trump looking to - Published: 2025-05-27 - Modified: 2025-05-27 - URL: https://www.thetruthaboutmortgage.com/pulte-asks-powell-to-lower-interest-rates-but-would-mortgage-rates-actually-go-down/ - Categories: Mortgage Rates Fed chair Jerome Powell has had no shortage of critics, not least being President Donald Trump. A month ago, there were even rumblings of Trump looking to oust Powell because he was “too late” on rate cuts. Now FHFA director Bill Pulte has joined in, saying enough was enough and that “Jay Powell needs to lower interest rates. ” He argued that doing so would help the housing market and that’s there’s reason not to with inflation apparently behind us. The question is would it actually help mortgage rates, or would bond traders balk at a pressured rate cut? Pulte Asks for a Fed Rate Cut to Boost the Housing Market First a very brief background. The Federal Reserve does not set mortgage rates, it merely can influence long-term interest rates by setting monetary policy. Even then, one could argue that the Fed simply makes policy moves based on underlying economic data, so it’s really the data that sets their policy. And at the same time, bond traders make moves based on the data too, so the 10-year bond yield will rise and fall based on what the data says. If the data shows inflation cooling, bond yields will fall and mortgage rates will too. If the data shows inflation heating up, bond yields and mortgage rates will rise. Demanding the Fed lower its federal funds rate wouldn’t do anything to help lower mortgage rates if the data didn’t warrant the move. Instead, you’d likely see yields (interest rates) go... --- > Today we’ll take a look at the top mortgage lenders in Ohio. Last year, nearly 900 mortgage companies originated about $42 billion in home loans there, a - Published: 2025-05-27 - Modified: 2025-05-27 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-ohio/ - Categories: Mortgage Tips Today we’ll take a look at the top mortgage lenders in Ohio. Last year, nearly 900 mortgage companies originated about $42 billion in home loans there, a far cry from the $113 billion seen back in 2021. But one company beat the rest despite not being the top-10 overall. Surprisingly, it wasn’t the nation’s top mortgage lender, but rather a depository bank. Read on to see who took the top spot and what other companies did a lot of business in The Buckeye State. Top Mortgage Lenders in Ohio (Overall) Ranking Company Name 2024 Loan Volume 1. Huntington Bank $2. 8 billion 2. Rocket Mortgage $2. 5 billion 3. CrossCountry $2. 2 billion 4. UWM $1. 9 billion 5. Union Savings Bank $1. 1 billion 6. Fifth Third Bank $1. 1 billion 7. Union Home Mortgage $967 million 8. Chase $869 million 9. Guaranteed Rate $791 million 10. Veterans United $784 million The top mortgage lender in Ohio last year was Huntington Bank, a company founded all the way back in 1866. In 2024, the Columbus, Ohio-based company funded $2. 8 billion in home loans, per HMDA data from Richey May. For the record, they funded $7. 8 billion in 2021 when mortgage rate hit record lows! But it was still more than enough to hold off Rocket Mortgage’s $2. 5 billion, the nation’s second largest mortgage lender overall. In third was Cleveland, Ohio-based CrossCountry Mortgage with $2. 2 billion funded, followed by the nation's largest mortgage lender United Wholesale... --- > In another twist of events, President Donald Trump has floated the release of Fannie Mae and Freddie Mac. On his Truth Social Platform yesterday, he said, - Published: 2025-05-22 - Modified: 2025-05-22 - URL: https://www.thetruthaboutmortgage.com/president-trump-teases-release-of-fannie-mae-and-freddie-mac/ - Categories: Mortgage News In another twist of events, President Donald Trump has floated the release of Fannie Mae and Freddie Mac. On his Truth Social Platform yesterday, he said, “I am giving very serious consideration to bringing Fannie Mae and Freddie Mac public. ” He went on to add that “Fannie Mae and Freddie Mac are doing very well, throwing off a lot of CASH, and the time would seem to be right. Stay tuned! ” The move comes at a time when mortgage rates have experienced increased volatility, potentially related to his big, beautiful bill making its way through the legislature. Questions remain if the pair's release is a good idea and how it might impact the housing market, which is already in a tenuous position. Fannie and Freddie Surge on the News of a Possible Exit Shares of both Fannie Mae and Freddie Mac hit new 52-week highs on the message from President Trump. At one point, shares of Fannie Mae (OTCMKTS: FNMA) rose to a whopping $10. 89, before coming back down to around $9 per share. That’s still a 467% return over the past year. Meanwhile, shares of Freddie Mac (OTCMKTS: FMCC) climbed to a new 52-week high of $7. 60 before falling back to $7. 08. That’s a near-380% return over the past year. Long story short, there is a ton of speculation surrounding their eventual release, and big names like Bill Ackman are long both the stocks. Ackman stands to make $1 billion or more if things... --- > With so many calls for higher mortgage rates lately, now might be the perfect time to play contrarian. It’s something I like to do in general, but it - Published: 2025-05-22 - Modified: 2025-05-22 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-are-still-expected-to-come-down-by-the-end-of-2025/ - Categories: Mortgage Tips With so many calls for higher mortgage rates lately, now might be the perfect time to play contrarian. It’s something I like to do in general, but it seems to work even better when the subject is “mortgage rates. ” Often when the consensus is high, things tend to unexpectedly shift and surprise everyone. At the moment, everyone is in the higher-for-longer camp, so much so that it seems they can’t all be right. And when it seems like there’s absolutely no hope in sight, the storm clouds part. Lots of Headwinds for Mortgage Rates Right Now At the moment, it seems like mortgage rates are riding a bicycle with a flat tire up a steep hill in the pouring rain. Nothing seems to be going their way, whether it’s tariffs, the trade war, the big, beautiful bill (and all that government spending), the U. S. credit rating downgrade, and now even talks about Fannie and Freddie being released. All of these things are contributing to higher bond yields, which directly impact long-term fixed mortgage rates. The 10-year bond yield has risen markedly over the past three weeks, climbing from around 4. 15% to 4. 55% today. It was as high as 4. 60% yesterday, but has since cooled off. Still, that’s enough to put the 30-year fixed firmly back above 7% thanks to bloated spreads. And every time the 30-year fixed climbs back above 7%, you can just feel the wind go out of the housing market’s sails. The... --- > One silver lining to elevated mortgage rates, other than the refinance opportunity later, has been a shifting psychology. A few years ago, I wrote that - Published: 2025-05-20 - Modified: 2025-05-20 - URL: https://www.thetruthaboutmortgage.com/is-the-magic-number-for-mortgage-rates-now-anything-close-to-6/ - Categories: Mortgage Rates One silver lining to elevated mortgage rates, other than the refinance opportunity later, has been a shifting psychology. A few years ago, I wrote that your brain (and my brain and everyone else’s) would soon think a 5% mortgage rate is pretty good. That was prior to mortgage rates going even higher, cresting at around 8% and then coming back down to earth (a bit). The logic was that after seeing higher, you might forget about lower and come to terms with something in between being not so bad. Now, your brain might think the same of a 6% mortgage rate. A 6% Mortgage Rate Doesn’t Look Too Bad Anymore The higher-for-longer mortgage rate environment has lasted longer than most imagined, including myself. And it might persist even longer than that. Nobody knows for sure. We make educated guesses and are often wrong. A lot of pundits expected the 30-year fixed to fall closer to 6% by the end of 2025, including myself. That’s still in play as it’s still only May, and we’re technically not that far away. But we still need something to drive rates lower. Lately, there’s been nothing but headwinds, whether it’s tariffs, a global trade war, and the latest, a credit rating downgrade of the United States. However, underneath all the headlines the economic data is showing more and more signs of cooling. And ultimately that’s what dictates the direction of mortgage rates. The rest is a sideshow and something to banter about from day... --- > In general, I like to play contrarian because it’s nice to consider alternative viewpoints. Instead of simply regurgitating the same take, sometimes going - Published: 2025-05-19 - Modified: 2025-05-19 - URL: https://www.thetruthaboutmortgage.com/how-moodys-downgrade-could-actually-help-lower-mortgage-rates/ - Categories: Mortgage Tips In general, I like to play contrarian because it’s nice to consider alternative viewpoints. Instead of simply regurgitating the same take, sometimes going against the grain can pay off. In fact, the consensus often gets it wrong, whether it’s the trajectory of home prices or the direction of mortgage rates. The latest expected headwind for mortgage rates dropped late Friday when Moody’s downgraded the United States’ credit rating. But if we zoom out a tad, this could end of helping mortgage rates. Allow me to explain. Initial Reaction Isn’t Great, Mortgage Rates Back Above 7% The 30-year fixed is back above 7%, again (again! ), per the latest daily reading from Mortgage News Daily. It has been seesawing around these levels for a while now, and it’s yet another gut punch for prospective home buyers. Again, no huge difference between a rate of 6. 875% and 7% in terms of monthly payment, but the psychology can be brutal. Seeing a 7 instead of a 6 while also possibly being stretched to begin with isn’t good for borrowers or the wider housing market. As such, mortgage applications might face even more of an uphill battle as the spring home buying market begins to fizzle. I should also note that the 30-year fixed is now only five bps below its year-ago levels. So lower mortgage rates are no longer a feature of the 2025 spring home buying season. Mortgage Rate Spreads Got Worse on the Downgrade News What’s interesting is the 10-year... --- > With mortgage rates staying stubbornly elevated, new narratives are being written in an attempt to change that view. A popular one of late has been - Published: 2025-05-18 - Modified: 2025-05-18 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-arent-that-high/ - Categories: Mortgage Tips With mortgage rates staying stubbornly elevated, new narratives are being written in an attempt to change that view. A popular one of late has been arguing that mortgage rates aren’t that high today. Or not as high as people think. The rationale is that when you zoom out, mortgage rates are actually pretty middle of the road historically, which bucks the misconception that they're high. After all, they were in the high double-digits in the 1980s, and still start with a 6 today. Seems okay, right? So is it true that mortgage rates aren’t so bad? Context Is Key for Mortgage Rates I could sit here and tell you the same thing. That mortgage rates aren’t that high. But what purpose would that serve if the proposed monthly payment still doesn’t pencil? And what solace would that provide if you knew you missed the boat on snagging a 2-3% fixed rate just a few years earlier? It probably wouldn’t give you any comfort unless you’re an extreme optimist. Instead, you’re probably just doing the math like everyone else and not liking what you see. If you’re a prospective home buyer today, mortgage rates are top of mind. And you probably don’t care what the long-term average is for the 30-year fixed. Spoiler alert: It’s a higher 7. 75%, or about 75 basis points (bps) above current levels. Does this mean the 30-year fixed is a screaming bargain today? I wouldn’t say so, but others might try to make that argument.... --- > Today we’ll take a look at the top mortgage lenders in Texas based on their annual production last year, including both retail and wholesale loan volume. - Published: 2025-05-15 - Modified: 2025-05-15 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-texas/ - Categories: Mortgage Tips Today we’ll take a look at the top mortgage lenders in Texas based on their annual production last year, including both retail and wholesale loan volume. They say everything is bigger in Texas, and that’s true when it comes to their mortgage lending volume relative to 49 other states. Only California is bigger when the subject is doling out home loans. And they even double New York's output. The Lone Star State accounted for about nine percent of national home loan volume, originating roughly $147 billion in 2024. Let’s find out who the top lenders were in the state in a few different categories. Top Mortgage Lenders in Texas (Overall) Ranking Company Name 2024 Loan Volume 1. UWM $12. 6 billion 2. Rocket Mortgage $7. 0 billion 3. DHI Mortgage $5. 7 billion 4. Chase $3. 9 billion 5. Lennar Mortgage $3. 7 billion 6. CMG Mortgage $3. 3 billion 7. loanDepot $2. 7 billion 8. Fairway Independent $2. 6 billion 9. PrimeLending $2. 4 billion 10. CrossCountry $2. 2 billion Yep, United Wholesale Mortgage (UWM) did it again, topping the overall rankings in Texas with $12. 6 billion in home loan volume in 2024, per HMDA data from Richey May. They were also number one overall, and in the states of California and Florida, so it’s no surprise they took Texas too. The Pontiac, Michigan-based lender led the way in many states nationwide so this came as no real surprise. Coming in second was former #1 Rocket Mortgage with... --- > Mortgage lender Paramount Residential Mortgage Group (PRMG) has launched a co-branded credit card with fintech company Mesa. The Mesa Homeowners Card is - Published: 2025-05-14 - Modified: 2025-05-14 - URL: https://www.thetruthaboutmortgage.com/prmg-launches-co-branded-credit-card-that-earns-points-on-mortgage-payments/ - Categories: Mortgage News Mortgage lender Paramount Residential Mortgage Group (PRMG) has launched a co-branded credit card with fintech company Mesa. The Mesa Homeowners Card is noteworthy because it allows cardholders to earn points on their monthly mortgage payments. No other credit card companies allow you to make a mortgage payment, let alone earn points for doing so. That’s the biggest draw of this new card, but the way it works is rather unorthodox so pay attention. In addition, you need to spend at least $1,000 on the card outside the mortgage each month to actually earn the points. PRMG’s Mesa Homeowners Card Rewards You for Paying the Mortgage From what I can see, this new PRMG co-branded Mesa Homeowners Card is no different than the default version. The press release simply states “PRMG clients will have access to an exclusive, customized version of the Mesa Homeowners Card. ” Perhaps that just means having the PRMG logo on the front of the card? Other than that, it says it features all the same benefits of Mesa's flagship card, and upon reading through the terms and conditions I couldn’t find anything unique here. That aside, this card works like the standard version in that it rewards you for making mortgage payments each month. But instead of actually paying the mortgage with a credit card, you link your bank account with the Mesa app to verify the existence of your mortgage account. And most importantly, the mortgage amount you enter during the card application process determines... --- > Why are mortgage rates approaching 7% again if inflation is cooling and the trade war has softened? You would think interest rates would be coming down - Published: 2025-05-14 - Modified: 2025-05-14 - URL: https://www.thetruthaboutmortgage.com/7-mortgage-rates-are-back-again-despite-lower-inflation-and-tariff-relief/ - Categories: Mortgage Rates Why are mortgage rates approaching 7% again if inflation is cooling and the trade war has softened? You would think interest rates would be coming down thanks to both falling prices and reduced tension with trade partners like China. Instead, the 10-year bond yield keeps rising, and at last glance was above 4. 50% today. Combine that with a spread of around 250 basis points (bps) and home buyers are looking at a 7% 30-year fixed mortgage rate. Clearly this is unwelcome news if you’re in the market to buy a home. But why is it happening this time? Bonds Like Economic Weakness but Not Uncertainty If I were to guess, I would say it boils down to ongoing uncertainty and defensiveness. For one, there is no actual trade deal as of yet. All there is a temporary 90-day agreement to hold off on larger tariffs between the two superpowers. So there’s a thought that this is merely a delay, and three months from now will be back in the same boat. In addition, there are the unforeseen consequences of the past couple months of tariff talk and back-and-forth on trade deals that have yet to show up in the data. There’s a decent possibility that could muddle the inflation data and other key economic reports released in coming months. And it might not present itself until June, July, August, etc. That makes it difficult for the federal reserve to move forward with important monetary policy changes if they don’t... --- > It’s been an uphill battle to sell a home lately, with interest rates through the roof and home prices equally expensive. But somehow, someway, the home - Published: 2025-05-13 - Modified: 2025-05-13 - URL: https://www.thetruthaboutmortgage.com/the-trick-home-builders-use-to-sell-more-homes/ - Categories: Home Buying, Mortgage Tips It’s been an uphill battle to sell a home lately, with interest rates through the roof and home prices equally expensive. But somehow, someway, the home builders have been increasing sales and unloading inventory as affordability continues to hamper existing home sales. Part of it has to do with mortgage rate lock-in, with existing homeowners less likely to sell and give up their low fixed rate, but that’s just one side of the story. The builders are also really good at offering incentives to move their product, even if it’s not the “best time to buy. ” They’ve been referred to as efficient sellers compared to the owners of existing homes, who have struggled to woo buyers the past few years. But why? The Home Builders Are Offering Customers Lower Mortgage Rates One of the big differentiators lately has boiled down to mortgage rates. After interest rates quickly climbed from their record lows in the 2s all the way to 8%, existing home sales fell off a cliff. And they haven’t recovered much either since sliding to their lowest point since 1995 last year. Meanwhile, newly-built home sales are chugging along at a solid clip, in spite of still-elevated mortgage rates. Sure, mortgage rates have come down a bit from their cycle-highs seen in October 2023, but they’re still way up there. At last glance, the 30-year fixed was hovering close to 7%, a far cry from the sub-3% rates on offer as recently as early 2022. Despite this, the... --- > The year 2025 has been all about mortgage and real estate linkups and vertical integration. Two of the biggest were announced in the month of March, when - Published: 2025-05-13 - Modified: 2025-05-13 - URL: https://www.thetruthaboutmortgage.com/lower-becomes-latest-mortgage-lender-to-acquire-a-real-estate-portal/ - Categories: Mortgage Tips The year 2025 has been all about mortgage and real estate linkups and vertical integration. Two of the biggest were announced in the month of March, when Rocket acquired Redfin and a few weeks later, Mr. Cooper too. Those moves could propel Rocket back to #1 on the top mortgage lender ranking list, a position it ceded to United Wholesale Mortgage (UWM). And it appears smaller lenders are taking note of this strategy, with Lower Mortgage announcing today it would acquire Movoto, a top-5 real estate portal in the U. S. Like the others, it’s looking to create an end-to-end homeownership platform while taking advantage of valuable top-of-funnel web traffic. Lower’s Acquisition of Movoto Will Make It the Portal’s Preferred Lender Similar to how Rocket will likely inject ads into the Redfin platform once the merger is complete, Lower is looking to be the preferred lender for Movoto. The real estate portal apparently received 150 million visits during 2024, making it the 5th largest real estate portal in the United States. Zillow is the leader in the space thanks to its popular Zestimate home valuation tool, followed by Redfin, Realtor, and then Trulia. Homes. com is reportedly fifth, followed by Remax, but it depends how it’s measured and what’s considered a portal I suppose. Movoto is 7th on that list, but that’s for all real estate websites, so it’s still a relative heavyweight any way you slice it. And once Lower closes on the acquisition, the plan will be to... --- > Over the weekend, the United States and China reached a temporary deal to cut tariffs tremendously. Instead of an astronomical 145% rate, the U.S. will - Published: 2025-05-12 - Modified: 2025-05-12 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-moderately-higher-as-china-trade-deal-reached/ - Categories: Mortgage Tips Over the weekend, the United States and China reached a temporary deal to cut tariffs tremendously. Instead of an astronomical 145% rate, the U. S. will now impose a much more reasonable 30% rate on imports from China. This should get business (and ships) moving again, though it should be noted that it’s only a 90-day pause. Investors cheered the news, believing more severe economic fallout such as a recession could now be averted. But the risk-on move has hurt bonds, and by nature mortgage rates, which have seen reduced demand in the process. Risk-On Trade Means Mortgage Rates Might Go Higher At last glance, the 10-year bond yield was about 20 basis points (bps) higher than it was before the trade deals began being reported last week. We got a U. K. trade deal on May 8th, which resulted in a bump, followed by a China deal today, which led to another bump up. Mortgage rates correlate very well with the 10-year bond yield, and as such have risen a bit as well. However, because of the trade deals and the perceived reduction in volatility, mortgage spreads have improved to offset those gains. So some of the increase you’d expect from higher bond yields means mortgage rates aren’t actually much higher. Ultimately, the 30-year fixed has been pretty flat over the past week, at least according to MND. We’re basically just hovering around 6. 875% to 6. 90%, where we otherwise might be pushing 7% again. In other words,... --- > While folks debate whether mortgage rates are going higher or lower, most expect a boom if they eventually do come down. Even Dave Ramsey, who is known - Published: 2025-05-09 - Modified: 2025-05-09 - URL: https://www.thetruthaboutmortgage.com/dave-ramsey-thinks-lower-mortgage-rates-could-ignite-a-home-buying-frenzy/ - Categories: Mortgage Tips While folks debate whether mortgage rates are going higher or lower, most expect a boom if they eventually do come down. Even Dave Ramsey, who is known for being a very shrewd financial guru, thinks so. In a new interview with TheStreet, he said if rates sink a point or two, prospective buyers will likely return in droves. And that could create a “fire” in the housing market, which has suffered lately from a severe lack of affordability. But Ramsey also some very strict rules for home buying, which still might not pencil even if rates come back down to record lows. Ramsey Expects Lower Mortgage Rates, Housing Market Comeback While he wasn’t too specific, Dave Ramsey told TheStreet that mortgage rates will “probably fall,” and with that he expects “this market to come back. ” He didn’t specify why mortgage rates might come down, just that they’d improve, perhaps because he’s an optimist. Maybe because like everyone else, he knows the housing market isn’t sustainable at rates and prices like these. To that end, he doesn’t believe homes prices are going to fall, even though inventory is beginning to rise and put pressure on sellers. In a nutshell, he said they aren’t going to come down because there’s more demand than supply. I suppose that varies based on the city in question, and there’s certainly been a shift to a buyer’s market in 2025 relative to prior years. But he believes there’s still a lot of pent-up demand from... --- > A day after the Fed held its key policy rate steady, 10-year bond yields are up double-digits. And that will result in higher mortgage rates for - Published: 2025-05-08 - Modified: 2025-05-08 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-worsen-after-first-trade-deal-announced/ - Categories: Mortgage Tips A day after the Fed held its key policy rate steady, 10-year bond yields are up double-digits. And that will result in higher mortgage rates for consumers, all else equal, though the driver appears to be an unrelated trade deal with the United Kingdom. The bellwether bond was up more than 10 basis points to nearly 4. 38 on the day after appearing to spike out of nowhere. The only real reason would be the U. K. -U. S. trade deal, which coincided with a stock market rally. In short, investors left bonds behind and piled into stocks, which resulted in higher bond yields (and mortgage rates). Is This a Sign of Things to Come? The newly-announced trade deal with the U. K. was somewhat scant on details, though the 10% tariff on imported goods will remain in place. And vehicles from the U. K. will see tariffs reduced from 27. 5% to 10%, while tariffs on steel and aluminum are eliminated. Of course, a trade deal with one of our closest allies isn’t necessarily the big news we’ve been waiting for. Ultimately, it’s China and has always been China. This is kind of a sideshow and not necessarily illustrative of what will transpire there. Investors seemed to cheer it anyway, a day after the Fed said due to the global trade war, “risks of higher unemployment and higher inflation have risen. ” This would mark some normalcy for markets, with good economic news typically resulting in stock market rallies... --- > I got to thinking lately that mortgage rates are probably as good as they’re going to be for the foreseeable future. And by that, I mean until at least - Published: 2025-05-07 - Modified: 2025-05-07 - URL: https://www.thetruthaboutmortgage.com/this-might-be-as-good-as-mortgage-rates-get-until-late-2025/ - Categories: Mortgage Rates I got to thinking lately that mortgage rates are probably as good as they’re going to be for the foreseeable future. And by that, I mean until at least August, as there’s just too much up in the air at the moment. We’ve got the ongoing trade war and tariffs, along with an upcoming spending bill to deal with. So even if we make some headway on trade talks, there’s that bill to worry about next. It’s almost like getting past one wave, only to look up and see another come crashing down on you. You Might Need to Adjust Your Mortgage Rate Expectations While I’ve argued that we’ve been in a falling mortgage rate environment for a while now, it’s not without its ebbs and flows. Really, since October 2023, the 30-year fixed has been drifting lower. Back then it hit a cycle high of about 8%. And since then, it’s been significantly lower, though still markedly higher than the 3% rates we were all accustomed to seeing in 2022 and earlier. Sure, there have been better and worse periods for mortgage rates over the past 18 months, but the general trend over time has been lower. If you zoom out, as I have in the chart above from Mortgage News Daily, you’ll see that trend lower. You’ll also see that mortgage rates were a lot lower last summer. But that was before President Trump came into office. With both the tariffs and a major spending bill on the... --- > While it’s been said countless times, it bears repeating: the Fed doesn’t set mortgage rates. The Fed simply sets short-term interest rates, driven by its - Published: 2025-05-06 - Modified: 2025-05-06 - URL: https://www.thetruthaboutmortgage.com/dont-expect-fed-meeting-to-bring-lower-mortgage-rates/ - Categories: Mortgage Rates While it’s been said countless times, it bears repeating: the Fed doesn’t set mortgage rates. The Fed simply sets short-term interest rates, driven by its dual mandate of price stability and maximum employment. Nowhere on the Fed’s to-do list is ensuring mortgage rates remain attractive for home buyers. It’d be nice, but it’s simply not the case. Instead, mortgage rates are driven by longer-term debt, namely the 10-year Treasury. And the price/yield of the 10-year is dictated by economic data, which has continued to show strength, for now. The Fed Will Hold Rates Steady Tomorrow As seen in the chart above from MND, the last two Fed meetings had no impact on mortgage rates. It’s basically a foregone conclusion that the Fed will hold its short-term fed funds rate steady again tomorrow at a range of 4. 25% to 4. 50%. At last glance, the CME FedWatch Tool has odds of 96. 8% for no action, meaning bonds and mortgage rates won’t be swayed (not that they necessarily would anyway with a cut/hike). But the takeaway is there isn’t a compelling case at the moment for the Fed to take any action. This means mortgage rates should also remain relatively flat for the foreseeable future, barring any new economic data that comes in overly hot or cold. The last meaningful economic report was the monthly jobs report (NFP), which surprised on the upside and had many speaking to the resilience of the U. S. economy. Some 177,000 jobs were added... --- > Not all mortgage rates are created equal. Why? Because lenders don’t price them the same for any number of reasons, whether it's cost to originate or - Published: 2025-05-02 - Modified: 2025-05-02 - URL: https://www.thetruthaboutmortgage.com/the-gap-between-good-and-bad-mortgage-rates-has-grown-wider-shop-accordingly/ - Categories: Mortgage Tips Not all mortgage rates are created equal. Why? Because lenders don’t price them the same for any number of reasons, whether it's cost to originate or desire to make more profit. Just like when you buy a new TV or a car, the price might vary depending on the company or salesperson you deal with. The thing with a mortgage though is what you pay today could stick with you for the next 360 months. So putting in the time to get it right is more important than those other purchases. Home Buyers Will Overpay Their Mortgages by $11 Billion This Year A new study from mortgage lender Tomo argued that home buyers will overpay by a whopping $11 billion in 2025. Or put differently, seven out of 10 home buyers will pay an extra $4,500 (split between a higher rate and more fees) simply because they chose the more expensive lender. This is due in large part to rate disparity, an issue I’ve talked about in the past. Essentially, mortgage rates vary by lender, despite home loans mostly being a commodity. Even though two or three lenders can offer the same exact 30-year fixed product, its interest rate might differ tremendously, as can the loan origination fee. The only real difference is the service you receive during the 30 to 45 days it takes to close the loan. After that, there is no difference assuming it’s the same exact product. So you need to choose wisely, and most importantly,... --- > Last year marked yet another year where high debt-to-income income ratios were the leading cause of denial for mortgage applicants. While a low credit - Published: 2025-05-01 - Modified: 2025-05-01 - URL: https://www.thetruthaboutmortgage.com/high-dti-ratios-continue-to-be-the-leading-cause-of-mortgage-denial/ - Categories: Mortgage News Last year marked yet another year where high debt-to-income income ratios were the leading cause of denial for mortgage applicants. While a low credit score can also be a significant factor, often it might just lead to a higher mortgage rate. That means you can still get approved for a home loan with marginal credit, but it’ll be more expensive. In other words, you want to focus on keeping your other liabilities as low as possible when applying for a mortgage. Interestingly, this should actually help your credit score in the process as well! High DTIs Top Reason Mortgages Are Declined In 2024, the top reason mortgages were declined was due to an elevated debt-to-income ratio (DTI). This was the case across all types of applications, according to a new study from iEmergent. And it has been a continuous trend, “increasing steadily from 32% in 2020 to 39% in 2023,” though there was a slight drop to 37% in 2024. This didn’t come as much of a surprise given the increase in both home prices and mortgage rates in recent years, not to mention rising property taxes and homeowners insurance costs. Long story short, the higher the mortgage payment, the higher your DTI ratio, all else equal. The second leading cause of denial was credit scores, aka low ones. Lenders have minimum credit score thresholds, but they are often quite liberal. As a result, you can get approved for a mortgage with the score as low as 620 for Fannie... --- > The mortgage landscape is changing fast, with the two biggest players making major moves to increase their market share even more. Today, top mortgage - Published: 2025-04-30 - Modified: 2025-04-30 - URL: https://www.thetruthaboutmortgage.com/nations-top-mortgage-lender-takes-loan-servicing-in-house-to-win-even-more-business/ - Categories: Mortgage News The mortgage landscape is changing fast, with the two biggest players making major moves to increase their market share even more. Today, top mortgage lender UWM announced it was shifting to in-house loan servicing, a strategic change designed to recapture more repeat business for its vast mortgage broker network. The company is already the #1 mortgage lender by a wide margin, but perhaps to fend off its crosstown rival Rocket, it’s getting proactive to secure that lead. In a nutshell, bringing servicing in house will enable the company to better control its stable of existing customers and ideally sell them another mortgage in the future. If you’re an existing homeowner with a mortgage, this is a good reminder to shop around beyond the company that services your loan. Mortgage Recapture Is Top of Mind In case you missed it, back in September UWM launched a new initiative called KEEP, designed to help its mortgage broker partners drum up more business. KEEP leans on AI to continuously monitor the company’s loan database to identify any borrowers who could benefit from a mortgage refinance, or perhaps a second mortgage like a HELOC or home equity loan. This information is tailored to the borrower and includes the contact info of the originating mortgage broker so they can win the business again. The idea is to KEEP the customer for life, instead of simply providing them with one home loan and moving onto a new prospect. It’s known as “recapture” in the mortgage world,... --- > It’s been a pretty solid week or two for mortgage rates. The 30-year fixed, which unexpectedly breached the key 7% psychological threshold in mid-April, - Published: 2025-04-29 - Modified: 2025-04-29 - URL: https://www.thetruthaboutmortgage.com/for-mortgage-rates-its-one-step-forward-two-steps-back/ - Categories: Mortgage Rates It’s been a pretty solid week or two for mortgage rates. The 30-year fixed, which unexpectedly breached the key 7% psychological threshold in mid-April, is back closer to 6. 75%. It’s still a lot closer to 7% than 6%, but after the worsening trade war sent rates flying, they’ve since calmed down a bit. The problem is when you zoom out, the good days haven’t offset the bad days. We’re in a worse place than where we started, similar to the stock market, which recovered some but not all of its losses. Mortgage Rates Are Higher Than They Used to Be One of the core “problems” with mortgage rates is that they go up faster than they go down. The old adage is elevator up, stairs down. Lenders are happy to raise them for any given reason (or no reason at all), but hesitant to lower them, even if a good reason exists. For stocks, it’s the opposite. Stairs up, elevator down. In other words, your portfolio value can plummet in a day, but take weeks to climb back up. Such is life I suppose, but it’s pretty relevant today with what we’ve seen of mortgage rates lately. While things have calmed down lately, the 30-year fixed is still higher than it used to be as recently as March. For much of that month, the 30-year fixed was in the 6. 70% range. For much of April, it has been hovering near 7% (or above). Now we’re slowly (keyword) moving... --- > Folks on social media love coming up with so-called “hacks” to excite their followers. In the mortgage realm, this typically means highlighting math that - Published: 2025-04-28 - Modified: 2025-04-28 - URL: https://www.thetruthaboutmortgage.com/the-2-mortgage-hack-explained/ - Categories: Mortgage Tips Folks on social media love coming up with so-called “hacks” to excite their followers. In the mortgage realm, this typically means highlighting math that seems unbelievable at first. And it usually revolves around paying down a mortgage ahead of schedule, much to the chagrin of the banks. For the record, the banks probably don’t care that much if at all, since these days they’d probably pay you more if you put money in a savings account instead of toward the mortgage. But I digress – let’s look at the latest hot trend, the 2% mortgage hack. What Is the 2% Mortgage Hack? $400k loan @ 6% Original 2% Hack Year 1 payment $2,398. 20 $2,398. 20 Year 2 $2,398. 20 $2,446. 16 Year 3 $2,398. 20 $2,495. 09 Year 5 $2,398. 20 $2,595. 90 Year 10 $2,398. 20 $2,866. 10 Year 15 $2,398. 20 $3,164. 41 Year 20 $2,398. 20 $3,493. 77 Year 21-30 $2,398. 20 $0 - paid off! In a nutshell, the 2% mortgage hack requires you to increase your mortgage payment 2% each year. This doesn’t mean just paying an extra 2% based on the original monthly payment. Instead, you pay 2% extra in year two, then 2% more on top of the 2% extra in three year, and so on. Every 12 months, your mortgage payment grows larger, based on the number the year before. For example, let’s look at a $400,000 loan amount with a 6% mortgage rate and a 30-year loan term. Pretty common... --- > If the last few days are any indication, mortgage rates want a trade deal. They don’t like tariffs, trade wars, or any of the uncertainty that comes with - Published: 2025-04-25 - Modified: 2025-04-25 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-want-a-trade-deal-but-patience-might-be-needed/ - Categories: Mortgage Tips If the last few days are any indication, mortgage rates want a trade deal. They don’t like tariffs, trade wars, or any of the uncertainty that comes with them. Instead, they crave clarity so bonds can settle down and provide direction for the market. So if you’re rooting for a lower mortgage rate anytime soon, you should also be rooting for a trade deal. And this week, there have finally been some positive signs on that front. The News on the Trade War Has Turned Positive The latest news on the global trade war is positive, at least, if you believe the reporting. Per Axios, Trump said “China called” and that a trade deal was only “weeks away. ” Sounds promising, but apparently China denied that and said the United States needs to make the first move. At the same time, it has been reported that China has eased up on some tariffs, and is pondering exemptions on 131 product categories included on a list that has been circulating among some businesses and trade groups. The takeaway here, for now, is that we’ve moved into a new phase of negotiation, or at least not a ratcheting up of reciprocal tariffs anymore. While it’s all speculative and debated, the two countries are at least not making matters worse, which could be at least be considered a small victory. The 10-year bond yield, which correlates well with 30-year fixed mortgage rates, has been steadily dropping throughout the week. At last glance, it... --- > Thanks to newly-released data, it's time to take a fresh look at the top mortgage lenders in California in 2024. The Golden State is by far the biggest - Published: 2025-04-24 - Modified: 2025-04-24 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-california/ - Categories: Mortgage Tips Thanks to newly-released data, it's time to take a fresh look at the top mortgage lenders in California in 2024. The Golden State is by far the biggest market for home loans, accounting for roughly 14% of the overall market in the United States. Nowhere else even comes close, including heavyweights like Florida and Texas, with about 9% market share. Or New York with about 4%. As you might expect, the big household names make this list, and many are also on the top-10 list nationwide. Let’s take a look at who topped the rankings, and break it down by home purchase lending and mortgage refinancing, along with a look at big cities like LA and SF. Top 10 Mortgage Lenders in California (Overall) Ranking Company Name 2024 Loan Volume 1. UWM $28. 4 billion 2. Rocket Mortgage $16. 2 billion 3. U. S. Bank $9. 9 billion 4. Chase $7. 7 billion 5. Wells Fargo $7. 6 billion 6. Bank of America $7. 5 billion 7. Citi $5. 5 billion 8. CrossCountry $5. 4 billion 9. BMO $4. 2 billion 10. loanDepot $3. 9 billion In 2024, United Wholesale Mortgage was the top mortgage lender in California, according to HMDA data from Richey May. They were also the top mortgage lender overall in 2024, so this came as no real surprise. UWM took the top spot in the Golden State by funding a whopping $28. 4 billion in home loans. Perhaps more impressive, they did so via the wholesale... --- > With home prices out of reach for many today, an obvious question has been when will the housing market crash? To be honest, this question gets asked - Published: 2025-04-23 - Modified: 2025-04-23 - URL: https://www.thetruthaboutmortgage.com/heres-why-the-housing-market-isnt-crashing-today/ - Categories: Housing Market With home prices out of reach for many today, an obvious question has been when will the housing market crash? To be honest, this question gets asked pretty much every year, and it is a certain cohort of the population that always seems to want it to happen. I get it – homeownership should be within reach for everyone in this country, but lately prices and elevated mortgage rates have made it a bridge too far for many. Despite this, I do believe it will get better as time goes on, thanks to moderating home price gains (even some losses) along with more attractive mortgage rates. Maybe even wages will catch up while we’re at it. But a housing crash? Probably not with the current mortgage stock. Today’s Mortgages Just Aren’t the Early 2000s Ones As such as some folks want to believe that today’s mortgages are just like the ones we saw in the early 2000s, they simply aren’t. And I’m actually sick and tired of people trying to make that argument. I was there. I originated loans in 2004, 2005, 2006, 2007, etc. I saw the toxic loans that were getting approved on a daily basis, which eventually led to the worst mortgage crisis in modern history. It’s just not that way today, despite the widespread availability of stated income and even no-doc mortgage products. First off, those loans are now niche, offered by so-called non-QM lenders that aren’t the default (no pun intended) option for home buyers... --- > A new lawsuit filed by Ohio Attorney General Dave Yost claims the nation’s top mortgage lender is ripping off Ohio consumers. It’s an interesting one - Published: 2025-04-22 - Modified: 2025-04-22 - URL: https://www.thetruthaboutmortgage.com/mortgage-brokers-are-supposed-to-shop-around-on-your-behalf/ - Categories: Mortgage News A new lawsuit filed by Ohio Attorney General Dave Yost claims the nation’s top mortgage lender is ripping off Ohio consumers. It’s an interesting one because the role of a mortgage broker is to shop on a consumer’s behalf so they don’t have to. Instead of working with a captive lender like a retail bank, homeowners can enlist a broker to do the comparison shopping for them among their wholesale lender partners. But Yost claims Pontiac, Michigan-based United Wholesale Mortgage (UWM) colluded “with many brokers to funnel nearly all loans back to itself. ” In other words, instead of searching for the lowest rate, or fewest fees, they sent the majority of their loans to their preferred lender. In the process, it may have cost these customers more thanks to higher closing costs and/or an elevated mortgage rate. Is Your Mortgage Broker Shopping Around or Using a Preferred Lender? At issue is the very nature of a mortgage broker, which as stated is a personal home loan shopper. When you work with one, they are supposed to be an independent entity that acts as a middleman between you and their lender partners. A typical broker might have a dozen or more wholesale lender partners they work with. This means X percentage of their loans might go to lender A, another portion to lender B, and the rest are spread out among several other lenders. If this is how their business is spread among partners, it would appear their doing their... --- > Is it too soon to be talking about the end of the trade war? Perhaps, but there have been rumblings of a closed-door meeting to get a deal done, along - Published: 2025-04-22 - Modified: 2025-04-22 - URL: https://www.thetruthaboutmortgage.com/how-will-mortgage-rates-react-to-the-end-of-the-trade-war/ - Categories: Mortgage Rates Is it too soon to be talking about the end of the trade war? Perhaps, but there have been rumblings of a closed-door meeting to get a deal done, along with a softer stance from President Trump. The man who tends to get bond yields to calm down, Treasury Secretary Scott Bessent, was a speaker at said meeting. He reportedly called the current situation unsustainable with the two largest trade partners effectively frozen thanks to heavy reciprocal tariffs. So if/when some sort of resolution springs up, could it get mortgage rates back on their downward trajectory? The Current Trade War Is Unsustainable During the private investor summit that took place in Washington D. C. , which happened to be hosted by none other than JPMorgan Chase, Bessent expressed that the current impasse between the U. S. and China wasn’t viable long term. And added that a de-escalation was expected in the “very near future. ” After all, China’s largest trading partner is the United States. And by a wide margin. Whereas our largest trading partners are Canada and Mexico, which we made deals with after initially threatening larger tariffs, followed by China. So clearly there’s a lot at stake and an ongoing trade war would likely lead to a lot of unintended consequences neither side may actually want. There’s also the thought that dialing things back after going further might be just the right amount of tariffs to appease both parties. A sort of Goldilocks level of tariffs might work,... --- > There’s growing talk about Fed Chair Jerome Powell being fired by President Donald Trump. Similar to his first term, he has lobbed insults at Powell while - Published: 2025-04-21 - Modified: 2025-04-21 - URL: https://www.thetruthaboutmortgage.com/what-happens-to-mortgage-rates-if-powell-gets-fired/ - Categories: Mortgage Rates There’s growing talk about Fed Chair Jerome Powell being fired by President Donald Trump. Similar to his first term, he has lobbed insults at Powell while arguing that the Fed should lower rates. But would doing so actually lead to lower mortgage rates? Or would it simply make matters worse? It’s important to note that Powell is just one member of the Federal Open Market Committee (FOMC). And that the Fed only controls short-term interest rates, while mortgages are long-term rates. Can the President Fire the Fed Chairman? First off, we should ask the obvious question, can Donald Trump even fire Jerome Powell to begin with? At the moment, it’s a “probably not,” though a case in the Supreme Court could change that. And Powell noted recently that “we’re not removable except for cause. ” Lots of gray there, as the statement indicates. But chances are it’s more rhetoric than reality, at least for now. In other words, Trump laying the groundwork now to get cuts without the actual removal of Powell. Ironically, Trump was the president who appointed Powell in the first place, nominated on November 2nd, 2017 and sworn in on February 5th, 2018. Despite that, Trump has consistently attacked Powell, both during his first term that started in 2017 and now during his second term. However, he has significantly ratcheted up the insults this time around and appears to be more serious about ousting Powell, if he can. In fact, on his Truth Social platform he called... --- > I was looking at ICE’s most recent Mortgage Monitor Report when something struck me. In their rate distribution chart of recent mortgages, I noticed a - Published: 2025-04-16 - Modified: 2025-04-15 - URL: https://www.thetruthaboutmortgage.com/beware-of-the-mortgage-rate-that-ends-with-875/ - Categories: Mortgage Rates I was looking at ICE’s most recent Mortgage Monitor Report when something struck me. In their rate distribution chart of recent mortgages, I noticed a super wide range of rates during the year 2022. This was because the 30-year fixed began the year around 3%, and ascended rapidly to around 7. 5% by that October. It has to be the worst year on record for mortgage rates going as far back as records go. But something else popped out at me as well, which could be important if you’re shopping for a home loan. 2022 Became a Terrible Year for Mortgage Rates As noted, 2022 was the worst year for mortgage rates on record in terms of movement. While the rate itself was lower, only rising above 7%, the magnitude of change is unrivaled. Nearly a tripling in rates. That’s nowhere close to the 18% mortgage rates in the 1980s, but the speed and intensity of change is second to none. In 1981 the 30-year fixed began the year at around 14. 9%, per Freddie Mac. It then climbed to 18. 45% that October before quickly calming down again. By 1982 it was back to the 13% range, where it stayed until 1985 as rates began their long descent to the single-digits. So while a rate of 7. 5% wasn’t notable, the rise in percentage terms was pretty bonkers. Going from 3% to 7. 5% is a 150% change. Conversely, going from 15% to 18% is just a 20% change.... --- > A week after Zillow drew a hard line on off-market listings, Redfin has rolled out its own ultimatum. Redfin CEO Glenn Kelman penned a short statement, - Published: 2025-04-15 - Modified: 2025-04-15 - URL: https://www.thetruthaboutmortgage.com/redfin-ultimatum-buyers-should-see-all-the-listings/ - Categories: Mortgage Tips A week after Zillow drew a hard line on off-market listings, Redfin has rolled out its own ultimatum. Redfin CEO Glenn Kelman penned a short statement, saying “Buyers should see all the listings, and sellers should control how their listing appears online. ” He went on to say that, “Redfin. com will not publish any listings that have been publicly marketed before being shared with all real estate websites via the MLS. ” So sellers can’t actually control their listing if they want it to be syndicated on websites like Redfin. They need to share it everywhere, immediately, otherwise it won’t show up on Redfin or Zillow going forward. Redfin Takes a Stand Similar to Zillow Per Kelman’s statement, a home seller will need to proceed with a standard listing if they want their listing to show up on Redfin. In other words, you can’t publicly market the property first, then syndicate to Redfin later. If you do, you won’t be able to enjoy all the traffic sites like Redfin get. Nor will a prospective buyer stumble across your listing that way. Problem is, the National Association of Realtors (NAR) just unveiled a new option for home sellers known as “delayed marketing” that allows public marketing so long as the property is submitted to the MLS. This option allows different brokerages to see what’s for sale and share it with their clients. However, it doesn’t activate IDX syndication, which means websites like Redfin and Zillow don’t get those listings until... --- > The mortgage rate whirlwind continues as we start another week. This time, rates are back below 7% (just barely), though it’s little consolation - Published: 2025-04-14 - Modified: 2025-04-14 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-back-below-7-but-dont-expect-any-huge-moves-lower/ - Categories: Mortgage Rates The mortgage rate whirlwind continues as we start another week. This time, rates are back below 7% (just barely), though it’s little consolation considering where they were just 10 days ago. If you recall, the 30-year fixed was close to 6. 5%, which felt pretty decent at the time, especially since we had what felt like solid downward momentum. Today feels like a little bit of a relief rally, but it’s still a one step forward, two steps back situation. And given the uncertainty that remains, I wouldn’t bank on rates getting much better anytime soon. Mortgage Rates Take the Elevator Up and the Stairs Down Someone said something recently about mortgage rates taking an elevator on the way up and stairs on the way down. It’s an analogy akin to what I always say about rates – that lenders take a long time lowering them, and waste no time raising them. The chart above from MND illustrates this. In other words, they’re happy to reduce (their own) risk by raising rates, but very hesitant about taking on more risk by lowering them. Simply put, it’s not in their best interest to take a chance on rates, especially in today’s environment. They don’t want to lower rates only to see breaking news about new tariffs or some other development related to trade that sends them flying again. So they price rates conservatively and anyone who needs a home loan has to pay a premium. This is one explanation why mortgage... --- > A new battle, or perhaps war, is underway for control of real estate listing data. Depending on who you ask, it’s about the consumer. Mostly the home - Published: 2025-04-11 - Modified: 2025-04-11 - URL: https://www.thetruthaboutmortgage.com/the-fight-for-control-of-real-estate-listings-heats-up-as-zillow-plays-hardball/ - Categories: Home Buying, Housing Market A new battle, or perhaps war, is underway for control of real estate listing data. Depending on who you ask, it’s about the consumer. Mostly the home seller, who logically benefits from maximum exposure to their listing. The best way to get the most exposure is by agreeing to syndicate your listing to as many portals as possible like Zillow, Redfin, Realtor, etc. But some real estate brokerages, such as Compass, are moving more of their listings in-house. While critics call it greedy to “hide listings,” it might actually be a bigger play to avoid going extinct. Zillow Aligns with NAR on Clear Cooperation Policy First some quick background. The National Association of Realtors (NAR) introduced Clear Cooperation Policy (CCP) in 2019, which requires a property that is publicly marketed to be put on the MLS within one business day. So if the real estate agent goes so far as to even put up a yard sign or send out an email about the property, the listing must also hit the MLS within 24 hours (if not a weekend or holiday). The idea here is to promote cooperation, transparency, fairness, and ultimately an open housing market where buyers can see everything that is for sale. It came up after pocket listings became prevalent, where agents would hang onto their listings and not share them publicly, perhaps for their own gain. Problem is, there are real estate brokerages that feel this is too restrictive, as they might want to try different... --- > In case you haven’t heard, the tariffs levied against China are now 145%. Yes, you read that right. Not the 125% you may have heard about yesterday - Published: 2025-04-10 - Modified: 2025-04-10 - URL: https://www.thetruthaboutmortgage.com/where-would-mortgage-rates-be-without-liberation-day/ - Categories: Mortgage Rates In case you haven’t heard, the tariffs levied against China are now 145%. Yes, you read that right. Not the 125% you may have heard about yesterday because the math apparently left out an additional 20% increase. Oops! They’re now well above the prior 104% tariff rate, and the 84% originally in place. When you start to look at the sequence of events, it becomes clear that it is all just absurd. What’s next? 200% tariffs? And to what end? What is the goal here and how does this actually get us lower mortgage rates? ! Trump Said He Was Bringing Back 3% Mortgage Rates During his campaigning in September, now-President Trump said he was going to bring back the ultra-low mortgage rates we came to know and love. Specifically, he said “Reducing mortgage rates is a big factor. ” We’re going to get them back down to, we think, 3%, maybe even lower than that. ” It wasn’t clear how, but once he selected Scott Bessent as Treasury Secretary, the strategy was to lower the 10-year bond yield. If you didn’t know, the 10-year yield correlates really well with 30-year mortgage rates because they both have a decade-long shelf life. Most homeowners only keep their home loans for about 10 years because they sell, refinance, prepay, etc. Anyway, if you’re able to get 10-year yields down, you can get mortgage rates down too. This appeared to be working in the early months of 2025, but hit a snag in... --- > Welp, the question I asked recently, would mortgage rates hit 5.99% or 7% next, has been answered. And unfortunately, if you’re a prospective home buyer - Published: 2025-04-09 - Modified: 2025-04-09 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-back-to-7-as-tariff-day-rattles-bond-market/ - Categories: Mortgage Tips Welp, the question I asked recently, would mortgage rates hit 5. 99% or 7% next, has been answered. And unfortunately, if you’re a prospective home buyer or recent homeowner looking for rate relief, it’s 7%. The latest foe for mortgage rates is a new round of global tariffs, including a whopping 104% tariff on Chinese imports. That was enough to rattle the bond market, which drives the prices of mortgage rates. As a result, the 30-year fixed is now priced exactly at 7%, per Mortgage News Daily. 7% Mortgage Rates Are Back Just when you thought they were gone forever, high mortgage rates they’re back. The 30-year fixed is at an even 7% today, up from 6. 85% yesterday, per MND. That’s a big one-day move, and it came on the heels of another big one-day move on Monday when rates jumped 22 basis points (0. 22%). We’ve now gone from 6. 55% at the end of last week to 7%, which is pretty astonishing. As noted, the driver is the new round of tariffs, which is a sky-high 104% on China, including a “previously imposed 20% duty, a 34% additional tariff and a last-minute 50% increase that Trump signed late Tuesday. ” China responded immediately, raising its tariff on U. S. goods to 84% from a previously announced 34%. The European Union (EU) also approved retaliatory tariffs on U. S. imports, which will go into effect on April 15th. In other words, we are in a full-scale global trade... --- > If you’ve been paying attention to mortgage rates lately, you might be wondering what on earth is going on. Mortgage rates appeared to be heading back - Published: 2025-04-08 - Modified: 2025-04-08 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-can-change-in-an-instant/ - Categories: Mortgage Rates If you’ve been paying attention to mortgage rates lately, you might be wondering what on earth is going on. Mortgage rates appeared to be heading back toward the low 6s before abruptly shifting back toward 7%. It all took place in the span of a day or two, compounding the matter further. In fact, Monday was the worst day of the year for mortgage rates thus far, and one of the worst days for rates in recent years. The takeaway, for now, is that mortgage rates can change fast, and you need to be prepared. Mortgage Rates Jumped Nearly a Half-Point in Just Two Days First, let’s assess the damage. In just the past two days, mortgage rates on the popular 30-year fixed increased about 30 basis points (0. 30%), per MND. What was 6. 55% on Friday (briefly) was back up to 6. 85% this morning, a testament to just how quickly conditions can change. Meanwhile, Wells Fargo was advertising a 6. 625% 30-year fixed, up from 6. 25% late last week. Similar to the stock market, mortgage rates can change daily. In fact, they can change multiple times per day if conditions warrant it. But there are also days when rates are mostly flat or even unchanged. In recent months, there were weeks where rates did basically nothing. That was then though. Ever since President Trump’s trade war ratcheted higher, it’s been volatility-central. If you don’t pay attention for a day, you might be shocked to discover that... --- > I keep hearing that lower mortgage rates are the silver lining of a global trade war. That despite the stock market fallout and possibly much higher - Published: 2025-04-07 - Modified: 2025-04-07 - URL: https://www.thetruthaboutmortgage.com/a-good-reminder-that-lenders-are-always-quick-to-raise-mortgage-rates/ - Categories: Mortgage Rates I keep hearing that lower mortgage rates are the silver lining of a global trade war. That despite the stock market fallout and possibly much higher prices due to tariffs, mortgage rates are at least lower. But how much lower are they really? And at what cost? And is anyone actually biting, other than recent home buyers looking to refi? While there’s nothing wrong with looking for something positive in these challenging times, it should be noted that rates are still not far from 7%. In fact, somehow the 30-year fixed is back to around 6. 75% today! Mortgage Rates Head Back Toward 7% While the last week and change was great for mortgage rates, today hasn’t started so well. As I pointed out a few days, big mortgage rate rallies like the one we saw recently are often stopped in their tracks without warning. Beware of the mortgage rate bounce I said, and that’s exactly what we got today. The 30-year fixed, which had fallen from 7. 25% in mid-January to around 6. 60% on Friday, is back to 6. 75%. It looked destined to keep falling, likely hitting 6. 50% next, but rates jumped back up today, despite another bad day on the stock market. Perhaps bonds have yet to catch up to the stock market, which is highly volatile at the moment. Maybe bonds need a breather while they attempt to determine President Trump’s next move. But the takeaway here is mortgage rates are still only 25... --- > There’s a lot going on right now with mortgage rates so I’m dedicating a very long post to it. First and foremost, mortgage rates are dropping fast as the - Published: 2025-04-04 - Modified: 2025-04-04 - URL: https://www.thetruthaboutmortgage.com/what-the-heck-is-going-on-with-mortgage-rates/ - Categories: Mortgage Rates There’s a lot going on right now with mortgage rates so I’m dedicating a very long post to it. First and foremost, mortgage rates are dropping fast as the economy teeters on the brink of a possible recession. The driver is worldwide tariffs and a global trade war, which has led to a stock market crash and a flight to safety in bonds. When bonds see more demand, their yields fall and so too do mortgage rates. As a result of the calamity, the 30-year fixed has fallen about 25 bps (0. 25%) from 6. 75% to 6. 50% this week. And could come down even more. Global Tariffs and a Trade War Are Good for Mortgage Rates, But Maybe Not Anything Else In the past week, the 30-year fixed has fallen from around 6. 75% to close to 6. 50% today, at least according to MND. Every lender will have different pricing, but it’s clear the trend has been lower. A lot lower in the past week. And it could just be getting started given the turmoil in the financial markets, with stocks now close to entering bear territory. When this happens, investors seek the safety of bonds, and mortgage rates benefit because they’re backed by similar securities (albeit with more risk). So if you’re wondering why mortgage rates dropped, you can thank the global tariffs, trade war, and plunging stock market. Even a decent jobs report released this morning wasn't enough to avert a market selloff, as all... --- > Like the year before, United Wholesale Mortgage (UWM) was the top mortgage lender in 2024. It marked their second year as the top dog, beating out their - Published: 2025-04-03 - Modified: 2025-04-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-of-2024/ - Categories: Mortgage News Like the year before, United Wholesale Mortgage (UWM) was the top mortgage lender in 2024. It marked their second year as the top dog, beating out their crosstown rival Rocket Mortgage yet again. Rocket had been #1 in the country since 2018 before ceding its lead to UWM, which works solely with mortgage brokers. And it wasn’t very close last year either, with UWM originating nearly $140 billion and Rocket mustering about $92 billion. Read on to see who else cracked the top-10 list overall, as well as in categories like home purchase loans and refinance loans. The Biggest Mortgage Lenders of 2024 (Overall) Ranking Company Name 2024 Loan Volume 1. United Wholesale Mortgage $137. 8 billion 2. Rocket Mortgage $92. 2 billion 3. CrossCountry $39. 3 billion 4. Chase $37. 5 billion 5. U. S. Bank $26. 0 billion 6. Rate $24. 3 billion 7. DHI Mortgage $24. 0 billion 8. Fairway Independent $23. 6 billion 9. Bank of America $23. 3 billion 10. Veterans United $23. 2 billion More than 4,600 banks, direct lenders, wholesalers, and credit unions originated nearly $1. 3 trillion in home loans last year. As noted, UWM took #1 again as they did in 2023, and similar to the year before, by a wide margin. It wasn’t very close and was never really in question, with the Pontiac, Michigan-based wholesale lender originating roughly $140 billion, per newly released HMDA data. Rival Rocket Mortgage was only able to originate about $92 billion, per figures compiled... --- > The latest mortgage rate forecast from Fannie Mae is a good one, assuming you’re a prospective home buyer or an existing homeowner. The - Published: 2025-04-02 - Modified: 2025-04-02 - URL: https://www.thetruthaboutmortgage.com/fannie-mae-now-expects-mortgage-rates-to-be-30-basis-points-lower-by-year-end/ - Categories: Mortgage Rates The latest mortgage rate forecast from Fannie Mae is a good one, assuming you’re a prospective home buyer or an existing homeowner. The government-sponsored enterprise (GSE) lowered their forecast pretty dramatically from a month earlier. They now expect the 30-year fixed to be a full 30 basis points lower by the end of 2025. And 30 basis points lower at the end of 2026 as well. Instead of a rate of 6. 6% to close out 2025, they now see the 30-year falling to 6. 3% instead. This should come as welcome news to anyone looking to save some money on their mortgage. Lower 10-Year Yields = Lower Mortgage Rate Forecasts Fannie Mae noted that the 10-year Treasury yield has “pulled back notably” from levels seen as recently as mid-January. As such, they now expect mortgage rates to be lower since a lower 10-year yield translates to lower mortgage rates. That happened to coincide with Trump’s inauguration. It seemed to be a sell the news event, where once he entered office stocks fell and bonds began to rally. Of course, this has been driven by a deteriorating economic outlook, so it might be bittersweet news. In other words, you might be able to snag a slightly lower interest rate but your job security could be worse. Not exactly the best tradeoff in the world. Fannie Mae seems to primarily use the 10-year bond yield to come up with their monthly mortgage rate forecast. And because it has fallen about 25... --- > As always, it’s been hard to determine the path forward for mortgage rates. They’re never easy to predict, but since the new administration took over, - Published: 2025-04-01 - Modified: 2025-04-01 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-appear-to-be-falling-as-recession-fears-rise/ - Categories: Mortgage Rates As always, it’s been hard to determine the path forward for mortgage rates. They’re never easy to predict, but since the new administration took over, it’s been even harder. You can blame it on a few things, whether it’s the DOGE-led government layoffs, the tariffs and wider trade war, or the general uncertainty of it all. For example, just last week the FHA said it will no longer allow non-permanent residents to get mortgages. Simply put, you just don’t know what you’ll wake up to on a given day, which makes forecasting that much harder. But now it appears storm clouds are brewing and that could finally push rates lower. Bad News Starting to Become Good News Again for Mortgage Rates? There’s a saying with mortgage rates that bad news pushes them lower. The general idea is that a slowing economy leads to lower inflation, which in turns leads to lower interest rates. When the going gets tough, investors seek safety in boring investments like bonds, namely U. S. Treasuries like the 10-year bond. They tend to make the move out of riskier stocks and into bonds for their perceived safety and guaranteed return, even if it’s lower. But when stocks are no longer expected to outperform, a lower return is better than no return. Conversely, if the economy (and inflation) is running hot, as it has the past several years, monetary policy would need to be tightened and interest rates would rise. That’s exactly what happened and explains to... --- > I’ve been saying for a year or two, maybe longer, that recapture was the next big thing in mortgage. Instead of going out and spending a lot of time and - Published: 2025-03-31 - Modified: 2025-03-31 - URL: https://www.thetruthaboutmortgage.com/rocket-buying-nations-largest-loan-servicer-mr-cooper-to-reclaim-top-mortgage-lender-title/ - Categories: Mortgage News I’ve been saying for a year or two, maybe longer, that recapture was the next big thing in mortgage. Instead of going out and spending a lot of time and money to acquire new customers, why not just tap into the ones you already have? This is especially true when it’s no longer easy to originate a home loans, thanks to much higher mortgage rates. Mortgage companies realized this, and began servicing their own loans so they could turn existing customers into repeat customers. And that’s clearly what Rocket is doing by acquiring the nation’s largest loan servicer, Mr. Cooper. Rocket Wants to Tap Into Mr. Cooper’s Giant Stable of Existing Homeowners In a nutshell, Rocket is acquiring Mr. Cooper to take advantage of millions of recapture opportunities. To give you an idea of how important recapture is to Rocket, the word is used seven times in their press release. For the uninitiated, recapture means to originate another loan for an existing customer you served in the past. An example would be someone who used Mr. Cooper to get a home purchase loan, who later uses Mr. Cooper to conduct a rate and term refinance to obtain a lower mortgage rate. With this tie-up, Rocket would be the one benefitting from any subsequent loans offered to Mr. Cooper customers. And there are a lot of them, given the fact that Mr. Cooper is the largest loan servicer in the country. At last glance, Mr. Cooper had roughly 6. 7 million... --- > I’ve seen a lot of posts lately on social media talking about waiting for mortgage rates to drop before buying a home. Or conversely, NOT waiting for - Published: 2025-03-27 - Modified: 2025-03-27 - URL: https://www.thetruthaboutmortgage.com/should-i-wait-for-mortgage-rates-to-drop-before-buying-a-home/ - Categories: Mortgage Rates I’ve seen a lot of posts lately on social media talking about waiting for mortgage rates to drop before buying a home. Or conversely, NOT waiting for mortgage rates to drop before buying a home. The typical argument, when it comes from an interested party, such as a real estate agent or loan officer, is obviously not to wait. If you wait, they don’t get paid. Right? Right. But should you even be trying to time the purchase to begin with? It's Impossible to Time Most Things in Life, Especially Mortgage Rates I remember when mortgage rates were hitting the dreaded 8% mark in late 2023. At that time, there were fears of double-digit rates. But at the same time, a new narrative emerged. Perhaps out of desperation, or perhaps out of some sort of real logic, a cohort of real estate agents and mortgage folk came up with a “beat the rush” narrative. Basically, with interest rates high, there was less competition out there. As such, you could swoop in and buy a home without getting into a bidding war, And maybe you’d even be able to lowball the seller and get a discount while you were at it. Win-win for an other sub-optinal situation. The rationale to do so was that once rates did eventually fall, it’d be bidding war central again. You’d have trouble getting back in. Blah blah blah. This was also around the time that silly marry the house, date the rate line surfaced. The... --- > A sweeping change took place this morning that blocks non-permanent residents from taking out FHA loans. After conforming loans backed by Fannie Mae and - Published: 2025-03-26 - Modified: 2025-03-31 - URL: https://www.thetruthaboutmortgage.com/non-permanent-residents-no-longer-eligible-for-fha-loans/ - Categories: Mortgage News A sweeping change took place this morning that blocks non-permanent residents from taking out FHA loans. After conforming loans backed by Fannie Mae and Freddie Mac, they are the most popular loan type available to home buyers today. They also have the most liberal underwriting guidelines, which allow for credit scores as low as 580 with a 3. 5% down payment. As a result of this change, only permanent residents will be able to obtain an FHA loan moving forward. The policy change is intended to both prioritize legal U. S. residents while also protecting “the integrity of government-insured loan programs. ” So-Called Illegal Aliens Barred from Taking Out FHA Loans A new mortgagee letter released today updates “will remove eligibility for illegal aliens from accessing FHA-insured mortgages. ” It does so by completely removing the “Non-permanent Residents” category in both the Single Family Title I and Title II programs. The FHA Title II loan programs include the basic FHA loan, known as 203(b), the home renovation 203(k) loan, and reverse mortgage program known as an HECM. The FHA Title I program includes property improvement loans and the manufactured housing (mobile) home program. As always, mortgage lenders must determine the residency status of borrowers based on information provided on the mortgage application along with other supporting documentation. The letter notes that “a Social Security card is not sufficient to prove immigration or work status. ” But only “Permanent Residents” are eligible for FHA-insured financing, meaning they must have lawful permanent... --- > File this one under unintended consequences of a global trade war. When you start a trade war, or at least threaten one, unexpected things can happen. We - Published: 2025-03-25 - Modified: 2025-03-25 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-could-go-up-if-foreign-countries-dump-their-mbs-holdings/ - Categories: Mortgage Rates File this one under unintended consequences of a global trade war. When you start a trade war, or at least threaten one, unexpected things can happen. We already got the sense that mortgage rates don’t like the trade war because of all the uncertainty involved. But there’s another wrinkle to consider here as well, and that’s the massive holdings of mortgage-backed securities (MBS) held by foreign countries. Should they decide to sell as a result of tariffs imposed against them, mortgage rates could jump in the United States. Foreign Investors Own a Good Chunk of Our Mortgages First things first, let’s talk about why foreign investors hold our mortgages and how much they own. In general, foreign countries invest in the United States for the perceived soundness and safety of its assets (and debt). Sure, things didn’t go so well in 2008, but all in all, foreign investors have long invested in agency mortgage-backed securities (MBS) because they’re relatively safe, high-yielding investments. And they’re pretty much guaranteed as well. Agency MBS include loans backed by Fannie Mae and Freddie Mac (conforming loans), which have an implicit government guarantee. And government loans, such as FHA loans, VA loans, and USDA loans, which have an explicit guarantee. Per Ginnie Mae, which provides a guarantee for the government home loans, foreign holdings of agency MBS hit an all-time high of roughly $1. 2 trillion in June 2021, representing nearly 13% of the market. The biggest investors of our agency MBS are Japan, Taiwan,... --- > Well, another year is in the books at the VA, and like prior years, Veterans United topped the list as the #1 VA loan lender in America. This marked their - Published: 2025-03-24 - Modified: 2025-03-26 - URL: https://www.thetruthaboutmortgage.com/veterans-united-the-top-va-loan-lender-in-2024/ - Categories: Mortgage News Well, another year is in the books at the VA, and like prior years, Veterans United topped the list as the #1 VA loan lender in America. This marked their third year as the top VA loan lender, beating out United Wholesale Mortgage (UWM) for the top spot this time around. They’ve now taken the top spot in 2024, 2023, and 2022, and as in past years by a large margin. The Columbia, Missouri-based mortgage company funded nearly 62,000 loans totaling over $19 billion during the year. That was more than enough to beat out UWM, which only mustered about $15. 6B. Read on to see the others in the top ten. Top VA Loan Lenders in 2024 Ranking Company Name 2024 VA Loan Volume 1. Veterans United $19. 3 billion 2. UWM $15. 6 billion 3. Rocket Mortgage $8. 0 billion 4. Freedom Mortgage $6. 6 billion 5. Navy Federal $5. 9 billion 6. DHI Mortgage $4. 3 billion 7. Village Capital $3. 8 billion 8. Pennymac $3. 5 billion 9. CrossCountry Mortgage $3. 2 billion 10. loanDepot $3. 1 billion As noted, Veterans United Home Loans was the biggest VA loan lender last year, per new Lender Statistics from the Department of Veteran Affairs. The company funded $19. 3 billion in VA loans, including over $17 billion in home purchase loans. Impressive given 2024 was another tough year for home buyers given the combination of elevated mortgage rates and still rising home prices. That didn’t seem to slow... --- > A couple weeks ago, I wrote about how mortgage rates hadn’t really done much since the U.S. presidential election took place. By not doing much, I meant - Published: 2025-03-20 - Modified: 2025-03-20 - URL: https://www.thetruthaboutmortgage.com/where-would-mortgage-rates-be-today-if-kamala-harris-won/ - Categories: Mortgage Rates A couple weeks ago, I wrote about how mortgage rates hadn’t really done much since the U. S. presidential election took place. By not doing much, I meant they didn’t really go anywhere. They definitely moved around a lot since then, but really only went full circle. In other words, rates are more or less the same today as they were back in late October. And I pointed this out because both President Trump and Secretary Treasury Scott Bessent have vocalized making lower interest rates a priority. So I wanted to see if they had actually made any headway, even though it’s only been a few months. Mortgage Rates Advanced Higher Ahead of Trump Win In that earlier post, I questioned whether Trump and Bessent had lowered mortgage rates. I did so because there was some praise that they had brought rates down, with the 30-year fixed falling for a six-week stretch from mid-January to early March. The problem was, the 30-year fixed was arguably elevated due to Trump winning the election, as seen in the MND chart above. And simply came back down after the market relaxed and Bessent did his best to ease rattled nerves. I will say that Bessent has done a good job countering some of Trump’s more volatile actions in this regard. But recently the stock market sold off (and bond yields went up) because of an increasingly nasty trade war that now includes the entire world. There’s only so much Bessent can do if... --- > I’ve been a lot more active on social media over the past few years. And one of my observations is that everyone is looking to go viral with some - Published: 2025-03-18 - Modified: 2025-03-18 - URL: https://www.thetruthaboutmortgage.com/if-you-have-a-mortgage-you-are-not-rich/ - Categories: Mortgage Tips I’ve been a lot more active on social media over the past few years. And one of my observations is that everyone is looking to go viral with some controversial take that ruffles feathers. You’re essentially rewarded for sparking a healthy (or perhaps unhealthy) conversation, so that’s often the goal. One recent tweet I came across said, “If you have a mortgage, you’re not rich. ” Clearly this is challenging people to argue. But is it actually true? Or do tons of rich people have mortgages themselves? Rich People Love Mortgages Without getting too into the weeds on this one, since for me it’s a pretty silly take, I’d argue that more rich people than “not rich people” have mortgages. In other words, you’re more likely to have a mortgage if you’re wealthy. Allow me to explain. For starters, wealthy folks are more likely to be homeowners than renters. And if you’re a homeowner, chances are you have a mortgage since buying a home all-cash just isn’t a reality for most. Even if it is possible, the ultra-wealthy still don’t want to sink a big chunk of cash into an illiquid asset like a single-family home. Why? Because chances are they can earn more on their money elsewhere. Real estate likely isn't the best investment they can make, but it's certainly a good one. And they get to live in it too! The rich know that putting your money to work for you is better than actually working. Just ask... --- > Lately, mortgage rates have been pretty flat. They enjoyed a nice string of six or seven weeks where they tumbled down from around 7.25% to 6.75% before - Published: 2025-03-18 - Modified: 2025-03-18 - URL: https://www.thetruthaboutmortgage.com/if-mortgage-rates-dont-move-theyll-be-better-in-a-month/ - Categories: Mortgage Rates Lately, mortgage rates have been pretty flat. They enjoyed a nice string of six or seven weeks where they tumbled down from around 7. 25% to 6. 75% before losing steam. While it’s unclear what caused them to plateau, I’ve pointed to things like tariff talk and general uncertainty. It seems like we’re kind of stuck at 6. 75%, which isn’t horrible, but also not what some had hoped when Trump and Bessent spoke about lowering interest rates. But there’s one thing working in favor of mortgage rates right now, and that’s year-ago levels. Like Everything Else, Context Matters to Mortgage Rates Context matters and when mortgage rate surveys are released, they typically include a year-ago level. This provides a more complete picture of where they stand today. And can affect things like home buyer sentiment if they are priced lower or higher than prior periods. In a sense, today’s mortgage rate doesn’t exist in a vacuum. It’s compared to yesterday, last week, and last year. To illustrate this, one simply has to consider that the long-term average for the 30-year fixed is around 7. 75%. Meanwhile, the going rate for a 30-year fixed today is about one full percentage point lower. Hooray! Right? Well, not exactly. Why? Because the 30-year fixed was sub-3% in early 2022, and in the 2-4% range for the prior decade before rates nearly tripled a couple years ago. So while mortgage rates today are below their long-term average, and not even close to those... --- > Let's talk home selling tips. While still-high mortgage rates will undoubtedly make prospective home buyers feel stretched, there's still plenty of hope - Published: 2025-03-17 - Modified: 2025-03-17 - URL: https://www.thetruthaboutmortgage.com/12-home-selling-tips-for-2019/ - Categories: Housing Market, Mortgage Tips Let's talk home selling tips. While still-high mortgage rates will undoubtedly make prospective home buyers feel stretched, there's still plenty of hope for home sellers in 2025! Sure, the lofty asking prices of 2022 and early 2023 have perhaps come down, but if you pan out a bit, property values remain well above pre-pandemic levels. In many metros, still up 50%! So while you may have missed your chance to sell at the absolute top, most home sellers today are still making out pretty darn well. Regardless of what happens to the economy this year, chances are those who are planning to buy a home will, assuming they can find one that suits their individual needs. The housing inventory shortage isn't as pronounced, but it remains an issue in markets in the Midwest and Northeast. And home buyer appetite is still relatively healthy, so sellers who list right should fare just fine in 2025. Let’s talk about some potential home selling tips to help you get top dollar if you do decide to list. 1. It’s Finally Becoming a Buyer's Market Nationwide If you happen to be selling a property in 2025, conditions might be a little different this year than in past years. And not in a good way. The main culprit, and really only culprit, has been mortgage rates. The 30-year fixed climbed from the high-2% range in early 2022 to over 8% in late 2023, before coming down some over the past year and change. But it... --- > I remember when I wrote my mortgage myths post, I pointed out that mortgages aren’t mostly interest. But I did so when mortgage rates were near record low - Published: 2025-03-17 - Modified: 2025-03-17 - URL: https://www.thetruthaboutmortgage.com/higher-mortgage-rates-mean-principal-repayment-has-slowed-to-a-crawl/ - Categories: Mortgage Rates, Mortgage Tips I remember when I wrote my mortgage myths post, I pointed out that mortgages aren’t mostly interest. But I did so when mortgage rates were near record low levels, which may have skewed the answer. It’s true that for most of the past century, mortgages haven’t been mostly interest. More has gone toward principal repayment than interest. However, now that interest rates are closer to 7%, this is no longer true if the loan is held to maturity. In addition, it means it takes a whole lot longer for principal to exceed interest on a monthly basis. Something you should know if you’re thinking of buying a home today. Monthly Mortgage Payments Stay the Same, But There’s a Shift in Principal and Interest The way mortgage amortization works on a fixed-rate mortgage, you enjoy the same monthly payment each month for the entire loan term. For example, consider a $400,000 loan amount set at 6. 75% on a 30-year fixed; the principal and interest payment is $2,594. 39 per month for 360 months. It doesn’t change. However, the payment composition does. Because the loan balance shrinks each month with a portion of the payment going to principal, you owe less interest the next month. Simply put, smaller outstanding balance, less interest due. Fairly straightforward concept. When mortgage rates were low, a huge portion of the monthly payment went toward principal (because the rate of interest was low). However, as we all know, mortgage rates aren’t so low anymore. Gone are... --- > Today we'll take a brief look at some mortgage rate history to gain a little context for where we stand today. It's always helpful to know what came - Published: 2025-03-15 - Modified: 2025-03-15 - URL: https://www.thetruthaboutmortgage.com/check-out-these-mortgage-rate-charts-from-the-early-1900s/ - Categories: Mortgage Rates, Mortgage Tips Today we'll take a brief look at some mortgage rate history to gain a little context for where we stand today. It's always helpful to know what came before so you can better guess what might come after. Just about everyone knows that mortgage rates hit all-time record lows in 2021. But do you know what mortgage rates were like in the early 1900s? The 30-year fixed averaged 2. 65% during the week ending January 7th, 2021, its lowest point in history. Later that year, the 15-year fixed hit the lowest point ever, sinking to 2. 10% during the week ending July 29th, 2021. Some lucky homeowners were able to snag fixed interest rates below 2% for the next 15 to 30 years! Freddie Mac's Mortgage Rate Statistics Started in 1971 Most mortgage rate statistics are tied to Freddie Mac's archive Unfortunately, it only goes back to the year 1971 which isn't much to go on I wanted to drill down a bit deeper to see what things were like prior to the 70s And see if I could find data from earlier on in the 20th century to gain more perspective The figure above come from Freddie Mac’s Primary Mortgage Market Survey, which only dates back to 1971. For the record, back in April of 1971, the first month they began tracking 30-year fixed mortgage rates, the national average was 7. 31%. It went as high as 18. 45% in October 1981 and as low as 2. 65% in... --- > It seems pretty clear that the housing market has cooled, and is now more of a buyer’s market than a seller’s market. While this does and will always vary - Published: 2025-03-14 - Modified: 2025-03-14 - URL: https://www.thetruthaboutmortgage.com/if-youre-buying-a-home-today-expect-to-keep-it-for-a-long-time/ - Categories: Home Buying It seems pretty clear that the housing market has cooled, and is now more of a buyer’s market than a seller’s market. While this does and will always vary by metro, it’s becoming increasingly common to see higher days on market (DOM), price cuts, and rising inventory. This all has to do with record low affordability, which has made it difficult for a prospective home buyer to make a deal pencil. The stubbornly high mortgage rates aren’t helping matters either, calling into question if it’s a good time to buy a home. Or if it's better to just keep renting. But if you do go through with a home purchase today, expect to keep the property for many years to come. Home Price Gains Have Cooled and Could Even Go Negative This Year While economists at CoreLogic still forecast home prices to rise 3. 6% from January 2025 to January 2026, it seems as if the gains are rapidly slowing. And in some markets, particularly Florida and Texas, home prices have already turned negative and have begun falling year-over-year. For example, home prices were off 3. 9% YoY in Fort Myers, FL, 1% in Fort Worth, TX, and 1. 1% in San Francisco. I expect more markets to turn negative as 2025 progresses, especially with more properties coming to market and sitting on the market as DOM goes up. It’s a simple matter of supply and demand, with fewer eligible (or interested) buyers, and more properties to choose from. There... --- > Yesterday, I wrote about how the uncertainty surrounding tariffs was hurting mortgage rates. In short, the market doesn’t know what to make of the tariffs - Published: 2025-03-13 - Modified: 2025-03-13 - URL: https://www.thetruthaboutmortgage.com/can-the-housing-market-stomach-a-return-to-7-mortgage-rates/ - Categories: Housing Market, Mortgage Rates Yesterday, I wrote about how the uncertainty surrounding tariffs was hurting mortgage rates. In short, the market doesn’t know what to make of the tariffs given the constant flip-flopping going on. One day the tariffs are on. The next day they’re off. Then they’re on again. Then there are new ones. Then they’re worldwide! It’s getting old, and in the process other countries seem to be losing interest in doing business with the United States. Apparently, Canadians aren’t buying U. S. -made products now... At the same time, the nice run mortgage rates enjoyed from mid-January to March seems to be over. And there’s now a real fear we could return to 7% mortgage rates. Could Mortgage Rates Go Back to 7%, Again? ! In early March, I asked a seemingly straightforward question. Will mortgage rates go to 5. 99% or 7% next? This was when the 30-year fixed was hovering around 6. 75%, but appeared to be on a clear downward trajectory. It seemed like despite a 75-basis point drop needed, rates were indeed heading to sub-6% as opposed to 7%. But basic math tells us it’s easier to move 25 bps than it is 75 bps, and now we’re knocking on 7’s door once again. If you consider monthly payments, it’s not a huge difference. A $400,000 loan amount set at 6. 75% is $2,594. 39 per month. It’s only about $67 more at a payment of $2,661. 21 with an interest rate of 7%. But it’s a... --- > Closing costs can be very expensive. Fortunately, there are a number of ways to reduce out-of-pocket costs and hold onto more of your money. - Published: 2025-03-12 - Modified: 2025-03-12 - URL: https://www.thetruthaboutmortgage.com/how-to-reduce-closing-costs-on-your-mortgage/ - Categories: Mortgage Tips When you take out a mortgage, whether it’s a home purchase or a refinance, you must pay "closing costs. " These costs can vary considerably from transaction to transaction, but typically amount to 1-6% of the purchase price or loan amount. For example, on a $450,000 home purchase you might pay $13,500 (3%) in closing costs. Ouch! The reason it's so pricey is because of the many people involved in the home loan process. There are fees that must be paid to the bank/lender, and fees that must be paid to third parties, such as title/escrow and insurance. Along with optional costs such as mortgage discount points, which lower your interest rate. You will also have to pay for various inspections, a home appraisal, property taxes, per diem interest, and much more. Whether you pay these fees out-of-pocket is another question, but either way there will be a cost, and you must pay it in one way or another. Key Takeaways on Reducing Mortgage Closing Costs Closing costs vary widely by lender, loan type, and loan amount - be sure to shop fees too! Fees differ because some lenders bake costs into rates while others itemize fees Negotiate everything: Haggle with lenders, tell them you have other quotes, ask for discounts Agent credit: Ask your real estate agent for a commission rebate to reduce your costs Seller contribution: Ask the sellers to offer a credit toward closing costs Lender credit: Ask the lender to give you a credit to offset... --- > It’s clear that the trade war is now the biggest driver of mortgage rates today. Prior to the arrival of tariffs and a wider trade war, inflation and - Published: 2025-03-12 - Modified: 2025-03-12 - URL: https://www.thetruthaboutmortgage.com/the-trade-war-matters-more-to-mortgage-rates-than-cool-economic-data/ - Categories: Mortgage Tips It’s clear that the trade war is now the biggest driver of mortgage rates today. Prior to the arrival of tariffs and a wider trade war, inflation and unemployment dictated their direction. Surging inflation was a big reason why mortgage rates climbed to 8% in late 2023. But no longer. At least not for the moment. Despite cool economic data being delivered each week, bond yields (and mortgage rates) are rising again. The latest evidence came via a softer-than-expected CPI report, which would normally result in better interest rates. Instead, the 10-year bond yield was up today when it might otherwise have fallen. What gives? Cooler Inflation Data Is Being Overshadowed by Tariffs If you’ve been paying attention, mortgage rates were enjoying a nice little run of late. But that abruptly ended a week ago. When Trump entered office for his second term in January, the 30-year fixed was averaging close to 7. 25%. In the span of six weeks, from around mid-January until early March, rates fell to roughly 6. 625%, possibly fueled by the mass government layoffs implemented by DOGE, and fears of a recession. But there was always some restraint as mortgage rates inched lower. And that was due to the unknowns surrounding Trump’s policies, including his favored tariffs. While he waffled and delayed planned tariffs on Canada and Mexico in February, he did follow through with 10% tariffs against China. He then imposed tariffs on Canada and Mexico in early March, before delaying them again until... --- > So far, 2025 is shaping up to be a bit better when it comes to mortgage rates. While the 30-year fixed is only slightly below year-ago levels at the - Published: 2025-03-11 - Modified: 2025-03-11 - URL: https://www.thetruthaboutmortgage.com/2025-could-be-the-year-of-the-rate-and-term-refinance/ - Categories: Mortgage News, Refinance So far, 2025 is shaping up to be a bit better when it comes to mortgage rates. While the 30-year fixed is only slightly below year-ago levels at the moment, it seems to be trending in a better direction compared to last year. It’s currently around 6. 75%, which is about an eighth below the 6. 875% average seen in early March 2024. But unlike back then, mortgage rates might sink further into spring, instead of rising like they did in April and May. And that could be a boon for existing homeowners looking to refinance an existing home loan. Rate and Term Refis Continue to Gain as Mortgage Rates Improve There are three main types of mortgages – the home purchase mortgage, which is self-explanatory. And the mortgage refinance, which is broken down into a rate and term refinance and a cash out refinance. When mortgage rates kept rising and eventually hit 8% in late 2023, nobody was applying for a rate and term refinance. Why? Because you’d only really do so if you could obtain a lower interest rate in the process. That meant the only real game in town, aside from some purchase lending, was cash out refinances, where existing homeowners were either consolidating debt or tapping equity to pay for other expenses. However, now that mortgage rates are seemingly falling, and well below those scary 8% levels seen about 18 months ago, rate and term refinances have made a little comeback. They’ve actually been the one... --- > Just a week after Rocket Mortgage exited Canada, parent company Rocket Companies has announced its intent to acquire Redfin. The Seattle, WA-based real - Published: 2025-03-10 - Modified: 2025-03-10 - URL: https://www.thetruthaboutmortgage.com/rocket-to-acquire-redfin-to-boost-home-purchase-lending-and-take-back-1-spot/ - Categories: Mortgage News Just a week after Rocket Mortgage exited Canada, parent company Rocket Companies has announced its intent to acquire Redfin. The Seattle, WA-based real estate brokerage is one of the largest in the United States, as well as the most visited real estate platform on the web. The acquisition will give one of the nation’s largest mortgage lenders a big leg up in the home purchase lending world, potentially allowing it to reclaim the top spot overall. Rocket Mortgage had been the top mortgage lender for several years before being unseated by crosstown rival United Wholesale Mortgage in 2023. With refinance volume falling in recent years as mortgage rates surged higher, it’s been clear that to rise to the top, you need to be originating a lot of purchase loans as well. Given Redfin has more than 2,200 real estate agents under its umbrella, Rocket could once again find its way back to #1. Rocket to Buy Redfin in All-Stock Transaction In terms of the financials, Rocket Companies (NYSE:RKT) has agreed to pay $12. 50 per share for Redfin (NASDAQ:RDFN) in an all-stock transaction, which values the company around $1. 75 billion. That’s quite a premium from its prior closing price last Friday of $5. 88. At last glance, Redfin shares were trading around $10 this morning, signaling more upside to come if the deal closes. The exchange ratio is 0. 7926 of Rocket Class A common stock for each share of Redfin common stock. Shares of Rocket were down about... --- > One of the oldest and largest credit unions in the nation, Navy Federal FCU, happens to be a big player in the home loan space. Instead of just offering - Published: 2025-03-07 - Modified: 2025-03-07 - URL: https://www.thetruthaboutmortgage.com/navy-federal-mortgage-review-rates-appear-low-and-they-keep-your-loan/ - Categories: Mortgage Tips One of the oldest and largest credit unions in the nation, Navy Federal FCU, happens to be a big player in the home loan space. Instead of just offering the same mortgages every other bank has readily available, they go a step further with their own unique offerings. This includes a conventional zero down loan option, conforming and jumbo loans, and even an interest-only option if you’ve got some home equity. Let’s learn more about this company to see if they’re the right fit for your home loan needs. The one caveat with Navy Federal is that not everyone is eligible for a membership. You or a family member must have some affiliation with the Armed Forces, DoD, Coast Guard or National Guard. The good news is that’s a lot of people because Navy Federal has over eight million members nationwide, up from just seven (7 people) when they began all the way back in 1933. Navy Federal is a Top-20 Mortgage Lender Nationwide Largest credit union in the United States Founded in 1933 and based in Vienna, Virginia Offers basic banking services (checking/savings accounts), mortgages, and home equity loans/lines Funded nearly $15 billion in home loans in 2023 (top-20 overall) Most active in the states of Florida, Virginia, and California Membership offered to active duty and veterans and their familes, along with Department of Defense Civilians May offer a price-match if you show them a lower quote from another lender At last glance, Navy Federal is a top-20 mortgage... --- > Tomorrow is a big day for mortgage rates, potentially. I say that because tomorrow is the release of the monthly jobs report from the Bureau of Labor - Published: 2025-03-06 - Modified: 2025-03-06 - URL: https://www.thetruthaboutmortgage.com/dont-be-surprised-if-mortgage-rates-go-up-tomorrow/ - Categories: Mortgage Rates Tomorrow is a big day for mortgage rates, potentially. I say that because tomorrow is the release of the monthly jobs report from the Bureau of Labor Statistics (BLS). Known as the Employment Situation, it details how many jobs were added in the prior month, in this case February. It also includes the unemployment rate, average hourly earnings (wage growth), and any revisions from prior months. A month ago, the jobs report was a mixed bag, with jobs added below expectations, but a lower unemployment rate and higher wages. Jobs Report Generally the Biggest Mortgage Rate Mover Mortgage rates have the potential to move daily based on what’s happening in the world and in financial markets. Generally, it is economic data that drives rates, but there are things like geopolitical events and lately, stuff like tariffs impacting mortgage rates. The jobs report tends to be one of the biggest economic drivers of mortgage rates, so loan officers and mortgage brokers pay close attention. They also may advise their clients to lock their mortgage rate before the report is released, given the uncertainty. Ultimately, nobody really knows what will happen on the first Friday of the month, when the jobs report is released. But they know it could be pretty impactful, so floating your mortgage rate before the release is often ill-advised if you expect to close your loan soon. Chances are your LO or broker will tell you, “if you like it, lock it. ” Anyway, tomorrow will be really... --- > There’s been a lot of optimism about mortgage rates under Trump. After all, rates have fallen for the past six weeks from around 7.25% to 6.75%, which is - Published: 2025-03-05 - Modified: 2025-03-06 - URL: https://www.thetruthaboutmortgage.com/have-trump-and-bessent-actually-lowered-mortgage-rates-at-all/ - Categories: Mortgage Rates There’s been a lot of optimism about mortgage rates under Trump. After all, rates have fallen for the past six weeks from around 7. 25% to 6. 75%, which is a pretty decent run. It feels as if the campaign promise to lower interest rates wasn’t just talk; it's actually real. But then when you look at a mortgage rate chart from when he became the frontrunner until today, it doesn’t look as great. In fact, it feels like we’ve gone nowhere at all, while the economy now feels a lot shakier. Mortgage Rates Are Simply Back to Pre-Election Levels I annotated a mortgage rate chart from Mortgage News Daily to make my case. By the way, this isn’t political, it’s simply looking at the timeline and the numbers. If we go back to September, the 30-year fixed was at its lowest point in several years, hovering just above 6%. That was actually pretty good at the time, and was driven by the Fed pivot, in which they stop hiking and signal a future cut. When they finally did cut, mortgage rates bounced a little higher. Not by much, but kind of a sell the news event. In other words, everyone knew the Fed was going to cut, and once they finally did, rates didn’t fall. They didn’t fall because the rumor of a Fed rate cut, which is highly telegraphed, was already baked in. Shortly after the Fed cut, a hot jobs report came down the pipe. This was... --- > Today was yet another good day for mortgage rates, which came down an additional 10 bps (0.10%), per the latest daily survey from Mortgage News Daily. The - Published: 2025-03-04 - Modified: 2025-03-04 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-are-now-back-to-october-levels-how-could-they-move-even-lower/ - Categories: Mortgage Rates Today was yet another good day for mortgage rates, which came down an additional 10 bps (0. 10%), per the latest daily survey from Mortgage News Daily. The 30-year fixed now sits at around 6. 625%, which is the lowest level seen since early October. It’s down from around 7. 25% in mid-January, representing an improvement of roughly 5/8 of a percentage point. However, they remain about a half-point above levels seen in early September so there could be more room to fall. The big question is will they keep falling, and how might they achieve that with a trade war now in effect and a looming budget proposal that could raise the debt ceiling considerably? Mortgage Rates Are Now at Five-Month Lows As noted, the 30-year fixed hasn’t been lower since early October, per MND, and it could be poised for even more improvement in coming days, weeks, and months. Interestingly, mortgage rates are basically back to where they were around the time Trump became the clear frontrunner to win the presidential election. In a sense, one could argue that the increase in rates driven by an expected Trump victory has simply been unwound. After all, they appeared to rise quite a bit on the expectation his policies would be inflationary. We're only back to where we started. So those rooting on Trump and his Treasury Secretary Scott Bessent should keep that in mind. Rates moved a lot higher around the time of the election and into the inauguration,... --- > It's time for yet another mortgage match-up, so without further ado, here’s a biggie: “Renting vs. buying a home.” Or a townhouse for that matter... This - Published: 2025-03-04 - Modified: 2025-03-04 - URL: https://www.thetruthaboutmortgage.com/renting-vs-buying-55-pros-and-cons/ - Categories: Housing Market, Mortgage Matchups, Mortgage Tips It's time for yet another mortgage match-up, so without further ado, here’s a biggie: “Renting vs. buying a home. ” Or a townhouse for that matter... This is certainly an intimidating question, and one that's difficult to sum up in one post, but I’ll do my best to cover as many pros and cons for each as possible (feel free to add more in the comments section! ). First and foremost, there is no universal yes or no answer to this question seeing that real estate is constantly in flux and extremely local (more so than ever). It's also about so much more than money. There are many reasons to buy a home beyond the investment itself. But financials are often a big driver of the decision, so that will be top of mind in this post. Key Takeaways to Consider When Weighing the Rent vs. Buy Decision No One-Size-Fits-All Answer: Renting vs. buying depends on your unique finances, emotions, goals, and local real estate trends — there’s no universal “yes” or “no” answer More than Money: It’s not just about the monthly cost — homeownership builds wealth and offers freedom, while renting provides flexibility with fewer responsibilities Tough Market Today: High home prices and elevated mortgage rates (~7% vs. 3% pre-2022) make buying less affordable; Zillow recently said it takes over a decade to turn a profit Rent vs. Buy Math: Tools like the “rule of 15” (annual rent x 15 = good price) or price-to-rent ratios (1-15 favors... --- > It’s no secret mortgage rates are falling. I’ve argued they never really stopped falling since the 30-year fixed hit 8% back in late 2023. But there have - Published: 2025-03-03 - Modified: 2025-03-03 - URL: https://www.thetruthaboutmortgage.com/are-mortgage-rates-going-to-5-99-or-7-next/ - Categories: Mortgage News It’s no secret mortgage rates are falling. I’ve argued they never really stopped falling since the 30-year fixed hit 8% back in late 2023. But there have been periods where rates increased quite a bit along the way, putting that theory into question. Lately, it’s been nothing but roses for mortgage rates, which have now fallen about half a percent since mid-January. And it has me wondering, are mortgage rates going to 5. 99% or 7% next? Mortgage Rates Have Fallen Every Week Since Mid-January Rates on the popular 30-year fixed are now firmly back below 7% again. In fact, they’ve fallen six weeks in a row, per Freddie Mac. And during that time, they’ve made some good headway, especially in the latest week when they dropped from 6. 85% to 6. 76%. That felt like a big move for mortgage rates, which have bounced higher and lower for years now without a clear sense of direction. To some, it might feel like a turning point. For me, it certainly feels like it. There have been lots of head fakes, but this latest move lower feels a little more real than the others. Perhaps it’s the string of “wins” that mortgage rates have seen lately, as opposed to the two steps forward, one step back pattern we’ve seen since they hit 8%. The vibes are better right now in terms of where mortgage rates might go next. Of course, the reason they’re falling, either due to rising government layoffs or... --- > What a run it has been for mortgage rates lately. In just the past six weeks, the 30-year fixed has fallen about half a percentage point. At last glance, - Published: 2025-02-28 - Modified: 2025-02-28 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-are-down-about-half-a-percent-in-the-past-six-weeks/ - Categories: Mortgage Rates What a run it has been for mortgage rates lately. In just the past six weeks, the 30-year fixed has fallen about half a percentage point. At last glance, the 30-year fixed is hovering around 6. 75%, down from 7. 25% as recently as mid-January. Mortgage rates are currently enjoying some tailwinds related to cooling economic data and rising unemployment. The obvious next question: Can it continue and what might derail it? Mortgage Rates Enjoying a Nice Downtrend Lately A series of weak economic reports have pushed mortgage rates lower The 30-year fixed is now down from around 7. 25% in mid-January to 6. 75% today The trend is our friend right now and could continue to deliver savings into spring But it might be at the expense of a deteriorating economy (recession) so beware A common phrase in the mortgage world is “the trend is our friend. ” Or conversely, “the trend isn’t our friend. ” At the moment, the trend has certainly been the friend to loan officers, mortgage brokers, and real estate agents. For much of the past six months, since around late September, the trend wasn’t our friend thanks to a hot jobs report and a Trump win. But after some cool economic reports, deteriorating consumer confidence, ongoing government layoffs, and dovishness surrounding tariffs, rates have reversed course and come down. The 10-year bond yield, which is used to track mortgage rates, has fallen from around 4. 79% in to 4. 24% today. It has also... --- > Trying to decide between locking and floating your mortgage rate? Discover the pros and cons of each, and how to make the right choice. - Published: 2025-02-26 - Modified: 2025-02-26 - URL: https://www.thetruthaboutmortgage.com/locking-vs-floating-your-mortgage-rate/ - Categories: Mortgage Matchups, Mortgage Rates, Refinance To mortgage folks across the country, it’s an age-old question: “Lock or float? ” It’s a question loan officers and mortgage brokers get asked on a daily basis, often over and over again by panicked borrowers and first-time home buyers. And it might just be the most important answer you come up with during the loan process, as it will determine the mortgage rate you ultimately receive and possibly keep for years. The interest rate you pick will dictate what you pay each month for potentially the next 30 years (assuming you don’t refinance), so it’s not a decision to be taken lightly! How Locking vs. Floating a Mortgage Rate Works You get the option to lock or float your interest rate when you apply for a mortgage If you lock, the interest rate won't change as long as you fund your loan before its expiration If you float, rates may go up or down until you finally lock it in Your loan officer or broker may be able to advise you on which move to make When you submit a home loan application, you will be asked if you want to lock in your mortgage rate or float the rate. If you choose to lock the rate, you are guaranteeing yourself a certain interest rate on your mortgage. So if the lender says you can lock in an interest rate of 6. 25% on your 30-year fixed-rate mortgage today, and you’re happy with that, they can lock it in... --- > It’s been a great week for mortgage rates. You can’t argue that. The 30-year fixed is now averaging around 6.80%, down from over 7% a week ago. Aside from - Published: 2025-02-25 - Modified: 2025-02-25 - URL: https://www.thetruthaboutmortgage.com/a-weakening-economy-might-bring-lower-mortgage-rates-but-what-else/ - Categories: Mortgage Rates It’s been a great week for mortgage rates. You can’t argue that. The 30-year fixed is now averaging around 6. 80%, down from over 7% a week ago. Aside from the psychological win of dropping the 7 for a 6, rates are now nearly the lowest they’ve been since December. There’s also a sense, finally, that they might be trending even lower and building momentum, instead of the head fakes we saw as rates seesawed back and forth. But there’s just one little hitch. What does this mean for the wider economy? Lower Mortgage Rates Are Great, for Now In case you didn’t notice, the 30-year fixed is now firmly back below 7%. At last glance, MND put it at 6. 80% This is down from 7. 13% two weeks ago, an impressive decline of about a third of a percentage point. And if we zoom out a little farther, the 30-year fixed was roughly 7. 25% in mid-January, representing a near-half point decline. I assume this is welcome news for prospective home buyers grappling with affordability issues. It’s also welcome news for home sellers looking to unload their properties at a time when affordability has never been worse. A nice selling point. And it could come at the perfect time, with the spring home buying season started to swing into gear. Timing is crucial, and last year mortgage rates were moving in the wrong direction from March through May. In addition, it will be a boon for existing homeowners... --- > As anticipated, mortgage rates are back below their year-ago levels. I had suspected they would be, despite a rough couple of months pre- and - Published: 2025-02-20 - Modified: 2025-02-20 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-back-below-year-ago-levels-as-we-head-into-spring/ - Categories: Mortgage Rates As anticipated, mortgage rates are back below their year-ago levels. I had suspected they would be, despite a rough couple of months pre- and post-election. There’s been a lot of uncertainty lately, but bond yields have also cooled thanks to friendlier economic data and a reprieve on most tariffs. Mortgage rates are also simply better today than last year because they've been more and less drifting lower since peaking at 8% in late 2023. The question is will it continue, and if so, can it save the spring housing market? Where Mortgage Rates Stand Today: Lower Than Last Year Both Freddie Mac and Mortgage News Daily posted a 30-year fixed back in the 6s today, which after seeing 7 and 8 doesn’t sound half-bad. Sure, it’s a far cry from 3%, but it’s all psychological and lower is better, even if it’s higher than it was previously. Specifically, mortgage rates fell to 6. 85% during the week ending February 20th, which was just below last year’s average of 6. 90% at this time, per Freddie Mac. Meanwhile, MND pegged the 30-year fixed at 6. 96%, which was below the 7. 11% seen in late February of 2024. It’s not a massive improvement, yet, but it is an improvement. And it does jibe with my take that mortgage rates remain in a falling rate environment. If you consider where the 30-year fixed was in late 2023, rates have improved by over 100 basis points (1%). And if you compare them to... --- > Mortgage Q&A: “How to pay off the mortgage early.” If you're looking to pay off your mortgage quickly, now might be a good time to do so because - Published: 2025-02-20 - Modified: 2025-02-20 - URL: https://www.thetruthaboutmortgage.com/how-to-pay-off-the-mortgage-early/ - Categories: Mortgage Tips Mortgage Q&A: “How to pay off the mortgage early. ” If you're looking to pay off your mortgage quickly, now might be a good time to do so because mortgage interest rates are no longer rock bottom. However, if you've had your existing mortgage for a while, there's a good chance your current interest rate is significantly lower than today's prevailing rates. In this case, it could make sense to just pay your mortgage back on schedule. After all, why rush repayment if the interest rate is a super low 2-4%? Ultimately, you need to look at extra mortgage payments as an investment. And your mortgage rate is the rate of return. For example, if your rate is 2. 75% but a high-yield savings account pays around 5%, why put more of your money toward the mortgage? Conversely, if you took out a home loan more recently and the rate is closer to 7%, paying it off early could be a winning move. Key Points to Consider If You Want to Pay Off the Mortgage Early You always have the option to pay the mortgage off ahead schedule Just be sure there isn't a prepayment penalty for doing so (not common today) Homeowners can allocate extra funds toward principal each month if they choose Ask your loan servicer if you're unsure of how this works (they can help) If you've got a high interest rate, it can make sense to pay off the loan sooner If you have a low... --- > If you’ve yet to enter the housing market, but are thinking of buying a home in 2025, there’s a lot you need to know. The 2025 housing market is going to - Published: 2025-02-19 - Modified: 2025-02-19 - URL: https://www.thetruthaboutmortgage.com/buying-a-home-in-2018-11-tips-to-get-it-done/ - Categories: Home Buying, Housing Market, Mortgage Tips If you’ve yet to enter the housing market, but are thinking of buying a home in 2025, there’s a lot you need to know. The 2025 housing market is going to be a lot different than in prior years! As I once pointed out, this isn’t your older sibling’s housing market. Not just anyone can get a mortgage these days. You actually have to qualify. But we’ll get to that in a minute. Let’s start by talking about home prices, which surged in recent years and are finally beginning to move sideways (or even lower) after hitting all-time highs. At the same time, mortgage rates remain quite elevated, having more than doubled from their record lows over the course of 2023 and 2024, though they are slated to fall (hopefully) as the year goes on. Taken together, home buying in 2025 should get a little easier from an affordability standpoint, but it still isn't cheap and quality inventory remains scarce. 1. Prepare for More Sticker Shock When Buying a Home in 2025 If you’re preparing to buy a home in 2025, expect to be shocked, and not in a good way. At this point in the cycle, home prices have eclipsed old all-time highs in many parts of the country, if not nearly all places. And while appreciation is now on a downward trajectory, with marginal or even slightly negative annual gains expected, it remains positive in most metros. In other words, homes aren't cheap, nor do they seem to... --- > In a bid to help more renters make the leap to homeownership, Rocket Mortgage has launched a new program called “RocketRentRewards.” As the name suggests, - Published: 2025-02-18 - Modified: 2025-02-18 - URL: https://www.thetruthaboutmortgage.com/rocketrentrewards-offers-10-back-on-rent-to-use-toward-closing-costs-on-a-home-purchase/ - Categories: Mortgage News In a bid to help more renters make the leap to homeownership, Rocket Mortgage has launched a new program called “RocketRentRewards. ” As the name suggests, you can now earn rewards simply for paying your rent each month. Specifically, renters get 10% of their rent for the past 12 months as a credit toward closing costs. For example, if you currently pay $2,000 per month, you’ll get $2,400 for a year’s worth of rent. This amount can then be applied to closing costs on your mortgage to reduce your out-of-pocket expenses. How RocketRentRewards Works In order to take part in this new program from Rocket Mortgage, you simply need to be a renter who applies for a home loan with Rocket. Once you apply, Rocket will look at your rent payments from the past 12 months that can be verified with documentation (another important reason to not pay cash! ) After confirming your current rental amount, they will multiple that amount by 12 and then give you 10% of that total. For example, they cite a national average rent of $1,800 per month, which translates to $21,600 annually. If we take 10% of that amount, it’d be $2,160, which could then be applied toward your mortgage closing costs. There is a limit of $5,000 offered via this program, meaning the credit caps out at a monthly rent of about $4,200. But the rent could theoretically come from multiple properties if you happened to move in the past year because they... --- > Less than a week after a task force was launched to “eliminate waste, fraud, and abuse” at HUD, it appears nearly half of the Federal Housing - Published: 2025-02-18 - Modified: 2025-02-19 - URL: https://www.thetruthaboutmortgage.com/fha-layoffs-40-of-staff-to-be-let-go-in-latest-government-cuts/ - Categories: Mortgage News Less than a week after a task force was launched to “eliminate waste, fraud, and abuse” at HUD, it appears nearly half of the Federal Housing Administration (FHA) is set to be laid off. The shock development was reported by Bloomberg, based on “two sources” who are familiar with the plan. Just last Thursday, HUD Secretary Scott Turner unveiled plans to trim down the agency, claiming to identify over $260 million in savings, with more to come. And like other government departments recently affected by layoffs, DOGE appears to be moving very quickly and aggressively at HUD as well. The big question is how the layoffs might affect the agency, and if they will be clawed back if disruptions occur. FHA Layoffs Are the Latest Shock to the System In just under a month, there have been countless government layoffs across many departments, including the Department of Energy, the Department of Education, the EPA, IRS, CDC, and many others. Another 75,000 government employees have accepted voluntary buyouts as well as the Department of Government Efficiency (DOGE) seeks to cut spending. It appears no section of the government is being spared, and the latest cuts have rattled the agencies that play a major role in the housing market. While it’s unclear how many employees will be affected, the parent of the FHA, the U. S. Department of Housing and Urban Development, or HUD for short, employs about 9,600 employees, per its own website. Last week, DOGE said half of the HUD... --- > I got to thinking the other day that Trump’s plan to lower mortgage rates might be through increased unemployment. While everyone is seemingly focused on - Published: 2025-02-17 - Modified: 2025-02-18 - URL: https://www.thetruthaboutmortgage.com/is-trumps-plan-to-lower-mortgage-rates-mass-government-layoffs/ - Categories: Mortgage Tips I got to thinking the other day that Trump’s plan to lower mortgage rates might be through increased unemployment. While everyone is seemingly focused on the other side of the coin, inflation, maybe it’s the wrong place to look. We’ve been talking about tariffs and deportations when maybe we should be talking about all the jobs being eliminated in Washington and beyond. Remember, the Fed’s dual mandate is price stability and sustainable employment. If we see a surge of layoffs, which we’re already seeing, the Fed could be forced to act. DOGE Says Call My Bluff on Government Layoffs When Trump was running for his second term, he promised to reduce federal spending and the size of the federal government. Helping him fulfill this difficult mission was Elon Musk, who ironically unveiled the "Department of Government Efficiency," or DOGE for short. If you need some quick background on that, it’s basically a play on the longstanding Doge meme, which is a Shiba Inu dog that emerged in the early 2010s. The real-life dog named Kabosu was pictured with silly, broken-English text overlays that used modifiers like “such” and “much. ” For example, if I were to create one (which I just did above) for what’s going on with all these job cuts, it might say something “much layoffs,” “such unemployment,” and “wow. ” And while it’s all totally absurd on the surface, it all got very real when the layoff announcements came streaming in. The DOGE government organization launched about... --- > One of the biggest hurdles to homeownership is the down payment. After all, the typical American has barely anything in the way of savings. At last - Published: 2025-02-13 - Modified: 2025-02-13 - URL: https://www.thetruthaboutmortgage.com/can-you-use-a-credit-card-for-a-down-payment-on-a-house/ - Categories: Mortgage Tips One of the biggest hurdles to homeownership is the down payment. After all, the typical American has barely anything in the way of savings. At last glance, the median amount in a transaction account such as checking, savings, or similar was just $8000, per the Federal Reserve. And for those 35 and under, just $5,400, though the average for this key first-time home buyer cohort is a slightly higher $20,540. The thing is, the average home today is priced higher than $355,000, meaning those savings won’t go very far. How Can You Fund the Down Payment for a Home Purchase? Checking or savings account Money market or CD Investment account Stock options Home equity line of credit (HELOC) Home equity loan Bridge loan Gift funds Grants Down payment assistance While we know Americans aren’t the best savers, the good news (I suppose) is you typically don’t need much in the way of down payment to buy a home. Aside from the many zero down loan programs available, including VA loans and USDA loans, there are also countless down payment assistance programs. And even if you don’t qualify for one of those, conforming loans backed by Fannie Mae and Freddie Mac require just a 3% down payment. So on a $355,000 home purchase, you’d only need about $10,650. For FHA loans, the down payment requirement is a slightly higher 3. 5%, or about $12,425 using the same example. In terms of funding the down payment, mortgage lenders are also very flexible,... --- > You’ve likely heard that one of President Trump’s goals is to lower mortgage rates. He talked about it on the campaign trail before he got elected, and - Published: 2025-02-12 - Modified: 2025-02-12 - URL: https://www.thetruthaboutmortgage.com/trump-wants-to-lower-mortgage-rates-without-the-fed/ - Categories: Mortgage Rates You’ve likely heard that one of President Trump’s goals is to lower mortgage rates. He talked about it on the campaign trail before he got elected, and has continued to call for lower rates since winning the election. Like most others, he is well aware that housing affordability is poor today, and that bringing down rates could help. But instead of calling on the Fed to do something, he’s apparently going to target the 10-year bond yield. In case you’re unaware, long-term mortgage rates track really well with 10-year yields, so it’s a good place to start. But will it be successful? Trump Continues to Call for Lower Mortgage Rates You probably didn’t see this, but during his campaigning back in September, Trump said,
“We’re going to get them back to we think 3%, maybe even lower than that, saving the average home buyer thousands per year. ” While that sounded ridiculous then, and still does today, he hasn’t shied away from continuing to call for lower rates. Just today on his Truth Social account, Trump added, “Interest Rates should be lowered, something which would go hand in hand with upcoming Tariffs! ! ! ” Moments later, the CPI report was released and it came in hot, leading to a big bounce in 10-year Treasury yields (and mortgage rates). The closely-watched bellwether increased about 10 basis points (bps) to around 4. 64%. It was as low as 4. 42% a week ago. The 30-year fixed, which had sunk below 7% last... --- > If you already have a mortgage, you might be curious about refinancing, and more specifically if you have to use your original lender. Or if it’s best to - Published: 2025-02-10 - Modified: 2025-02-10 - URL: https://www.thetruthaboutmortgage.com/is-it-better-to-refinance-with-your-current-mortgage-lender/ - Categories: Mortgage Tips, Refinance If you already have a mortgage, you might be curious about refinancing, and more specifically if you have to use your original lender. Or if it’s best to use them versus another option. Let’s talk about that to get a better grasp for how it all works. And why it could make sense to look beyond your current bank/lender instead of using them again. Sure, loyalty can be a great thing, but when it comes to mortgages, it might be more beneficial to shop around instead. This is especially true if a lender reaches out to you before you even put in the time to do your own research. You Can Only Refinance with Your Current Lender? False! First, let’s get a big myth out the way. You may have heard, or worse, been told that you can only refinance with your current lender. This is NOT true. So someone is fibbing or you may have been misinformed. Either way, know that you can refinance with any bank or lender willing to work with you. The same is true for any mortgage broker out there, assuming you used one in the past. Or even if you didn’t. For example, let’s say you got your current mortgage with Bank A and now you want to refinance. You can go back to Bank A, or you can go to Bank B, or mortgage broker A, or mortgage broker B. Or even credit union C. The options are pretty limitless here. And any... --- > If you’re hoping for a quick release of Fannie Mae and Freddie Mac, you might want to exercise some patience. While the odds of the pair exiting - Published: 2025-02-08 - Modified: 2025-02-10 - URL: https://www.thetruthaboutmortgage.com/bessent-says-release-of-fannie-and-freddie-depends-on-mortgage-rates/ - Categories: Mortgage Tips If you’re hoping for a quick release of Fannie Mae and Freddie Mac, you might want to exercise some patience. While the odds of the pair exiting conservatorship increased sharply once Trump’s second term began, it still faces an uphill battle. One of the major sticking points is mortgage rates, which many expect to increase if they’re released. Having a near-explicit guarantee that Fannie and Freddie will buy and securitize mortgages makes them cheaper for consumers. The expectation is if/when they go public, mortgage rates would need to be higher to compensate for increased risk. Fannie and Freddie Have Been in Conservatorship Since 2008 First some quick background. After the worst housing crisis in recent history, Fannie Mae and Freddie Mac, known as the government-sponsored enterprises (GSEs) were placed in conservatorship. This was essentially a government bailout as the pair were “severely damaged” as a result of the early 2000s mortgage meltdown and “unable to fulfill their missions without government intervention. ” The arrangement allowed them to continue to support the very fragile housing market as it recovered over the past decade. But perhaps nobody expected the pair to remain in government hands as long as they have. At last glance, it has now been nearly 20 years! Of course, this isn’t the first time efforts have been made to release them back into the wild. During Trump’s first term that began back in 2017, there was a lot of talk of a release. And the stocks of both companies... --- > If you’ve seen commercials for “Mortgage Matchup” lately, perhaps during an NBA game, or on the court itself, you might be wondering what they’re all - Published: 2025-02-07 - Modified: 2025-02-08 - URL: https://www.thetruthaboutmortgage.com/what-is-mortgage-matchup/ - Categories: Mortgage Tips If you’ve seen commercials for “Mortgage Matchup” lately, perhaps during an NBA game, or on the court itself, you might be wondering what they’re all about. This is actually an interesting question and answer because they are a company that doesn’t work directly with the public. Yet they advertise directly to consumers all the time, which isn’t a very common arrangement. They also happen to be owned by the largest mortgage lender in the United States, a company known as UWM. Fortunately, I can fully explain how their business works so you can make sense of it all. Mortgage Matchup Is an Online Mortgage Broker Directory Owned by UWM An online mortgage broker directory owned by wholesale lender UWM (nation's #1 lender) Allows users to find a local independent broker to work with to get a mortgage A broker is required to apply for loan with UWM (can't apply directly) The website also promotes the mortgage broker business model vs. going retail/direct Mortgage Matchup is the official mortgage partner of the NBA and WNBA In a nutshell, Mortgage Matchup is an online directory powered by UWM that allows you to find and partner with a local mortgage broker in order to apply for a home loan. Once you arrive on this website, there is a field to enter your address to “find your local home loan expert. ” But what’s strange is some of these experts may not even work with UWM, which pays for and maintains the website. I’ll... --- > It’s been a good couple of weeks for mortgage rates, which benefited from a delay on tariffs and some favorable economic data. Between a slowing economy, - Published: 2025-02-06 - Modified: 2025-02-06 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-back-below-7-but-pricing-remains-cautious/ - Categories: Mortgage Rates It’s been a good couple of weeks for mortgage rates, which benefited from a delay on tariffs and some favorable economic data. Between a slowing economy, reduced inflation, and the thought that the tariffs could be overblown, the 10-year bond yield has improved markedly. Since hitting its 2025 high of 4. 81% on January 13th, it has since fallen a sizable 35 basis points in less than a month. This has been driven by cooler inflation/economic data and less fear of tariffs and a wider trade war. However, mortgage rates haven’t fallen by the same amount, which tells you there is a still a lot of defensiveness on pricing. Mortgage Lenders Remain Defensive on Pricing The 10-year bond yield is a good way to track mortgage rates, with the 30-year fixed moving in relative lockstep over time. However, over the past couple years mortgage rate spreads (the premium MBS investors demand) have risen considerably. Over much of this century, since at least the year 2000, the spread has hovered around 170 basis points on average. During late 2023, it widened to around 300 basis points (bps), meaning investors demanded a full 3% spread above comparable Treasuries, as seen in the chart above from Fitch Ratings. This was largely driven by prepayment risk, and to some degree credit risk, such as loan default. But my guess is it has been mostly prepayments that MBS investors fear, because mortgage rates nearly tripled in about a year’s time. In other words, the thought... --- > A new loyalty program has been launched by Better Mortgage that waives loan origination fees for life. Known as the “Better Forever Program,” it rewards - Published: 2025-02-05 - Modified: 2025-02-06 - URL: https://www.thetruthaboutmortgage.com/better-forever-program-waives-loan-origination-fees-for-life/ - Categories: Mortgage News A new loyalty program has been launched by Better Mortgage that waives loan origination fees for life. Known as the “Better Forever Program,” it rewards customers by removing these fees when they refinance in the future or purchase a new property. While these fees can vary by bank or lender, it’s not uncommon to see a 1% fee charged as part of your closing costs. For example, a $500,000 loan with a 1% origination fee amounts to $5,000, so it’s not a trivial amount. The big question, as I always ask, is this a good deal! Better Forever Programs Allows You to Refi or Purchase a Home without Some of the Fees First let’s talk program specifics so we know what we’re actually getting here. As stated, Better Forever works as a sort of loyalty program where you aren’t charged loan origination fees if you use them again in the future. But the key here is that you need to use them a first time in order to be eligible. And that ostensibly means you’ll be charged a loan origination fee the first go around. Not all lenders charge these fees, so that’s something to consider. I’ll speak more to that in a moment, but let’s examine the fine print. In order to get the fee waived, you must refinance an existing loan originally secured with Better. Or in the case of a new property purchase, previously get any type of loan with Better. The distinction here is you could... --- > If you have an adjustable-rate mortgage you’re looking to get out of, the good news is it’s usually as simple as applying for a refinance. The bad news is - Published: 2025-02-04 - Modified: 2025-02-04 - URL: https://www.thetruthaboutmortgage.com/can-you-refinance-an-adjustable-rate-mortgage/ - Categories: Mortgage Tips If you have an adjustable-rate mortgage you’re looking to get out of, the good news is it’s usually as simple as applying for a refinance. The bad news is the interest rate might be a lot higher today, assuming you locked in a super-low rate several years ago. This has been a common scenario lately, with homeowners opting for ARMs when it appeared mortgage rates would never go up again. And failing to refinance before rates went up. Of course, we were all caught by surprise at just how quickly rates increased, and by how much! For reference, the 30-year fixed climbed from around 3. 25% to start 2022 to roughly 6. 5% to end that year, then kept rising from there. Ouch! Why Do You Want to Refinance Out of the ARM? Before we discuss the process, let’s talk about the why. Why do you want/need to refinance out of the adjustable-rate mortgage? My assumption is the number one reason why someone would want to refinance an ARM would be to avoid a rate reset. By rate reset, I mean an adjustment where the interest rate increases, sometimes by a sizable amount. Many ARMs today are hybrids in that there is a fixed-rate period followed by an adjustable-rate period. For example, the 5/6 ARM features a fixed interest rate for the first five years (or 60 months) and the 7/6 ARM is fixed for the first seven years (or 84 months). After that time, the loans can adjust every... --- > It’s no secret for-sale inventory has been in short supply for a long time now, making it increasingly difficult to find your dream home. The supply of - Published: 2025-02-03 - Modified: 2025-02-03 - URL: https://www.thetruthaboutmortgage.com/housing-inventory-expected-to-normalize-by-mid-2026/ - Categories: Housing Market It’s no secret for-sale inventory has been in short supply for a long time now, making it increasingly difficult to find your dream home. The supply of available homes fell considerably when the pandemic took hold, though since bottoming around early 2022, it has risen at a fairly steady clip. The obvious driver of increased for-sale supply has been markedly higher mortgage rates, which has led to more homes sitting on the market. This is mainly attributable to a lack of affordability, which grew worse than conditions seen in the early 2000s housing bubble. But there is still a wide variance in supply levels throughout the country, with the South and Southeast seeing a glut while supply in the Midwest and Northeast remains scarce. Available Supply Is Driving the Housing Market While a lot of people believe mortgage rates drive home prices, in that higher ones lower prices, it’s not really true. Sure, there are indirect effects of higher interest rates, such as reduced purchasing power, which in turn can result in fewer buyers. And fewer buyers means less demand, which can increase supply if more homes are sitting on the market. But if you consider that all of the country basically has access to the same mortgage rates, it’s clear that rates are only a contributing factor. The latest Mortgage Monitor report from ICE revealed that the number of active listings increased a sizable 22% last year. This pushed the national deficit of listings from -36% to -22%, meaning... --- > The Consumer Financial Protection Bureau (CFPB) has a new acting director, none other than Treasury Secretary Scott Bessent. The news was announced today - Published: 2025-02-03 - Modified: 2025-02-03 - URL: https://www.thetruthaboutmortgage.com/treasury-secretary-scott-bessent-becomes-acting-director-of-the-consumer-financial-protection-bureau/ - Categories: Mortgage Tips The Consumer Financial Protection Bureau (CFPB) has a new acting director, none other than Treasury Secretary Scott Bessent. The news was announced today after the firing of former CFPB director Rohit Chopra over the weekend, who had been in charge of the agency since September 2021. It now throws into question what comes next for the agency, which was born out of the Great Financial Crisis (GFC) in the early 2000s. One key achievement of the CFPB was the creation of the Ability to Repay/Qualified Mortgage (ATR/QM) Rule. Among other things, it requires mortgage applicants to qualify using verified financial information, while banning risky loan features like negative amortization. Why Was the CFPB Created Anyway? I’ve long said that the difference between the early 2000s housing market and today’s are the rules in place for home loan financing. Back in the early 2000s, you could take out a mortgage with zero down while providing very little financial documentation. Often, all it took was a credit report to get approved for a mortgage. And you could even get by with a subprime credit score, below 620. The amount of layered risk back then was beyond pale. Imagine an investor purchasing a four-unit property with no money down, a 620 FICO score, and zero documentation. And on top of that, taking out an interest-only adjustable-rate mortgage, or perhaps worse, a negative amortization loan where the monthly payment didn’t even cover the minimum amount of interest due. All while home appraisers weren’t well... --- > If you haven’t heard, the Trump administration imposed tariffs on imports from Mexico, Canada, and China today. As of February 1st, there is a 25% tariff - Published: 2025-02-01 - Modified: 2025-02-01 - URL: https://www.thetruthaboutmortgage.com/home-builders-urge-trump-to-rethink-tariffs-that-could-drive-home-prices-up-further/ - Categories: Housing Market If you haven’t heard, the Trump administration imposed tariffs on imports from Mexico, Canada, and China today. As of February 1st, there is a 25% tariff on goods from Canada and Mexico, and a 10% tariff on Chinese goods. At issue with the Mexican and Canadian tariffs is the impact it might have on the home building industry, with the pair accounting for nearly 25% of building material imports. The National Association of Home Builders (NAHB) penned a letter to President Trump shortly after his order, asking him to consider the effects of the tariffs. Assuming they remain in place, the cost to build new homes could increase, which would likely be passed onto the consumer via higher home prices. Housing Affordability Could Worsen with Tariffs in Place The NAHB’s letter pointed out that we already face a “severe housing shortage and affordability crisis,” which would only be exacerbated by higher building costs. And while Trump has said he wants to increase the affordable housing supply, the new tariffs could have the opposite effect. In addition, there are the ongoing deportations, which could drive up the cost of skilled labor to build new homes. But the pressing issue now is the tariffs, which will likely lead to higher material costs on key items such as aluminum, gypsum, lumber, and steel. “While home building is inherently domestic, builders rely on components produced abroad, with Canada and Mexico representing nearly 25% of building materials imports,” said NAHB’s chairman Carl Harris in the... --- > I knew I was going to have to write this post at some point during Trump’s second term. And here we are, only 10 days in. In case you didn’t hear, the - Published: 2025-01-31 - Modified: 2025-01-31 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-vs-tariffs/ - Categories: Mortgage Rates I knew I was going to have to write this post at some point during Trump’s second term. And here we are, only 10 days in. In case you didn’t hear, the Trump administration has announced new tariffs that go into effect tomorrow. White House press secretary Karoline Leavitt said Trump will be implementing 25% tariffs on both Mexico and Canada, along with 10% tariffs on China. There was word the White House was considering waiting until March 1st instead, to allow time to possibly negotiate. But Leavitt said that was “false. ” Now it’s full steam ahead on tariffs as of February 1st. And guess what? Bonds didn’t like it, which means mortgage rates likely won’t either. Call My Bluff on Tariffs As noted, there was some confusion about when the tariffs would actually roll out, with some saying March 1st. That’s an important detail because it’s not just about 30 days, but rather an additional month to negotiate and even hold off on tariffs entirely. But on the one hand it’s a good thing if they we’re inevitable because there will be no more guessing, no more waiting with bated breath. There’s been so much speculation about these tariffs since late last year that in a sense it’s somewhat of a relief to finally just get them over with. There’s a good chance Trump abruptly delivered them after coming off a bit more dovish in recent weeks. A sort of “call my bluff” moment. Other countries (and investors)... --- > A home loan where you bring money to the table to lower your loan balance and your mortgage rate at the same time. - Published: 2025-01-30 - Modified: 2025-01-30 - URL: https://www.thetruthaboutmortgage.com/what-is-a-cash-in-refinance/ - Categories: Mortgage Tips, Refinance If you’re currently the proud owner of a mortgage, you’ve undoubtedly heard of a cash-out refinance, one that allows you to tap into your home equity. They were quite popular during the early 2000s housing boom, when homeowners serially refinanced and simultaneously pulled “cash” from their homes while property values skyrocketed. You may have also heard the phrase, “using homes as ATM machines. ” Well, the downside to this seemingly lucrative practice is that mortgage balances also grow when you refinance. You don’t just get free money. If you refinance and pull cash out, your loan amount grows, no ifs, ands or buts about it. This can eventually lead to issues if you need to refinance again in the future, or even if you wish to sell your property. If at some point your outstanding mortgage balance exceeds the property value, you could wind up with an underwater mortgage. Did You Run Out of Home Equity? Many borrowers serially refinanced during the early 2000s housing boom And zapped all their home equity in the process At the same time home prices dropped rapidly Making it impossible to refinance via traditional channels When the housing appreciation party came to a sudden end around 2006, many of these homeowners became the proud owners of underwater mortgages – that is, they owed more on their mortgages than their properties were worth. For example, a home buyer may have acquired their property for $400,000, then eventually refinanced it at a value of $500,000. If... --- > If you’re an existing homeowner who purchased your property as recently as 2022, you probably have a really low, fixed mortgage rate. Perhaps something - Published: 2025-01-30 - Modified: 2025-01-30 - URL: https://www.thetruthaboutmortgage.com/non-mortgage-housing-costs-nearly-exceed-the-mortgage-itself/ - Categories: Home Buying If you’re an existing homeowner who purchased your property as recently as 2022, you probably have a really low, fixed mortgage rate. Perhaps something that starts with a 2, 3, or 4. After all, mortgage rates hit record lows in 2021 and were generally very cheap for about a decade. In spring of 2022, that changed and rates began surging higher as inflation took hold and the Fed ended its MBS-buying program known as Quantitative Easing (QE). While 30-year fixed mortgage rates are no longer a screaming bargain, they’re not far from their long-term average of about 7. 75%. But because everything else is so expensive, the mortgage itself actually eats up a smaller share of total housing costs. Housing Costs Go Far Beyond a Simple Mortgage A new survey from Real Estate Witch found that non-mortgage costs have increased to $24,529 for 2025, up from $17,958 in 2024. This includes homeowners insurance, property taxes, home renovations, routine maintenance, and monthly utilities. Broken down it looks like this: Utilities: $7,319 Maintenance: $6,087 Renovations: $5,762 Property taxes: $3,057 Homeowners insurance: $2,304 Depending on where you live, some of these costs might seem low or high, but it’s the average cost taken from various websites utilized for the survey. And chances are homeowners insurance will only be going up next year, pretty much no matter where you live. Meanwhile, the typical household spends $26,508 annually on the mortgage, which isn’t much more than these other costs combined. In other words, the mortgage... --- > While it appears that Trump’s funding freeze won’t affect home buyers who use a government-backed mortgage, there’s now another concern. It came to my - Published: 2025-01-29 - Modified: 2025-01-29 - URL: https://www.thetruthaboutmortgage.com/down-payment-assistance-programs-may-be-affected-by-federal-funding-pause/ - Categories: Mortgage News While it appears that Trump’s funding freeze won’t affect home buyers who use a government-backed mortgage, there’s now another concern. It came to my attention that homebuyer assistance programs could actually be affected by the federal funding pause. I received an email from Johnna Szegda at Down Payment Resource regarding a possible disruption to hundreds of federally-funded programs. This too is up in the air, as the FHA/VA loan programs were yesterday, but it is a major concern at the moment given the uncertainty. DPR estimates that if the freeze is enforced, it could impact funding for roughly one-third of available homebuyer assistance programs nationwide. Nearly 750 Homebuyer Assistance Programs at Risk of Losing Funding While a judge has temporarily blocked the president’s Office of Management and Budget (OMB) pause on federal funding until Monday, DPA programs hang in the balance. As noted, the impact is unknown at this time, but it has the potential to affect hundreds of programs home buyers rely on to purchase properties. Not all DPA programs are federally-funded, but a good chunk of them are. An estimated 734 of the nation’s 2,466 homebuyer assistance programs rely upon the federal government. Assuming they are subject to the memo, they could be put on hold or even scrapped entirely. That total includes 469 programs supported by HUD’s HOME initiative and 265 that rely on Community Development Block Grant (CDBG) funds. Down Payment Resource founder and CEO Rob Chrane said it "is working closely with program administrators" to... --- > With home prices dare I say a little frothy these days, low appraisals are becoming a concern again for home buyers. It wasn’t uncommon for appraisals to - Published: 2025-01-29 - Modified: 2025-01-29 - URL: https://www.thetruthaboutmortgage.com/what-happens-if-the-appraisal-comes-in-low/ - Categories: Mortgage Tips With home prices dare I say a little frothy these days, low appraisals are becoming a concern again for home buyers. It wasn’t uncommon for appraisals to come in low in the early 2000s when home prices were flying ever higher. This happened towards the end of the cycle when banks and lenders could no longer justify slapping an astronomical valuation onto a property. As a result, lots of mortgage deals fell apart based on the collateral alone and the financing spigot essentially got shut off. While we fortunately aren’t back to those days, here’s what you need to know if your appraisal happens to come in low. Why an Appraisal Is Important for a Home Purchase One of the key qualifying criteria for getting approved for a home loan is the collateral value of the property. Aside from your own borrower characteristics, such as your credit score and DTI ratio, the property also has to be valued by an independent party. After all, you might be an excellent borrower and a low default risk, but the bank will still want to know the property itself is worth taking a risk on. Lenders also need to know how leveraged you’ll be, and simply that there’s an independent assessment of the value beyond the buyer and seller to ensure there’s no funny business. This is the job of a third-party home appraiser, who will be hired early on in loan process to determine the property’s present value. The appraiser has the... --- > Yesterday, President Trump released a memo calling for the temporary pause of grants, loans, and other financial assistance programs. The executive order - Published: 2025-01-28 - Modified: 2025-02-08 - URL: https://www.thetruthaboutmortgage.com/trumps-funding-freeze-causes-uncertainty-for-government-backed-mortgages/ - Categories: Mortgage News Yesterday, President Trump released a memo calling for the temporary pause of grants, loans, and other financial assistance programs. The executive order was intended to address the “more than $3 trillion” in federal financial assistance doled out in fiscal year 2024 (of the $10 trillion total). It went on to say that “federal agencies must temporarily pause all activities related to obligation or disbursement of all Federal financial assistance. ” The move was intended to allow for a review of the programs offered by these agencies to ensure they align with the President's priorities of reducing government spending. Instead, it sparked widespread confusion, including concerns that the FHA, VA, and USDA home loan programs would be disrupted in the process. MBA President Calls for Clarity on President’s Memo After fears of a mortgage disruption began to spread, the Mortgage Bankers Association (MBA) released a statement on the matter. MBA President and CEO Bob Broeksmit sought clarity on the memo to ensure it “did not apply to the single family and multifamily loan insurance or guarantee programs at their agencies. ” “Americans are going to the closing table tomorrow and deserve to know that their loan will close on their home purchase. Without this clear assurance that the federal government will insure new loans or pay claims under these programs, there will be severe harm to borrowers and disruption to the mortgage market. ” While individual banks and lenders are the ones that actually fund the mortgages backed by these government... --- > Last week, President Donald Trump demanded that “interest rates drop immediately” while addressing the World Economic Forum in Davos, Switzerland - Published: 2025-01-27 - Modified: 2025-01-31 - URL: https://www.thetruthaboutmortgage.com/trump-may-get-his-wish-of-lower-mortgage-rates-granted-but-not-for-the-right-reasons/ - Categories: Mortgage Rates Last week, President Donald Trump demanded that “interest rates drop immediately” while addressing the World Economic Forum in Davos, Switzerland virtually. He mentioned the falling price of oil as a driver for this to happen, along with his “historic victory” in the recent presidential election. The general idea is that lower inflation should usher in lower interest rates, which is basically how it works. However, the big question is why would inflation be lower under Trump’s second term? Because of positive developments like lower government spending, or due to an economic crisis? Bond Yields Drop as AI Stocks Fall This morning, the stock market sold off as AI companies nosedived, driven by news of a Chinese AI company called DeepSeek. Long story short, the early take is that DeepSeek has revolutionized AI by relying upon inference-time computing, which uses far less resources and computing power. As such, chipmakers like stock market darling Nvidia (NASDAQ: NVDA) could be under pressure if demand for their chips turns out to be overblown. Of course, the counterargument is that more efficiency leads to higher usage. This phenomenon is known as “Jevons Paradox. ” It means AI could become even more popular, eventually leading to even greater chip demand, despite falling prices, the end result being higher sales/profits for these companies. So one might not want to get too caught up on this fast-moving story if they’re trying to ascertain the direction of the economy or the stock market. However, it does call into question... --- > To say it’s been a bad 12 months for home sales would be a massive understatement. Today, the National Association of Realtors (NAR) reported that - Published: 2025-01-24 - Modified: 2025-02-03 - URL: https://www.thetruthaboutmortgage.com/existing-home-sales-fall-to-lowest-level-since-1995/ - Categories: Housing Market To say it’s been a bad 12 months for home sales would be a massive understatement. Today, the National Association of Realtors (NAR) reported that existing home sales fell to the lowest level in nearly 30 years last month. So if you’re wondering if something broke after the Fed raised rates 11 times, look no further than the residential housing market. Per NAR, existing-home sales declined to an annual rate of 4. 06 million in December, the lowest total since 1995. For perspective, many real estate agents today weren’t even born in 1995, nor were the loan originators who helped buyers obtain the mortgages. What’s Behind the Drop in Home Sales? While home sales actually ticked up to close out 2024, the annual volume was pretty abysmal and the worst since the mid-1990s. Driving the lack of home sales has been two main things. A lack of for-sale inventory and a lack of affordability. And one could argue that mortgage rates are behind a lot of it, whether it’s mortgage rate lock-in causing homeowners to stay put. Or the record low mortgage rates seen in 2021, leading to investors and others gobbling up what little was out there and refusing to let go. Now that 30-year fixed mortgage rates are around 7%, it has become unaffordable for new buyers to enter the fray. NAR noted that completed transactions, which include single-family homes, townhomes, condominiums and co-ops, rose 2. 2% from November and 9. 3% from December 2023. That was the... --- > Now that tapping home equity is back in fashion, I figured it’d be helpful to see who the top HELOC lenders are. This is especially timely with the prime - Published: 2025-01-23 - Modified: 2025-01-29 - URL: https://www.thetruthaboutmortgage.com/top-heloc-lenders/ - Categories: Mortgage Tips Now that tapping home equity is back in fashion, I figured it’d be helpful to see who the top HELOC lenders are. This is especially timely with the prime rate finally falling after 11 successive hikes, making these loans cheaper again! As you probably know, the year 2023 was a rough one for mortgage lenders thanks to much higher interest rates, and second mortgages were impacted as well. The latest annual figures from the Consumer Financial Protection Bureau (CFPB) revealed that HELOC volume fell from 1. 4 million units in 2022 to just 1 million in 2023. That's quite the drop-off, which the agency attributed to a sort of leveling off after volume surged in 2022 when homeowners gave up on cash-out refinances. HELOC Volume Slipped in 2023 After a Very Big Year As noted, HELOC volume reversed course pretty markedly in 2023 (the latest full year of data currently available as of early 2025), falling 23. 5% after a very strong year in 2022. Banks and mortgage lenders doled out about 1. 4 million home equity lines of credit (HELOCs) in 2022, per the latest HMDA data, but only about one million in 2023. That 2022 total was 41. 2% higher than the 962,000 HELOCs opened in 2021, and the second consecutive annual increase after several years of falling volumes. I expected HELOC applications to show increases again in 2023 and 2024 since mortgage rates on existing mortgages are so low relative to what’s available today. After all, homeowners... --- > Well, we’re just one day into Trump’s second term and there are already rumblings of new residential housing policy. While it’s still all just talk, at - Published: 2025-01-21 - Modified: 2025-01-21 - URL: https://www.thetruthaboutmortgage.com/fha-life-of-loan-premiums-might-be-scrapped-under-trump/ - Categories: Mortgage Tips Well, we’re just one day into Trump’s second term and there are already rumblings of new residential housing policy. While it’s still all just talk, at least there is some talk going on, especially so early on. Trump issued an executive order yesterday, calling on all departments and agencies to deliver emergency price relief to help the American people during this “cost-of-living crisis. ” This included pursuing actions to lower the cost of housing while expanding the housing supply. While building ourselves out of this inventory crisis won’t happen overnight, there are quicker fixes. One of those is adjusting premiums on government back FHA loans. First a Quick Background on Annual FHA Mortgage Insurance Premiums (MIP) Through the Years 2000-2008: 50 basis points (bps) 2008: 55 bps (Mortgagee Letter 2008-16) 2010: 90 bps (source) 2011: 115 bps (source) 2012: 125 bps (source) 2013: 135 bps (source) 2015: 85 bps (source) 2023: 55 bps (source) Back in early 2013, the FHA began requiring borrowers to pay an annual mortgage insurance premium for the life of the loan. Prior to the change, annual insurance premiums on FHA loans would be removed once the loan balance fell to 78% of the original purchase price. This made them a lot less appealing compared to other options where mortgage insurance typically rolls off at an 80% loan-to-value ratio (LTV). In addition, the FHA raised premiums as loan defaults increased, making FHA loans more expensive and less attractive relative to other options, such as conforming loans.... --- > Well, President Donald Trump is officially back in office after the long-awaited inauguration took place today in Washington D.C. He was sworn in as the - Published: 2025-01-20 - Modified: 2025-01-20 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-begin-above-7-to-start-trumps-second-term-in-office/ - Categories: Mortgage Rates Well, President Donald Trump is officially back in office after the long-awaited inauguration took place today in Washington D. C. He was sworn in as the 47th president of the United States to go along with his 45th. After what felt like a long waiting game between early November and today, we’re finally going to find out what action he’ll take. Like most politicians, there’s always a lot of talk, but it doesn’t always result in action. For the purpose of this website (and this article), my focus is on the direction of mortgage rates, which will be led to by both policy and economic conditions. Mortgage Rates Are Over 7% to Start Trump’s Second Term Mortgage Rates Under Trump 30-Year Fixed Rate First Term Second Term Start 4. 25% 7. 08% End 2. 85% ? ? ? ? ? High 5. 05% ? ? ? ? ? Low 2. 76% ? ? ? ? ? When it comes to mortgage rates, to say things are different this time around would be a huge understatement. Of course, Trump is talking about a lot of the same stuff eight years later, namely China. But for reference, the 30-year fixed stood at 4. 25% when Trump first took office as president number 45 back on January 20th, 2017. And was in the mid-3% range when he unexpectedly won the presidential election in November 2016. Given that the average rate is closer to 7. 125% today (I use eighths like mortgage lenders do),... --- > Let's talk about HELOC rates. If you’ve had a home equity line of credit (HELOC) for a while, you likely saw your interest rate rise significantly over - Published: 2025-01-20 - Modified: 2025-01-20 - URL: https://www.thetruthaboutmortgage.com/heloc-rates/ - Categories: Mortgage Rates, Mortgage Tips Let's talk about HELOC rates. If you’ve had a home equity line of credit (HELOC) for a while, you likely saw your interest rate rise significantly over the past few years. The reason is HELOCs are adjustable and tied to the prime rate, which moves in lockstep with the fed funds rate. Since early 2022, the Federal Reserve has raised its target rate 11 times, pushing the prime rate up from 3. 25% to 8. 50%. This means homeowners with HELOCs have seen their rates increase 5. 25% in less than two years. But here’s the good news; HELOC rates seemed to peak last year and the Fed has since cut rates 100 basis points (bps), providing some much-needed payment relief in the process. There Were Three Fed Rate Cuts in 2024 After a Series of Hikes While the financial markets are dynamic and always subject to change, data has signaled that the Fed rate hikes are done. And even better, that more rate cuts are on the horizon between now and the end of 2025. The CME FedWatch Tool, which tracks the likelihood that the Fed will change its target rate at upcoming FOMC meetings, no longer has additional rate hikes as odds-on favorites. Instead, it has flat rates for several months until another 0. 25% rate cut as the most probable move slated for the June 2025 Fed meeting. In the meantime, rates are expected to remain unchanged, though a rate cut could arrive even sooner. These percentage... --- > Welp, another day in 2025, another mortgage lender calling it quits. This time it’s depository Washington Federal Bank, or WaFd for short. The - Published: 2025-01-17 - Modified: 2025-01-17 - URL: https://www.thetruthaboutmortgage.com/wafd-bank-exits-single-family-mortgage-lending-business/ - Categories: Mortgage News Welp, another day in 2025, another mortgage lender calling it quits. This time it’s depository Washington Federal Bank, or WaFd for short. The Seattle-based bank, which has been in the home loan business for over 100 years, cited lower profits and more risk for the decision. As we all know, it’s also been a very tough few years in the mortgage industry, with mortgage interest rates nearly tripling during that time. This has made refinancing a lot less common, while also putting pressure on prospective home buyers. The decision represents yet another loss for banks in the residential mortgage space, which continue to see their market share decline as nonbanks gain. WaFd Will No Longer Offer Home Loans to Its Customers Washington Federal Bank (NASDAQ: WAFD) made the announcement to exit its home loans business in its first quarter earnings release yesterday. And it was a pretty interesting revelation because they went into detail about why they’re exiting. Unlike the fast and loose days of the early 2000s when banks and lenders went under because of shoddy underwriting, today it’s more about mortgages being a commodity. In other words, they’re all pretty much the same these days. Boring old 30-year fixed-rate mortgages backed by government-entities such as Fannie Mae and Freddie Mac, or the FHA/VA. This means borrowers can get the same loan just about anywhere, so if you’re not serious about competing, what’s the point? That competition all fighting for the same thing, and a lot less of it... --- > As I’ve said before when talking about mortgage, what a difference a week makes. Or even a couple days. If you’re new to mortgage rates, know that first - Published: 2025-01-16 - Modified: 2025-01-31 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-get-boost-from-bessent-and-soft-economic-data/ - Categories: Mortgage Rates As I’ve said before when talking about mortgage, what a difference a week makes. Or even a couple days. If you’re new to mortgage rates, know that first and foremost, they can be very volatile. And can change from one day to the next. Similar to a stock, the price might not be the same tomorrow (it could be higher or lower or possibly unchanged). On top of that, the price could even change multiple times per day, typically when there’s a lot going on. That happened today, with an afternoon reprice coming in after rates had already improved from the day before. Why Did Mortgage Rates Fall Today (and Yesterday)? In short, weak economic data was the driver and lower mortgage rates were the beneficiary. We had several economic reports come in cooler-than-expected this week, including PPI, CPI, initial jobless claims, and retail sales. It was basically the best you could ask for in terms of economic data. And as we all know, weaker economic data leads to lower mortgage rates (and vice versa). So if you’re rooting for lower mortgage rates, unfortunately you also kind of have to root for the economy to cool off. Granted you don’t have to root for it to collapse, so it’s not totally cynical to hope for some weakness. Inflation has been running hot for years, and it’s okay if it comes down while the economy continues to move forward at a more reasonable pace. There’s a good middle ground, generally known... --- > Mortgage Q&A series: “What is a letter of explanation for a mortgage?” If you’re currently going through the joyful process of obtaining a home loan, - Published: 2025-01-16 - Modified: 2025-01-16 - URL: https://www.thetruthaboutmortgage.com/what-is-a-letter-of-explanation/ - Categories: Mortgage Tips Mortgage Q&A series: “What is a letter of explanation for a mortgage? ” If you’re currently going through the joyful process of obtaining a home loan, you may have been asked to furnish a “letter of explanation,” otherwise known as a LOE. Simply put, it allows you to provide a little more color to what the underwriter might feel is a complicated matter. You can think of the mortgage underwriter as a home loan sleuth, one hired to uncover anything abnormal that may show up in your loan file as documentation is submitted. Sure, the required paperwork might all be there, and your credit score and DTI ratio might be spot on, but it is the underwriter’s job to read between the lines. Otherwise, mortgage applications truly could be fed through automated underwriting systems and that would be the end of it. We wouldn’t need human beings anymore. This isn’t the case, at least not yet, so expect your mortgage application to be scrutinized, and be prepared to “explain yourself” if anything that the underwriter feels needs explaining comes up. Definitely don’t argue with the underwriter or be defiant, that’s never a very good strategy. When I worked for a lender, I always went out of my way to be nice to the underwriters. You should too. Ultimately, the quicker you can get them the answers they need, the faster you can get your home loan closed and move on with your life. What Is the Purpose of a Letter... --- > If you haven’t been feeling 30-year mortgage rates recently, maybe an ARM could suit you better. This is especially true if you don’t plan to stay in the - Published: 2025-01-15 - Modified: 2025-03-21 - URL: https://www.thetruthaboutmortgage.com/what-is-a-3-1-arm/ - Categories: Mortgage Tips If you haven’t been feeling 30-year mortgage rates recently, maybe an ARM could suit you better. This is especially true if you don’t plan to stay in the home for a very long period of time. There are a variety of adjustable-rate mortgages available to homeowners today, with varying fixed-rate periods. One of the shorter of the hybrid-ARMs, which are home loans that are fixed before becoming adjustable, is the “3/1 ARM. ” Let’s learn more about how it works to see if it could be a good alternative to the 30-year fixed mortgage. 3/1 ARM Meaning It's a hybrid home loan program with a 30-year term Meaning it's fixed before becoming adjustable You get a fixed interest rate for the first 3 years Then it can adjust once annually for the remaining 27 years As the name suggests, it’s an adjustable-rate mortgage with two key components. The first number (the "3") indicates the period of time in which the mortgage interest rate is fixed. In this case, it’s three years. This means your initial interest rate won’t budge for 36 months. This is great news if you fear a rate adjustment (higher), and also quite handy if you only need short-term mortgage financing. The second number (the "1") represents the adjustment frequency, which as you may have guessed, is annually. Yep, this means the rate can adjust each year once the first three years are up. For the record, the 3/1 ARM is still a 30-year loan, so you... --- > You’ve heard the news – mortgage rates jumped from close to 6% back in September to over 7% in less than a few months, before climbing even higher. And - Published: 2025-01-15 - Modified: 2025-01-15 - URL: https://www.thetruthaboutmortgage.com/10-ways-to-save-money-on-your-next-mortgage/ - Categories: Mortgage Rates, Mortgage Tips You’ve heard the news – mortgage rates jumped from close to 6% back in September to over 7% in less than a few months, before climbing even higher. And they don’t appear to be heading back down anytime soon, despite some mild improvement this morning thanks to a cooler-than-expected CPI report. While that’s still up for debate, the trend is clearly NOT your friend when it comes to securing a low interest rate on your home loan. But that doesn't mean you just throw the rules out the window and apply with any bank or lender willing to approve your mortgage application. Nor should you just accept the first lowish interest rate presented to you, as enticing as it might be. This is actually a great time to be even more aggressive when it comes to lender selection, especially as home buying competition remains fierce in many parts of the country. 1. Shop Your Mortgage Rate! Seriously I’ve said it once and I’ll say it again, and again after that. Because apparently folks aren't getting the memo. You have to take the time to compare rates from multiple lenders if you want to secure the lowest interest rate on your mortgage. There are real studies that prove this – it’s not just boilerplate advice. A recent study from Freddie Mac revealed that getting just two quotes as opposed to one could save you thousands over the life of your loan. And it actually gets better the more you shop. Three... --- > With second mortgages like home equity loans and home equity lines of credit (HELOCs) growing in popularity lately, I figured it’d be prudent to talk - Published: 2025-01-14 - Modified: 2025-01-14 - URL: https://www.thetruthaboutmortgage.com/can-you-refinance-a-home-equity-loan-or-a-heloc/ - Categories: Mortgage Tips With second mortgages like home equity loans and home equity lines of credit (HELOCs) growing in popularity lately, I figured it’d be prudent to talk about next steps. For example, what happens if you want to refinance the loan, either to switch loan programs or to obtain a lower rate? Well, similar to a first mortgage, there are lots of refinance options for HELOCs and home equity loans too. In fact, you can even pay off the HELOC or home equity loan with your first mortgage. Although with interest rates on existing first mortgages so cheap at the moment, that’s probably not going to be the move! Can You Refinance a Home Equity Loan? Old Home Equity Loan New Home Equity Loan Balance $50,000 $100,000 Interest Rate 8% 7% Loan Term 20 years (15 remaining) 20 years Monthly Payment $418. 22 $775. 30 Yes. Similar to a first mortgage, you can refinance a home equity loan in order to take advantage of a lower rate. Or to obtain a larger loan amount, perhaps because you need to borrow more money for additional projects or expenses. You can also refinance the loan if you’re looking for a different type of loan, or to consolidate the loan into a first mortgage. It’s also possible to reduce your monthly payment by extending the loan term, assuming you are okay with paying additional interest. Conversely, it’s possible to refinance the home equity loan into a shorter-term loan to reduce the interest expense and pay... --- > While the Los Angeles wildfires are still ongoing, some mortgage relief options are beginning to roll out. This morning, both Fannie Mae and Freddie Mac - Published: 2025-01-13 - Modified: 2025-01-14 - URL: https://www.thetruthaboutmortgage.com/fannie-freddie-fha-and-chase-announce-mortgage-relief-for-la-wildfire-victims/ - Categories: Mortgage News While the Los Angeles wildfires are still ongoing, some mortgage relief options are beginning to roll out. This morning, both Fannie Mae and Freddie Mac unveiled disaster relief options for borrowers affected by the fires. They are both offering up to 12 months of mortgage forbearance, meaning payments can be suspended for a year. In addition, homeowners won’t incur late fees or face foreclosure or similar legal proceedings during this window. There are more options once the forbearance ends as well, including payment deferral and flex loan modifications. What Kind of Mortgage Relief Is Available for Los Angeles Fire Victims? As you’re probably aware, several wildfires ravaged the Los Angeles area in the past week, including the in the Palisades Fire in the Pacific Palisades and the Eaton Fire in Altadena. Both have caused widespread destruction, leading to the loss of tens of thousands of structures. At last count, some 10,000 structures were destroyed in the Palisades Fire and 7,000 in the Eaton Fire. Sadly, many will need to be rebuilt, but it could take years depending on how quickly insurance companies, the government (think permitting, etc. ), and builders are able to respond. The good news is that for those with a mortgage, there is disaster relief being offered by certain entities, including the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac. They own or insure the majority of home loans today, so in many instances your loan is likely owned by one of the two. You can check... --- > I saw his seemingly straightforward question posed and was surprised I’d never really addressed it. I’ve been writing about mortgages on this blog since - Published: 2025-01-10 - Modified: 2025-01-10 - URL: https://www.thetruthaboutmortgage.com/what-is-the-downside-of-getting-a-mortgage/ - Categories: Mortgage Tips I saw his seemingly straightforward question posed and was surprised I’d never really addressed it. I’ve been writing about mortgages on this blog since 2006, so chances are I’ve covered most things. But I rarely think in terms of a mortgage being a choice. For most, it’s compulsory, given how expensive homes are these days. Few can buy a property with cash, so the mortgage is often a given when we’re discussing a home purchase. That being said, we can discuss the pros and cons of getting a mortgage (and keeping it long term). Pretty Much Everyone Needs a Mortgage First things first. If you’re reading this and want to buy a home (or already own a home), chances are you either need a mortgage or have one. It’s just not practical to buy a home with cash for the majority of the population. Your average American can’t even muster a 20% down payment, so the chances of them buying a home outright is slim. But beyond that, even those who can afford to buy a home with cash often don’t. just look at Beyoncé or Mark Zuckerberg. When given the chance, they still opted for a mortgage. Why? Because financing is often a better play than locking up all their cash in an illiquid investment. Their money is put to better use (theoretically) in other investments, whether it’s the stock market or something else. All they really need to do is earn a rate of return higher than the... --- > Well, 2025 is off to a rough start with one fairly large mortgage lender calling it quits already. Ally Financial is reportedly done with mortgage lending - Published: 2025-01-08 - Modified: 2025-01-08 - URL: https://www.thetruthaboutmortgage.com/ally-financial-calls-it-quits-on-mortgage-lending-will-lay-off-staff/ - Categories: Mortgage News Well, 2025 is off to a rough start with one fairly large mortgage lender calling it quits already. Ally Financial is reportedly done with mortgage lending entirely, per a statement from their spokesman Peter Gilchrist. He told the Charlotte Observer that the company plans to exit the mortgage origination business in the first quarter of the year. As a result, the company will see “less than 5% of its workforce” impacted by layoffs. Apparently they will “right-size” the company, reducing staff in some areas (like mortgage lending) but hiring in others. Ally Financial Exits the Mortgage Business Despite only being in the mortgage business under the Ally Financial name for just over a decade, they’re apparently done. And the culprit this time is likely higher-for-longer mortgage rates, not subprime lending or skyrocketing mortgage defaults like it was back in the early 2000s. Speaking of, Ally Financial was previously known as GMAC until 2010, a unit of General Motors. They also owned Residential Capital (ResCap), their subprime lending division that was caught up in the massive mortgage crisis back then. They eventually shuttered ResCap as their multi-billion-dollar subprime loan portfolio went kaput, leading to a bankruptcy and bailout from the Treasury. But as things settled down, they transformed the brand into Ally Bank and a year later renamed it Ally Financial. Then Ally Home was born, focused on consumer-direct mortgage lending and offering everything from conforming loan to jumbo loans. Their strategy was to provide a “high-touch experience” unlike many of... --- > In the mortgage/real estate world there’s a saying: “Drive until you qualify.” It’s a cute way of saying if you can’t afford a home in a certain - Published: 2025-01-07 - Modified: 2025-01-07 - URL: https://www.thetruthaboutmortgage.com/should-you-drive-until-you-qualify-for-a-mortgage/ - Categories: Home Buying, Housing Market, Mortgage Tips In the mortgage/real estate world there’s a saying: “Drive until you qualify. ” It’s a cute way of saying if you can’t afford a home in a certain (desirable) area, hop on the highway and keep driving until home prices get more affordable! This could mean driving an hour away from where you work, an obvious negative for someone who has to commute five days a week, especially if traffic is a bear (hint: it often is). This was common during the previous housing boom, with home builders often buying up cheap land in the outskirts of towns, known as the "exurbs," to construct their massive new tracts. Because inventory was either non-existent, or simply out of price range, prospective home buyers would opt to buy in these far-out places instead. Homes Tends to Get Cheaper the Farther You Drive There's a good chance home prices are out of your budget in desirable areas As such you might want to consider additional areas further outside your target zone While sometimes frowned upon, the suburbs offer lots of advantages and are back en vogue Benefits include more living space, outdoor features, and better schools (good for families) We’re beginning to see this phenomenon again thanks to dwindling existing-home inventory and higher and higher home prices. It might explain why prospective buyers are beginning to look where they may not have initially looked for a property. The difference today is that the work office environment has changed, partially due to COVID-19. In... --- > The Consumer Financial Protection Bureau (CFPB) has finalized a rule that will remove medical debts from consumer credit reports. In doing so, Americans' - Published: 2025-01-07 - Modified: 2025-01-07 - URL: https://www.thetruthaboutmortgage.com/new-rule-removes-medical-bills-from-credit-reports-could-lead-to-20k-more-mortgage-approvals-annually/ - Categories: Mortgage News The Consumer Financial Protection Bureau (CFPB) has finalized a rule that will remove medical debts from consumer credit reports. In doing so, Americans' credit scores should rise by an average of roughly 20 points, increasing the number of mortgage applicants who get approved for a home loan. The agency noted that “medical debts provide little predictive value to lenders about borrowers’ ability to repay other debts. ” And are often reported by consumers to be inaccurate or in dispute, leading to more harm than good. Going forward, the inclusion of medical bills on credit reports will be banned and lenders will be prohibited from using medical information in their credit decisioning. No More Medical Debt on Credit Reports Specifically, the new change from the CFPB will amend Regulation V by removing an exception that allowed creditors to obtain and consider medical debt in credit eligibility determinations. As such, the Fair Credit Reporting Act (FCRA) will now prohibit creditors from considering medical information when underwriting new loans. And the credit reporting bureaus (Equifax, Experian, TransUnion) won’t be able to provide consumer credit reports to lenders that contain information related to medical debt. Previously, the trio had announced the removal of medical collections if the amounts were under $500. And the two main credit scoring companies, FICO and VantageScore, had adjusted their algorithms to lessen the degree to which medical bills impacted a consumer’s credit score. But now all medical bills will be banned on credit reports, other than medical-based forbearance plans... --- > It’s no secret that the 30-year fixed was the best deal ever a few short years ago. Back in 2021 (and in surrounding years) you could lock-in a sub-3% - Published: 2025-01-06 - Modified: 2025-01-06 - URL: https://www.thetruthaboutmortgage.com/is-the-30-year-fixed-even-a-good-deal-anymore/ - Categories: Mortgage News It’s no secret that the 30-year fixed was the best deal ever a few short years ago. Back in 2021 (and in surrounding years) you could lock-in a sub-3% mortgage rate for a full 30 years. Yes, you could get an interest rate of say 2. 75% for the next three decades, with no worry of the rate adjusting higher. EVER. In retrospect, it’s pretty bonkers that we weren’t falling over one another to go get one. Sure, lending volume during those years was sky-high, but sometimes I’m surprised it wasn’t even higher. But now that the 30-year fixed is no longer on sale, why do borrowers keep opting for one over other options? 30-Year Fixed Mortgage Rates Are Decidedly Average Using Freddie Mac data going back to 1972, the 30-year fixed has averaged roughly 7. 75%. That number takes into account those super-high mortgage rates in the 1980s, when the 30-year ascended to nearly 20%. And the super-low mortgage rates seen over much of the past decade, when the 30-year fixed hit an all-time record low 2. 65% in January 2021. So it appears we are right smack dab in the middle again. Mortgage rates aren’t a terrible deal today, but they’re no longer a bargain either. They’re simply hovering near their long-term average, which goes back more than 50 years now. The problem is that the typical American is/was used to seeing a mortgage rate that started with a 2 or 3, and now a rate that starts... --- > The popular 30-year fixed averaged 6.91% to begin 2025, per the latest Freddie Mac data. This means mortgage rates are now on par with 2001 levels, when - Published: 2025-01-06 - Modified: 2025-01-06 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-are-back-at-2001-levels/ - Categories: Mortgage Rates The popular 30-year fixed averaged 6. 91% to begin 2025, per the latest Freddie Mac data. This means mortgage rates are now on par with 2001 levels, when the 30-year averaged 7. 03% in the month of January. During that year, the 30-year fixed basically remained flat, ending 2001 at 7. 07%. This got me to thinking. What if mortgage rates do nothing in 2025, sort of like they did in 2001? It’s certainly a possibility and something to think about and prepare for if you’re a prospective home buyer (or a loan originator). 2001 Mortgage Rates in 2025 Jan: 7. 03% Feb: 7. 05% Mar: 6. 95% Apr: 7. 08% May: 7. 15% Jun: 7. 16% Jul: 7. 13% Aug: 6. 95% Sep: 6. 82% Oct: 6. 62% Nov: 6. 66% Dec: 7. 07% After a really good decade for mortgage rates, the 30-year fixed is back closer to its long-term average of around 7. 75%. It’s actually a bit better than that since it’s hovering around 7% today, which puts it very close to levels last seen in 2001. If you look at that year, listed above by month, which is now a staggering 24 years ago, the 30-year fixed did very little. It stayed within a tight range just over 7%, dipping slightly below 7% late in the year, but bouncing back to where it started to close out the year. What if mortgage rates do the same thing in 2025? Tip: Even if mortgage rates stay... --- > Are You a Mortgagee or Mortgagor? It's 2025 and it's time for some fresh mortgage Q&A! Today's question: “What is a mortgagee?” No, it's not a typo. I - Published: 2025-01-06 - Modified: 2025-01-06 - URL: https://www.thetruthaboutmortgage.com/what-is-a-mortgagee/ - Categories: Mortgage Tips Are You a Mortgagee or Mortgagor? It's 2025 and it's time for some fresh mortgage Q&A! Today's question: “What is a mortgagee? ” No, it's not a typo. I didn't leave an extra “e” on the word mortgage by mistake, though it may appear that way. I may have also needed to ignore the "misspelling" when I conducted the spell check for this article. Despite its similar appearance, it's actually a completely different word, somehow, simply with the mere addition of the letter E. Don't ask me how or why, I don't claim to be an expert in word origins. Seems like a good way to confuse a lot of people though, and it has probably been successful in that department for years now. You can blame the British English language for that, or maybe American English. Anyway, let's stop beating up on the English language and define the darn thing, shall we. What Is a Mortgagee? A “mortgagee” (two Es! ) is the entity that originates (makes) and sometimes holds the mortgage, otherwise known as the bank or the mortgage lender. They lend money so individuals like you and I can purchase real estate without draining our bank accounts. It could also be your loan servicer, the entity that sends you a mortgage bill each month, and perhaps an escrow analysis each year if your loan has impounds. The mortgagee extends financing to the “mortgagor,” who is the homeowner or borrower in the transaction. So if you're reading this... --- > A lender credit can eliminate the closing costs on your mortgage. But it will increase your mortgage rate as a result. - Published: 2025-01-03 - Modified: 2025-01-03 - URL: https://www.thetruthaboutmortgage.com/what-is-a-lender-credit/ - Categories: Mortgage Tips, Refinance Mortgage Q&A: “What is a lender credit? ” If you've been shopping mortgage rates, whether for a new home purchase or a refinance, you've likely come across the term “lender credit. ” These optional credits can be used to offset your closing costs. But they will bump up your interest rate in the process. Let's learn more about how they work and if it makes sense to take advantage of them. Jump to lender credit topics: - How a Lender Credit Works - Lender Credit vs. Paying Points - What Can a Lender Credit Be Used For? - Lender Credit Limitations - Lender Credit Example - A Lender Credit Will Raise Your Mortgage Rate - Does a Lender Credit Need to Be Paid Back? - How to See If You're Getting a Lender Credit - Is a Lender Credit a Good Deal? - Lender Credit Pros and Cons How a Lender Credit Works Mortgage lenders know you don't want to pay any fees to get a home loan So they offer "credits" that offset the customary closing costs associated with a mortgage Credits can be applied to things like title insurance, appraisal fees, and so on You don't pay those costs out-of-pocket, but wind up with a higher mortgage rate Everyone wants something for free, whether it's a sandwich or a mortgage. Unfortunately, both require manpower and cost money, and one way or another you're going to have to pay the price as the consumer. When you take out a... --- > What a difference a year makes. Toward the end of 2023, mortgage rates fell nearly 150 basis points to ring in the New Year. Meanwhile, mortgage rates - Published: 2025-01-03 - Modified: 2025-01-03 - URL: https://www.thetruthaboutmortgage.com/we-are-entering-2025-with-mortgage-rates-on-the-rise/ - Categories: Mortgage Rates What a difference a year makes. Toward the end of 2023, mortgage rates fell nearly 150 basis points to ring in the New Year. Meanwhile, mortgage rates jumped about 100 basis points to close out 2024. Ouch! In other words, things were looking bright heading into 2024, and feel a bit bleak by comparison going into 2025. Despite that, the 30-year fixed isn’t all that different than it was a year ago. Rates were actually about neck-and-neck until they diverged in mid-to-late December. Mortgage Rate Sentiment Has Worsened At last glance, the 30-year fixed averaged about 7. 07%, per Mortgage News Daily, and 6. 91%, per Freddie Mac. According to Freddie, it’s the worst average going back to July, meaning it’s been a rough stretch for the 30-year fixed. Whether that points to some relief soon is another question, but it’s certainly a stark contrast to late 2023 and early 2024. A year ago, the 30-year fixed was finally starting to show signs that it had topped out and that the worst was behind us. After all, the 30-year fixed climbed just above 8% in October 2023 and had fallen to around 6. 625% by the end of the year. So things were looking up as we rang in 2024, largely because the Fed had indicated it was ready to pivot. It wasn’t going to hike its own fed funds rate anymore, and chances of a rate cut were now on the table. That held true, though it took about... --- > 1. Mortgage rates will move lower and hit the 5s at some point I always start my New Year predictions post with a guess about which way mortgage rates - Published: 2024-12-30 - Modified: 2025-02-08 - URL: https://www.thetruthaboutmortgage.com/2025-mortgage-and-real-estate-predictions/ - Categories: Mortgage Tips 1. Mortgage rates will move lower and hit the 5s at some point I always start my New Year predictions post with a guess about which way mortgage rates will go. It’s very difficult to predict mortgage rates and just about nobody gets it right. But we can make some educated guesses based on what we know. Complicating 2025 is a new incoming presidential administration. And not just any, but a second term for Donald Trump. This time around, he has promised some sweeping changes, including widespread tariffs, mass deportations, and big tax cuts. All three spell higher inflation, which is what the Federal Reserve has been battling since at least early 2022. They’ve made a lot of progress, but there are fears Trump’s policies could unwind that in a hurry. This is partially why 10-year bond yields, which are used to determine mortgage rates, have risen so much recently in spite of three separate Fed rate cuts. However, there is also growing unemployment and fears of a recession, which could counteract some of Trump’s inflationary policies. There's also the idea he may not actually do what he said he would do. For me, the economic data will matter more and I see the economy slowing and beginning to struggle. That’s not good news for the economy, obviously, but it could be good news for mortgage rates. Like past years, they won’t move in a straight line down, but I do believe they’ll be lower in 2025 than in 2024,... --- > With home prices out of reach for many and affordability the worst it’s been in decades, a lot of folks are talking about another housing crash. However, - Published: 2024-12-23 - Modified: 2024-12-23 - URL: https://www.thetruthaboutmortgage.com/one-major-reason-why-the-housing-market-is-much-better-off-than-it-used-to-be/ - Categories: Housing Market With home prices out of reach for many and affordability the worst it’s been in decades, a lot of folks are talking about another housing crash. However, just because buying conditions aren’t affordable doesn’t mean we’ll see cascading home price declines. Instead, we could just see years of stagnant growth or real home prices that don’t actually keep up with inflation. All that really means is that homeowners won’t be seeing their property values skyrocket like they had in years past. At the same time, it also means those waiting for a crash as a possible entry point to buy a home might continue to be disappointed. This Chart Perfectly Sums Up Then Versus Now Just consider this chart from the Federal Reserve, which breaks down the vintage of today’s mortgages. In other words, when they were made. It shows that a huge chunk of the outstanding mortgage universe was made in a very short window. Basically 60% of outstanding home loans were made from 2020 to 2022, when 30-year fixed mortgage rates were at their all-time lows. To contrast that, something like 75% of all outstanding loans were originated from 2006 to 2008. Why does that matter? Because underwriting standards were at their absolute worst during those years in the early 2000s. This meant the vast majority of home loans originated at that time either shouldn’t have been made to begin with or simply weren’t sustainable. In short, you had a housing market that was built on a house... --- > If you’ve scanned the headlines lately, you probably saw that mortgage rates went up yet again. And they did so despite another Fed rate cut, which has a - Published: 2024-12-20 - Modified: 2024-12-20 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-increased-about-a-quarter-percent-this-week-what-does-that-actually-mean/ - Categories: Mortgage Rates If you’ve scanned the headlines lately, you probably saw that mortgage rates went up yet again. And they did so despite another Fed rate cut, which has a lot of folks pretty confused. I already touched on that strange relationship, but today I wanted to talk actual numbers. Yes, mortgage rates jumped up over 7% again this week, and yes, they moved up by a sizable 25 basis points (0. 25%). But how does that affect the typical monthly mortgage payment? You might be surprised. Mortgage Rates Climbed Back Into the 7s This Week It’s no secret this week has been rough for mortgage rates. They were actually trending lower post-Thanksgiving and into early December before jumping back up on Wednesday. The 30-year fixed had approached 6. 625% before an abrupt about-face to 7. 125%. What prompted the move was a new dot plot from the Fed, which detailed fewer rate cuts in 2025. Fed chair Powell also indicated that inflation was stickier than they originally thought back in September, and that unemployment wasn’t quite so bad. Translation: the economy is performing better than expected, so additional rate cuts might not be necessary. And higher inflation could still rear its ugly head again if economic growth continues at a hotter clip. Of course, this flip-flopping is super common in all financial markets. It’s why you see stocks go up one day and down the next. Then rinse and repeat. New economic data is released pretty much daily, all of which... --- > Well, it happened again. The Federal Reserve announced another rate cut and mortgage rates surged higher. In fact, the 30-year fixed now starts with a 7 - Published: 2024-12-19 - Modified: 2025-01-31 - URL: https://www.thetruthaboutmortgage.com/the-reason-mortgage-rates-jumped-after-the-fed-rate-cut/ - Categories: Mortgage Rates Well, it happened again. The Federal Reserve announced another rate cut and mortgage rates surged higher. In fact, the 30-year fixed now starts with a 7 instead of a 6 for most loan scenarios. What's going on? While it seems to defy logic, it’s a pretty common occurrence. It actually happened back in September too. This should make it crystal clear that the Fed doesn’t set mortgage rates. In other words, if they cut, mortgage rates don’t also go down. And if they hike, mortgage rates don’t also go up. But indirect effects are certainly possible. What Does the Fed Rate Cut Mean for Mortgage Rates? Yesterday, the Federal Reserve announced its third rate cut since it pivoted from hikes about a year ago. They lowered the federal funds rate (FFR) another 25 basis points (0. 25%) to achieve employment and inflation goals, known as its dual mandate. In short, inflation is at risk of reigniting, but unemployment is also at risk of rising. So they felt another cut was warranted. On a normal day, this might have zero effect on mortgage rates, which are long-term rates like the 30-year fixed. Fed policy involves short-term rates, with the FFR being an overnight lending rate that banks charge one another when they need to borrow. So the key here is the FFR and 30-year fixed are very different in terms of maturity, and thus often have little correlation. However, the Federal Reserve does more than just cut or raise the FFR.... --- > It’s that time of the year when I look at what the next year might have in store for mortgage rates. It’s never easy to accurately forecast mortgage - Published: 2024-12-17 - Modified: 2025-02-21 - URL: https://www.thetruthaboutmortgage.com/2025-mortgage-rate-predictions/ - Categories: Mortgage Rates It’s that time of the year when I look at what the next year might have in store for mortgage rates. It’s never easy to accurately forecast mortgage rates, and this past year was no exception. The 30-year fixed ranged from a low of 6. 08% in September to as high as 7. 22% in May, and interestingly, is not far off year-ago levels today. For reference, it ended the year 2023 at 6. 61%, per Freddie Mac data, and averaged 6. 60% last week. So what will 2025 look like? Well, it’s anybody’s guess. But let’s look at some popular forecasts (including my own) to attempt to make some educated predictions. Quick Insights on 2025 Mortgage Rates: Most 2025 rate forecasts predict a modest decline this year, with year-end estimates ranging from 5. 875% (my apparently optimistic view) to 6. 5% (First American’s upper bound) High volatility is expected, driven by economic conditions and potentially sizable policy shifts under a new presidential administration The 30-year fixed mortgage rate is currently near levels last seen in 2001 But spreads between mortgage rates and government bonds remain elevated (around 75 basis points above average) due to higher credit/prepayment risk Rates could improve if spreads compress, economic conditions cool, and Trump's policies (tariffs, tax cuts, etc. ) don't stoke inflation Forecasts Expect Mortgage Rates to Improve, But Stay Elevated in 2025 First off, let’s start with the general consensus, which is somewhat positive on mortgage rates in 2025. Like last year, most... --- > While 2025 offers some hope mortgage rates will move lower, that’s still very much up in the air. There are renewed worries that inflation could reignite, - Published: 2024-12-13 - Modified: 2024-12-13 - URL: https://www.thetruthaboutmortgage.com/larger-loan-amounts-require-smaller-mortgage-rate-decreases-for-a-refinance-to-pencil/ - Categories: Mortgage Tips, Refinance While 2025 offers some hope mortgage rates will move lower, that’s still very much up in the air. There are renewed worries that inflation could reignite, pushing rates higher in the New Year. Especially as we welcome a new president who has promised to introduce some inflationary policies, such as widespread tariffs. This not only affects prospective home buyers grappling with strained affordability, but also existing homeowners looking to refinance. After all, millions still managed to take out mortgages when rates were in the 7-8% range, and they’re quite rightfully looking for relief. How Can We Make the Decision to Refinance a Little Easier? One thing I want to point out first is that there’s no single refinance rule of thumb. Sure, I wish there was. It’d be great if you could make one blanket statement to help homeowners decide if they could benefit or not. But this just isn’t the case. There are far too many variables involved with mortgages and real estate to do that. But we can at least pluck out some tips to make the decision easier. Today, I’m focusing on rate and term refinances, which allow borrowers to trade in their old loan for a new one with a lower interest rate and new term. These are pretty much the only game in town right now because cash out refinances don’t make much sense given rates aren’t all that attractive. Anyway, one thing to consider when making a refinance decision is the size of your... --- > Recently, I’ve encountered two very different types of for-sale listings in the market. There are the properties that go pending in about a week, - Published: 2024-12-12 - Modified: 2024-12-12 - URL: https://www.thetruthaboutmortgage.com/if-youre-serious-about-selling-your-home-list-below-the-zestimate/ - Categories: Housing Market Recently, I’ve encountered two very different types of for-sale listings in the market. There are the properties that go pending in about a week, essentially flying off the shelf. And there are the listings that fester on the market for months with little to no action. Often, the difference is simply in the price, not the quality or amenities of the home. So if you’re serious about selling in today’s housing market, think lower instead of higher. Choose a Listing Price Below the Zestimate or Redfin Estimate One of the easiest ways to drum up a lot of excitement for your home is to simply price it right. This generally entails listing it for a lower price versus a higher price. But what’s low and what’s high? Well, your real estate agent should be able to help you out on that one, but there are also simple clues to figure this out. Most properties have an associated Zestimate, which is Zillow’s estimate of a home’s market value. No, it’s not an actual home appraisal, nor can it be used in lieu of an appraisal, but it’s often a decent starting point to determine value. The same feature can be found on Redfin and is known as a Redfin Estimate. Same concept, just a different company. And even Realtor has its so-called "RealEstimate," which features three different home value estimates. Sometimes these estimates are higher or lower than the other. For example, your Zestimate might be lower than your Redfin Estimate.... --- > When mortgage rates fell to around 6% in August, homeowners jumped at the opportunity to refinance. In the months of September and October, more than - Published: 2024-12-10 - Modified: 2024-12-10 - URL: https://www.thetruthaboutmortgage.com/homeowners-who-refinanced-recently-saw-the-biggest-mortgage-rate-improvement-in-decades/ - Categories: Mortgage Tips When mortgage rates fell to around 6% in August, homeowners jumped at the opportunity to refinance. In the months of September and October, more than 300,000 borrowers closed on a refinance, including nearly 150,000 rate and term refinances, per the latest Mortgage Monitor report from ICE. This pushed refinance volumes to their highest levels in more than two-and-a-half years. And more than a quarter of October mortgage lending consisted of refinances in a market long dominated by home purchase loans. Perhaps most interesting, borrowers who refinanced in these months saw some of the biggest rate improvements in decades. The Average Refinancer Obtained a Mortgage Rate About 120 Basis Points Lower You’ve probably heard the phrase marry the house, date the rate. But if you haven’t, it was basically an argument to buy a home if you wanted one, and hope to refinance sooner rather than later to get a better rate. In other words, the home is a keeper, but the mortgage is disposable. This didn’t work out well in early 2022 as mortgage rates nearly tripled from 3% to 8% by late 2023, but it worked out recently. Per ICE, the average homeowner who applied for a rate and term refinance reduced their mortgage rate by more than a full percentage point in both September (-1. 07%) and October (-1. 17%). This resulted in monthly savings of $310 and $320 respectively, which is a pretty compelling reason to refinance. At the same time, nearly a third of these borrowers... --- > Often times when you apply for a mortgage, you’ll be bombarded by offers from competing banks and lenders. The reason this happens is because the credit - Published: 2024-12-09 - Modified: 2024-12-09 - URL: https://www.thetruthaboutmortgage.com/opt-out-before-you-begin-mortgage-shopping/ - Categories: Mortgage Tips Often times when you apply for a mortgage, you’ll be bombarded by offers from competing banks and lenders. The reason this happens is because the credit bureaus sell your information to these other companies. They’re known as trigger leads, which are triggered when you submit a loan application and your credit report is pulled. It acts as a signal that you’re currently applying for a home loan and lets others in on that secret. To avoid getting inundated with texts, phone calls, and emails, you can opt-out beforehand. First Some Background on How This Works As noted, a credit application, such as a mortgage that involves a hard credit pull, triggers an inquiry with the credit bureaus. These bureaus, which include Equifax, Experian, TransUnion, and even a fourth one, Innovis, are notified that you’re looking for a loan. While this is all good and well since you generally need a credit check to get approved for a mortgage, the credit bureaus are for-profit companies. So instead of simply making money on the credit pull, they will also sell mortgage and refinance leads to banks, loan officers, mortgage brokers, etc. This allows them to make even more money, and it allows the loan originators who buy them to close more loans. Assuming they can win your business. However, the collateral damage might be you, the consumer, by way of major annoyance. You see, it’s not just the odd phone call or email. It could be dozens or even close to a... --- > It’s been a wild ride for mortgage rates this year. The 30-year fixed began 2024 at around 6.625% and is currently not far from those levels. Despite - Published: 2024-12-09 - Modified: 2024-12-09 - URL: https://www.thetruthaboutmortgage.com/are-we-still-in-a-falling-mortgage-rate-environment/ - Categories: Mortgage Rates It’s been a wild ride for mortgage rates this year. The 30-year fixed began 2024 at around 6. 625% and is currently not far from those levels. Despite that, rates were as low as 6% and as high as 7. 50%. So there has been quite a range over the past 50 weeks or so. Rates rallied last December after the Fed revealed it was ready to pivot and begin loosening monetary policy. But as always, they ebbed and flowed along the way, instead of simply falling lower and lower, with the past couple months quite the rollercoaster higher. However, we remain in a falling rate environment, even if rates aren’t currently at their 2024 lows. Allow me to explain. Mortgage Rates Are Better Than Their Year-Ago Levels Many things, including home prices and mortgage rates, are measured both monthly and year-over-year. The latter can give you a bigger picture of where something is trending, whether it’s home prices or mortgage rates. For example, home prices might fall month-to-month, but still register year-over-year gains thanks to stronger months along the way. When it comes to mortgage rates, I’ve argued since mid-September that we remained in a falling rate environment. Why did I have to? Because rates on the 30-year fixed climbed from about 6% to 7% in the span of less than two months. This had many fearing for the worst. That the recent improvement in rates was another head fake. And a return to 8% or higher was imminent.... --- > Mortgage rates have been on a wild ride the past few years. In fact, it was still possible to obtain a 3% 30-year fixed mortgage in early 2022. By late - Published: 2024-12-05 - Modified: 2024-12-05 - URL: https://www.thetruthaboutmortgage.com/winter-is-coming-for-mortgage-rates-why-that-might-a-good-thing/ - Categories: Mortgage Rates Mortgage rates have been on a wild ride the past few years. In fact, it was still possible to obtain a 3% 30-year fixed mortgage in early 2022. By late 2023, you may have faced an 8% mortgage rate. And today, your rate might start with a 5, 6, or a 7. Volatility has reigned supreme as the Fed battles inflation and economic uncertainty makes it difficult to ascertain the longer-term direction of rates. But one thing I’ve noticed is that rates tend to perform better during certain times of the year. Namely in the winter months, which in the Northern Hemisphere include December, January, and February. Winter Is a Historically Great Season for Mortgage Rates Without getting overly technical here, winter runs from December 1st until the end of February. It’s three months more or less, though if you want to get technical, there is an astronomical season and a meteorological season. Anyway, I’ll keep it simple and focus on the months of December, January, and February. These are your core winter months, and also when it tends to be coldest. While I don’t like being cold (as I reside in Southern California), winter isn’t all bad. In fact, there is actually a perk to winter when it comes to mortgage rates. And possibly shopping for a home too. I crunched the numbers going back to 1972 and found that mortgage rates tend to be lowest in the winter months. Using Freddie Mac’s Primary Mortgage Market Survey (PMMS), I... --- > Mortgage rates are a pretty complex subject. They’re also commonly misunderstood and oversimplified, with many myths perpetuated by those who work in the - Published: 2024-12-04 - Modified: 2025-01-31 - URL: https://www.thetruthaboutmortgage.com/the-u-s-president-doesnt-set-mortgage-rates/ - Categories: Mortgage Tips Mortgage rates are a pretty complex subject. They’re also commonly misunderstood and oversimplified, with many myths perpetuated by those who work in the industry. Some folks think that when the Fed cuts rates, mortgage rates fall by the same amount. Others might believe the government somehow sets the rates and then lenders offer them accordingly. The fact of the matter is that none of this is true. Ultimately, mortgage rates are set by the market, just like many other things you buy. Does the President Set Mortgage Rates? The short answer is no. When it comes to mortgage rates, there is a supply and demand dynamic, just like other goods. Driving this mortgage pricing is investor appetite for mortgage-backed securities (MBS), which are bonds consisting of bundles of home loans. Simply put, if there is more investor demand for these bonds, MBS prices go up and mortgage rates can come down. If there isn’t a lot of demand for MBS, prices must fall and interest rates must be increased to attract more purchases from investors. This all speaks to the market determining the direction of rates, not a politician or any other individual. So where does the president of the United States factor into all of this? Well, you could argue that the president definitely plays an indirect role in where rates go because they are driven by the economy. However, there’s not a direct order by President Biden or President Trump saying rates should be X so they are... --- > It’s no secret that mortgage rates aren’t cheap anymore. In the first quarter of 2022, you could still get a 30-year fixed in the 3% range. Within a year, - Published: 2024-12-03 - Modified: 2024-12-03 - URL: https://www.thetruthaboutmortgage.com/why-you-might-want-to-steer-clear-of-a-cash-out-refinance-right-now/ - Categories: Refinance It’s no secret that mortgage rates aren’t cheap anymore. In the first quarter of 2022, you could still get a 30-year fixed in the 3% range. Within a year, rates were pushing 8%, before easing in 2024 to around 6% then rising again to 7% in the lead up to the election. It's been a wild ride. Today, the 30-year stands at around 7% for your typical loan scenario, but can be even higher for certain transactions like a cash-out refinance. Making matters worse is the typical homeowner already has a rock-bottom rate, so losing it might be a big mistake. A Cash-Out Refinance Pays Off Your Existing Mortgage Lately, I’ve been hearing firsthand more stories of folks struggling financially. The easy-money days of the pandemic are in the rear-view mirror. There’s no more stimulus and prices on just about everything are a lot higher than they were a few years ago. Whether it’s the homeowners insurance policy or even a trip to your favorite fast food restaurant, prices are not your friend right now. This may have forced you to start relying on credit cards more lately, racking up debt in the process. And perhaps now you’re looking for a way to lighten the load and reduce your interest expense. After all, credit card APRs are also through the roof, with typical interest rates pushing past 23% for those who are actually assessed interest, per the Federal Reserve. Clearly that’s not ideal. Nobody should be paying rates that high.... --- > Well, it sounds like the new Mesa Homeowners Card got the attention of one of its competitors. Bilt is best known for its credit card that allows its - Published: 2024-12-03 - Modified: 2024-12-03 - URL: https://www.thetruthaboutmortgage.com/bilt-card-to-offer-point-earning-on-mortgage-payments/ - Categories: Mortgage Tips Well, it sounds like the new Mesa Homeowners Card got the attention of one of its competitors. Bilt is best known for its credit card that allows its members to earn points on rent, but soon homeowners will be able to earn points on mortgage payments too. We heard rumblings of this possibility a while back, but it never materialized, possibly because the numbers just didn’t pencil. Now it seems like some good old fashioned competition may have proven to be the mother of innovation. And if you’ve been paying attention, Mesa, which is planning the same thing, just so happened to be built by some former Bilt employees, among others. Bilt MasterCard Will Reward Homeowners in 2025 In its Letter to Bilt Members released today, Bilt Rewards CEO Ankur Jain said, “We’ll announce the first phase of plans in the mortgage space, creating a whole new category of value for homeowners. ” This includes the ability to earn points on mortgage payments, and points when refinancing a mortgage, likely a referral style program. As I always say with those referral programs, don’t use the lender unless the total cost is lower than other options, even if you can earn points! Anyway, the fact that you’ll be able to use a credit card to pay the mortgage is the biggie here, at least for me. It’s been very difficult to pull off, and even when it is permissible, there are often hefty fees that negate the benefit of using plastic.... --- > Lately, there’s been a ton of speculation surrounding the direction of mortgage rates. I too have taken part in this quite a bit as I’ve attempted to - Published: 2024-12-02 - Modified: 2024-12-02 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-tend-to-fall-within-12-weeks-of-a-first-fed-rate-cut/ - Categories: Mortgage Tips Lately, there’s been a ton of speculation surrounding the direction of mortgage rates. I too have taken part in this quite a bit as I’ve attempted to determine what’s next for rates. Despite the recent increase in the 30-year fixed from around 6% to 7%, I have remained bullish that they remain in a downward trend. Really, I haven’t changed my view since they began to fall about a year ago when they appeared to top out at 8%. Many other economists and pundits have flip-flopped since the Fed first cut rates in September, but that might prove to be a mistake. Mortgage Rates Tend to Move Lower Before a First Fed Rate Cut The first Fed rate cut this cycle took place on September 18th, with the Federal Reserve opting for a 50-basis point cut to its federal funds rate (FFR). This marked the “pivot” after the Fed raised rates 11 times beginning in early 2022 to combat inflation. The reason they finally pivoted after increasing rates so much was because they felt inflation was no longer a major concern, and that keeping rates higher for longer could affect employment. Their dual mandate is price stability and maximum sustainable employment, the latter of which could suffer is monetary policy remains too restrictive. Anyway, that led to their first rate cut and much to everyone’s surprise, the 30-year fixed climbed about a full percentage point since, as seen in the chart from MND above. Many people believe the Fed controls... --- > As I’ve been saying for a while now, all of the potential bad news (for mortgage rates) has been largely baked in over the past couple months. And then - Published: 2024-11-25 - Modified: 2025-01-31 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-improve-after-new-treasury-secretary-bessent-announced/ - Categories: Mortgage Rates As I’ve been saying for a while now, all of the potential bad news (for mortgage rates) has been largely baked in over the past couple months. And then some! Meanwhile, anything potentially positive for mortgage rates, such as easing inflation and higher unemployment, has largely been ignored. Rates can’t seem to catch a break. Simply put, we have experienced a very defensive bond market lately, which in turn drives consumer mortgage rates higher. Nobody has wanted to stick their neck out given the incoming administration’s proposed sweeping economic changes. But as I suspected, many of the much talked about policies like tariffs and trade wars may not actually materialize, which should help mortgage rates get back on their downward track. Treasury Secretary Bessent Viewed as a Less Inflationary Choice Without getting too convoluted here, the appointment of Treasury secretary Scott Bessent has eased inflation concerns. He is seen as a less volatile, more conservative choice to implement some of Trump’s ideas without ruffling as many feathers. This includes lowering government spending and using the threat of tariffs to improve trade relations. It all points to easing inflation instead of rising prices. Lower inflation is good for bonds, and thus good for mortgage rates since they track longer-maturity bond yields like the 10-year. Prior to this announcement, there was a lot of fear surrounding Trump’s policies, which include tax cuts and a trade war with China and other countries. Specifically, his tariffs are seen as inflationary as the costs are... --- > Lately we’ve been hearing a lot about trigger leads due to legislation trying to ban them. If you’re unaware, when a lender pulls your credit, the credit - Published: 2024-11-22 - Modified: 2024-11-22 - URL: https://www.thetruthaboutmortgage.com/watch-out-for-mortgage-mailers-that-look-super-official-but-arent/ - Categories: Mortgage Tips Lately we’ve been hearing a lot about trigger leads due to legislation trying to ban them. If you’re unaware, when a lender pulls your credit, the credit bureaus will happily sell your information to competing banks and lenders letting them know you’re shopping for a mortgage. The result is getting absolutely bombarded by phone calls and text messages with offers to use them instead. They have yet to be outlawed, partially because agencies like the CFPB actually want consumers to comparison shop more. And this is one way to kind of enforce it. Even if you haven't applied for a mortgage recently, homeowners (including myself) have received official-looking mailers that appear to be from their existing bank or loan servicer. What on Earth Is an Equity Reserve Summary? Recently, I got an “Equity Reserve Summary” in the mail (that I’m glad I opened so I can share it with you). First off, I’ve never heard this phrase in life, but I believe some version of it is used by mortgage lenders to solicit homeowners. The gist of it is that you have “equity reserves” that can be tapped if you call the number on the notice. My particular letter listed the name of my old loan servicer (they didn’t know my loan got transferred to a new one I guess), my property address, and a hypothetical amount of equity available to tap. It’s also featured some arbitrary file ID number and a customer support center phone number with hours listed,... --- > Lately, homeowners have been turning to their equity for their cash needs. After all, most already have a super low fixed mortgage rate and don’t want to - Published: 2024-11-21 - Modified: 2025-01-14 - URL: https://www.thetruthaboutmortgage.com/three-key-differences-between-helocs-and-home-equity-loans/ - Categories: Mortgage Tips Lately, homeowners have been turning to their equity for their cash needs. After all, most already have a super low fixed mortgage rate and don’t want to disturb it in any way. If they were to go the cash out refinance route, they’d lose their old low rate and wind up with a much higher one. To avoid this, they can take out a second mortgage instead and keep the existing first mortgage intact. Question is: Do you go with a HELOC or a home equity loan? How HELOCs and Home Equity Loans Are Similar If you’re like a lot of folks trying to understand the difference between a home equity line of credit (HELOC) and home equity loan, allow me to help. There are basically three main differences between the two, despite both options sharing a lot of the same qualities. Let’s discuss those first before we get into their differences. First off, they both often act as second mortgages. And they both allow you to tap into your home equity. You can get cash from either and you can do so without disturbing your first mortgage. Nothing changes with your first mortgage when you take out a second mortgage like a HELOC or home equity loan. And that’s a good thing if you’ve got one of those 3% 30-year fixed mortgage rates that were available for much of the past decade. So either one you choose will allow you to continue enjoying that low rate, unlike a cash... --- > The big NAR settlement is expected to be finalized next week, but the changes already took effect back in August. They include needing a written buyer - Published: 2024-11-20 - Modified: 2024-11-20 - URL: https://www.thetruthaboutmortgage.com/its-okay-to-negotiate-with-your-real-estate-agent/ - Categories: Mortgage Tips The big NAR settlement is expected to be finalized next week, but the changes already took effect back in August. They include needing a written buyer agreement prior to touring a home and removing offers of compensation from the Multiple Listing Services (MLS). That upfront agreement is also supposed to lay out the compensation charged by the agent, such as a flat fee dollar amount or percentage of the sales price. There also needs to be “a conspicuous statement that broker commissions are not set by law and are fully negotiable. ” Yet whenever I bring up the idea of a real estate agent reducing or discounting their fee, it is met with resistance. Real Estate Agent Commissions Are Negotiable NAR has been quick to point out that “agent compensation for home buyers and sellers continues to be fully negotiable. ” And that the negotiability of commissions needs to be communicated to the consumer explicitly via disclosures. So we know whatever fee an agent proposes isn’t set in stone. For example, an agent might say they charge 3% of the purchase price. On a $500,000 home, that’d be $15,000, though it is important to point out that this amount is often shared with the brokerage. Meaning an agent may only see a portion of that. Conversely, if you walk into a retail store or a restaurant, you will likely see set prices. For example, a pizza might cost $15. 99, and a stick of deodorant might be $5. 99. You... --- > Lately, I’ve been a hearing a lot of people say that mortgage rates are “average” or “normal.” As in, they aren’t high or low. They’re just typical. This - Published: 2024-11-18 - Modified: 2024-11-18 - URL: https://www.thetruthaboutmortgage.com/normal-mortgage-rates-the-average-mortgage-rate-since-1972-is-roughly-7-75/ - Categories: Mortgage Tips Lately, I’ve been a hearing a lot of people say that mortgage rates are “average” or “normal. ” As in, they aren’t high or low. They’re just typical. This is usually in response to someone pointing out that they’re much higher than they were just a couple years ago. In a way, it feels like a dismissal that rates are high today. And it’s usually accompanied by something like, “Do you know how high rates were when I bought my first home? ! ” Problem is, that doesn’t do anyone any good. Who cares what they were decades ago. Or what they averaged since the 1970s? What Is the Historical Average 30-Year Mortgage Rate? While it doesn’t necessarily matter what the long-term average of the 30-year fixed is, I might as well tell you. I did the research and put in some time with spreadsheets tallying up historical Freddie Mac data, so it’d be a waste not to share it. Since 1972, the first complete year Freddie Mac compiled mortgage rate data, through the end of 2023, the 30-year fixed has averaged roughly 7. 75%. Technically 7. 74%, but who’s counting (a single basis point)? At last glance, the 30-year averaged 6. 78%, per the company’s latest weekly Primary Mortgage Market Survey (PMMS). So someone could arguably tell you that rates aren’t that high at the moment. After all, they’re about a full percentage point below their long-term average. They could also point out those notorious 1980s mortgage rates in... --- > Recently, a lot of people have argued that we won’t return to lower mortgage rates. That there’s no possible way we can go back to low mortgage rates. - Published: 2024-11-14 - Modified: 2024-11-14 - URL: https://www.thetruthaboutmortgage.com/what-does-it-actually-mean-to-return-to-lower-mortgage-rates/ - Categories: Mortgage Tips Recently, a lot of people have argued that we won’t return to lower mortgage rates. That there’s no possible way we can go back to low mortgage rates. Thing is, when they say that, they’re always thinking about 3% mortgage rates, maybe 4%. In reality, mortgage rates could go down quite a bit from current levels and still be a lot higher than they used to be. Simply put, they can go lower without being considered “low” again. Remember When a 4. 5% Mortgage Rate Sounded Super High? A couple years ago, a friend of mine purchased a home and took out an adjustable-rate mortgage (ARM). Back then, he got a rate of 4. 5%, which at the time sounded super steep. Not in the least bit attractive. And again, it was an ARM, so it’s not like it was a slightly costlier 30-year fixed. It was both higher in price than what everyone had been used to and not fixed for more than five years. Back then, 4. 5% sounded super high. Why? Because we were used to rates in the twos and threes. Months before he locked in his rate, you could still get a 30-year fixed at 3. 25%. So it’s always relative to what you’re used to. And he and everyone else was used to seeing rates that started with a 2 or a 3. I wrote a while back that once we saw higher rates, our brain would think a rate of 5% or 6%... --- > If you’ve been home shopping since early 2022 when mortgage rates surged higher, you’ve likely come across the buydown. The buydown is used to lower a - Published: 2024-11-13 - Modified: 2024-11-13 - URL: https://www.thetruthaboutmortgage.com/do-the-home-builders-need-to-offer-mortgage-rate-buydowns-to-make-the-math-work/ - Categories: Mortgage Tips If you’ve been home shopping since early 2022 when mortgage rates surged higher, you’ve likely come across the buydown. The buydown is used to lower a home buyer’s mortgage rate, either temporarily or permanently. It can make the mortgage payment cheaper for the first few years of the loan term, or for the entire 30 years. These buydowns serve as an incentive to purchase a home, even if interest rates and home prices are high. And the home builders are all-in on them, partially because they don’t want to lower their prices. And maybe because they need to offer them to move product. Rate Buydowns Are Nice, But Might Even Be Necessary As mentioned, the home builders are big on mortgage rate buydowns, offering them in earnest since the 30-year fixed began climbing rapidly in early 2022. Before spring 2022, mortgage rates had been near record low levels, but once the Fed ended its mortgage-backed securities (MBS) purchasing program known as QE and starting raising the fed funds rate, conditions changed fast. The 30-year fixed was in the 3s to start 2022, and quickly increased to around 6% by the same summer. It eventually went as high as 8% before pulling back into the 6s. Meanwhile, home prices continued to rise, albeit at a slower clip than previously. This clearly dampened affordability, but home builders aren’t in the business of lowering their prices. Nor can they sit on their inventory like an individual can. They need to move their inventory.... --- > While mortgage rates have already seen some improvement since the election dust settled, they remain quite elevated. At last glance, the 30-year fixed was - Published: 2024-11-12 - Modified: 2024-11-12 - URL: https://www.thetruthaboutmortgage.com/can-mortgage-rates-improve-much-before-trumps-inauguration/ - Categories: Mortgage Rates While mortgage rates have already seen some improvement since the election dust settled, they remain quite elevated. At last glance, the 30-year fixed was hovering around 6. 875%, down about 0. 25% from its recent highs. It’s been a good few days, but rates are still at least 0. 75% higher than they were in mid-September. The reason they’re higher is up for debate, but I believe most of the move higher was driven by the expectation Trump would win the election. Simply put, his policies are expected to be inflationary. And inflation is bad for mortgage rates. The question is can rates continue to improve before he gets into office in January? Mortgage Rate Movement Might Be Limited During the Presidential Transition The United States will celebrate its 60th presidential inauguration on Monday, January 20th, 2025 in Washington, D. C. That’s roughly 70 days from now. While we will undoubtedly hear lots of speculation about Trump’s policies for his second term, it’ll be just that. It won’t be until he’s in office that we’ll know more concrete details. So that uncertainty might restrict the movement of mortgage rates for the next few months. Even once he’s in office, we could still be awaiting answers on policy questions, such as tariffs and tax cuts and other objectives. As it stands now, most market participants expect Trump’s second term to be an inflationary one, due to those expected policies. For example, tariffs on things like lumber and steel could increase the... --- > It’s a tale as old as time. Someone attempts to time the market, only to fail miserably. Then they either miss out completely, or chase an opportunity - Published: 2024-11-11 - Modified: 2024-11-11 - URL: https://www.thetruthaboutmortgage.com/dont-attempt-to-time-the-housing-market/ - Categories: Housing Market It’s a tale as old as time. Someone attempts to time the market, only to fail miserably. Then they either miss out completely, or chase an opportunity that is no longer there and perhaps overpay in the process. Recently over dinner, a friend told me a story that seemed worthy of sharing. It had to do with two families who sold their townhomes, but only one purchased another property, while the other rented. And guess what. Nearly five years later, the renter is still renting. It’s Never Easy to Get the Timing Right, Especially with Real Estate The year is 2019. The housing market had seen some pretty impressive gains since bottoming around 2012 (see this chart from the FHFA for more on that). Home prices had doubled in a lot of markets nationwide. For sellers, it seemed like a pretty great time to cash out and move on. Of course, if you were selling a primary residence, you still needed new accommodations. This meant either renting or buying another home. A friend of mine had his first child and was expecting a second. Like many young families, they had purchased a smaller townhome to get their feet wet. But it was now time to find a larger space, and make a move from an urban area to a more suburban setting to raise their family. The good news was their townhome had increased in value tremendously since they purchased it. This meant a good chunk of sales proceeds and... --- > I sometimes wonder with so little equity extracted this cycle if it’s still early innings for the housing market. At least in terms of the next collapse. - Published: 2024-11-08 - Modified: 2024-12-30 - URL: https://www.thetruthaboutmortgage.com/is-this-housing-market-cycle-just-getting-started/ - Categories: Housing Market I sometimes wonder with so little equity extracted this cycle if it’s still early innings for the housing market. At least in terms of the next collapse. Sure, home sales volume has plummeted thanks to unaffordable conditions, driven by high home prices and significantly higher mortgage rates. But do we still need a flood of HELOCs and cash out refis before the market inevitably overheats again? Otherwise it’s just an unaffordable market that is likely just going to get more affordable as mortgage rates ease, home prices stall, and wages increase. Where's the fun in that? Homeowners Were Maxed Out in the Early 2000s If you look at outstanding mortgage debt today, it really hasn’t risen much over the past 16 or so years when the housing bubble popped. It skyrocketed in the early 2000s, thanks to rapidly rising home prices and zero down financing. And a flood of cash out refinances that went all the way to 100% LTV and beyond (125% financing anyone? ). Basically homeowners and home buyers back then borrowed every penny possible, and then some. Either they cashed out every six months on higher valuations, fueled by shoddy home appraisals, or they took out a HELOC or home equity loan behind their first mortgage. Many also purchases investment properties with no money down, and even without any documentation. Whatever it was, home buyers back then always maxed out their borrowing capacity. It was kind of the move back then. Your loan officer or mortgage broker... --- > It’s been no secret that most everyone thinks mortgage rates will be higher under President Trump. But because it’s been so telegraphed this time around, - Published: 2024-11-07 - Modified: 2025-01-31 - URL: https://www.thetruthaboutmortgage.com/what-will-happen-to-mortgage-rates-during-trumps-second-term/ - Categories: Mortgage Rates It’s been no secret that most everyone thinks mortgage rates will be higher under President Trump. But because it’s been so telegraphed this time around, we’ve seen a very defensive bond market leading up to the election. Many have argued that him winning the election was already priced in to the bond market. After all, the 10-year yield increased from 3. 65% in mid-September to around 4. 40% today. Likewise, the 30-year fixed increased nearly a full percentage point from roughly 6. 125% to 7. 125%. In other words, Trump was expected to win the election and did win the election. So what happens next for mortgage rates during this second term in office? Are Trump’s Policies Already Baked in to Mortgage Rates? While there’s never 100% certainty, especially with mortgage rates, one could make a pretty compelling argument that Trump’s win is baked in. As noted, the 30-year fixed has already risen about one full percentage point in the span of about six weeks. And this took place shortly after the Federal Reserve pivoted and made its first rate cut after 11 consecutive rate hikes. The Fed did so because it felt inflation was coming down and monetary policy didn’t need to remain so restrictive. Keep in mind that the federal funds rate (FFR) is still a lot higher than it was in early 2022, even with the most recent cut and the expected cuts to come. So it’s not as if we’re entering an easy money policy period... --- > The National Association of Realtors (NAR) reported that the first-time home buyer share fell to a historic low of just 24%. That was down from 32% a year - Published: 2024-11-05 - Modified: 2024-11-05 - URL: https://www.thetruthaboutmortgage.com/first-time-home-buyer-share-hits-record-low-why-that-might-be-a-good-thing/ - Categories: Housing Market The National Association of Realtors (NAR) reported that the first-time home buyer share fell to a historic low of just 24%. That was down from 32% a year earlier based on transactions between July 2023 and June 2024. At the same time, the typical home buyer age reached an all-time high of 56 years old. This all speaks to a housing market that has becoming increasingly unaffordable, especially for renters and young people. But there is a silver lining; we aren’t seeing a flood of questionable home purchases as we did in the early 2000s. Improved Underwriting Standards Prevent Risky Home Sales I’ll start by saying the data is clearly negative. Those statistics from NAR certainly don’t paint a pretty picture for the housing market at the moment. The FTHB share hit a record low 24% in 2024, going all the way back to 1981. And it’s well below the historic norm of 40% prior to 2008. It’s a sign that homes have become unaffordable for most, especially those who have never owned one before. Without a large amount of sales proceeds (think repeat home buyers), it’s difficult to come up with the necessary down payment. And without a big salary, it’s near-impossible to afford the monthly payment at today’s prices. So obviously not great if you’re a young person or a renter without a parent willing to gift you a down payment. Or co-sign your mortgage. Contrast that to the early 2000s when we had similar conditions in terms... --- > Everyone knows high mortgage rates have been a total drag lately, especially for prospective home buyers facing extremely high asking prices. But what if - Published: 2024-11-04 - Modified: 2024-11-04 - URL: https://www.thetruthaboutmortgage.com/how-did-almost-half-of-recent-home-buyers-snag-a-mortgage-rate-under-5/ - Categories: Mortgage Rates Everyone knows high mortgage rates have been a total drag lately, especially for prospective home buyers facing extremely high asking prices. But what if I told you that nearly half of those who purchased a home recently still got an interest rate below 5%? Sounds pretty unlikely, given the fact that the 30-year fixed is back over 7%, and never went lower than 6% for the duration of 2024. However, that didn’t stop 45% of “mortgage buyers” (non-cash buyers) from obtaining a sub-5% mortgage rate, per a new survey from Zillow. As for how, the most common reason cited was special financing offered by the seller or home builder. Special Mortgage Rates from Home Builders One of the most common ways to get a below-market mortgage rate has been via the home builders. They often operate in-house mortgage companies to ensure their customers make it to the finish line. And thanks to a financing tool call “forward commitments,” they’re able to offer super low mortgage rates to the customers who use their captive lender. Those commitments involve buying low mortgage rates in bulk, ahead of time, and then deploying the low rates to customers who buy properties in select communities. While some only offer temporary rate buydowns, lately many have offered permanent rate buydowns for the full 30-year loan term. This probably sounds pretty sweet, but keep in mind you need to buy a newly-built home to get your hands on a special rate. Some have argued that the discount... --- > If you recall, Chase took over troubled First Republic Bank back in May 2023. Prior to First Republic going under, they were the leading jumbo home loan - Published: 2024-11-04 - Modified: 2024-11-04 - URL: https://www.thetruthaboutmortgage.com/chase-relationship-pricing-offers-discounted-mortgage-rates-for-up-to-1-off/ - Categories: Mortgage Rates If you recall, Chase took over troubled First Republic Bank back in May 2023. Prior to First Republic going under, they were the leading jumbo home loan lender in the United States. They catered to very wealthy homeowners and businesspeople. And it was ironically their ultra-low rate mortgages that eventually took them down. Today, Chase is the top jumbo loan lender in the nation, with production of more than $8 billion in the first half of 2024, per Inside Mortgage Finance. Like First Republic, they too are wooing high-net worth individuals with special mortgage rate discounts. Up to 1% Off Mortgage Rates If You Bring Money to the Bank In 2023, Chase was the third largest mortgage originator in the country, per HMDA data. And the largest depository issuer of home loans. They were only beaten out by two nonbanks, United Wholesale Mortgage and Rocket Mortgage. Their acquisition of troubled First Republic has only made them bigger, and put an even stronger emphasis on jumbo loan lending at the bank. In essence, they are carrying on some of the same principles, though likely with added guardrails to avoid the same fate. One of those practices is offering mortgage rate discounts to their wealthiest customers, namely those willing to park lots of money at the bank. The NYC-based bank’s so-called “Relationship Pricing Program” offers mortgage rate discounts ranging from 0. 125% and 1% based on new and existing balances at the bank. These apply whether you’re buying a home or refinancing... --- > Seems pretty clear now that it doesn't matter what economic data shows up between now and next week. Mortgage rates aren't going to improve by any - Published: 2024-11-01 - Modified: 2024-11-01 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-are-in-a-holding-pattern-until-after-the-election/ - Categories: Mortgage Rates Seems pretty clear now that it doesn't matter what economic data shows up between now and next week. Mortgage rates aren't going to improve by any significant margin this week or until after the election. Unfortunate for those who need to lock their rate and/or close this week. And the past month for that matter. Lenders are essentially in a holding pattern and continuing to price defensively until at least next Wednesday. Likely longer... Simply put, the outcome of the election matters more than the data right now. Biggest Presidential Election in Years We all know next week’s presidential election is a big one. One of the bigger ones in years. Aside from it being very contentious, a lot is at stake regarding the direction of the economy. Thus far, the markets have priced in a Trump victory, at least in a defensive type of way. Without getting political here (I never have any interest in doing that), it doesn’t appear that either candidate winning is helping 10-year bond yields at the moment. The best way to track mortgage rates is via the 10-year bond yield, which works well historically because 30-year fixed mortgages often last about a decade too. Despite being offered for 30 years, most are paid off earlier due to a refinance or a home sale. Lately, the 10-year yield has climbed higher and higher, with most market pundits pointing to increased government spending as the culprit. Long story short, with more government spending expected, any way... --- > I wanted to take a moment to talk about the types of sellers that exist in the housing market. There are typically two types of sellers in the - Published: 2024-10-30 - Modified: 2024-10-31 - URL: https://www.thetruthaboutmortgage.com/would-be-sellers-vs-must-sell-sellers/ - Categories: Housing Market I wanted to take a moment to talk about the types of sellers that exist in the housing market. There are typically two types of sellers in the marketplace: would-be sellers and must-sell sellers. The first group are folks who would sell their property, but only for the right price. They're often in no big rush nor interested in negotiating much if it all. The second group consists of motivated sellers who must sell, even if the price isn’t right. These homeowners will usually slash their listing price quickly and offer concessions to buyers. At the moment, the market appears to be dominated by the first group. It's why you're seeing a lot of properties sitting, even if they're "overpriced. " And coupled with a continued lack of for-sale inventory, it's a big reason why home prices continue to go UP. This is very different than the early 2000s when sellers were in desperate need to unload their properties, which led to cascading price declines nationwide. Let’s discuss why this is important and how it impacts today's housing market. What Is a Would-Be Home Seller? As the name suggests, a “would-be seller” is a homeowner that is interested in selling their property, but only if the conditions are right. Typically, this means they’ll only part with the property for the right price. And that right price is usually a high price. For example, you might see a home listed for $500,000 in a neighborhood where most other properties are selling... --- > Figure Lending has unveiled a new piggyback loan at a time when housing affordability has rarely been worse. Call it a sign of the times, and maybe an - Published: 2024-10-30 - Modified: 2024-10-30 - URL: https://www.thetruthaboutmortgage.com/figure-launches-a-piggyback-second-mortgage/ - Categories: Mortgage News Figure Lending has unveiled a new piggyback loan at a time when housing affordability has rarely been worse. Call it a sign of the times, and maybe an eerie reminder of the early 2000s housing market. But perhaps with a few added safeguards this time around, such as actual loan underwriting! The new product, which is a home equity line of credit (HELOC), will serve both new home buyers and existing homeowners looking to access more of their equity. It will be available at Figure and via their partner network of lenders, banks, credit unions, loan servicers, and home builders. Figure’s New Piggyback HELOC Allows for Lower Down Payments As noted, Figure’s new Piggyback HELOC aims to serve both new home buyers and existing homeowners. Those still searching for that right property can use the HELOC as a second mortgage that closes concurrently with a first mortgage, hence the name piggyback. For example, they can take out a first mortgage at an 80% loan-to-value ratio (LTV) and the HELOC for another 10% or more. This is known as an 80/10/10 loan. Other variations include 80/20 loans, which indicates zero down payment. These were quite popular during the early 2000s. It’s unclear how high Figure will go on this product, but my understanding is their max CLTV is 95%. In other words, you might be able to take out a first and second mortgage while bringing in just five percent down payment. This would be an 80/15/5. The use of a... --- > I often try to find silver linings in bad situations. The latest issue facing prospective home buyers is a return to 7% mortgage rates, up from around 6% - Published: 2024-10-29 - Modified: 2024-10-29 - URL: https://www.thetruthaboutmortgage.com/home-buyers-use-high-mortgage-rates-as-an-excuse-to-get-a-lower-price/ - Categories: Home Buying I often try to find silver linings in bad situations. The latest issue facing prospective home buyers is a return to 7% mortgage rates, up from around 6% just one month ago. While there’s not a clear, negative correlation between mortgage rates and home prices, in that one goes up and the other down, you can still make that argument to a home seller. If you’re currently in the market to buy a home, you can use this big move higher in mortgage rates to your advantage. Simply put, home buyers can make the argument that it got more expensive to buy a home and therefore ask for a discount. Buying a Home? Ask for a Discount in Light of Higher Mortgage Rates A month ago, you could get a 30-year fixed mortgage for around 6%. Today, prospective home buyers are looking at a rate closer to 7%. Or higher! And it’s possible it could get even worse before it gets better given all the uncertainty flowing at the moment. Instead of fretting about the higher monthly payment, you can use this to your advantage and make a lowball offer. Home sellers will be well aware that mortgage rates have risen, and that housing affordability has worsened. As such, you can lower your offer price and hope the seller goes with it. When making an offer, be sure to have your agent communicate this to their agent so your lower offer price has a better chance of being accepted. While... --- > Both Fannie Mae and Freddie Mac announced newly expanded appraisal waivers to reduce costs and help more first-time home buyers purchase a property. The - Published: 2024-10-28 - Modified: 2025-01-29 - URL: https://www.thetruthaboutmortgage.com/fannie-and-freddie-expand-appraisal-waivers-to-even-more-home-buyers/ - Categories: Mortgage News Both Fannie Mae and Freddie Mac announced newly expanded appraisal waivers to reduce costs and help more first-time home buyers purchase a property. The pair already offer appraisal waivers on some of the loans they guarantee, but the loan-to-value ratio (LTV) is currently capped at 80%. This means you must come in with a least a 20% down payment to avoid the cost and potential hassle of a traditional appraisal. To further streamline this process and ease the burden on lower-income borrowers, this number will increase to 90% LTV beginning in the first quarter of 2025. And it will be expanded to the program limits (e. g. 97% LTV) for their more robust inspection-based appraisal waivers. You Might Not Need an Appraisal for Your Next Home Purchase While appraisal waivers aren’t all that new; they were introduced by Fannie Mae in 2016 for refinance transactions and later expanded to home purchases in 2017, they’re limited in reach. In other words, many home buyers still need to pay for an appraisal when they apply for a mortgage. This results in an added cost, which can range from say $400 to $1,000 or more. And a longer home loan process as the appraisal is ordered, conducted, and submitted. It can also lead to uncertainty regarding the collateral value, possibly jeopardizing the loan late in the game if the human appraiser returns with a value below the purchase price. For these reasons, receiving an appraisal waiver can be a blessing. What’s not to... --- > Another fintech has been quietly growing in the mortgage space, looking to solve the age-old “buy before you sell” conundrum. A major challenge for - Published: 2024-10-24 - Modified: 2024-10-24 - URL: https://www.thetruthaboutmortgage.com/calque-mortgage-looks-to-solve-the-buy-before-you-sell-problem/ - Categories: Mortgage News Another fintech has been quietly growing in the mortgage space, looking to solve the age-old “buy before you sell” conundrum. A major challenge for prospective move-up buyers these days is unloading their old property while securing a new residence. Exacerbating the issue is a continued lack of for-sale inventory, coupled with waning affordability thanks to high home prices and mortgage rates. This can make it difficult to float two mortgage payments while finding a buyer for their old home. Enter Calque, which partners with local mortgage lenders to ensure the home loan piece is solved. Calque’s Trade-In Mortgage The Austin, Texas-based company actually offers two products to make it easier to buy and sell a home at the same time. Their so-called “Trade-In Mortgage” allows home sellers to gain access to their home equity ahead of time without needing to sell first. This second mortgage acts as a bridge loan, freeing up liquidity so you can make a stronger offer. And it comes with a guaranteed back-up offer where Calque will buy your old home, allowing you to submit cash-like offers. This gives buyers increased purchasing power in a number of different ways, whether it’s an increased down payment, larger cash reserves, or the ability to pay off other high-cost debt. It can also make the buyer more competitive in a housing market that continues to be plagued by low inventory. If you find yourself in a bidding war, coming in with a larger down payment can help you win... --- > We’re currently in a strange sort of housing crisis where existing homeowners are in a fantastic spot, but prospective buyers are mostly priced out. The - Published: 2024-10-24 - Modified: 2024-10-25 - URL: https://www.thetruthaboutmortgage.com/the-second-mortgage-sales-pitch-is-coming-be-ready/ - Categories: Mortgage Tips We’re currently in a strange sort of housing crisis where existing homeowners are in a fantastic spot, but prospective buyers are mostly priced out. The issue is both an affordability problem and a lack of available inventory problem. Namely, the type of inventory first-time home buyers are looking for. So you’ve got a market of haves and have nots, and a very wide gap between the two. At the same time, you’ve got millions and millions of locked-in homeowners, with mortgages so cheap they’ll never refinance or sell. This exacerbates the inventory problem, but also makes it difficult for mortgage lenders to stay afloat due to plummeting application volume. The solution? Offer your existing customers a second mortgage that doesn’t disturb the first. Loan Servicers Want to Do More Than Service Your Loan Over the past several years, mortgage loan servicers have been embracing technology and making big investments to ramp up their recapture game. They’re no longer satisfied with simply collecting monthly principal and interest payments, or managing your escrow account. Realizing they’ve got a goldmine of data at their fingertips, including contact information, they’re making big moves to capture more business from their existing clientele. Why go out and look for more prospects when you’ve got millions in your own database? Especially when you know everything about your existing customers? Everyone knows mortgage rate lock-in has effectively crushed rate and term refinance demand. And cash out refinances are also a non-starter for many homeowners unless they have other... --- > With mortgage rates surging higher again, somewhat unexpectedly, a thought came to my mind if you’re currently home shopping. A couple years ago, I threw - Published: 2024-10-23 - Modified: 2024-10-23 - URL: https://www.thetruthaboutmortgage.com/use-a-higher-mortgage-rate-when-shopping-for-a-home-to-stay-within-budget/ - Categories: Mortgage Tips With mortgage rates surging higher again, somewhat unexpectedly, a thought came to my mind if you’re currently home shopping. A couple years ago, I threw out the idea to adjust your maximum purchase price lower when looking for a property. That post was driven by the many home sales that were going way above asking at the time. In other words, a home may have been listed for $600,000, but eventually sold for $700,000 in a bidding war. That was all to do with a very hot housing market, driven in large part by a combination of record low mortgage rates and very low for-sale supply. Today, we still have relatively low inventory, but the cheap mortgage rates have come and gone. And now that they’re so volatile, you may want to input a higher rate into your mortgage calculator to ensure you don’t get caught out. Mortgage Rates Are Highly Volatile Right Now At the moment, mortgage rates are super unpredictable. While they had enjoyed a very good 11 months, falling from as high as 8% to nearly 6% in early September, they’ve since reversed course. The 30-year fixed was nearly back into the high 5% range before the Fed cut rates and a better-than-expected jobs report arrived. Sprinkle in some doubting about the Fed’s pivot and the upcoming uncertainty regarding the election outcome and home buyers are now facing a rate nearly 1% higher. Per MND, the 30-year fixed has risen from a low of 6. 11% on... --- > When the housing market crashed in the early 2000s, new mortgage rules emerged to prevent a similar crisis in the future. The Dodd-Frank Act gave us both - Published: 2024-10-22 - Modified: 2024-10-23 - URL: https://www.thetruthaboutmortgage.com/is-it-time-to-bring-back-the-mortgage-prepayment-penalty/ - Categories: Mortgage News When the housing market crashed in the early 2000s, new mortgage rules emerged to prevent a similar crisis in the future. The Dodd-Frank Act gave us both the Ability-to-Repay Rule and the Qualified Mortgage Rule (ATR/QM Rule). ATR requires creditors “to make a reasonable, good faith determination of a consumer's ability to repay a residential mortgage loan according to its terms. ” While the QM rule affords lenders “certain protections from liability” if they originate loans that meet that definition. If lenders make loans that don’t include risky features like interest-only, negative amortization, or balloon payments, they receive certain protections if the loans happen to go bad. This led to most mortgages complying with the QM rule, and so-called non-QM loans with those outlawed features becoming much more fringe. Another common feature in the early 2000s mortgage market that wasn’t outlawed, but became more restricted, was the prepayment penalty. Given prepayment risk today, perhaps it could be reintroduced responsibly as an option to save homeowners money. A Lot of Mortgages Used to Have Prepayment Penalties In the early 2000s, it was very common to see a prepayment penalty attached to a home loan. As the name suggests, homeowners were penalized if they paid off their loans ahead of schedule. In the case of a hard prepay, they couldn’t refinance the mortgage or even sell the property during a certain timeframe, typically three years. In the case of a soft prepay, they couldn’t refinance, but could openly sell whenever they wished... --- > This might sound like a no-brainer question, but there are several scenarios where mortgage payments can rise, even if your rate is fixed. - Published: 2024-10-21 - Modified: 2025-03-19 - URL: https://www.thetruthaboutmortgage.com/do-mortgage-payments-increase/ - Categories: Mortgage Tips Mortgage Q&A: “Do mortgage payments increase? ” Wondering why your mortgage keeps going up? While this sounds like a no-brainer question, it's actually a little more complicated than it appears. You see, there a number of different reasons why a mortgage payment can increase, aside from the obvious interest rate change. But let's start with that one and go from there. And yes, even if you have a fixed-rate mortgage your monthly payment can increase! You're not out of the woods. While that might sound like bad news, it's good to know what's coming so you can prepare accordingly. Why Did My Mortgage Go Up? Your property tax bill increased (and your loan has impounds) Your homeowners insurance bill increased (and your loan has impounds) You have an adjustable-rate mortgage (ARM) and it adjusted higher You had a temporary rate buydown that ended Your interest-only period came to an end Mortgage Payments Can Increase with Interest Rate Adjustments If you have an ARM your monthly payment can go up or down This is possible each time it adjusts, whether every six months or annually To avoid this payment surprise, simply choose a fixed-rate mortgage instead FRMs are actually pricing very close to ARMs anyway so it could be in your best interest just to stick with a 15- or 30-year fixed Here's the easy one. If you happen to have an adjustable-rate mortgage, your mortgage rate has the ability to adjust both up or down, as determined by the interest... --- > If you’ve been paying attention, you may have noticed that mortgage rates have quietly crept back up to nearly 7%. While it appeared that those 7% - Published: 2024-10-21 - Modified: 2024-10-21 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-take-time-to-fall-so-be-patient/ - Categories: Mortgage Rates If you’ve been paying attention, you may have noticed that mortgage rates have quietly crept back up to nearly 7%. While it appeared that those 7% mortgage rates were a thing of the past, they seemed to return just as quickly as they disappeared. For reference, the 30-year fixed averaged around 8% a year ago, before beginning its descent to nearly 6% in early September. It appeared we were destined for 5% rates again, then the Fed rate cut happened. While the Fed itself didn’t “do anything,” their pivot coincided with some positive economic reports. Combined with a “sell the news” event of the Fed cut itself, rates skyrocketed. However, now might be a good time to remind you that rates do tend to fall for a while after rate cuts begin. Falling Rates Often Play Out Over Years, Not Months As noted, the Fed pivoted, aka lowered its own fed funds rate, in September. They did so after increasing their rate 11 times during a period of tightening. Hence the word “pivot,” as they switch from raising rates to lowering rates. In short, the Fed determined monetary policy was sufficiently restrictive, and it was time to loosen things up. This tends to result in lower borrowing rates over time. While many falsely assumed the pivot would lead to even lower mortgage rates overnight, those “in the know” knew those cuts were mostly already baked in, at least for now. So when the Fed cut, mortgage rates actually drifted a... --- > I came across a report from CoreLogic the other day that said home equity loan lending increased to its highest level since 2008. Whenever anyone hears - Published: 2024-10-17 - Modified: 2024-10-17 - URL: https://www.thetruthaboutmortgage.com/is-home-equity-lending-really-that-crazy-today/ - Categories: Mortgage News I came across a report from CoreLogic the other day that said home equity loan lending increased to its highest level since 2008. Whenever anyone hears the date “2008,” they immediately think of the housing bubble in the early 2000s. After all, that’s when the housing market went absolutely sideways after the mortgage market imploded. It’s the year we all use now as a barometer to determine if we’re back to those unsustainable times, which can only mean one thing: incoming crisis. However, nuance is important here and I’m going to tell you why the numbers from 2008 and the numbers from 2024 aren’t quite the same. First Let’s Add Some Context CoreLogic economist Archana Pradhan noted that home equity loan lending (not HELOCs) grew to the highest point since the first half of 2008 during the first two quarters of 2024. During the first half of this year, mortgage lenders originated more than 333,000 home equity loans totaling roughly $23. 6 billion. For comparison sake, lenders originated $29. 9 billion in home equity loans during the first half of 2008, just before the housing market began to crash. It was the last big year for mortgage lending before the bottom fell out. For reference, home equity lending totaled just $6. 4 billion in 2009 and barely surpassed $5 billion annually up until 2021. Part of the reason it fell off a cliff was due to credit conditions becoming frozen pretty much overnight. Banks and lenders went out of business,... --- > The nation’s largest mortgage lender, UWM, has launched a new 90% LTV cash-out refi to drum up more business. While it’s being sold to mortgage - Published: 2024-10-16 - Modified: 2024-10-16 - URL: https://www.thetruthaboutmortgage.com/uwm-is-now-offering-90-ltv-cash-out-refis-should-we-worry/ - Categories: Mortgage News The nation’s largest mortgage lender, UWM, has launched a new 90% LTV cash-out refi to drum up more business. While it’s being sold to mortgage broker-partners as a way to “win more business,” it doubles as a worrisome trend of loosening underwriting guidelines. Typically, homeowners are capped at 80% LTV when it comes to a cash out refinance, but UWM is taking things a little further. This could be the symptom of low volume, which has plagued many mortgage lenders ever since mortgage rates jumped in mid-2022. And it could be a sign that some American consumers are struggling to make ends meet as they grapple with surging inflation. Conventional Cash-Out 90 Lets You Borrow More Than the Other Guys Cash out refinance up to 89. 99% LTV Loan amount capped at the conforming loan limit Must be a primary residence Minimum FICO score of 680 required No mortgage insurance required (might be built into rate) First let’s talk about this new loan program, known as "Conventional Cash-Out 90," then we’ll talk about whether it’s worrisome or not. As noted, United Wholesale Mortgage (UWM) will now let you cash out up to 90% of your property value. Technically, it’s capped at 89. 99% LTV, but it’s still considered a conventional loan. Note that there’s a difference between conventional and conforming loans. Both are non-government loans, but conforming loans must meet the guidelines of Fannie Mae or Freddie Mac. And Fannie Mae and Freddie Mac have a maximum 80% loan-to-value ratio... --- > At first glance, assumable mortgages sound like an awesome solution to a problem home buyers have been facing lately. With mortgage rates now closer to - Published: 2024-10-15 - Modified: 2024-10-15 - URL: https://www.thetruthaboutmortgage.com/assumable-mortgages-have-a-down-payment-problem/ - Categories: Home Buying At first glance, assumable mortgages sound like an awesome solution to a problem home buyers have been facing lately. With mortgage rates now closer to 6. 5% instead of 3%, housing affordability has suffered greatly. It’s now at its worst levels in decades. Coupled with ever-rising home prices, many would-be buyers have essentially been locked out of the housing market. But with an assumable loan, you can take on the seller’s mortgage, which these days is often super low, sometimes even sub-3%. While that all sounds good and well, there’s a pretty sizable (literal) problem: the down payment. Wait, How Much Is the Down Payment? As noted, an assumable mortgage allows you to take on the seller’s mortgage. So the mortgage rate, the remaining loan balance, and the remaining loan term all become yours. For example, say a home seller got a 2. 75% 30-year fixed five years ago when mortgage rates hit record lows. Let’s pretend the loan amount was $500,000. Today, they’re selling the property and the outstanding balance is roughly $442,000. The remaining loan term is 25 years. It’d be great to inherit that low-rate mortgage from the seller instead of settling for a rate of say 6. 5%. Here’s the tricky part. The difference between the new sales price and the outstanding loan amount. Let’s pretend the seller listed the property for $700,000. Remember, home prices have surged over the past decade, and even over just the past five years. In some metros, they’re up about... --- > Last week, I argued that mortgage rates remain in a downward trend, despite some pullback lately. The 30-year fixed had almost been sub-6% when the Fed - Published: 2024-10-14 - Modified: 2024-10-14 - URL: https://www.thetruthaboutmortgage.com/a-temporary-buydown-could-make-sense-while-mortgage-rates-continue-to-fall/ - Categories: Refinance Last week, I argued that mortgage rates remain in a downward trend, despite some pullback lately. The 30-year fixed had almost been sub-6% when the Fed announced its rate cut. That “sell the news” event led to a little bounce for rates. Then a hotter-than-expected jobs report days later pushed the 30-year up to 6. 5% and rates kept creeping higher from there. They’re now closer to 6. 625% and have reignited fears that the worst may not yet be behind us. Whether that’s true or not, you can’t get a rate as low as you could just three weeks ago, and that makes the temporary buydown attractive again. You Don’t Get Your Money Back on a Permanent Buydown While some home buyers and mortgage refinancers were able to lock-in sub-6% rates in September, many are now looking at rates closer to 7% again. This has made mortgage rates unattractive again, especially since there aren’t many lower-cost options around these days, such as adjustable-rate mortgages. You’re basically stuck going with a 30-year fixed that isn’t worth keeping for anywhere close to 30 years. And you’re paying a premium for it because the rate won’t adjust for the entire loan term. One option to make it more palatable is to pay discount points to get a lower rate from the get-go. But there’s one major downside to that. When you buy down your rate with discount points, it’s permanent. This means the money isn’t refunded if you sell or refinance early... --- > Over the past several years, we’ve been entirely focused on high mortgage rates. The 30-year fixed surged from sub-3% levels to around 8% in the span of - Published: 2024-10-10 - Modified: 2024-10-10 - URL: https://www.thetruthaboutmortgage.com/are-mortgage-rates-just-a-distraction-for-high-home-prices/ - Categories: Housing Market Over the past several years, we’ve been entirely focused on high mortgage rates. The 30-year fixed surged from sub-3% levels to around 8% in the span of less than two years. This obviously got the attention of everyone, whether it was the media or everyday Americans. But often it felt like home prices were overshadowed by interest rates, despite also surging higher. In the United States, home prices have risen nearly 50% since just 2019, and have basically doubled since bottoming a decade ago. We’re Focused on Mortgage Rates, But What About Home Prices? I get it, the rise in mortgage rates was unprecedented. While they only went up to around 8% this cycle, the increase in such a short period is record-breaking stuff. For context, the 30-year fixed went from about 3% to 8%, which is a 167% gain, from early 2022 to late 2023. That’s an extremely small window of time to see such an increase. Conversely, the 1980s mortgage rates went from 9% to 18%, only a 100% increase. And it took four years. They only didn’t stay that high for more than a few months before retreating back to the low teens. Either way, it’s clear mortgage rates have been top of mind for everyone because of this dramatic rise. And the higher rates have had real implications. Housing affordability was historically okay prior to the mortgage rate run-up, but quickly surpassed the early 2000s housing bubble peak late last year, per ICE (see chart below).... --- > It’s not quite Halloween just yet, but home buyers may have already gotten a good scare. The 30-year fixed mortgage, for which most buyers rely upon, - Published: 2024-10-10 - Modified: 2024-10-10 - URL: https://www.thetruthaboutmortgage.com/is-this-mortgage-rate-scare-going-to-get-home-buyers-off-the-fence/ - Categories: Home Buying It’s not quite Halloween just yet, but home buyers may have already gotten a good scare. The 30-year fixed mortgage, for which most buyers rely upon, jumped from around 6% to nearly 6. 75% in the span of about three weeks. And this took place right after the Fed finally pivoted and cut its own fed funds rate. Good timing I know. Prior to this rate reversal, mortgage rates had steadily fallen all the way from 8%, their present cycle high that ironically took place just before last Halloween. Talk about a good year for rates, moving down two full percentage points. But the trend is no longer our friend, at least in the interim. Now I’d like to make a case for why this actually might be good for the housing market. Higher Mortgage Rates Might Motivate More Than Lower Rates I know what you’re thinking, higher mortgage rates can’t possibly be good for the struggling housing market. Especially this housing market, which is presently one of the most unaffordable in recent history. But bear with me here. I got to thinking recently how the low mortgage rates didn’t seem to get prospective home buyers off the fence. As noted, rates came down quite a bit from their cycle highs, falling about two percentage points. In Mid-September, you could get a 30-year fixed for around 6% for the average loan scenario. And in reality, much lower if you had a vanilla loan (high FICO, 20% down, etc. ) and/or... --- > Did those higher mortgage rates ruin your plans to refinance your mortgage? Well, there might be a temporary solution to save some money while you wait - Published: 2024-10-09 - Modified: 2024-10-09 - URL: https://www.thetruthaboutmortgage.com/if-you-cant-refinance-you-can-make-larger-mortgage-payments-each-month-instead/ - Categories: Mortgage Tips Did those higher mortgage rates ruin your plans to refinance your mortgage? Well, there might be a temporary solution to save some money while you wait for interest rates to move lower again. Assuming you have the extra cash on hand, you can reduce your interest expense by simply paying more each month until you refi. For example, pay an additional $100, $250, or $500 per month and you’ll save on interest and knock down your loan balance. In the process, you will reduce the effective interest rate on your existing home loan and potentially make it easier to refinance later. You Can Still Save Money Without a Refinance First off, you can save money on your mortgage without refinancing if you simply pay extra each month. Let’s consider a simple example where you’ve got a 7% mortgage rate and a $400,000 loan balance. The monthly principal and interest payment is $2,661. 21. In just one year, you’d pay $27,871. 29 in interest. Now imagine you pay an extra $500 per month to save on that interest. The payment is $3,161. 21 per month. After a year, your outstanding balance would be $389,740. 45 instead of $395,936. 77. After 24 months, the balance would drop to $378,739. 26 instead of $391,579. 82. Your total interest expense for that period would fall from $55,448. 86 to $54,608. 30. That’d be about $840 in interest saved and a balance that is $12,841 lower. The cost would be $12,000 ($500x24 months) for savings... --- > In the mortgage rate world, it’s sometimes a game of inches. This can be true for both prospective home buyers and existing homeowners looking for rate - Published: 2024-10-09 - Modified: 2024-10-09 - URL: https://www.thetruthaboutmortgage.com/five-million-refinances-hinge-on-mortgage-rates-falling-back-to-5-5/ - Categories: Refinance In the mortgage rate world, it’s sometimes a game of inches. This can be true for both prospective home buyers and existing homeowners looking for rate relief. Granted, if you’re that marginal when it comes to affording a home, maybe you should consider renting until it’s a little more decisive. But if you already own a home and hold a high mortgage rate, the next six months or so could make or break your refinance opportunity. Lately, mortgage rates have retraced from their recent lows of just over 6%, returning to levels around 6. 625%. As a result, many millions of homeowners are no longer “in the money” for a refinance. But that could change in an instant, just as it already has. Are Current Mortgage Rates at Least 0. 75% Below Your Rate? A new report from ICE revealed that the refinance population climbed to over 4. 3 million thanks to the rally in rates that came to an abrupt end, ironically after the Fed cut rates. At that time, the 30-year fixed mortgage was averaging around 6. 125%, down from nearly 7% as recently as late July. That meant the refinanceable population had surged from around 1. 2 million to 4. 3 million in a matter of less than two months. Of these 4. 3M, a whopping 65% received their mortgages over the past two years, including 1. 4M in 2023 and 1. 3M this year. So that whole date the rate, marry the house thing could actually... --- > Ever since the Fed announced their 50-basis point cut, mortgage rates have been climbing higher. In fact, they’re basically 50 bps higher since the Fed - Published: 2024-10-08 - Modified: 2024-10-08 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-dont-move-in-a-straight-line-up-or-down/ - Categories: Mortgage Rates Ever since the Fed announced their 50-basis point cut, mortgage rates have been climbing higher. In fact, they’re basically 50 bps higher since the Fed cut their own federal funds rate (FFR) 50 bps lower. While we know the Fed doesn’t control mortgage rates, it does seem unusual to see such a disconnect. But the first important thing to remember here is the Fed’s rate is a short-term one, and mortgage rate are long-term rates, aka the 30-year fixed. So it’s not really about the Fed. However, this is a good reminder that mortgage rate trends never move in a straight line. Mortgage Rates Seesawed on the Way Up If you recall mortgage rates’ ascent from sub-3% to 8% (yes, 8%! ), it wasn’t just a straight line up. Just take a look at my annotated chart from Mortgage News Daily for evidence of this, where I highlighted all the pullbacks. There were days, weeks, and even months when mortgage rates went down. For example, the 30-year fixed climbed from around 3% in January 2022 to roughly 6. 25% that June. Then mortgage rates “rallied” a bit and fell to around 5% (quotes in the high-4% range) by that August. Did that mean the worst was behind us? Nope. It sure didn’t. Instead, mortgage rates resurged and climbed to a new cycle high above 7% by that October. Things were looking pretty bleak until another relief rally took place, sending the 30-year fixed back down to 5. 99% by February... --- > Recently, Zillow began airing a commercial called “Homeowner Mates.” It depicts three women moving into a home together. It shows their individual - Published: 2024-10-07 - Modified: 2024-10-07 - URL: https://www.thetruthaboutmortgage.com/dont-buy-a-home-with-friends/ - Categories: Mortgage Tips Recently, Zillow began airing a commercial called “Homeowner Mates. ” It depicts three women moving into a home together. It shows their individual “BuyAbility” followed by “Your BuyAbility,” the latter of which combines the purchasing power of all three. The three women have individual buying power of $117,000, $124,000, and $131,000, but a combined $372,000 when pooled together. This apparently allows them to go in on that near-$400,000 home purchase, despite not being anywhere close on their own. While having co-borrowers does indeed boost your purchasing power, the question is it a good idea when it's a friend (or two)? It’s Hard Enough to Buy a Home on Your Own When I first saw this commercial, I was pretty taken aback. It felt somewhat irresponsible, and a lot related to the current housing market being unaffordable for most. For me, that doesn’t mean forcing your way into a purchase. It might mean holding off on your homeownership goal, saving up more money, perhaps hoping for a raise, and generally getting all your ducks in a row. Oh, and maybe lowering your maximum purchase price to something you can actually afford! Instead, Zillow presents a solution to just find a couple close friends and buy the house today. It pretty much ignores what happens after the dust settles and the moving boxes are unpacked. It doesn't get into what happens when one of the roommates wants to move out. It also seemingly glosses over who gets what room, or what happens... --- > Over the past several years, mortgage lenders have been offering “early bird” conforming loan limits for the upcoming year. This allows them to make - Published: 2024-10-01 - Modified: 2025-01-15 - URL: https://www.thetruthaboutmortgage.com/did-mortgage-lenders-raise-their-early-bird-2025-conforming-loan-limits-too-high/ - Categories: Mortgage Tips Over the past several years, mortgage lenders have been offering “early bird” conforming loan limits for the upcoming year. This allows them to make bigger loans that adhere to the underwriting guidelines of Fannie Mae and Freddie Mac without them being considered jumbo loans. Instead of waiting until January 1st, they make a projection for where the loan limit will land the next year and offer it around the fourth quarter. For example, in early October 2023 some lenders raised the 2024 loan limit to $750,000 ahead of the announcement that came in late November. That loan limit wound up being $766,550, which meant the lenders who offered the higher loan limits ahead of time didn’t get caught out. But that only worked because home prices kept on marching higher and higher. Some Lenders Are Already Offering 2025 Conforming Loan Limits as High as $803,500 Like last year, lenders haven’t waited for the conforming loan limit announcement in late November to raise it. And this year it has come even earlier than in years’ past. It has actually become a sort of game between competing mortgage companies to be the first out of the gate. Rocket Pro TPO, the wholesale division of Rocket Mortgage, was first to come out with the 2025 loan limits this year. On September 13th, they announced a limit of $802,650, up from the current limit of $766,550. This represents a 4. 7% increase. While that seems like a fairly reasonable estimate, home price appreciation has... --- > When mortgage rates surged off their record lows in early 2022, the housing market ground to a halt. In the span of less than 10 months, 30-year fixed - Published: 2024-10-01 - Modified: 2024-10-01 - URL: https://www.thetruthaboutmortgage.com/maybe-homeowners-are-struggling-with-mortgage-loan-amount-lock-in/ - Categories: Housing Market When mortgage rates surged off their record lows in early 2022, the housing market ground to a halt. In the span of less than 10 months, 30-year fixed mortgage rates climbed from the low-3% range to over 7%. While a 7% mortgage rate is historically “reasonable,” the percentage change in such a short period was unprecedented. Mortgage rates increased about 120% during that time, which was actually worse than those 1980s mortgage rates you’ve heard about in terms of velocity of change. The rapid ascent of interest rates was severe enough to introduce us to a new phrase, mortgage rate lock-in. In short, existing homeowners became trapped in their properties seemingly overnight because they couldn’t leave their low rates behind and exchange them for much higher ones. Either because it was cost-prohibitive or simply unappealing to do so. And there isn’t a quick fix because your typical homeowner has a 30-year fixed mortgage in the 2-4% range. Mortgage Rates Have Come Down, But What About Loan Amounts? There’s been so much focus on mortgage rates that I sometimes feel like everyone forgot about sky-high loan amounts. Mortgage rates climbed as high as 8% a year ago, but have since fallen to around 6%. And can be had for even lower if you pay discount points. So in some regard, mortgage rate lock-in has eased, yet housing affordability remains constricted. For the typical home buyer who needs a mortgage to get the deal done, there are two main components of the... --- > Even though mortgage rates have fallen quite a bit from their highs seen a year ago, they remain quite elevated relative to much of the past decade. Sure, - Published: 2024-09-30 - Modified: 2024-09-30 - URL: https://www.thetruthaboutmortgage.com/those-double-digit-mortgage-rates-from-the-80s-required-you-to-pay-points-too/ - Categories: Mortgage News, Mortgage Rates Even though mortgage rates have fallen quite a bit from their highs seen a year ago, they remain quite elevated relative to much of the past decade. Sure, a 6% 30-year fixed is better than an 8% 30-year fixed, but it’s still a far cry from a 3 or 4% 30-year fixed. This might explain why prospective home buyers haven’t exactly rushed back into the housing market in recent months. And now we’re being told this is as good as it’s going to get for mortgage rates. That remains to be seen, but what’s interesting is I’ve seen quotes down into the high-4s for mortgage rates recently too. So how are lenders able to advertise rates that low if the Freddie Macs of the world are telling us rates are still above 6%? Well, the secret is a little thing called mortgage discount points. Mortgage Rates Are Lower When You Pay Points After mortgage rates surged since beginning in early 2022, the secondary market where investors buy and sell mortgage-backed securities (MBS) got all out of whack. Basically, uncertainty and volatility surged while volume plummeted. Long story short, MBS investors wanted more assurances, which generally meant borrowers had to pay points upfront. This ensured a profit even if the mortgage was short-lived and paid off in a short period of time. It also allowed lenders to keep mortgage rates from going even higher, completely decimating lending volume in the process. Conditions have since improved, and it’s again possible to get... --- > Well, it’s been over a week since the Fed cut rates and mortgage rates went up. While this may have come as a surprise to some, seasoned mortgage industry - Published: 2024-09-27 - Modified: 2024-09-27 - URL: https://www.thetruthaboutmortgage.com/is-this-as-good-as-mortgage-rates-get-for-now/ - Categories: Mortgage News, Mortgage Rates Well, it’s been over a week since the Fed cut rates and mortgage rates went up. While this may have come as a surprise to some, seasoned mortgage industry peeps didn’t bat an eye. It’s pretty common for the Fed to do one thing and mortgage rates to do another. Without getting too convoluted, the Fed adjusts short-term rates while mortgages are long-term rates, aka the 30-year fixed. In other words, the cut (and future cuts too) were already priced in to mortgage rates. So much so that they actually increased over the past week in a sort of “sell the news” correction. Are Mortgage Rates Still Dropping? Fitch Ratings recently came out and said the 50-basis point Fed rate cut was already priced in to both the 10-year Treasury yield and 30-year fixed mortgage rates. In addition, they argued that the 10-year yield, which tracks mortgage rates historically, has “less room to decline” because of that. It basically already came down in anticipation and might be difficult to drop much lower. In fact, we’ve seen it rise since the Fed cut last week. The 10-year yield was as low as 3. 61% and now sits around 3. 77%, putting some mild upward pressure on mortgage rates since then. Rates actually looked destined for the high-5% range before pulling back and inching their way back toward 6. 25%. And with little economic data out this week, there’s been no reason for them to rally. But next week we get the... --- > I know, I know, mortgage shopping is the worst. It’s not a fun thing to do. It’s not like shopping for a new car or a new TV, or even a new house. But - Published: 2024-09-26 - Modified: 2024-09-26 - URL: https://www.thetruthaboutmortgage.com/the-other-reason-you-should-shop-around-for-your-mortgage/ - Categories: Home Buying, Mortgage Rates, Mortgage Tips, Refinance I know, I know, mortgage shopping is the worst. It’s not a fun thing to do. It’s not like shopping for a new car or a new TV, or even a new house. But it’s a necessary evil unless you’ve got a boatload of cash. The reason it’s not fun is because there’s lot of math, paperwork, and high-pressure salespeople involved. Not to mention lots of mortgage lingo that will likely go over your head. But there’s a silver lining to putting in all that time to shop; you’ll learn a lot about mortgages. I Get It, Mortgages Aren’t Fun Look, I’ll be the first person to tell you that mortgages are boring af. I’ve been writing about them for nearly 20 years now. And before that, I was working on the frontlines with mortgage brokers and loan processors and underwriters. None of it was fun, and it’s probably even less fun when you’re new to it and simply trying to get through it. Conversely, you might have a blast shopping for a new car and doing test drives while checking out all the cool features. The same goes for new clothes, a new TV, computer, etc. They call it retail therapy for a reason. I’ve never heard anyone say mortgage shopping is therapeutic. In fact, it’s usually the exact opposite. Typically, people say they’d rather go to the dentist than go through the mortgage process. Okay, so what’s the point here? Well, as mentioned, you can learn a lot... --- > While lower mortgage rates have reinvigorated hope for the stalling housing market, 2025 might not wind up much better than 2024. Sure, lower interest - Published: 2024-09-25 - Modified: 2024-09-25 - URL: https://www.thetruthaboutmortgage.com/home-purchase-lending-expected-to-be-lackluster-in-2025-despite-lower-rates/ - Categories: Home Buying, Housing Market, Mortgage Rates While lower mortgage rates have reinvigorated hope for the stalling housing market, 2025 might not wind up much better than 2024. Sure, lower interest rates boost affordability, but there are other components to a home purchase that remain cost-prohibitive. Whether it’s simply an asking price that’s out of reach, or rising insurance premiums and lofty property taxes. Or other monthly bills that eat away at the housing budget. This explains why mortgage origination forecasts for purchase lending continue to be pretty dismal. However, the emerging trend of rising mortgage refinance volume should get stronger into 2025. 2024 Purchase Volume Has Been Revised Down A new report from iEmergent revealed that 2024 purchase mortgage originations are projected to fall in terms of loan count when compared to 2023. In other words, despite lower mortgage rates, the number of home purchase loans is now expected to fall below 2023 levels. However, thanks to an increase in average loan size, the company believes purchase loan volume will still see a modest increase of 3. 5% year-over-year. To blame is still-high mortgage rates, which peaked about a year ago and have since fallen nearly two percentage points. But home prices remain elevated, and when combined with a 6% mortgage rate and steep insurance premiums and rising property taxes, the math often doesn’t pencil. Adding to affordability woes is the continued lack of existing home supply. There simply aren’t enough homes for sale, which has kept prices high in spite of reduced demand. Refis Expected... --- > There is apparently a “home cost crisis,” and a new fintech company called Mesa is looking to solve that. It’s no secret that home prices are through the - Published: 2024-09-24 - Modified: 2025-04-25 - URL: https://www.thetruthaboutmortgage.com/mesa-wants-to-reward-you-for-every-dollar-you-spend-on-your-home/ - Categories: Home Buying, Mortgage News There is apparently a “home cost crisis,” and a new fintech company called Mesa is looking to solve that. It’s no secret that home prices are through the roof, and when coupled with much higher mortgage rates and things like skyrocketing homeowners insurance, it can put homeownership out of reach. Or at the very least, make it a struggle for the average American to keep up. To ease this burden, the company has rolled out a suite of products to make homeownership a little more affordable. Perhaps ironically, this new company operates out of Austin, Texas, one of the hardest hit housing markets nationwide. The popular metro has suffered from a glut of housing supply as many remote tech workers packed their bags and moved back to wherever they came from. What Is Mesa? Referred to as the “first homeowner membership platform,” Mesa is actually a group of offerings aimed at making homeownership cheaper and more valuable. This means putting better mortgage deals in front of prospective home buyers and giving them rewards when they make housing-related purchases. Their first two products are the Mesa Mortgage Marketplace and the Mesa Homeowners Card. The marketplace appears to operate similar to the Zillow Mortgage Marketplace. Prospective home buyers and existing homeowners looking to refinance can compare lenders in one place. And aside from maybe scoring a lower rate and/or reduced closing costs, they can earn a portion of the loan amount back in rewards points. Those who take out a loan via... --- > Want to lower your mortgage rate without a traditional refinance? Look into a “mortgage rate modification,” which does just that. Instead of having to - Published: 2024-09-23 - Modified: 2024-09-23 - URL: https://www.thetruthaboutmortgage.com/what-is-a-mortgage-rate-modification/ - Categories: Mortgage Rates, Mortgage Tips, Refinance Want to lower your mortgage rate without a traditional refinance? Look into a “mortgage rate modification,” which does just that. Instead of having to contact lenders, fill out applications, and provide stacks of paperwork, you might be able to get payment relief by simply signing a modification agreement. Aside from it being easier than a refinance, it could cut the processing time down from a month plus to just a week or so. That means if you start the process early in the month, your very next mortgage payment could be lower. While that all sounds great, there are some limitations you should be aware of, and like a refinance, fees are typically charged as well. How a Mortgage Rate Modification Works As the name suggests, a mortgage rate modification allows you to lower the interest rate on your existing home loan without going through the formal refinance process. Instead, you are simply asked to fill out a modification agreement with your current loan information, including mortgage rate and loan product, along with desired loan program and current interest rate. For example, if you currently hold a 30-year fixed-rate mortgage set at 7%, you’d enter that into the form and then select the type of loan you’d like going forward. This could be another 30-year fixed, or perhaps a 15-year fixed or even an adjustable-rate mortgage if permitted. Or it’s possible you hold an ARM loan and want to move into a fixed-rate product at the same time, removing future... --- > Anyone who works in the industry probably saw this coming. But those who don't might be left scratching their head. Yesterday, the Fed finally pivoted and - Published: 2024-09-19 - Modified: 2024-09-19 - URL: https://www.thetruthaboutmortgage.com/fed-rate-cut-but-mortgage-rates-up-what-gives/ - Categories: Mortgage News, Mortgage Rates Anyone who works in the industry probably saw this coming. But those who don't might be left scratching their head. Yesterday, the Fed finally pivoted and cut its own fed funds rate, yet mortgage rates went up. Why does this always seem to happen? Shouldn’t good news on the interest rate front push rates lower across the board? Seems perfectly logical until you dig into the details. There are two main reasons why mortgage rates often defy the Fed’s own move. One is that the Fed’s policy is often fairly telegraphed and not a surprise, and the other is that the data is typically baked in already. The Fed Simply Follows the Economic Data First things first, the Federal Reserve is simply making monetary policy decisions (hike, cut, nothing) based on the economic data in front of them. So their FOMC statement and accompanying interest rate decision generally don’t come as much of a surprise. Yesterday, there was a little more uncertainty than normal, with both a 25-basis point and 50-basis point cut a possibility. The Fed opted to go with a 50-bps cut, which had been the favorite with a ~60%+ likelihood per CME FedWatch. In other words, the Fed did what the market expected, as they often do. The reason the Fed does what the market expects is because they base their decisions on publicly available data. And the data is somewhat old by the time the Fed makes its announcement. That removes much of the element of... --- > If you’ve got a home equity line of credit (HELOC), payment relief may finally be here. The Fed is expected to “pivot” today, meaning they’ll shift from a - Published: 2024-09-18 - Modified: 2024-09-18 - URL: https://www.thetruthaboutmortgage.com/why-you-probably-dont-want-to-lock-your-heloc/ - Categories: Mortgage Rates, Mortgage Tips If you’ve got a home equity line of credit (HELOC), payment relief may finally be here. The Fed is expected to “pivot” today, meaning they’ll shift from a tightening monetary policy to a loosening policy. In other words, they’re going to start cutting rates instead of raising them! While this won’t have a direct impact on long-term mortgage rates, it directly affects loans tied to the prime rate, including HELOCs. This means your HELOC rate will go down by whatever the Fed cuts. So if they cut 25 basis points today, your HELOC rate will be adjusted down 0. 25%. Though one cut isn’t likely to provide major relief, there are expectations that this is the first cut of many, with possibly 200+ bps of cuts penciled in over the next 12 months. So if you’ve been given the option to “lock your HELOC rate,” it’s probably best to give it a hard pass. How HELOC Rates Are Determined As a quick refresher, HELOCs are variable-rate loans, meaning they can adjust each month based on the prime rate. To come with your HELOC rate, you combine the HELOC's margin, which is fixed, and the prevailing prime rate, which moves in lockstep with the fed funds rate. Whenever the Fed decides to raise or lower its own fed funds rate (FFF), the prime rate will also go up or down by the same amount. Since early 2022, the Fed has raised the FFF 11 times, from near-zero to a range of... --- > What a difference a year makes. While the mortgage industry has been purchase loan-heavy for several years now, it could finally be starting to shift. A - Published: 2024-09-17 - Modified: 2024-09-17 - URL: https://www.thetruthaboutmortgage.com/rate-and-term-refinances-are-up-a-whopping-300-from-a-year-ago/ - Categories: Mortgage Tips What a difference a year makes. While the mortgage industry has been purchase loan-heavy for several years now, it could finally be starting to shift. A new report from Optimal Blue revealed that rate and term refinance volume increased nearly 110% in August from a month earlier, and 310% from the year before. Driving the emerging trend is cheaper mortgage rates, which have finally begun to accelerate lower in recent months. Assuming they continue on their newfound trajectory, there’s a good chance refis will be back en vogue in 2025 and beyond. Mortgage Refinance Share Highest Since Spring 2022 It has been a rough few years for loan officers and mortgage brokers, but it’s possible the worst is over. As mortgage rates nearly tripled from sub-3% levels in early 2022 to over 8% last year, originators came up with the saying, “Survive ‘til 25. ” The idea was that if you could hang on and ride out the storm (of low lending volume) in 2024, you’d be rewarded in 2025. And while that sometimes felt far-fetched, it looks like it could actually come to fruition, and perhaps even ahead of schedule. The latest Market Advantage report from Optimal Blue found that mortgage refinances accounted for 26% of total home loan production, the highest share since March 2022. At that time, you could still get a 30-year fixed in the 3% range. But rates ascended rapidly from there, basically wiping out all refinance activity in a matter of months. So it’s... --- > It’s been a pretty good year so far for mortgage rates, which topped out at around 8% last year. The 30-year fixed is now priced about one full percentage - Published: 2024-09-16 - Modified: 2024-09-16 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-could-fall-another-half-point-just-from-market-normalization/ - Categories: Mortgage News, Mortgage Rates It’s been a pretty good year so far for mortgage rates, which topped out at around 8% last year. The 30-year fixed is now priced about one full percentage point below its year ago levels, per Freddie Mac. And when you consider the high of 7. 79% seen in October 2023, is now over 150 basis points lower. But the recent mortgage rate rally may still have some gas in the tank, especially with how disjointed the mortgage market got in recent years. Simply getting spreads back to normal could result in another 50 basis points (. 50%) or more of relief for mortgage rates going forward. Forget the Fed, Focus on Spreads There are a couple of reasons mortgage rates have improved over the past 11 months or so. For one, 10-year treasury yields have drifted lower thanks to a cooler economy, which is a boost for bonds. When demand for bonds increases, their price goes up and their yield (interest rate) goes down. Long-term mortgage rates follow the direction of the 10-year yield because they have similar maturities (mortgages are often prepaid in a decade). So if you want to track mortgage rates, the 10-year yield is a good place to start. Anyway, inflation has cooled significantly in recent months thanks to monetary tightening from the Fed. They raised rates 11 times since early 2022, which seemed to finally do the trick. This pushed the 10-year yield down from nearly 5% in late October to about 3. 65%... --- > I’ve said for a while that the mortgage recapture game was going to ramp up and get more aggressive. Customer retention has always been a big thing in - Published: 2024-09-13 - Modified: 2024-09-13 - URL: https://www.thetruthaboutmortgage.com/uwm-launches-keep-to-recapture-prior-mortgage-clients-for-its-broker-partners/ - Categories: Mortgage News, Refinance I’ve said for a while that the mortgage recapture game was going to ramp up and get more aggressive. Customer retention has always been a big thing in every industry, but thanks to new technology and “AI,” companies are getting better at it. Many of the largest mortgage companies have also been growing their mortgage servicing portfolios for this very reason. Instead of handing off their borrowers to third-party companies, they’re retaining servicing rights so they can mine their database of homeowners for future offers. And with mortgage rates finally showing some real promise, there could be a lot of opportunity going forward. The Refi Boom Is, Apparently, Here UWM just proclaimed that “the refi boom is officially here,” and wants to make sure its mortgage broker partners are “ready for it. ” To help give them a boost, they have launched a new initiative called KEEP, which leverages artificial intelligence (AI) to help brokers stay in front of their old clients. The way it works is fairly simple. It continuously scans the data from UWM’s portfolio and identifies borrowers “who will benefit from a mortgage refinance. ” Once a match is found, it automatically sends an email to the customer with a pre-validated offer, including the contact information of the originating broker. Borrowers will see their current monthly payment, estimated new payment, and estimated monthly savings. It will also include disclosures such as the loan type, loan-to-value ratio (LTV), amount of discount points required, and APR. It’s unclear what... --- > Lately, savings accounts have been paying a pretty solid return. Companies like Capital One and Discover have been offering over 4% APY. It’s not - Published: 2024-09-12 - Modified: 2024-09-12 - URL: https://www.thetruthaboutmortgage.com/i-pay-my-mortgage-around-the-15th-of-every-month/ - Categories: Mortgage Tips Lately, savings accounts have been paying a pretty solid return. Companies like Capital One and Discover have been offering over 4% APY. It’s not necessarily free money, given the high rate of inflation, but it’s been one way to keep your dollars from eroding in value versus just putting them in a bank account earning a measly 0. 01%. When savings rates began to rise a few years ago, I started to make my mortgage payments later in the month. The logic was that I could earn more interest on my money if I kept more of it in a savings account for a longer amount of time. While maybe not a massive amount of money, still more money. You Don’t Get Any Savings by Paying on the 1st of the Month First a quick overview. Mortgage payments are typically due on the first of the month, but not actually late until 15 days later. In other words, most loan servicers will give you a grace period to pay any time between the first of the month and the 15th without penalty. So while “technically due” on the first, it’s not actually late until the 16th. I never looked into why they do this, but this tends to be the universal rule (always check with your bank/servicer to be sure! ). And because most mortgages in the United States are simple interest and calculated monthly, it doesn’t matter when you pay in terms of interest charges. If you pay on... --- > A recent report from CoreLogic revealed that “piggybacked purchase loans” for FHA borrowers reach a new high in June of this year. While piggybacked home - Published: 2024-09-11 - Modified: 2024-09-11 - URL: https://www.thetruthaboutmortgage.com/surge-in-fha-loans-with-piggyback-second-mortgages-could-spell-future-problems/ - Categories: Home Buying, Housing Market, Mortgage News A recent report from CoreLogic revealed that “piggybacked purchase loans” for FHA borrowers reach a new high in June of this year. While piggybacked home purchases tend to be higher historically for those who take out FHA loans, they’ve surged in recent years. The culprit is likely high home prices, which have made it increasingly difficult to come up with down payment funds, even if you only need 3. 5%. For reference, a piggyback loan is a second mortgage that is taken out concurrently with the first mortgage to extend the total amount of financing. An example would be a first mortgage for 96. 5% of the purchase price and a piggyback second for the remaining 3. 5%. While this is helpful for home buyers who have little set aside for down payment and closing costs, it could present problems if and when they attempt to refinance or sell. FHA Piggyback Share Rises to 18% of Home Purchase Loans From June 2022 to June 2024, the piggybacked FHA purchase loan share increased from 10. 8% to 18%, per CoreLogic. That’s nearly double the 9. 8% share seen back in 2017 when the housing market was seemingly normal. And while FHA loans tend to have a higher piggyback share in general, the recent increase is a whopping 67%. It illustrates how stretched home buyers have become lately, especially those who need an FHA loan to qualify for the purchase. FHA loans tend to go to lower-income home buyers and/or those with... --- > The latest monthly national housing survey from Fannie Mae revealed an interesting contradiction. Last month, a new survey-high 39% of respondents said - Published: 2024-09-09 - Modified: 2024-09-09 - URL: https://www.thetruthaboutmortgage.com/more-consumers-think-mortgage-rates-will-go-down-and-that-home-prices-are-going-to-fall/ - Categories: Home Buying, Housing Market, Mortgage Rates The latest monthly national housing survey from Fannie Mae revealed an interesting contradiction. Last month, a new survey-high 39% of respondents said they expect mortgage rates to go down over the next 12 months. At the same time, fewer expect home prices to go up over the same period. And more believe home prices will fall. So despite a home purchase becoming more affordable thanks to a lower interest rate, consumers don’t think prices will increase. What does this say about home buyer demand as mortgage rates go down? But We Were Told Bidding Wars Would Return When Mortgage Rates Fell Fannie’s monthly Home Purchase Sentiment Index (HPSI) did increase very slightly (0. 6 points) to 72. 1 in August from a month earlier. But it remains very low, with most of the 1,000 respondents saying it’s a poor time to buy and also an increasingly bad time to sell. Just 17% said it was a “good time” to buy a home in August, which has remained relatively flat for several months and remains just above all-time survey lows. Meanwhile, 83% said it was a “bad time” to buy a home, the highest share since the survey’s inception. At the same time, only 65% say it’s a good time to sell, while 34% say it’s a bad time. Since August 2021, the “net good time” to sell has fallen from 54% to just 31%. So it appears no one is happy with the current state of the housing market, which... --- > The other day I noticed that mortgage rates were being advertised at some really low levels. Many quotes in the mortgage rate table on my own site were in - Published: 2024-09-06 - Modified: 2024-09-06 - URL: https://www.thetruthaboutmortgage.com/its-not-a-mortgage-rate-story-anymore/ - Categories: Home Buying, Housing Market, Mortgage Rates The other day I noticed that mortgage rates were being advertised at some really low levels. Many quotes in the mortgage rate table on my own site were in the mid-5s. That got me curious how low rates could be with a really favorable loan scenario, such as a 760+ FICO, 20% down home purchase, owner-occupied, single-family residence. So I headed over to Zillow’s Mortgage Marketplace to see what I could come up with. Knowing that VA loan rates are typically the lowest, I threw that in too and lo and behold, saw 30-year fixed rates that began with a “4. ” I threw the screenshot up on Twitter and simply said, “Guys, it’s not a mortgage rate story anymore. ” What Did I Mean? The tweet got a good amount of traction, likely because of those very low 4. 875% 30-year fixed rate quotes in the screenshot. And some felt it was deceiving to post rates like that, which might not be reflective of the entire borrower universe at the moment. After all, not everyone has a 760 FICO score or the ability to put down 20%, nor might they be eligible for a VA loan. I also threw in two discount points, since most of the low rates advertised today require the borrower to pay some money at closing in order to obtain a “below-market” rate. In reality, you can put nothing down on a VA loan and get the same pricing since there aren’t mortgage pricing adjustments... --- > If you’re thinking about purchasing a property, you’ve likely sifted through available home loan options to determine what’s best. There are lots of loan - Published: 2024-09-05 - Modified: 2024-09-05 - URL: https://www.thetruthaboutmortgage.com/the-hidden-problem-with-fha-loans/ - Categories: Home Buying, Mortgage News, Mortgage Tips If you’re thinking about purchasing a property, you’ve likely sifted through available home loan options to determine what’s best. There are lots of loan types of choose from, including conventional loans (those not backed by the government) and government-backed loans, such as FHA, USDA, and VA loans. While each have their pros and cons, there is one hidden danger to taking out an FHA loan, especially if you’re buying a home as opposed to refinancing an existing loan. In competitive markets where there are multiple bidders vying for the same property, the financing you choose matters. Sellers want assurances that you can actually close your loan, and that could make or break your offer. Home Sellers Care What Type of Mortgage You Use Over the past decade, home buying has been very competitive. It’s been a seller’s market for as long as I can remember. In fact, even when the housing market bottomed in 2012-2013, it was still difficult to find a property. While short sales and foreclosures were prevalent then, inventory was still relatively scarce and many savvy buyers entered the fray quickly to scoop up bargains. Over the years, it has only gotten worse, thanks in part to underbuilding since the mortgage crisis, and also due to record low mortgage rates. That combination of limited inventory and low mortgage rates propelled home buyer demand to new heights. And the fact that millions were entering the prime home buying age (of 34 years old) didn’t help either. Long story... --- > A new paper from Yale professor Kelly Shue argues that consumers mistakenly wait to take out mortgages and other long-term loans when the Fed is expected - Published: 2024-09-04 - Modified: 2024-09-04 - URL: https://www.thetruthaboutmortgage.com/researchers-says-dont-wait-on-the-fed-rate-cut-to-refinance-your-mortgage/ - Categories: Mortgage Tips A new paper from Yale professor Kelly Shue argues that consumers mistakenly wait to take out mortgages and other long-term loans when the Fed is expected to cut rates. Their confusion seems to be related to conflating short-term and long-term rates, which don’t necessarily move in tandem. In fact, short-term rate moves are typically already baked in to long-term rates, meaning there’s no need to wait until the cut is official for an even lower interest rate. The savings of short-term rate cuts should already be reflected in the interest rate of a long-term loan such as a 30-year fixed mortgage. Despite this, home buyers and even professional forecasters tend to get this wrong according to the research. Short-Term Rates vs. Long-Term Rates Consumers have long misunderstood the relationship between the Fed and mortgage rates. Many incorrectly believe that the Fed directly controls mortgage rates. So when the Fed announces a rate cut, prospective home buyers expect mortgage rates to come down as well. For example, the Fed is widely expected to lower its fed funds rate by 25 (or maybe 50 basis points) at its September 18th meeting. When this takes place, there will be a slew of articles written about how “mortgage rates fall” and the like. Some may even assume that the 30-year fixed fell by the same amount, whether it’s 0. 25% or . 50%. So if the 30-year fixed was 6. 50% the day before the meeting, a hypothetical home buyer might think the going... --- > They say not to time the market. It’s a chump’s game. If anyone had any real success at it, they’d be rich. This type of advice typically applies to the - Published: 2024-09-03 - Modified: 2024-09-03 - URL: https://www.thetruthaboutmortgage.com/home-buyers-were-urged-to-beat-the-rush-but-now-told-that-they-might-want-to-wait/ - Categories: Home Buying, Housing Market They say not to time the market. It’s a chump’s game. If anyone had any real success at it, they’d be rich. This type of advice typically applies to the stock market, but it can apply to just about anything else too. It’s hard enough to predict something to happen at any given time. And exponentially harder to predict something to happen in a short window of time. In other words, don’t bother. Don’t try to time it. It won’t go as expected. When it comes to home buying, the same holds true. But unlike investing, there are so many factors to consider beyond price. Now That Rates Are Lower, You No Longer Need to Beat the Rush? It’s funny how the media jumps onto certain narratives, runs with them, exhausts them, and then moves on to the next one. All while forgetting about (and essentially ignoring) the prior one in the process. It’s, for a lack of better words, old news. That piece of old news was the argument that it made sense to dive into a home purchase while mortgage rates and home prices were high, before the herd followed. Simply put, there’d be less competition if you purchased when no one else was, and you could snag a home before the others inevitably came after you and bid up the price. Despite paying a high price and getting an equally expensive mortgage rate, there was the promise of a lower rate in the near future thanks to... --- > I went for a walk today and starting thinking about mortgage debt. I know, pretty lame. But that’s what apparently goes through my head when I make a - Published: 2024-08-29 - Modified: 2024-08-29 - URL: https://www.thetruthaboutmortgage.com/i-am-debt-averse-but-dont-mind-having-a-mortgage/ - Categories: Home Buying, Mortgage Tips I went for a walk today and starting thinking about mortgage debt. I know, pretty lame. But that’s what apparently goes through my head when I make a conscious effort to put my phone down and exercise. Anyway, I began thinking about how I really don’t like debt. I don’t know if it’s psychological or what. Even if it’s 0% APR debt that isn’t accruing interest, I’m simply not a fan. I am not one of those people who would take out massive loans to launch a project. Or feel comfortable with tons of debt in general, even if investing elsewhere, perhaps for a better return. However, the one exception is a mortgage. For whatever reason, I don’t mind holding onto one (or several). A Housing Payment Feels Standard For one, I feel like having a housing payment is just part of life. So it’s not strange to pay a mortgage each month. It could even feel strange not to have one as an adult. If I wasn’t paying a mortgage, I’d likely be paying rent someplace else, every month in perpetuity. So in that regard, it doesn’t feel like it’s an extra burden. It’s really just par for the course. To make this easier to swallow, mortgage rates were ultra-cheap the past decade or so. I hold very inexpensive mortgage debt today, especially relative to prevailing rates on home loans today. We’re talking 3% rates when the 30-year fixed today is closer to 6. 5%. Even if the 30-year... --- > What’s better than taking on the National Association of Realtors (NAR) and winning? Well, launching your own flat-fee, AI-powered real estate service - Published: 2024-08-29 - Modified: 2024-09-03 - URL: https://www.thetruthaboutmortgage.com/new-flat-fee-ai-powered-real-estate-buyer-agent-service-called-landian-launches/ - Categories: Home Buying, Housing Market What’s better than taking on the National Association of Realtors (NAR) and winning? Well, launching your own flat-fee, AI-powered real estate service just months after of course. In the wake of the new real estate commission rules, which were born from the Sitzer-Burnett class-action lawsuit, a new service called Landian has launched. The word is a play on land and guardian and aligns with their mission to “safeguard homebuyers from the excessive fees typically charged by real estate agents. ” Shots fired! And yes, Josh Sitzer is one of the company founders, along with Bryce Galen and Neal Batra, per TechCrunch. Why Landian? Per their mission, they want to bring down what they refer to as “excessive fees” charged by real estate agents. In the not-too-distant past, it wasn’t uncommon for a seller to pay 6% of the sales price, with 3% going to both listing agent and buyer’s agent. This fee structure was the focus of the NAR lawsuit, and because of it, agents can no longer advertise compensation via the MLS. However, for many transactions it's still business as usual, just a little different procedurally. Going a step further, Landian wants to bring down the buyer’s agent fee instead of sellers simply baking it into the sales price. The company aims to save home buyers a year’s worth of mortgage payments with pay-as-you-go fees. Instead of the usual 2. 5% to 3% commission a home buyer must cough up, the newly-launched proptech (still in beta) charges as little... --- > If you’re looking to save money on your next mortgage, a mortgage broker might be able to help. A firm by the name of Polygon Research conducted a study - Published: 2024-08-28 - Modified: 2025-02-07 - URL: https://www.thetruthaboutmortgage.com/new-study-says-mortgage-brokers-save-consumers-more-than-10k/ - Categories: Mortgage News If you’re looking to save money on your next mortgage, a mortgage broker might be able to help. A firm by the name of Polygon Research conducted a study and found that mortgage brokers can save consumers money versus other channels, such as retail. The research, which was supported by the nation’s top mortgage lender (also a wholesale-only lender) United Wholesale Mortgage, found “substantial savings for consumers on average” via the wholesale channel. For reference, the wholesale channel is B2B, where mortgage brokers provide financing to consumers from their lender partners. Instead of being captive to a single bank or lender, they can shop the borrower’s loan scenario with multiple partners at once to find the best combination of rate and fees. On the other hand, a retail loan officer can only offer pricing and loan programs from their captive lender. Lower Rates and Lower Fees with Mortgage Brokers The research found that for loans originated in 2023, consumers would save an average of $10,662 over the life of their loan when working with an independent mortgage broker compared to a nonbank retail lender. Some of the largest nonbank retail lenders include Rocket Mortgage, CrossCountry Mortgage, loanDepot, Rate (formerly Guaranteed Rate), and Movement Mortgage. Polygon also said upfront fees were lower on broker-originated loans compared to those originated by retail loan officers. And the study found higher loan approval rates in Minority Majority Census Tracts (MMCT) via the wholesale channel (70%) versus retail (58%). The average interest rate extended to... --- > In an effort to boost affordability for those most in need, Rocket Mortgage has launched a new program called “Welcome Home RateBreak.” Similar to their - Published: 2024-08-26 - Modified: 2024-08-26 - URL: https://www.thetruthaboutmortgage.com/rocket-mortgage-unveils-new-2-1-rate-buydown-for-lower-income-home-buyers/ - Categories: Mortgage Tips In an effort to boost affordability for those most in need, Rocket Mortgage has launched a new program called “Welcome Home RateBreak. ” Similar to their Inflation Buster product rolled out two years, it is a lender-paid interest rate buydown. It allows home buyers to enjoy a discounted mortgage rate for the first two years of their loan term. After that, the rate reverts back to the note rate that they qualified for the remainder of the term. Home buyers with area median income (AMI) of 80% or less are eligible for the potential savings. How Rocket Mortgage Welcome HomeBreak Works As noted, it’s a temporary buydown offered by Rocket Mortgage to home buyers with area median income (AMI) of 80% or less. Rocket has estimated that some 90 million people nationwide meet this definition. You can look up your local AMI here. You must also be purchasing a single-family home (apparently condos aren’t eligible) and you must meet all other underwriting criteria, such as minimum credit score, max DTI ratio, and so on. Rocket cited an example where a home buyer qualifies for a $250,000 loan at a rate of 6. 99% (APR 7. 399%). This would normally result in a monthly principal and interest payment of $1,661. But thanks to the temporary buydown, their mortgage rate the first year would be 4. 99%, reducing the payment to $1,340. In year two, the rate discount would be just 1%, or 5. 99% in this example, with a monthly payment... --- > In the not-so-distant past, aka before August 17th, 2024, real estate commissions worked a lot differently. Or at least the rules governing them did. Back - Published: 2024-08-20 - Modified: 2024-08-26 - URL: https://www.thetruthaboutmortgage.com/how-does-real-estate-commission-work-now/ - Categories: Home Buying, Housing Market, Mortgage News In the not-so-distant past, aka before August 17th, 2024, real estate commissions worked a lot differently. Or at least the rules governing them did. Back then, listing agents would put a property on the multiple listing service (MLS) that included an explicit, stated commission (offer of compensation) to the buyer’s agent. This commission was actually paid for by the home seller, who also paid their listing agent, out of the sales proceeds. The offer of compensation ensured both agents would be paid for their services and representation. Real Estate Commissions Inflated? While that setup was all good and well on the surface, some argued that it allowed agents to collude with one another and keep commissions inflated. At the same time, there was an argument that agents didn’t exactly highlight the fact that commissions were negotiable either. So both buyer and seller were often told the fee is 2. 5%, or 3%, end of story. The end result was a 5-6% commission paid by the seller to both agents on the transaction. A pretty penny to be sure. Perhaps more problematic, buyers were often told they didn’t have to pay for representation and that the buyer’s agent services were “free. ” After all, they didn’t have to pay anything out of pocket. It was funded via the sales proceeds of the transaction. Of course, the argument was that the home buyer actually did pay for it via a higher sales price needed to absorb some or all of that cost.... --- > You’ve probably heard about the big NAR settlement that could completely change how real estate works going forward. But if you haven’t, or are unsure of - Published: 2024-08-16 - Modified: 2025-01-17 - URL: https://www.thetruthaboutmortgage.com/can-real-estate-commissions-be-financed-via-the-mortgage/ - Categories: Home Buying, Mortgage Tips You’ve probably heard about the big NAR settlement that could completely change how real estate works going forward. But if you haven’t, or are unsure of what’s changing, there are two new rules set to go into effect August 17th, 2024. The first is that offers of compensation will be prohibited on Multiple Listing Services (MLSs). In other words, listing agents won’t be able to say they’re offering 2% or 3% to the buyer’s agent on the MLS. The logic is that this type of co-op commission leaves the buyer out of the conversation, which isn't fair if the buyer ultimately pays for it. While they may not pay it directly, a pre-determined commission might result in a higher sales price. In addition, there’s also not much transparency about the fee, nor do consumers know such fees are negotiable. Simply put, this move is intended to boost transparency and ideally lower fees for consumers by letting buyers negotiate with their agents separately ahead of time. But there might be some unintended consequences as a result, which I’ll get to in a moment. The other major change is that buyers must sign a written agreement before they can tour a property. At that time, compensation will also be discussed. Real Estate Agent Fees May Drop, However... Now about those unintended consequences I alluded to. While the standard commission might go down thanks to these new rules, from say 2. 5% to 1. 5% or even 1% on the buy-side, there’s still... --- > In recent years, new technologies have been rolled out to increase efficiency, lower costs, and improve the borrower experience during the home loan - Published: 2024-08-09 - Modified: 2024-08-11 - URL: https://www.thetruthaboutmortgage.com/i-refinanced-my-mortgage-without-making-a-single-phone-call/ - Categories: Mortgage News, Refinance In recent years, new technologies have been rolled out to increase efficiency, lower costs, and improve the borrower experience during the home loan process. For example, there's now digital verification, which allows borrowers to electronically share their financial information with lenders, including bank account and payroll data. This in turn allows banks/lenders to verify income, employment, and assets without bugging the borrower and asking for mountains of paperwork. At the same time, it improves accuracy and reduces mistakes since the information is coming direct from the source. Still, many feel that getting a mortgage is a major pain and stuck in the stone age. While I agree, I’d be lying if I said it hasn’t gotten easier. However, it still takes a month or more to get a mortgage, which in today’s day and age just doesn’t seem good enough. Personal-Touch Has Significantly Declined That brings me to a new study that was conducted by Fannie Mae to better understand adoption rates of said technologies. Fannie surveyed recent home buyers who purchased a property with a mortgage acquired by the company between January 2023 and November 2023. One of the survey’s key findings was that the use of personal-touch-only channels when obtaining a mortgage (for example in-person or by-phone) have "significantly declined. " In other words, fewer mortgage applicants are picking up the phone to speak to a loan officer. And probably a lot less are driving down to the local bank branch. They simply don’t have to thanks to... --- > Over the years, there’s been a popular argument that it’s better to buy a home when mortgage rates are high. The logic is that home prices should be lower - Published: 2024-08-07 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/is-it-better-to-buy-a-home-when-mortgage-rates-are-high/ - Categories: Home Buying, Mortgage Rates, Mortgage Tips Over the years, there’s been a popular argument that it’s better to buy a home when mortgage rates are high. The logic is that home prices should be lower if rates are high, and thus you get a property for less. And the cherry on top is that if/when mortgage rates fall, you can get a lower interest rate too! When all is said and done, you basically get the best of both worlds. A lower purchase price and low mortgage rate. But is this scenario actually reality? And do home prices and mortgage rates even have such a relationship? Buying a Home When Interest Rates Are High On the surface, buying a home when interest rates are high seems like a pretty bad deal. After all, your monthly mortgage payment is going to be more expensive if the interest rate is higher. For example, imagine a $500,000 home purchase with 20% down. That’s a $400,000 loan amount. 7% mortgage rate: $2,661. 21 4% mortgage rate: $1,909. 66 The difference in just principal and interest each month is a whopping $750! That’s not a small amount by any measure. Tack on insurance and taxes and it gets worse, possibly even cost-prohibitive. *You can quickly compare other monthly payments on my mortgage rate charts page. This large difference in payment could make many would-be home buyers ineligible for a mortgage if they exceed maximum DTI limits. Remember, you have to qualify for a home loan, so if your income doesn’t cover... --- > Well, here we are. It took longer than expected, but mortgage rates have finally strung together a decent rally after nearly three years of increases. - Published: 2024-08-05 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/will-home-prices-go-up-when-interest-rates-go-down/ - Categories: Home Buying, Housing Market, Mortgage Tips Well, here we are. It took longer than expected, but mortgage rates have finally strung together a decent rally after nearly three years of increases. They fell below year-ago levels a week or two ago, per Freddie Mac, and took another big leg down after a softer-than-expected jobs report on Friday. As for why, fewer new hires, increased unemployment, and slowing wage growth all point to a slowing economy. And interest rates tend to drop when the economy cools. In addition, the Fed is expected to pivot and begin cutting rates, which could act as another tailwind for lower mortgage rates. This has many thinking we’ll see another surge of home buyer demand, and potentially a big jump in home prices. But is it true? Do lower interest rates increase housing prices? Do Lower Interest Rates Actually Increase Home Prices? It’s entirely logical on the surface. If something people want becomes cheaper overnight, demand for it should hypothetically increase. And if demand increases, the price might rise as supply decreases, especially if there are already too few homes for sale. But if that were true for single-family homes, why didn’t asking prices crash over the past year and change? Shouldn't demand have fallen as mortgage rates spiked higher, leading to price cuts? After all, rates on the 30-year fixed mortgage nearly tripled from its record lows in the mid-2s in early 2021 before peaking at just above 8% last fall. Using the same logic above, home prices would surely nosedive... --- > I got active on Twitter over the past year and change and to my surprise (not sure why it’s surprising really), encountered lots of housing bears on the - Published: 2024-07-25 - Modified: 2024-09-13 - URL: https://www.thetruthaboutmortgage.com/will-the-housing-market-crash-in-2025/ - Categories: Home Buying, Housing Market, Mortgage News I got active on Twitter over the past year and change and to my surprise (not sure why it’s surprising really), encountered lots of housing bears on the platform. Many were/still are convinced that the next housing crash is right around the corner. The reasons vary, whether it’s an Airbnbust, a high share of investor purchases, high mortgage rates, a lack of affordability, low home sales volume, rising inventory, etc. etc. And the reasons seem to change as each year goes on, all without a housing crash... So, now that we’re halfway through 2024, the obvious next question is will the housing market crash in 2025? Next year’s got to be the year, right? But First, What Is a Housing Crash? The phrase “housing crash” is a subjective one, with no real clear definition agreed to by all. For some, it’s 2008 all over again. Cascading home price declines nationwide, millions of mortgage defaults, short sales, foreclosures, and so on. For others, it might just be a sizable decline in home prices. But how much? And where? Are we talking about national home prices or regional prices? A certain metro, state, or the nation at large? Personally, I don’t think it’s a crash simply because home prices go down. Though it is a pretty uncommon occurrence to see nominal (non-inflation adjusted) prices fall. Over the past few years, we’ve already experienced so-called home price corrections, where prices fell by 10%. In 2022, we were apparently in a housing correction, defined... --- > By now you’ve heard the news. President Biden dropped out of the 2024 presidential race and paved the way for current VP Kamala Harris to run in his - Published: 2024-07-23 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/presidential-candidate-kamala-harris-has-a-7-year-adjustable-rate-mortgage/ - Categories: Mortgage News, Mortgage Rates By now you’ve heard the news. President Biden dropped out of the 2024 presidential race and paved the way for current VP Kamala Harris to run in his place. That was big news that shook up the election overnight, and now there is a renewed focus on Harris, including her financial disclosures. The WSJ ran a story today about how she manages her money, pointing out her penchant for index funds and her ultra-low rate 2. 625% mortgage. I dug a little deeper to see what kind of mortgage she had, along with when and where she got it. And it turns out it’s an adjustable-rate mortgage, which we all know aren’t for the faint of heart. Kamala Seems to Really Love the 7-Year ARM With regard to that 2. 625% mortgage Kamala Harris holds, it turns out it’s a 7-year adjustable-rate mortgage (ARM). This is a popular type of ARM these days because it provides 84 months of interest rate stability before the first adjustment. In that respect, homeowners can take one out and not worry about their rate increasing for many years. And in the meantime, either sell their property or refinance the mortgage if need be. Harris obtained her latest mortgage in 2020 and was able to get a very low interest rate set at 2. 625% until the year 2027. It’s unclear what the exact loan amount is, but it was revealed to be somewhere between $1,000,000 and $5,000,000. We also know that the lender in... --- > In case you haven’t heard, there’s talk of a “refinance boom” as soon as 2025. Yes, you read that right. While it seemed like high mortgage rates were - Published: 2024-07-11 - Modified: 2025-02-10 - URL: https://www.thetruthaboutmortgage.com/beware-of-inferior-mortgage-refinance-offers-from-your-original-lender/ - Categories: Mortgage Tips, Refinance In case you haven’t heard, there’s talk of a “refinance boom” as soon as 2025. Yes, you read that right. While it seemed like high mortgage rates were going to spoil the party for a long time, things can change quickly. Thanks to the millions who took out high-rate mortgages over the past couple years, even a slight improvement in rates could open the floodgates. But now more than ever it’s going to be important to go with the right lender, the one who ultimately offers the lowest rate with the fewest fees. This is especially true now that banks and lenders are working hard to improve recapture rates for past customers. A Refinance Boom in 2025? What? First let’s talk about that supposed refinance boom. This hopeful news comes courtesy of the latest Mortgage Lender Sentiment Survey® (MLSS) from Fannie Mae. The GSE surveyed over 200 senior mortgage executives and found that almost three in five (58%) expect a refinance boom to start in 2025. And some even believe it could kick off later this year, though that would take a pretty big move lower for mortgage rates in a hurry. Either way, many are now anticipating that the Fed will cut their own rate in September as inflation continues to cool. This expectation may lend itself to lower mortgage rates as bond yields drop and take the 30-year fixed down with it. Assuming this all plays out according to plan, we could see a nice uptick in mortgage... --- > Want to hear some good news about mortgage rates that involves them being a lot higher than they previously were? Yes, I know that sounds absurd, but hear - Published: 2024-07-03 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/more-than-4-million-mortgages-originated-since-2022-have-rates-above-6-5/ - Categories: Mortgage News, Mortgage Rates, Refinance Want to hear some good news about mortgage rates that involves them being a lot higher than they previously were? Yes, I know that sounds absurd, but hear me out. There are now millions more mortgages that feature rates above 6. 5%, and many with rates above 7%. There are also millions less that feature rates below 5% than there were just a couple years ago. Why is this good you ask? Well, it means the effects of mortgage rate lock-in are beginning to wane. It also means millions of borrowers might stand to benefit from a refinance as rates eventually drop. Nearly a Quarter of Mortgage Holders Have an Interest Rate Above 5% The latest Mortgage Monitor report from ICE released this week found that there’s been quite a shift in outstanding mortgage rates. While it was quite common for a homeowner to hold a 30-year fixed priced at 2-3% a few years ago, it’s becoming less so today. In fact, as of May some 24% of those with outstanding home loans had a mortgage rate at or above 5%, up from just 10% two years ago. At the same time, there were there nearly six million (5. 8M) fewer mortgages with rates below 5% than there were there back then. And nearly five million (4. 8M) fewer with rates below 4%, thanks to borrowers either selling their homes or in some cases pursuing a cash out refinance. While the low-rate homeowners shed their mortgages via home sale or... --- > They say to never say never. But why? Because if you say it, whatever you said would never happen typically happens. Go figure. Well, speaking of, Fannie - Published: 2024-06-28 - Modified: 2024-10-02 - URL: https://www.thetruthaboutmortgage.com/will-mortgage-rates-ever-go-back-down-to-3-again/ - Categories: Mortgage Tips They say to never say never. But why? Because if you say it, whatever you said would never happen typically happens. Go figure. Well, speaking of, Fannie Mae chief economist Doug Duncan recently said barring a “catastrophic economic event,” not to expect mortgage rates to return to 3% in our lifetimes. I wrote about it on Twitter and it garnered a big reaction, with most saying he’s right. And others asking how old he was... My take was that when I hear things like “not in our lifetime,” I naturally expect them to occur sooner rather than later. How Did We Get 3% Mortgage Rates to Begin With? Before we talk about the possibility of mortgage rates being 3% again, let’s discuss how they got there in the first place. After the early 2000s mortgage crisis led to the Great Recession between 2007 and 2009, the Fed took action to lower its own lending rate (the federal funds rate) to nearly zero. This was done to increase economic output by encouraging banks to lend money and for consumers and businesses to take out loans. Despite the Fed’s best efforts, the economy continued to contract, leading to the advent of an unconventional monetary policy called Quantitative Easing, or QE. Without getting too wordy here, the Fed began buying long-dated treasuries and mortgage-backed securities (MBS) to stimulate lending and turn the economy around. Thanks to a very large, new buyer in the market, bond prices went up and their yields (aka interest... --- > I’ve heard this argument many times, whether in real life or on social media. That if you hold a mortgage (or two), you don’t actually OWN your house. The - Published: 2024-06-26 - Modified: 2024-06-26 - URL: https://www.thetruthaboutmortgage.com/if-i-have-a-mortgage-do-i-actually-own-my-house/ - Categories: Mortgage Tips I’ve heard this argument many times, whether in real life or on social media. That if you hold a mortgage (or two), you don’t actually OWN your house. The logic is that the bank/lender is the one that truly owns the property because they lent you the money to purchase the property. And you must pay them each month for the right to continue living in the home. If you don’t, they have the right to repossess the property via the foreclosure process. On top of that, many home buyers only put down 3-5%, meaning borrowers technically own very little and owe a whole lot to the bank. So is it true that mortgage holders don’t actually own their homes? You Still Own Things That Have Loans Attached While there’s some logic to the idea that a home with loans attached isn’t truly owned, it’s a pretty abstract thought. Sure, one can argue that if you have a mortgage, it means you only OWN the portion that is paid off. For example, if you bought a house for $500,000 and put down 20%, you’ve only got $100,000 in ownership, also known as home equity. When people refer to equity, it means the part of your real estate that is paid off, or simply the present value minus any outstanding liens. Over time, this same $500,000 property will likely appreciate in value, and the loan will be paid down. This means ownership will increase as time goes on and with each... --- > Mortgage Q&A: “Can I mortgage a house that is paid off?” When you own a home without any associated mortgages, it’s known as a “free and clear” - Published: 2024-06-26 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/can-i-mortgage-a-house-that-is-paid-off/ - Categories: Mortgage Tips, Refinance Mortgage Q&A: “Can I mortgage a house that is paid off? ” When you own a home without any associated mortgages, it’s known as a “free and clear” property. Some view this as a good thing, while others see mortgages as a good debt that doesn’t need to be paid off ahead of schedule (or ever). Others argue that you shouldn’t take a mortgage into retirement, as you’ll be on a fixed income and it can be a large expense. If you do happen to have a home that is completely paid off, you might be wondering if you can take out another mortgage. Let’s talk about it. Yes, You Can Take Out a Mortgage on a Home That’s Free and Clear Without getting too technical here, the short answer is yes. If your property is free and clear of any debts or liens, you can take out a mortgage, assuming you qualify otherwise. This means having the income, assets, employment and credit history to qualify for the loan. In truth, it shouldn’t be much different than when you got your original loan. Though it would be considered a cash out refinance as opposed to a home purchase loan. If you own your home outright and there are no existing loans associated with the property, taking out a new loan means tapping equity. When you tap equity, it’s known as a cash out refinance because you’re taking what you already own and depositing it into your bank account. The loan... --- > In case you missed it, the Federal Housing Finance Agency (FHFA) granted conditional approval to Freddie Mac to purchase single-family closed-end second - Published: 2024-06-25 - Modified: 2024-10-25 - URL: https://www.thetruthaboutmortgage.com/freddie-macs-pilot-program-to-buy-second-mortgages-probably-isnt-a-big-deal/ - Categories: Mortgage News, Refinance In case you missed it, the Federal Housing Finance Agency (FHFA) granted conditional approval to Freddie Mac to purchase single-family closed-end second mortgages. What this means is lenders will now be able to originate second mortgages and sell them off to one of the two government-sponsored enterprises (GSEs). Arguably, this should improve access to such lending products, and potentially result in cost savings if increased competition drives down interest rates and fees. At the same time, some have argued that this is inflationary (since it makes it easier for homeowners to take on more debt), while others have said it’s not part of the GSEs core mission to boost homeownership. I’m here to argue that this new pilot program is very limited and likely won’t change much, at least anytime soon. What Is Freddie Mac’s New Second Mortgage Pilot Program? In a nutshell, Freddie Mac is now permitted to purchase second mortgages that meet certain criteria. As a result, there will be added liquidity in the lending markets for home equity loans, which are closed-end loans. At the moment, most second liens, whether open-end HELOCs or closed-end home equity loans, are originated by large depository banks that typically keep them on their books. The nonbanks often don’t have this luxury because it’s capital intensive, so the end result is that fewer mortgage companies offer such loans. Notice the lack of home equity lending in the chart above provided by ICE, which has since been exacerbated by mortgage rate lock-in. This... --- > If you’re currently thinking about buying a home, or somehow in a position to refinance an existing loan, current mortgage rates don’t look great. While - Published: 2024-06-10 - Modified: 2024-06-10 - URL: https://www.thetruthaboutmortgage.com/the-other-major-downside-to-a-higher-mortgage-rate/ - Categories: Mortgage Tips If you’re currently thinking about buying a home, or somehow in a position to refinance an existing loan, current mortgage rates don’t look great. While they might not be as high as they were in the 1980s (when they averaged 18%), the rapid ascent from sub-3% to 7% is no doubt painful. The obvious issue is that a higher mortgage rate equates to a much larger monthly payment. You pay more each month and that’s both undesirable and potentially unaffordable. But assuming you are still able to qualify a mortgage, there’s another huge downside to a higher rate. Look at the Mortgage Payment Composition Home buyers tend to focus solely on the total monthly mortgage payment But it's important to look at the allocation between principal and interest When mortgage rates are high a large portion of the payment goes toward interest When mortgage rates are low much more of the payment goes toward principal (aka paying down the loan! ) As I’ve written before, a mortgage payment consists of four components: principal, interest, taxes, and insurance. For short, we refer to it as PITI (see more mortgage lingo here). The tax and insurance piece is mostly driven by the purchase price, while the principal and interest is dictated by the loan amount and mortgage rate. Simply put, the higher your mortgage rate, the higher your monthly payment, all else equal. So if you took out a $500,000 (30-year fixed loan) at 7%, it’d be a lot more expensive than... --- > You may have heard that the nation’s largest mortgage lender just rolled out a zero down mortgage. If you were around for the housing market crash in the - Published: 2024-06-04 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/is-a-0-down-home-purchase-much-different-than-a-3-down-purchase/ - Categories: Home Buying, Mortgage News You may have heard that the nation’s largest mortgage lender just rolled out a zero down mortgage. If you were around for the housing market crash in the early 2000s, it could feel like déjà vu. And not in a particularly good way. After all, it was toxic home loans that sunk the market then, sending home prices crashing and short sales and foreclosures surging. Does this mean we’re going down a familiar path, which will likely see a familiar outcome? Or is it a big to do about nothing? UWM’s New 0% Down Purchase Program United Wholesale Mortgage (UWM), which works exclusively with mortgage brokers, recently unveiled a new loan program called “0% Down Purchase. ” As the name implies, it allows a home buyer to purchase a property with nothing out of pocket, at least with respect to down payment. Upon first glance, this looks and sounds like a bad idea, especially with how high home prices are at the moment. Not to mention mortgage rates either... But before we get into the judgment of the program, let’s talk about how it works. It’s essentially a 97% LTV loan, widely available from both Fannie Mae and Freddie Mac, featuring a 3% silent second mortgage provided by UWM. The silent aspect of the second mortgage means it doesn’t carry any monthly payments, or interest for that matter. Instead, this lien just quietly sits behind the first loan and only comes due if the borrower sells the property, or refinances... --- > When you apply for a home loan, an underwriter will review your file in order to make a lending decision. They can approve your loan, deny your loan, or - Published: 2024-05-22 - Modified: 2024-05-23 - URL: https://www.thetruthaboutmortgage.com/what-is-a-conditional-loan-approval/ - Categories: Home Buying, Mortgage Tips, Refinance When you apply for a home loan, an underwriter will review your file in order to make a lending decision. They can approve your loan, deny your loan, or possibly suspend your loan pending additional information. The two most common outcomes are approval and denial, but even an approved loan is typically “conditional. ” This means it’s actually a conditional approval that requires certain requirements to be met before you’re issued a final approval. Only at that point can you sign loan documents and eventually fund your loan. Not All Mortgage Approvals Are Created Equal There are various levels of loan approval in the mortgage world. If you’ve been considering a home purchase, you’ve likely come across the terms mortgage pre-qual or mortgage pre-approval. As the names suggests, it’s a preliminary step in the home loan approval process, a sort of “seeing where you stand. ” A pre-qual is the less robust of the two and often just involves light calculations (sans any real paperwork) to determine your purchasing power. Depending on the bank or lender in question, a pre-approval may involve a credit pull and the furnishing of certain documentation such as pay stubs, tax returns, and bank statements. With this information in hand, a lender can give you a fairly good idea of how much house you can afford and whether you qualify for a home loan. It’s still pretty preliminary though, which explains why it’s called a pre-approval. And it’s also not a formal loan application, nor... --- > There are many different people involved in the home loan process. I wrote about this in detail already, but probably didn’t even include everyone. - Published: 2024-05-21 - Modified: 2024-05-22 - URL: https://www.thetruthaboutmortgage.com/what-is-a-mortgage-account-executive/ - Categories: Mortgage Tips There are many different people involved in the home loan process. I wrote about this in detail already, but probably didn’t even include everyone. Because getting a mortgage is a pretty big deal, a lot of hands are needed to ensure it goes according to plan. There are also several ways to obtain a home loan, which require different participants. For example, if you choose to use a mortgage broker to get your loan, an “account executive” will be in the mix. The Role of a Mortgage Account Executive A mortgage account executive, or AE for short, works as a liaison between a mortgage broker and the wholesale lender they represent. With regard to mortgage lending, wholesale simply means business-to-business (B2B) instead of retail, which is direct-to-consumer (B2C). Simply put, AEs are NOT consumer-facing and have no interaction with borrowers whatsoever. Instead, they communicate with the mortgage broker, who in turn corresponds with the borrower. Typically, AEs hold an internal role at the wholesale lender they represent, meaning they don’t leave the office unless they’re doing a sales pitch. They simply field phone calls from third-party mortgage brokers and work with their staff internally to originate and close loans. Mortgage brokers rely on AEs to get loan pricing, submit loans to underwriting, clear conditions once approved, provide status updates, and eventually fund their loans. In a way, they act similarly to a retail loan officer, but deal with another mortgage professional as opposed to a consumer. What a Typical Day... --- > You may have heard recently that "tappable" home equity has reached an all-time high, thanks to rapidly appreciating home prices and conservative - Published: 2024-05-15 - Modified: 2024-05-15 - URL: https://www.thetruthaboutmortgage.com/heloc-vs-credit-card-why-the-plastic-may-work-out-better/ - Categories: Mortgage Matchups, Mortgage Tips You may have heard recently that "tappable" home equity has reached an all-time high, thanks to rapidly appreciating home prices and conservative borrowing on behalf of existing homeowners. If you haven’t, know that some 48 million homeowners have around $11 trillion in equity at their disposal. This assumes a maximum 80% loan-to-value ratio (LTV), according to ICE’s latest Mortgage Monitor report for May 2024. That figure is about double what it was back in early 2018, when it stood at around $5. 5 trillion, which sounds pretty unbelievable. Put another way, millions of homeowners with a mortgage have the ability to tap into their home equity, either via a home equity line of credit (HELOC), home equity loan, or a traditional cash-out refinance. And the average borrower can access about $206,0000, up from $185,000 at the same time last year. In addition, they can do so while keeping a 20% cushion between outstanding loan balances and their property value. But because current mortgage rates are more than double recent lows, borrowers may not be interested in doing any of those things. Ironically, this will just drive up that amount of tappable equity, as borrowers continue to eschew borrowing and pay down their mortgages. Instead of a HELOC, Why Not Just Use a Credit Card? If you need cash for home renovations you don't necessarily need to tap equity It's possible to get a fairly high-limit credit card and 0% APR for nearly 2 years Some contractors even allow credit card... --- > I spoke to a friend the other day who is selling their home and moving up to a bigger one. Crazy I know! What with home prices where they are the mortgage - Published: 2024-05-13 - Modified: 2024-06-28 - URL: https://www.thetruthaboutmortgage.com/want-to-move-but-have-a-super-low-mortgage-rate/ - Categories: Home Buying, Mortgage Rates, Mortgage Tips I spoke to a friend the other day who is selling their home and moving up to a bigger one. Crazy I know! What with home prices where they are the mortgage rates more than double their early 2022 levels. Despite this, they needed more space (and wanted a new locale) and were ready to move on from their old home. Sure, it might not be the best time to buy a home, but it’s not always about the financials. And even so, they’ve got a plan to offset the big jump in interest expense. They’ve Currently Got a 30-Year Fixed Mortgage Set at 2. 75% First some background on the deal. They purchased their existing home around 2012, which was basically the housing market bottom post-GFC. This was one of the very best times to purchase a home in recent memory. Aside from seeing their home nearly triple in value, they also snagged a crazy low mortgage rate. A 30-year fixed at 2. 75%. Pretty hard to beat. The purchase price of the home was around $400,000, and is expected to sell for around $1 million today. Also pretty hard to beat! Problem is, mortgage rates are now closer to 7% and home prices on replacement homes are comparatively high as well. In short, if you sell today you take on a much higher mortgage rate and sales price. This means a significantly higher payment. They can actually absorb the higher payment, but they know swapping a 2. 75%... --- > Mortgage Q&A : “Which mortgage should I pay off first?” Today we're going to talk about strategy if you hold multiple mortgages and want to reduce - Published: 2024-05-01 - Modified: 2024-05-02 - URL: https://www.thetruthaboutmortgage.com/which-mortgage-should-i-pay-off-first/ - Categories: Mortgage Rates, Mortgage Tips Mortgage Q&A : “Which mortgage should I pay off first? ” Today we're going to talk about strategy if you hold multiple mortgages and want to reduce your total interest expense by paying one off ahead of schedule. It's not uncommon to have multiple mortgages, such as a first and second mortgage tied to the same property. Or perhaps a couple mortgages on separate properties, such as one on a primary home and another on a second home (or investment property). Before we dig into the details, paying down the loan with the higher interest rate is generally advised. Generally Best to Pay Off Highest Interest Rate First Like any other loan or credit card you have it's typically beneficial to pay off the one with the highest interest rate first This usually means a second mortgage (as they often feature very high mortgage rates) Or a mortgage tied to a second home or investment property (they also carry higher rates) But you should do the math with an early payoff calculator to be sure of your decision Let's consider an example. If you’ve got a first mortgage with an interest rate of 6%, and a second mortgage set at 12%, it’d probably be in your best interest to knock out that second mortgage sooner rather than later. That means making extra mortgage payments on the second mortgage if you’ve got the money handy (assuming you actually wish to pay down your mortgage ahead of time). These days you have... --- > How an assumable mortgage works and why they might get super popular with mortgage interest rates above 7%. - Published: 2024-04-30 - Modified: 2025-02-21 - URL: https://www.thetruthaboutmortgage.com/assumable-mortgages-set-to-get-popular-once-rates-rise/ - Categories: Home Buying, Mortgage Rates, Mortgage Tips It's time to talk about assumable mortgages. Everyone knows mortgage rates are no longer super cheap. The popular 30-year fixed was in the low 3% range just last year and today is closer to 7. 5%. And it's possible mortgage rates could move higher before they move lower, though they could be close to peaking. For existing homeowners, this has created a strange dynamic where they are effectively "locked-in" by their low rates. In other words, they have less incentive to move out if they need to buy again and subject themselves to a higher interest rate on their next home purchase. But if their mortgage is "assumable," they could use it as a leverage to sell their home for more money. Key Takeaways on Assumable Mortgages Assumable mortgages let buyers take over a seller’s home loan, including the outstanding loan amount, interest rate, and remaining loan term FHA, VA, and USDA loans are assumable, while conventional loans (such as Fannie/Freddie) typically are NOT Assuming a 3% 30-year fixed is much more attractive than taking out a new 7% mortgage But home sellers might list their property higher if you can assume their loan And you might need a very large down payment or second mortgage to bridge the gap between purchase price and outstanding loan amount Also note that loan assumptions can be time-consuming and difficult to close How an Assumable Mortgage Works Assumable mortgages can be transferred from one borrower to another on the same property A homeowner... --- > I’ve already covered the mortgage underwriter’s role, so let’s take a look at what mortgage loan processors do too. After you speak to a mortgage broker - Published: 2024-04-29 - Modified: 2025-01-16 - URL: https://www.thetruthaboutmortgage.com/what-do-loan-processors-do/ - Categories: Mortgage Tips I’ve already covered the mortgage underwriter’s role, so let’s take a look at what mortgage loan processors do too. After you speak to a mortgage broker or loan officer and agree to move forward with a loan application, a processor may reach out to gather required paperwork. This individual is responsible for prepping and organizing your loan file and getting it over to the underwriting department for approval. Other than that, they can also answer questions, provide status updates, and guide you through the loan process from start to finish. In that sense, they play an integral role in getting your loan funded while acting as a liaison between you and all parties to the loan. Loan Processors Are the Workhorse Behind Your Mortgage A loan processor's main function is to assist mortgage brokers and loan officers from application to funding They compile and review important paperwork from the borrower like pay stubs and bank statements And look out for any red flags along the way that could create issues or headaches They also communicate with all parties to the loan from start to finish to ensure everything goes smoothly Loan processors, also known as loan coordinators, are very important figures in the home loan process, and often quite knowledgeable about mortgages as well. They are the loan officer's right-hand man/woman that assists with loan prep and all the day-to-day stuff that happens from loan origination to loan funding. This includes gathering paperwork from the borrower, determining loan eligibility, reviewing... --- > Here’s some Q&A with regard to the home loan approval process: “What do underwriters do?” Once you actually apply for a home loan, your mortgage - Published: 2024-04-23 - Modified: 2025-03-19 - URL: https://www.thetruthaboutmortgage.com/what-do-underwriters-do/ - Categories: Home Buying, Mortgage Tips Here’s some Q&A with regard to the home loan approval process: “What do underwriters do? ” Once you actually apply for a home loan, your mortgage application will be organized by a loan processor and then sent along to a loan underwriter, who will determine if you qualify for a mortgage. The underwriter can be your best friend or your worst enemy, so it's important to put your best foot forward. The expression, "you've only got one chance to make a first impression" comes to mind here. Trust me, you'll want to get it right the first time to avoid going down the bureaucratic rabbit hole. The Underwriter Will Approve, Suspend, or Decline Your Mortgage Application After you formally apply for a home loan your file will be submitted to the underwriting department A human underwriter will then review your loan application and decision it Their job is to approve, suspend, or decline your application based on its contents It's paramount to submit a clean file to boost your chances of loan approval Simply put, the loan underwriter's job is to approve, suspend, or decline your mortgage application. If the loan is approved, you'll receive a list of "conditions" which must be met before you receive your loan documents. So in essence, it's really a conditional loan approval. If the loan is suspended, you’ll need to supply additional information or loan documentation to move it to approved conditional status. If the loan is declined, you’ll more than likely need to... --- > If you’re having trouble obtaining a home loan, perhaps after speaking to multiple banks, lenders and even a mortgage broker, consider reaching out to a - Published: 2024-04-22 - Modified: 2024-08-17 - URL: https://www.thetruthaboutmortgage.com/use-portfolio-lenders-for-hard-to-close-mortgage-deals/ - Categories: Mortgage Tips If you’re having trouble obtaining a home loan, perhaps after speaking to multiple banks, lenders and even a mortgage broker, consider reaching out to a "portfolio lender. " Simply put, portfolio lenders keep the loans they originate (instead of selling them off to investors), which gives them added flexibility when it comes to underwriting guidelines. As such, they might be able to offer unique solutions others cannot, or they could have a special loan program not found elsewhere. For example, a portfolio lender may be willing to originate a no-down payment mortgage while others are only able to provide a loan up to 97% loan-to-value (LTV). Or they could be more forgiving when it comes to marginal credit, a high DTI ratio, limited documentation, or any other number of issues that could block you from obtaining a mortgage via traditional channels. What Is a Portfolio Loan? A home loan kept on the bank's books as opposed to being sold off to investors May come with special terms or features that other banks/lenders don't offer Such as no down payment requirement, an interest-only feature, or a unique loan term Can also be useful for borrowers with hard-to-close loans who may have been denied elsewhere In short, a "portfolio loan" is one that is kept in the bank or mortgage lender's portfolio, meaning it isn't sold off on the secondary market shortly after origination. This allows these lenders to take on greater amounts of risk, or finance loans that are outside the... --- > A detailed overview of how mortgage refinancing works, including examples and a breakdown of different types of refinances. - Published: 2024-04-17 - Modified: 2025-02-10 - URL: https://www.thetruthaboutmortgage.com/how-does-refinancing-work/ - Categories: Mortgage Tips, Refinance Trade In Your Old Home Loan for a New One Fundamental mortgage Q&A: “How does mortgage refinancing work? ” When you refinance a mortgage, you trade in your old home loan for a new one in order to get a lower interest rate, cash out of your home, and/or to switch loan programs. In the process, you'll also wind up with a new mortgage term, and possibly even a new loan balance if you elect to tap into your home equity. You may choose to obtain this new mortgage from the same bank (or loan servicer) that held your old loan, or you may refinance your home loan with an entirely different lender. That choice is up to you. It's certainly worth your while to shop around if you're thinking about refinancing your mortgage, as your current lender may not offer the best deal. I've seen first-hand lenders try to talk their existing customers out of a refinance simply because there wasn't an incentive for them. So be careful when dealing with your current lender/servicer. Anyway, the bank or mortgage lender that funds your new mortgage pays off your old loan balance with the proceeds from the new loan, thus the term refinancing. You are basically redoing your loan. In a nutshell, most borrowers choose to refinance their mortgage either to take advantage of lower interest rates or to access equity they've accrued in their home. Two Main Types of Mortgage Refinancing As noted, a mortgage refinance is essentially a... --- > A reader recently asked, “What mortgage rate can I get with my credit score?” So I figured I’d try to clear up a somewhat complex question. With mortgage - Published: 2024-04-16 - Modified: 2024-04-16 - URL: https://www.thetruthaboutmortgage.com/what-mortgage-rate-can-i-get-with-my-credit-score/ - Categories: Mortgage Rates, Mortgage Tips A reader recently asked, “What mortgage rate can I get with my credit score? ” So I figured I’d try to clear up a somewhat complex question. With mortgage rates no longer at all-time lows (sigh), borrowers looking to refinance a mortgage or purchase a home are facing an uphill battle. Today, it's much more common for your rate to start with a 6 or 7 as opposed to a 2 or 3. While these higher rates aren't bad historically, the velocity of change over the past few years has been dramatic. This contrasts those 1980s mortgage rates, which were already high before simply moving even higher. But no matter where mortgage rates are, your credit score will play a huge role in determining whether you get a good, average, or not-so-good rate. What you see advertised isn't always what you get, and could in fact be a lot higher if you've got marginal credit scores. Conversely, you might be able to score a below-market rate if you've got an excellent FICO score. Let's explore why that is so you can set the right expectations and avoid any unpleasant surprises when you finally speak to a lender. Mortgage Rates Are Based on Your Credit Score The illustration above should give you an idea of the importance of credit scores When it comes to mortgages even a small difference in rate can equate to thousands of dollars Someone could have a rate 0. 75% higher (or more) based on credit score... --- > We’ve finally got data for 2023 and United Wholesale Mortgage (UWM) left no doubt that it was the top mortgage lender during the year. And by a wide - Published: 2024-04-15 - Modified: 2025-04-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-2023/ - Categories: Mortgage News We’ve finally got data for 2023 and United Wholesale Mortgage (UWM) left no doubt that it was the top mortgage lender during the year. And by a wide margin. The Pontiac, Michigan-based company mustered an impressive $108. 5 billion in home loan volume, despite only operating in the wholesale lending channel. That was more than enough to unseat Rocket Mortgage from the top spot, with their crosstown rivals only able to originate about $76. 3 billion. It then dropped off significantly, with third place Chase closing just $38. 4 billion in home loans. In total, more than 5,000 mortgage companies nationwide funded roughly $1. 8 trillion in home loans during 2023, a sizable drop from the $2. 3 trillion seen in 2022. Last year was a very difficult year for the mortgage industry, with rapidly rising mortgage rates wreaking havoc on refis and challenging home buyer affordability. Still, some companies managed to increase market share and climb the leaderboard. Read on to see who else made the top 10. Top Mortgage Lenders of 2023 (Overall Leaders) Ranking Company Name 2023 Loan Volume 1. United Wholesale Mortgage $108. 5 billion 2. Rocket Mortgage $76. 3 billion 3. Chase $38. 4 billion 4. Wells Fargo $32. 1 billion 5. CrossCountry Mortgage $29. 6 billion 6. Bank of America $28. 5 billion 7. Fairway Independent $26. 9 billion 8. U. S. Bank $25. 7 billion 9. DHI Mortgage $21. 7 billion 10. loanDepot $21. 5 billion As noted, UWM claimed the #1 spot... --- > Mortgage Q&A: “Why are refinance rates higher?” If you’ve been comparing mortgage rates lately in an effort to save some money on your home loan, you - Published: 2024-04-15 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-are-refinance-rates-higher/ - Categories: Mortgage Rates, Mortgage Tips, Refinance Mortgage Q&A: “Why are refinance rates higher? ” If you’ve been comparing mortgage rates lately in an effort to save some money on your home loan, you may have noticed that refinance rates are higher than purchase loan rates. This seems to be the case for a lot of big banks out there, including Chase, Citi, and Wells Fargo, which while enormous institutions, aren’t necessarily the leaders in the mortgage biz anymore. In fact, today United Wholesale Mortgage in the #1 spot, followed by Rocket Mortgage, then a mix of these big banks and nonbanks, including CrossCountry Mortgage, Fairway Independent Mortgage, and others. So why is that some of the big guys list “purchase rates” and “refinance rates” separately, with different pricing, points, and APRs? Well, for starters a home purchase is not the same as a mortgage refinance, despite both processes being very similar, and the underlying loans themselves not much different. Ultimately, a home purchase loan is for someone who has yet to buy a property, whereas a mortgage refinance is for an existing homeowner who wants to redo their home loan. We know they are different objectives, but if the underlying loans are both 30-year fixed mortgages with the same loan amounts, the same borrower credit scores, and the same property types, why should rates be any different? Let's find out. Home Purchase Mortgages Default the Least There are three main types of mortgages, including home purchase loans, rate and term refinances, and cash out refinances. The... --- > Mortgage Q&A: “Does the Fed control mortgage rates?” With all the recent hubbub concerning mortgage rates, and the Fed, you might be wondering how it - Published: 2024-03-28 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/does-the-fed-control-mortgage-rates/ - Categories: Mortgage Rates, Mortgage Tips Mortgage Q&A: “Does the Fed control mortgage rates? ” With all the recent hubbub concerning mortgage rates, and the Fed, you might be wondering how it all works. Does the Federal Reserve decide what the interest rate on your 30-year fixed mortgage is going to be? Or is it dictated by the open market, similar to other products and services, which are supply/demand driven. Before getting into the details, we can start by saying the Fed doesn’t directly set mortgage rates for consumers. But it’s a little more complicated than that. The Federal Reserve Plays a Role in the Direction of Mortgage Rates A more accurate way of defining the Fed/mortgage rate relationship Is that it might be an indirect, long-term one that takes a lot of time to materialize If the Fed is raising rates over time, long-term mortgage rates may eventually follow The same is true if the Fed is guiding rates lower, as common economic factors typically affect both As noted, the Federal Reserve doesn’t set mortgage rates. They don’t say, “Hey, the housing market is too hot, we’re increasing your mortgage rates tomorrow. Sorry. ” This isn’t why the 30-year fixed started the year 2022 at around 3. 25%, and is now closer to 7% today. But you could argue that the Fed indirectly influences mortgage rates. Ultimately, the Fed is just trying to control inflation via short-term rates. This in turn dictates how longer-term rates may play out. Essentially, the market for longer-term rates such... --- > Well, so much for mortgage rates falling just in time for the spring home buying season. While many expected interest rates to be lower by now, they’ve - Published: 2024-03-20 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/fannie-mae-and-freddie-mac-expect-mortgage-rates-to-be-higher-for-longer/ - Categories: Mortgage News, Mortgage Rates Well, so much for mortgage rates falling just in time for the spring home buying season. While many expected interest rates to be lower by now, they’ve proven to be pretty sticky at current levels. At last glance, the 30-year fixed is still hovering close to 7%, albeit better than October 2023 when it was around 8%. But there was hope we’d see rates in the 6% range by now and maybe even lower if the Fed had cut rates earlier. Interestingly, rates are actually pretty well aligned with the 2024 mortgage rate predictions made at the end of last year. The likes of Fannie Mae and the Mortgage Bankers Association pegged the popular loan program at 7% for the first quarter of 2024. And that’s pretty much where we stand today. The bad news is they’ve now indicated that it could take longer for rates to fall to more agreeable levels. Fannie Mae Has Adjusted Its Mortgage Rate Forecast Higher for 2024 and 2025 In Fannie Mae’s March forecast, they noted that their “interest rate forecast has been upgraded. ” And not upgraded in a good way. Upgraded as in expect higher mortgage rates for the foreseeable future. Just how bad is it? Well, after making adjustments a month earlier, they’ve since made upgrades of four-tenths and five-tenths, for the years 2024 and 2025, respectively. This puts the 30-year fixed at an average of 6. 6% in 2024 and 6. 2% in 2025. In other words, no sub-6% mortgage... --- > Lately, mortgage rates have surged higher, climbing from as low as 2% to over 8% in some cases. Despite this, home builders have been enjoying healthy - Published: 2024-03-07 - Modified: 2025-01-29 - URL: https://www.thetruthaboutmortgage.com/why-dont-home-builders-lower-prices-if-mortgage-rates-are-way-higher/ - Categories: Home Buying, Mortgage Rates, Mortgage Tips Lately, mortgage rates have surged higher, climbing from as low as 2% to over 8% in some cases. Despite this, home builders have been enjoying healthy sales of newly-built homes. And somewhat incredibly, they haven’t had to lower their prices in many markets either. The question is how can they continue to charge full price if financing a home has gotten so much more expensive? Well, there are probably several reasons why, which I will outline below. Home Builders Don’t Have Competition Right Now The first thing working in the home builders’ favor is a lack of competition. Typically, they have to contend with existing home sellers. A healthy housing market is dominated by existing home sales, not new home sales. If things weren’t so out of whack, we’d be seeing a lot of existing homeowners listing their properties. Instead, sales of newly-built homes have taken off thanks to a dearth of existing supply. In short, many of those who already own homes aren’t selling, either because they can’t afford to move. Or because they don’t want to lose their low mortgage rate in the process. This is known as the mortgage rate lock-in effect, which some dispute, but logically makes a lot of sense. At the same time, home building slowed after the early 2000s housing crisis, leading to a supply shortfall many years later. Simply put, there aren’t enough homes on the market, so prices haven’t fallen, despite much higher mortgage rates. They Don't Need to Lower Prices... --- > The Biden Administration has just unveiled a number of proposals to make homeownership more affordable. Aside from legislation to build and renovate more - Published: 2024-03-07 - Modified: 2024-03-09 - URL: https://www.thetruthaboutmortgage.com/president-biden-proposes-new-10000-mortgage-relief-credits/ - Categories: Home Buying, Mortgage News The Biden Administration has just unveiled a number of proposals to make homeownership more affordable. Aside from legislation to build and renovate more than two million homes, they are calling on Congress to approve a pair of new “mortgage relief credits. ” One targets prospective home buyers grappling with significantly higher mortgage rates, while the other addresses home sellers dealing with mortgage rate lock-in. Both are intended to increase the supply of homes for sale, which has been below healthy levels for several years now. The question remains whether incentivizing home buying is what’s necessary for the housing market at the moment. $5,000 Tax Credit for Two Years for First-Time Home Buyers The mortgage relief that targets home buyers would provide a tax credit of $5,000 for two years to first-time home buyers. Generally, this is defined as someone without ownership interest in the three years preceding the home purchase. In total, these new home buyers could snag $10,000 in tax savings over the first two years. A tax credit directly reduces your tax bill, unlike a deduction, which simply reduces your taxable income. This piece of legislation is intended to tackle the high mortgage rates currently available, which nearly tripled from below 3% to above 8% recently. Per the White House fact sheet, the $10,000 in savings is the equivalent of reducing the borrower’s mortgage rate by more than 1. 5 percentage points on a median-priced home. At last glance, the median home was valued at roughly $418,000. Of... --- > Mortgages can be viewed very differently. Some see them as a positive financial instrument, a way to free up their money so it can be invested elsewhere, - Published: 2024-03-04 - Modified: 2025-03-19 - URL: https://www.thetruthaboutmortgage.com/the-power-of-extra-mortgage-payments/ - Categories: Mortgage Tips Mortgages can be viewed very differently. Some see them as a positive financial instrument, a way to free up their money so it can be invested elsewhere, ideally for a better return. Then there are those who view mortgages as the root of all evil, as a debt overhang that must be terminated as quickly as possible. Whatever your stance, you’ve probably entertained the idea of making “extra mortgage payments,” though you may not know the exact impact, due to the complexity of mortgage amortization. Fortunately, there are early payoff calculators available that take the guesswork out of the process and make it easy to see how much you can save in a number of different scenarios. Adding an Extra Mortgage Payment of $10 Per Month Even adding a nominal amount such as $5 or $10 On a monthly basis over a long period of time Can save you thousands of dollars on your mortgage And shorten your loan term at the same time Let’s start with a simple scenario where you add just $10 a month in extra payment to principal. Assuming you’ve got a $100,000 loan amount set at 4% on a 30-year fixed mortgage, that extra $10 payment would save you $3,191. 81 over the full loan term. It would also shorten your mortgage by 13 months, meaning your 30-year mortgage would be a 28-year (ish) mortgage. So that’s good news, right? You save thousands and you only have to pay a measly $10 extra per month.... --- > It’s official. United Wholesale Mortgage (UWM) is the nation’s largest mortgage lender. The Pontiac, Michigan-based wholesale lender took the top spot for - Published: 2024-02-28 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/uwm-is-officially-the-nations-largest-mortgage-lender/ - Categories: Mortgage News It’s official. United Wholesale Mortgage (UWM) is the nation’s largest mortgage lender. The Pontiac, Michigan-based wholesale lender took the top spot for all of 2023 after easily beating out former #1 lender Rocket Mortgage. In total, the company funded $108. 3 billion in home loans during the year, compared to Rocket’s $78. 7 billion tally. Crosstown rival Rocket, based in Detroit, had been the nation’s top mortgage lender since 2018. Prior to that, Wells Fargo was the top dog, though the San Francisco bank has steadily shrunk its mortgage footprint over the years. Still, they remain in third place. UWM Generated the Most Loan Volume of Any Mortgage Lender for All of 2023 Similar to their predecessors, UWM was able to beat out the rest of the competition in a quarter or two before getting to the top of the pile. But they finally mustered outright victory for an entire year in 2023, without even needing their fourth quarter production of $24. 4 billion. That’s pretty impressive. Of course, it wasn’t all good news. The company still saw production fall year-over-year from $127. 3 billion in 2022. And they lost money last year as well. UWM recorded a net loss of $69. 8 million in 2023, compared to $931. 9 million of net income in 2022. Though UWM Chairman and CEO Mat Ishbia said they are “operationally profitable,” and that the loss was the result of MSR markdowns related to interest rate movements. Given how difficult of a year it... --- > Perhaps one of the most confusing aspects of getting a mortgage is knowing who you actually pay once the thing funds. And to that end, when your first - Published: 2024-02-27 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/what-is-a-mortgage-loan-servicer/ - Categories: Mortgage Tips Perhaps one of the most confusing aspects of getting a mortgage is knowing who you actually pay once the thing funds. And to that end, when your first mortgage payment is due. While Bank X may have closed your loan, an entirely different company could send you paperwork and a payment booklet. What gives? Well, this highlights the difference between a mortgage lender and a mortgage servicer. The former funds your loan and the latter collects payments each month thereafter until the loan is paid off. Sometimes it's the same company, sometimes it's not, assuming your loan is sold off after closing. Mortgage Lender vs. Mortgage Servicer The bank or mortgage lender processes and funds the home loan Once it closes it may be sold off to a loan servicer or retained in portfolio The job of a loan servicer is to collect monthly mortgage payments And manage escrow accounts if your home loan has impounds As noted, a mortgage loan servicer, also known simply as a loan servicer, is the company that collects your monthly mortgage payments once the loan funds. Each month, you will send payment to this company, which could go on for 30 years depending on how long you keep your loan. They will also manage your escrow account if your home loan has impounds, collecting a portion of property taxes and homeowners insurance each month, before making those payments on your behalf when due. So really, there’s a good chance you’ll deal with your loan... --- > How Much Lower Should Mortgage Rates Be to Refinance? Unfortunately there is no one-size-fits-all answer to this question Because no two loan scenarios - Published: 2024-02-26 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/the-refinance-rule-of-thumb/ - Categories: Mortgage Rates, Mortgage Tips, Refinance How Much Lower Should Mortgage Rates Be to Refinance? Unfortunately there is no one-size-fits-all answer to this question Because no two loan scenarios (or homeowners) are the same You have to factor in existing home loan details along with old rate vs. new And future plans/financial objectives/expected tenure in home, etc. If you’ve considered refinancing your mortgage, you may have searched for the “refinance rule of thumb” to help you make your decision. Funnily enough, there isn’t just a single refinance rule of thumb. There are numerous ones that exist. And before we dive into them, it should be noted that rules don't tend to work universally because there is a laundry list of reasons to refinance a mortgage. What works for one person might not work for another, and if you're relying on some sort of shortcut to make a decision, you might wind up shortchanging yourself in the process. That being said, let's look at some of these "refinance rules" to see if there are any takeaways we can use to our advantage. Only Refinance If the New Mortgage Rate Is 2% Lower Some say to only refinance if you can get a rate 2%+ lower This is definitely not a rule to live by and ultimately very conservative It's possible to save lots of money with a rate that is less than 1% lower There are also other reasons to refinance that aren't always interest rate-dependent One popular refinance rule says you should only refinance if your... --- > If you’re new to real estate and preparing to make an offer on a property, you might be wondering what mortgage is best for a first-time home buyer. This - Published: 2024-02-22 - Modified: 2024-02-22 - URL: https://www.thetruthaboutmortgage.com/whats-the-best-mortgage-for-first-time-buyers/ - Categories: Home Buying, Housing Market, Mortgage Tips If you’re new to real estate and preparing to make an offer on a property, you might be wondering what mortgage is best for a first-time home buyer. This is especially important now that mortgage rates have essentially doubled, putting budgets front and center. It also means the popular 30-year fixed is no longer the default option for home buyers, with cheaper adjustable-rate mortgages now a consideration. While both seasoned homeowners and first-time buyers may wind up with the same exact home loan, there are additional options to consider if you’ve never bought a home before. Let's explore the many loan choices available today to determine what might be best in the current environment. Home Loan Types to Consider If You're a First-Time Buyer Fannie Mae HomeReady (3% down payment) Freddie Mac Home Possible (3% down payment) FHA loans (3. 5% down payment) VA loans (0% down payment for vets/active duty) USDA loans (0% down payment for rural home buyers) State Housing Finance Agency loans (down payment assistance and help with closing costs) Also look for local and national grants for first-time home buyers and Mortgage Credit Certificates (MCCs) I've listed the most common loan types available to first-time home buyers, many of which are also an option for existing homeowners. These generally don't require much in terms of down payment, which seems to be a chief need/want for first-time buyers that don't have the equity of move-up buyers. Personally, I prefer to put down 20% on a home purchase... --- > An in-depth look at the 15-year fixed vs. 30-year fixed mortgage, and the reasons one may be better suited for you. - Published: 2024-02-20 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/30-year-fixed-vs-15-year-fixed/ - Categories: Mortgage Matchups, Mortgage Tips It's time for another mortgage match-up: "15-year fixed vs. 30-year fixed. " As always, there is no one-size-fits-all mortgage solution because everyone is different and may have varying real estate and financial goals. For example, it depends if we're talking about a home purchase or a mortgage refinance. Or if you're a first-time home buyer with nothing in your bank account or a seasoned homeowner close to retirement. Ultimately, for home buyers who can only muster a low down payment, a 30-year fixed-rate mortgage will likely be the only option from an affordability and qualifying standpoint. So for some, the argument isn't even an argument. It's over before it starts. But let's explore the key differences between these two loan programs so you know what you're getting into. 15-Year Fixed vs. 30-Year Fixed: What's Better? The 15-year fixed and 30-year fixed are two of the most popular home loan products available. They are very similar to one another. Both offer a fixed interest rate for the entire loan term, but one is paid off in half the amount of time. That can amount to some serious cost differences and financial outcomes. While it's impossible to universally choose one over the other, we can certainly highlight some of the benefits and drawbacks of each. As seen in the chart above, the 30-year fixed is cheaper on a monthly basis, but more expensive long-term because of the greater interest expense. The 30-year mortgage rate will also be higher relative to the 15-year... --- > It's time for another mortgage match-up: "Cash out vs. HELOC vs. home equity loan." Yes, this is a three-way battle, unlike the typical two-way duels - Published: 2024-02-20 - Modified: 2025-01-14 - URL: https://www.thetruthaboutmortgage.com/cash-out-vs-heloc-vs-home-equity-loan/ - Categories: Mortgage Matchups, Mortgage Rates, Mortgage Tips, Refinance It's time for another mortgage match-up: "Cash out vs. HELOC vs. home equity loan. " Yes, this is a three-way battle, unlike the typical two-way duels found in my ongoing series. Let’s discuss these options with the help of a real-life story involving a buddy of mine. Now that mortgage rates are closer to 7% than they are 3%, there's little reason for existing homeowners to refinance. After all, if you were lucky enough to lock in a fixed mortgage rate in the 2-4% range, why would you exchange it for a rate nearly double that? Chances are you wouldn't, which explains why second mortgages like home equity loans and HELOCs have surged in popularity. Let's take a closer look at popular home equity extraction options to see which may be the best fit for your situation. Perhaps the biggest consideration will be your existing mortgage rate, which you'll either want to desperately keep or be happy to give away. Cash Out Your First Mortgage or Take Out a HELOC/Home Equity Loan Instead? If you have a mortgage and need cash, you've got two main options to access home equity You can refinance your first mortgage and take cash out on top of the existing balance Or you can take out a second mortgage to avoid disrupting the rate/term on the first mortgage This can be in the form of a variable-rate HELOC or a fixed-rate home equity loan A couple years ago, a friend told me he was refinancing... --- > If you’ve been researching mortgages, or are in the process of taking out a home loan, you may have come across the term “impounds” or “escrows.” When you - Published: 2024-02-15 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-impounds-vs-paying-taxes-and-insurance-yourself/ - Categories: Mortgage Matchups, Mortgage Tips If you’ve been researching mortgages, or are in the process of taking out a home loan, you may have come across the term “impounds” or “escrows. ” When you hear these seemingly complex words, the loan officer or mortgage broker is simply referring to an impound account, also known as an escrow account. Here's how it works. Each month, a portion of property taxes and homeowners insurance are collected along with your regular mortgage payment, then disbursed to the appropriate parties when due. This arrangement ensures the lender that taxes and insurance are paid on time, instead of relying on the homeowner to make the payments themselves. It protects the lender's interest in the property since taxes are compulsory and insurance shields the collateral from harm. What Are Mortgage Impounds? A housing payment includes a mortgage, homeowners insurance, and property taxes Impounds (or escrows as they're also known) refers to the automatic collection of taxes and insurance It ensures the homeowner has funds available to make these important payments when due A portion of these costs is taken out of your housing payment each month and set aside until disbursement Many mortgages these days require an escrow account to ensure the timely disbursement of property taxes and homeowners insurance premiums. This account is managed by a third-party intermediary, typically a loan servicer, who collects and disperses funds on behalf of the homeowner. Homeowners pay money into the escrow account at loan closing, and each month after that with their mortgage... --- > I had a conversation with a friend the other day about his current housing situation. In a nutshell, the home he resides in isn’t large enough for his - Published: 2024-02-15 - Modified: 2024-02-15 - URL: https://www.thetruthaboutmortgage.com/is-rent-out-and-rent-the-new-way-to-move-to-a-different-house/ - Categories: Home Buying, Housing Market I had a conversation with a friend the other day about his current housing situation. In a nutshell, the home he resides in isn’t large enough for his family, nor does it have certain amenities like a swimming pool. At the same time, he loves his home and the very cheap mortgage attached. Like millions of other Americans, he’s got a 30-year fixed in the low 3% range. This has created a dilemma for him and many others, who want to move, but can’t make it pencil at today’s rates and asking prices. But one thought is to rent out his current home and then rent another, as opposed to buying. Or selling for that matter. It’s Possible to Rent Out Your Current Home and Rent Yourself One trend that has emerged of late is the ‘rent out and rent’ scheme. The way it works is relatively simple. If you’re an existing homeowner, you simply rent out your property to someone else and then go rent a different home. This allows you to keep your low-rate mortgage intact, and it allows you to rent for less than what a new mortgage would cost. It works because the PITI on the old house is so low, and asking rents are pretty attractive in many markets nationwide. Sure, there might be a premium for rent on the new property, but it can still be the cheaper option relative to buying a home. And the homeowner doesn’t need to worry about a large... --- > With mortgage rates no longer at or near record lows, the refinance question has become a lot more complex. It used to be a no-brainer to refinance if you - Published: 2024-02-14 - Modified: 2024-02-20 - URL: https://www.thetruthaboutmortgage.com/refinance-questions/ - Categories: Mortgage Tips, Refinance With mortgage rates no longer at or near record lows, the refinance question has become a lot more complex. It used to be a no-brainer to refinance if you hadn't in a while, with 30-year fixed rates in the 2-3% range for many years thanks to the Fed and their mortgage-backed securities (MBS) buying spree. But those days have come and gone, and today the only homeowners looking to refinance probably got their mortgage when rates were closer to 8%. Of course, there are myriad reasons to refinance and you’ve likely pondered one at some point if you’re already a homeowner. You probably have a lot of questions too, especially if it’s your first time refinancing a home loan. Let’s clear up some of the confusion by tackling some of the most common refinance questions out there. 1. When is a good time to refinance? As noted, mortgage rates are no longer near their record lows, sadly. In fact, they've since more than doubled as inflation finally forced the Fed's hand. This has made refinancing attractive to only a select few at the moment. In the not-too-distant past, it used to be anyone with a stale interest rate. No longer... But there are other reasons to refinance too, such as to tap home equity to furnish improvements or to pay down other debt or other expenses. You just have to be mindful of losing your low rate in the process, assuming you currently have a low rate. If you do,... --- > I’ve already written at length about the pros and cons of a 15-year fixed mortgage, but some financial experts claim you shouldn’t even buy a home if you - Published: 2024-02-13 - Modified: 2024-03-19 - URL: https://www.thetruthaboutmortgage.com/should-you-only-buy-a-house-if-you-can-afford-a-15-year-fixed-mortgage-payment/ - Categories: Housing Market, Mortgage Tips I’ve already written at length about the pros and cons of a 15-year fixed mortgage, but some financial experts claim you shouldn’t even buy a home if you can’t afford this shorter-term mortgage option. You know, guys like Dave Ramsey, and perhaps more reasonable folks like that financial planner you visited recently. The problem is that many, many Americans simply can’t afford the higher monthly payments tied to a 15-year fixed mortgage, for better or worse. And that shouldn't necessarily stop them from purchasing a home. This isn't dissimilar to buying a home with less than 20% down if it means getting in the door several years earlier. 15-Year Mortgage or Bust? Some financial gurus argue if you can't afford the 15-year fixed mortgage payment You're buying too much home or simply shouldn't be buying at all But this "rule" is simply too rigid for my liking and could set you back in the long run You can always pay more each month, refinance if rates improve, or put your cash to use elsewhere Let’s talk about the rationale behind this theory first to see why it's often suggested. With a 15-year fixed mortgage, you own your home in, you guessed it, half the time. Just a decade and a half versus the lengthy three decades it takes to pay off a more common 30-year fixed-rate mortgage. That’s the first big benefit, obviously. Another is you save an absolute ton on interest because the amortization period is cut in half... --- > These days, the world is full of misinformation. You can thank the Internet for that, which has led to an explosion in content, both good and bad. Social - Published: 2024-02-12 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-myths/ - Categories: Credit Scores, Mortgage Rates, Mortgage Tips, Refinance These days, the world is full of misinformation. You can thank the Internet for that, which has led to an explosion in content, both good and bad. Social media isn't much help either, with everyone looking to go viral regardless of what they say is actually true. Let's put some common mortgage myths to bed once and for all so you don't inadvertently miss out on becoming a homeowner. After all, property owners tend to acquire a lot more wealth than renters, so why let these falsehoods stand in your way? You Need Perfect Credit to Get a Mortgage Let’s start with credit because it’s a biggie. Lots of renters seem to think you need a 700+ FICO score to get a home loan. This simply isn't true, nor anywhere close to the truth. Sure, a higher credit score can help you get a lower mortgage rate, but it’s not necessary to qualify. In fact, you can get an FHA loan with a credit score as low as 500, and there’s technically no minimum score for VA loans (though lenders do impose floors). When it comes to a conforming loan backed by Fannie Mae or Freddie Mac (the most common loan type), you only need a 620 FICO. These aren’t particularly high credit scores, or anything I’d refer to as “good” or even “average credit. ” At last glance, the average FICO score was over 700. Simply put, you can get a mortgage with a low credit score. And while... --- > Real estate Q&A: "When should you start looking for a house?" The short answer: Immediately. That is, if you want to buy a home at some point in the - Published: 2024-02-07 - Modified: 2024-02-07 - URL: https://www.thetruthaboutmortgage.com/when-should-you-start-looking-for-a-house/ - Categories: Housing Market, Mortgage Tips Real estate Q&A: "When should you start looking for a house? " The short answer: Immediately. That is, if you want to buy a home at some point in the next year, or any time thereafter. We’ll get into the specifics in a moment, but there’s really no sense in waiting if you want to own a home or condo because it’s always going to be a lengthy process. Sure, once you find “the one” it might only take a month, or even less, to close escrow, thanks to new technologies that are making the actual transactional piece faster. But the sale is just one slice of the pie, and usually the fastest part. Personally, whenever I’ve looked for real estate, it’s been a long, long search. We’re talking many months if not a year or longer. Consider All Aspects of the Home Buying Process Decide you want to buy a home (might be a long or short process) Determine if you're able to afford one (seek out mortgage pre-approval) Might need additional time to save for down payment and/or improve credit Start looking at listings (set saved searches and alerts on popular apps) Find a real estate agent to work with (can be early on or late in the process) Attend open houses, tour properties, and find one you like Make an offer the seller accepts Conduct inspections of the property Secure financing and close your loan It’ll Probably Take You Over a Year to Find a Home If... --- > Mortgage Q&A: “Does refinancing hurt your credit score?” Everyone seems to be obsessed with their credit scores and what impact certain actions may - Published: 2024-02-06 - Modified: 2024-05-28 - URL: https://www.thetruthaboutmortgage.com/does-refinancing-hurt-your-credit-score/ - Categories: Credit Scores Mortgage Q&A: “Does refinancing hurt your credit score? ” Everyone seems to be obsessed with their credit scores and what impact certain actions may have on them. Perhaps the credit bureaus are to blame since they're constantly urging us to check our scores for any changes. Let's cut right to the chase. When it comes to mortgage refinancing, your credit score probably won’t be negatively impacted unless you’re a serial refinancer. Like anything else, moderation is key here. And the savings could easily outweigh any drop in scores, which will likely be minimal and temporary anyway. A Mortgage Refinance Will Result in a Credit Pull A refinance is treated as a new line of credit (since it's a new loan! ) It will also involve a credit report pull (possibly several if you shop around) And the closure of the old loan that is being paid off via the transaction All three of these actions MAY reduce your credit scores, at least temporarily When you refinance your home loan, the bank or mortgage lender will pull your credit report and you’ll be hit with a hard credit inquiry as a result. It'll stay on your credit report for two years, but only affect your scores for the first 12 months. What's more, it will show up on all three credit reports with all three credit bureaus. This includes Equifax, Experian, and TransUnion. The credit inquiry alone might lower your credit score 5-10 points. But if you’re constantly refinancing and/or applying... --- > Similar to stocks and bonds, mortgage rates can move higher or lower daily based on economic reports and market conditions. - Published: 2024-02-02 - Modified: 2024-02-03 - URL: https://www.thetruthaboutmortgage.com/do-mortgage-rates-change-daily/ - Categories: Mortgage Rates, Mortgage Tips The latest mortgage Q&A: “Do mortgage rates change daily? ” It’s that time again folks, where I answer your burning mortgage questions. Mortgage rates are hot news right now. After the 30-year fixed surpassed 8% in October, a near-21st century high, it has since come down to below 7%, though just barely. The hope is this trend continues into 2024 and rates eventually dip below 6%. But as always, expect the unexpected when it comes to mortgage rates or you'll be caught off guard. Lately, mortgage rates have been extremely volatile as a result of ongoing inflation concerns, the end of the government's MBS buying program, and the economy at large. So when shopping for a home loan, it’s now more important than ever to keep a close eye on rates, because they can and will change daily (learn more about how mortgage rates are determined). Mortgage Rate Sheets Are Printed Monday Through Friday New lender rate sheets are released daily throughout the week Monday through Friday unless it's a holiday (not on weekends) Sometimes interest rates will be different, sometimes they'll remain unchanged It depends what transpired the day before and/or the morning of the release Each morning, Monday through Friday, banks and their loan officers get a fresh "mortgage rate sheet" that contains loan pricing for that day. I know because when I first started in the industry, I got tasked with handing them out to fellow employees (back when we used paper). I'll never forget kicking the... --- > Mortgage Q&A: "Are mortgage points worth it?" When taking out a mortgage, whether for a new home purchase or to refinance an existing loan, one - Published: 2024-02-01 - Modified: 2025-02-19 - URL: https://www.thetruthaboutmortgage.com/are-mortgage-points-worth-the-cost/ - Categories: Mortgage Rates, Mortgage Tips Mortgage Q&A: "Are mortgage points worth it? " When taking out a mortgage, whether for a new home purchase or to refinance an existing loan, one decision you’ll have to make is if it’s worth paying mortgage points to obtain an even lower interest rate. Before we get into that, it’s important to note that the term “points” gets thrown around loosely, and can refer to the loan origination fee and/or discount points. The loan origination fee is the commission charged by the bank or loan officer in exchange for working on your loan, whereas discount points are optional costs used to buy down your interest rate. It’s an important distinction because the loan origination charge is basically unavoidable (they need to eat, right? ). Whereas paying discount points (prepaid interest) is entirely optional depending on the interest rate you desire. Note that not all lenders charge loan origination fees, but that could just mean the cost is already baked into the (higher) interest rate. Either way, take the time to compare lenders' rates and fees to ensure you get the best combination of both. Key Takeaways on Paying Mortgage Points Discount points lower your mortgage rate in exchange for an upfront fee Example: Upfront cost of $5,000 to save $100/mo. on your mortgage This would take 50 months to break even and begin saving money If you keep the loan past the break-even period (cost ÷ savings) you "win" Be careful paying points if you think you'll refi/sell in... --- > Applying for a mortgage can be stressful, what with all the money that’s on the line. Oh, and the possibility that you could be denied entirely, perhaps - Published: 2024-01-24 - Modified: 2024-08-17 - URL: https://www.thetruthaboutmortgage.com/mortgage-lingo/ - Categories: Mortgage Tips Applying for a mortgage can be stressful, what with all the money that’s on the line. Oh, and the possibility that you could be denied entirely, perhaps while starting a family or attempting to relocate to a new state. Making matters worse is the fact that all types of new words are thrown your way, which aside from being confusing, can make it difficult to negotiate a great mortgage rate on your home loan. If you don't know what the salesperson is talking about, how are you going to make your case for a better rate or lower fees? My central message here at TTAM has always been empowerment through knowledge, with the reward being a better mortgage, whether it’s a lower interest rate, fewer closing costs, or simply the right product. If you’re new to the game, you’ve probably got a lot of mortgage questions, and even if it’s not your first time, it never hurts to brush up on the basics. Let’s discuss some common mortgage lingo you might hear as you navigate the housing market, what the words mean, and how knowing them could save you some dough! 1. FICO Let’s start with what’s arguably the most important mortgage-related term out there; your FICO score. I say that because it can greatly impact what mortgage rate you ultimately receive, which can affect your wallet in a major way each and every month for many years to come. If you’re applying for a mortgage, you’ve probably already heard... --- > The most popular mortgage questions from aspiring home buyers and existing homeowners, all answered in one convenient place. - Published: 2024-01-18 - Modified: 2024-08-05 - URL: https://www.thetruthaboutmortgage.com/21-mortgage-questions-that-are-commonly-asked-answered/ - Categories: Mortgage Rates, Mortgage Tips I figured it'd be helpful to create a post that answers the top "mortgage questions" people ask, all in one convenient place. You should know the answers to these questions if you're serious about getting a mortgage and ready to buy a home. And you might be better off hearing it from an objective source, before you make contact with a loan officer or real estate agent. Armed with this knowledge ahead of time, you'll be more confident in your decision-making and recognize if you're being taken for a ride. Mortgage Questions and Answers 1. What will my mortgage rate be? 2. How long is my mortgage rate good for? 3. How do you calculate a mortgage payment? 4. What is a mortgage refinance? 5. How much will my housing payment really be? 6. When is the first mortgage payment due? 7. What credit score do I need to get approved? 8. What is an FHA mortgage? 9. How large of a mortgage can I afford? 10. Do I need to get pre-qualified for a mortgage? 11. Do I even qualify for a mortgage? 12. Why might I be denied a mortgage? 13. What documents do I need to provide to get a home loan? 14. What does a mortgage broker do? 15. What type of mortgage should I get? 16. How big of a down payment do I need? 17. Do I need to pay mortgage insurance? 18. What are mortgage points? Do I need to pay them? 19.... --- > If you’ve recently applied for a home loan and been bombarded by competing offers, a “trigger lead” might be to blame. Simply put, when your credit is - Published: 2024-01-16 - Modified: 2024-12-09 - URL: https://www.thetruthaboutmortgage.com/what-is-a-trigger-lead/ - Categories: Mortgage Tips If you’ve recently applied for a home loan and been bombarded by competing offers, a “trigger lead” might be to blame. Simply put, when your credit is pulled, other creditors may be alerted in real-time. Armed with your contact information and your intent, they can reach out with competing offers via phone, email, or even snail mail. And the best part is the credit bureaus themselves are the ones selling this information! On the one hand, this can be seen as a major nuisance and/or invasion of privacy. But on the other, a means to shop around for your mortgage with a little less effort. Your Mortgage Application Could Alert the Competition When you apply for a mortgage, a tri-merge credit report will be ordered to determine your FICO scores and associated credit history. This allows lenders to qualify you based on your credit history, which is a key component of mortgage underwriting. A credit score is generated by Equifax, Experian, and TransUnion, collectively known as the three major credit reporting agencies (CRAs). In the process, a credit inquiry is also created, which is a record that you applied for a certain form of credit, be it a credit card, auto loan, or a mortgage on a certain date. This information can then be sold to other creditors who wish do business with you, whether it’s a mortgage lender, insurance company, auto lender, and so on. Your contact information, including name and address, along with your FICO scores, credit history,... --- > Ever wonder how much that real estate agent you constantly see on bus benches or your grocery store receipts makes? Given the ongoing commission lawsuits, - Published: 2024-01-09 - Modified: 2024-08-20 - URL: https://www.thetruthaboutmortgage.com/how-much-does-a-real-estate-agent-make/ - Categories: Home Buying, Housing Market Ever wonder how much that real estate agent you constantly see on bus benches or your grocery store receipts makes? Given the ongoing commission lawsuits, and possible shakeup regarding how they earn money going forward, this is an even more interesting datapoint. Fortunately, the National Association of Realtors (NAR) releases an annual report that details the earnings of its many members. The “2023 National Association of Realtors Member Profile” covers the approximately 1. 58 million active real estate agents in the United States. It found that the median gross income for a “Realtor” was $56,400 in 2022, up from $54,300 in 2021. Very Few Real Estate Agents Earn Six Figures There seem to be really big winners and equally big losers in the residential real estate business Top producers are capable of bringing in $150k+, while many others earn $10k or less annually Median gross income of Realtors increased to $56,400 in 2022 from $54,300 in 2021 The typical agent closed 12 transactions yearly as sales volume increased to $3. 4 million from $2. 6 million First things first, most real estate agents don't make six figures. In fact, median earnings are about half of that. And it's actually even lower for those who function as sales agents as opposed to real estate brokers. These agents earned a median $46,300 in 2022, which surprisingly was up pretty big from $33,800 in 2021. However, there was quite a range in earnings based on years of experience. For a Realtor with 16... --- > With the winter break now finally behind us, it’s time to talk mortgage rates again. Lately, they’ve been on the minds of anyone even remotely interested - Published: 2024-01-08 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/a-record-high-share-of-consumers-believe-mortgage-rates-will-go-down-over-the-next-12-months/ - Categories: Housing Market, Mortgage News, Mortgage Rates With the winter break now finally behind us, it’s time to talk mortgage rates again. Lately, they’ve been on the minds of anyone even remotely interested in buying a home. Or selling a home for that matter, as that can affect home buyer demand as well. The good news is most forecasts are calling for lower mortgage rates throughout 2024. And now there’s another piece of favorable data from Fannie Mae regarding mortgage rates and consumer sentiment. Survey-High 31% of Consumers Expect Mortgage Rates to Fall This Year A report released by Fannie Mae this morning revealed that consumers are growing increasingly bullish on mortgage rates in 2024. Their Home Purchase Sentiment Index (HPSI), which reflects both existing views and future expectations for the housing market, asks respondents which way mortgage rates will go. In the latest survey, a record 31% said they believe mortgage rates will fall over the next 12 months. While 31% may not sound like a lot, consider this share was around 16% in October, and just 4% in December 2021! In other words, sentiment has shifted big time, with mortgage rate expectations doing a virtual 180. Simply put, consumers no longer expect mortgage rates to rise, but rather see them drifting lower after peaking last fall. This is important for the housing market, which suffered mightily in 2023 as transactions plummeted in the face of 8% mortgage rates. But with the expectation that the worst is now behind us and a return to rates in... --- > Well, another year is nearly in the books, which means it’s time to look ahead to what the next 365 days have in store. While 2022 felt like it couldn’t - Published: 2023-12-28 - Modified: 2024-08-16 - URL: https://www.thetruthaboutmortgage.com/2024-mortgage-and-real-estate-predictions/ - Categories: Home Buying, Housing Market, Mortgage Rates, Mortgage Tips, Refinance Well, another year is nearly in the books, which means it’s time to look ahead to what the next 365 days have in store. While 2022 felt like it couldn’t get any worse, 2023 surprised all of us by being an even rougher year. Thanks to the highest mortgage rates in nearly a century, loan origination volume ground to a halt, as did home sales. The only real bright spot was new home sales, though builders had to make some big concessions to unload their inventory. So what does 2024 have in store? Well, the good news might just be that the worst is finally behind us. 1. Mortgage rates will drop below 6% (maybe even 5%) First things first, mortgage rates. While I (and many others) expected mortgage rates to fall in 2023, they defied expectations. Rates began the year 2023 on a downward slope, but quickly reversed course and surpassed 7% by spring. Then things got even worse as rates climbed beyond 8% in October. However, inflation has since cooled and economic reports continue to signal that the worst of it could be over. The Fed has also gotten on board, with their latest dot plot signaling rate cuts for 2024. After raising rates 11 times in less than two years, there could be three or more cuts next year. While the Fed doesn’t control mortgage rates, their monetary policy tends to correlate. So if they’re cutting rates due to a cooling economy, mortgage rates should also fall.... --- > If you’re thinking about buying a home, or refinancing an existing home loan, mortgage rates are likely top of mind. As you may or may not know, mortgage - Published: 2023-12-18 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/how-to-track-mortgage-rates/ - Categories: Mortgage Rates, Mortgage Tips If you’re thinking about buying a home, or refinancing an existing home loan, mortgage rates are likely top of mind. As you may or may not know, mortgage rates can change daily based on market conditions, similar to the stock market. This means they can be higher one day and lower the next. Or they may do next to nothing at all from day to day, or even week to week. But having an idea of which direction they’re going can be helpful, especially if you’re actively shopping your rate. Let’s discuss a simple way to track mortgage rates using readily available economic data. You Can Track Mortgage Rates Using the 10-Year Bond Yield Simply look up the 10-year bond yield on your favorite finance website Check the direction it’s going (like you would a stock ticker) If it’s up then mortgage rates will likely be higher than yesterday If it’s down then mortgage rates will likely be lower than yesterday Hands down, the simplest way to track mortgage rates is the 10-year treasury bond yield. Over time, mortgage rates and the 10-year yield have moved in near lockstep, as seen in the graph above from FRED. In other words, when 10-year yields fall, so do mortgage rates. And when yields rise, mortgage rates climb higher. As for why, many 30-year fixed mortgages are paid off in about a decade. This means the duration is similar to a 10-year bond. But because mortgages have prepayment risk, there is a “spread,”... --- > Mortgage rate pricing can be a bit of a mystery. And also super complex. I’ve written about it in detail (how mortgage rates are determined). But you - Published: 2023-12-14 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/do-we-need-a-mortgage-msrp/ - Categories: Mortgage Rates, Mortgage Tips Mortgage rate pricing can be a bit of a mystery. And also super complex. I’ve written about it in detail (how mortgage rates are determined). But you could go on and on about it, eventually generating more confusion than clarity. At the end of the day, there are many different loan types and countless loan scenarios. There are also thousands of banks, credit unions, mortgage lenders, brokers, and so on. Which begs the question; do we need a mortgage MSRP? First Off, What Is MSRP? And Why Is It Useful? First off, what is MSRP? Well, it stands for manufacturer's suggested retail price. It’s essentially what the manufacturer of the product suggests a consumer should pay. Typically, it’s found at dealerships because auto dealers are required by law to post it on the windows of new vehicles on the lot. You might also see it on a book at the bookstore, or even a bag of chips at a convenience store. When purchasing a vehicle, it is known as the “sticker price,” and may include manufacturing and sales costs along with the retailer markup. It’s all supposed to improve price transparency for the consumer, even though the final sales price could be above or below the MSRP. But by knowing what the price of an item should be, you’ll know if you’re being overcharged. For example, if a car has an MSRP of $25,000 and the dealer is attempting to sell it to you for $35,000, you might raise an... --- > Over the past year and change, mortgage refinance applications have fallen off a cliff. We had some of the biggest refi years in 2020 and 2021, followed - Published: 2023-12-13 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/its-easier-to-save-more-money-when-refinancing-a-high-rate-mortgage/ - Categories: Mortgage Rates, Mortgage Tips, Refinance Over the past year and change, mortgage refinance applications have fallen off a cliff. We had some of the biggest refi years in 2020 and 2021, followed by the worst year for mortgage applications this century. And it’s all because mortgage rates hit all-time lows, then abruptly surged to around 8% in just over 12 months. Rates on the 30-year fixed have since settled in around 7%, and there’s hope they’ll continue to drop into 2024. If so, we might see a return to rate and term refinancing as recent home buyers seek out payment relief. Does Anyone Refinance Their Mortgage Anymore? As noted, mortgage refinancing hasn’t been very popular in 2023. After a few banner years, the low-rate mortgage party came to an end. After all, most homeowners already took advantage when rates were low. And very few are forgoing their 2-4% mortgage rate to tap into their home equity. Instead, they’re opting for a second mortgage if they need money, such as a home equity loan or HELOC. This allows them to retain their low-rate first mortgage while still accessing their equity. But because mortgage rates have hovered in the 6-8% range for much of the past year, and rates have since improved a bit, the refi applications are beginning to trickle in. Per the latest Originations Market Monitor report from Optimal Blue, the 30-year fixed improved by 67 basis points during the month of November. For some lenders, we’re talking a rate drop from around 8% to... --- > Just when it appeared that the recent rally was running out of steam, mortgage rates sunk even lower. Despite a lackluster CPI report yesterday that - Published: 2023-12-13 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-fall-to-lowest-levels-since-spring/ - Categories: Mortgage News, Mortgage Rates Just when it appeared that the recent rally was running out of steam, mortgage rates sunk even lower. Despite a lackluster CPI report yesterday that merely met expectations, an updated dot plot and dovish comments from Fed chairman Jerome Powell seemed to do the trick. That resulted in a big move downward for mortgage rates, which are now the lowest they’ve been since May. The 30-year fixed is now priced at around 6. 75%, or even lower if you pay points. Ironically, home buyers weren’t thrilled with those rates back then, but they might be moving forward. Thank human psychology. Why Did Mortgage Rates Fall So Much Today? The Fed left the federal funds rate unchanged, as was widely expected. So that wasn’t it. And remember, the Fed doesn’t control mortgage rates anyway. But along with that announcement, they released an updated dot plot and Fed chair Jerome Powell held a press conference. In prepared remarks he said, “While we believe that our policy rate is likely at or near its peak for this tightening cycle, the economy has surprised forecasters in many ways since the pandemic, and ongoing progress toward our 2 percent inflation objective is not assured. ” Powell essentially confirmed that the rate hike in July was likely the last for this economic cycle. He added that, “If the economy evolves as projected, the median participant projects that the appropriate level of the federal funds rate will be 4. 6 percent at the end of 2024, 3.... --- > Today we’ll take a look at another home builder’s lender, K. Hovnanian American Mortgage. They are the affiliated lender of K. Hovnanian Homes, which is a - Published: 2023-12-11 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/k-hovnanian-american-mortgage-review/ - Categories: Mortgage Tips Today we’ll take a look at another home builder’s lender, K. Hovnanian American Mortgage. They are the affiliated lender of K. Hovnanian Homes, which is a top-15 home builder nationally. Like other builders, they created their own financing division to streamline their new home sales. And to better control the customer experience from start to finish. The biggest perk to using them is the financing specials you likely won’t find elsewhere. Read on to learn more. K. Hovnanian American Mortgage Serves Its Home Buyer Customers Affiliated mortgage lender for K. Hovnanian Homes Provides home purchase loans for new home buyers Founded in 2002, headquartered in Boynton Beach, FL Parent company is one of the largest home builders nationwide Licensed to do business in 14 states and the District of Columbia Funded more than $1. 1B in mortgages last year Most active in the states of Arizona, California, Delaware, Texas, and Virginia As noted, K. Hovnanian American Mortgage is the lending division of K. Hovnanian Homes, a top U. S. home builder. Their parent company Hovnanian Enterprises, Inc. is a publicly traded company (NYSE:HOV), currently valued at nearly $1 billion dollars. They’ve been around since 1959, and operate 128 residential communities across 14 different states. Those states include Arizona, California, Delaware, Florida, Georgia, Illinois, Maryland, New Jersey, Ohio, Pennsylvania, South Carolina, Texas, Virginia, West Virginia, and Washington, D. C. These are the places where K. Hovnanian American Mortgage is licensed to lend as well, since they only exist to serve their... --- > Lately, some mortgage lenders have pitched “buy now, refinance for free” offers to get more home buyers to take the plunge. The thinking is mortgage rates - Published: 2023-12-07 - Modified: 2024-02-14 - URL: https://www.thetruthaboutmortgage.com/buy-now-refinance-for-free-deals-arent-all-their-cracked-up-to-be/ - Categories: Mortgage Rates, Mortgage Tips, Refinance Lately, some mortgage lenders have pitched “buy now, refinance for free” offers to get more home buyers to take the plunge. The thinking is mortgage rates will be lower in the near future. And when that time comes, you won’t have to pay any lender fees. This can even sway the decision to buy a home, assuming you’re on the fence about renting vs. buying because it feels too expensive today. These offers sound like a win-win for the home buyer, as they’ll get a lower interest rate and potentially avoid thousands in closing costs. But there are quite a few issues with this line of thinking that are worth discussing. Nobody Knows If Mortgage Rates Will Rise or Fall Last I checked, mortgage rate predictions have been a tough game. Prior to early 2022, mortgage rates defied the forecasts. While most expected them to rise, they hit fresh all-time lows and stayed at those levels for much longer than expected. Then the Fed announced an end to it Quantitative Easing (QE) program and the start of Quantitative Tightening (QT), which sent shockwaves through the mortgage market. Accompanied by 11 Fed rate hikes, the 30-year fixed surged from around 3% in January 2022 to as high as 8% in October 2023. Once again, no one expected this, and most predictions called for improvements in 2023 after a rough 2022. Instead, mortgage rates climbed even higher, leading to the lowest mortgage demand in decades. People stopped buying homes and virtually nobody... --- > Lately, new home sales have surged as existing housing supply continues to be hard to come by. This is partially because mortgage rates more than doubled - Published: 2023-12-06 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/should-i-use-the-home-builders-mortgage-lender-or-a-different-one/ - Categories: Home Buying, Mortgage Rates, Mortgage Tips Lately, new home sales have surged as existing housing supply continues to be hard to come by. This is partially because mortgage rates more than doubled in less than two years, effectively locking in existing homeowners. With many of these homeowners unwilling to budge, home builders have gained a lot more market share. After all, they need to move their inventory, and there isn’t a borrower living in the property with a low interest rate to worry about. To boost sales in spite of high rates, many builders have offered impressive mortgage rate deals that everyday lenders just can’t seem to match. Does this mean there's no need to look anywhere else? Most Home Builders Have Their Own Financing Department Despite being in the business of building homes, many home builders also operate financing divisions. This means they are also fully-fledged mortgage lenders with the ability to offer home loans on the properties they sell. And several of them are quite large. For example, D. R. Horton’s DHI Mortgage is a top-25 mortgage lender in the nation. The same goes for Lennar Mortgage. Both companies originate tens of billions of dollars in mortgages annually to their home buyer customers. On top of this, they also operate title/escrow companies and insurance agencies. This means a prospective home buyer can do one-stop shopping. Convenience aside, these builder lenders are also able to offer aggressive financing offers that outside lenders often can’t beat. So if you’re buying a new home, why look anywhere... --- > Well, another year is nearly in the books, which means it’s time to look ahead at what 2024 might have in store. As is customary, I take a look at - Published: 2023-12-05 - Modified: 2024-12-17 - URL: https://www.thetruthaboutmortgage.com/will-mortgage-rates-go-down-in-2024/ - Categories: Home Buying, Housing Market, Mortgage Rates, Mortgage Tips Well, another year is nearly in the books, which means it’s time to look ahead at what 2024 might have in store. As is customary, I take a look at mortgage rate predictions from a variety of economists and offer up my own take for the upcoming year. I also look back at the predictions for the current year to see how everyone did (hint: not well! ). The big story in 2023 was out of control inflation. The story going forward might be cooling inflation. Though there’s also the risk it resurges, at which point mortgage interest rates could rise again. Mortgage Rates Are Expected to Go Down in 2024 First let’s talk about the general outlook. Most expect mortgage rates to go down in 2024, which was actually the call in 2023 as well. But guess what? Everyone was wrong. Expectations that the 30-year fixed would fall back into the 5% range were way off. Instead, interest rates on the popular loan program surpassed the 8% mark before finally letting up over the past month. So while many economists are optimistic for the coming year, take note that they felt the same way a year ago. And got it wrong. But things aren’t exactly the same. The Fed increased its fed funds rate 11 times, which many believe has worked to corral inflation. And this could lead to weak economic output and rising unemployment, which could result in Fed rate cuts as early as March 2024. This doesn’t... --- > A new week, a new 1% down mortgage product, the latest coming from Fort Washington, Pennsylvania based lender Newrez. Call it a sign of the times, with - Published: 2023-12-04 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/newrez-rezsource-1-down-mortgage/ - Categories: Mortgage News A new week, a new 1% down mortgage product, the latest coming from Fort Washington, Pennsylvania based lender Newrez. Call it a sign of the times, with housing affordability the worst it has been in decades thanks to high home prices and elevated mortgage rates. Known as "RezSource," the new program relies upon a 2% lender contribution to minimize out-of-pocket costs. It takes a standard 3% down payment mortgage backed by Freddie Mac and whittles it down to just 1%. And it’s available to both low-income borrowers and first-time home buyers. Read on to learn more. RezSource 1% Down Offers Up to $5,000 in Lender Contributions Similar to other programs, the latest 1% down mortgage from Newrez includes a 2% lender contribution. This means the borrower winds up with a mortgage set at 97% LTV, the maximum allowed for a conforming loan backed by the likes of Fannie Mae or Freddie Mac. The end result is less money required from the borrower, an equity cushion, and potentially easier qualification. The maximum dollar amount of the lender contribution is $5,000, which is determined by the lesser of 2% of the appraised value or purchase price. My understanding is this 2% doesn’t need to be paid back as it is a credit to the borrower. For example, someone buying a $250,000 property would be able to maximize the credit while only needing $2,500 via their own contribution. And even this 1% can come from a variety of flexible sources, whether it’s gift... --- > Silverton Mortgage has rolled out a series of mortgages that feature 100% financing in light of ongoing affordability woes. Some of the loan programs rely - Published: 2023-11-30 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/silverton-mortgage-launches-100-financing-across-all-loan-types/ - Categories: Mortgage News Silverton Mortgage has rolled out a series of mortgages that feature 100% financing in light of ongoing affordability woes. Some of the loan programs rely on down payment assistance via a second mortgage that can cover both closing costs and the down payment. These options are available on conventional loans and FHA loans, complementing other zero down options already available via the VA and USDA. As home prices continue to move higher, mortgage lenders are increasingly looking for options to keep homeownership in reach. They join several other banks and lenders that have recently launched zero down options for home buyers. Silverton's Conventional Program with Down Payment Assistance While home loans backed by Fannie Mae and Freddie Mac typically require at least a 3% down payment, Silverton Mortgage has a solution to offer 100% financing. Their “Conventional Program with down payment assistance” features a conforming mortgage loan set at 97% combined with a second mortgage. The second mortgage can be used for a down payment and/or toward closing costs. Together, these two loans can provide 100% financing to help prospective home buyers get into a new property with little or nothing out of pocket. It is available in 32 states throughout the nation (Silverton does business in 45 states). In September, San Antonio-based Frost Bank re-entered the mortgage biz with its Progress Mortgage, a zero down conventional loan that doesn’t require mortgage insurance (PMI). A month earlier, Zillow Home Loans began piloting a 1% down mortgage via the use of... --- > Today we’ll take a hard look at “HomeAmerican Mortgage,” yet another home builder affiliated mortgage lender. They offer home purchase financing to - Published: 2023-11-30 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/homeamerican-mortgage-review/ - Categories: Mortgage Tips Today we’ll take a hard look at “HomeAmerican Mortgage,” yet another home builder affiliated mortgage lender. They offer home purchase financing to Richmond American Homes customers, which is a top-10 home builder nationally. Because they are operated by the same parent company, they can offer a streamlined process and home buying experience. And perhaps more importantly, extend special financing offers like big mortgage rate buydowns. Read on to see if you should use their in-house lender or look elsewhere for a better deal. HomeAmerican Mortgage Is the Captive Lender of Richmond American Homes The affiliated mortgage lender of Richmond American Homes Offers home purchase financing on newly-built homes Founded in 1983, headquartered in Denver, Colorado Licensed to do business in 16 states and Washington D. C. Funded $2. 75B in home loans last year Most active in Arizona, California, and Colorado Also operate a title/escrow company and insurance agency HomeAmerican Mortgage is a full-service, direct lender based out of Denver, Colorado. They got their start way back in 1983 and are a subsidiary of MDC Holdings, Inc. , which is a publicly-traded company (NYSE: MDC). MDC also owns Richmond American Homes, which builds single-family residences in more than a dozen states throughout the country. Simply put, HomeAmerican Mortgage exists to serve these home buyers, offering purchase loans only (no refinances). This is similar to Lennar Mortgage and DHI Mortgage, which exist to serve Lennar and D. R. Horton home buyers, respectively. They are currently licensed to do business in 16... --- > The Federal Housing Administration (FHA) announced new loan limits for 2024 this week, bumping up the “floor” on FHA loans to $498,257. This represents a - Published: 2023-11-29 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/2024-fha-loan-limits-rise-to-498257/ - Categories: Home Buying, Mortgage News The Federal Housing Administration (FHA) announced new loan limits for 2024 this week, bumping up the “floor” on FHA loans to $498,257. This represents a 5. 56% increase from the current 2023 FHA loan limit of $472,030, which is based on home price movement over the past year. There is also a ceiling loan limit for FHA loans for high-cost areas, which was increased to $1,149,825 from $1,089,300. Together, this should boost access to the FHA’s low-down-payment home loan program at a time when affordability has rarely been worse. FHA loans comes with various perks, whether it’s a cheaper mortgage rate or a lower minimum required credit score. 2024 FHA Low-Cost Area Floor Loan Limits One-unit property: $498,257 Two-unit property: $637,950 Three-unit property: $771,125 Four-unit property: $958,350 For 2024, the low-cost area “floor” FHA loan limit will be $498,257 for a one-unit property. It will rise as high as $958,350 for a four-unit property in these low-cost areas, which includes metros like Chicago, Tampa, and Tucson, Arizona. The floor is set at 65% of the 2024 conforming loan limit, which also announced an increase to $766,550 this week. It applies to areas of the country where 115 percent of the median home price is less than the floor limit. Given the large difference in maximum loan amounts, roughly $250,000, it could sway the decision to choose a conventional loan instead of an FHA loan. For example, if buying a $525,000 home with 3. 5% down, you’d be forced to go... --- > Another year, another increase in the conforming loan limit, thanks to continued home price gains. The FHFA announced today that the new limit for loans - Published: 2023-11-28 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/2024-conforming-loan-limit-climbs-to-766550/ - Categories: Mortgage News Another year, another increase in the conforming loan limit, thanks to continued home price gains. The FHFA announced today that the new limit for loans backed by Fannie Mae and Freddie Mac would be a whopping $766,550 in 2024. This figure is up $40,350 from the current loan limit of $726,200 for 2023. The conforming loan limit is dictated by the annual change in home prices, which as you may have guessed, went up, again. These loan limits are even larger in high-cost regions of the United States, special designated areas like Hawaii, and for multi-unit properties. New Conforming Loan Limits for 2024 One-unit property: $766,550 Two-unit property: $981,500 Three-unit property: $1,186,350 Four-unit property: $1,474,400 As noted, the 2024 conforming loan limit has increased to $766,550 for one-unit properties. This is the result of home prices rising 5. 56% between the third quarters of 2022 and 2023. Specifically, seasonally-adjusted nominal house prices from the expanded-data FHFA HPI are used to determine annual home price appreciation. While it’s yet another increase, it’s nearly half the increase seen from 2022 to 2023, a sign of slowing home price appreciation. Home prices still went up over the past year, but as mortgage rates more than doubled before surpassing 8%, the gains expectedly slowed. But even if home prices decline in the future, this baseline loan limit will not decrease. Rather, it would remain flat, and would need to “make up” any losses before it could increase further. This happened from the third quarter... --- > In an effort to keep more veterans and servicemembers in their homes, the VA has paused foreclosures for the next six months. The move was made following - Published: 2023-11-18 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/foreclosure-halted-for-va-loan-holders-until-june-2024/ - Categories: Foreclosure, Mortgage News In an effort to keep more veterans and servicemembers in their homes, the VA has paused foreclosures for the next six months. The move was made following an investigation and a series of new stories alleging that tens of thousands of VA loan holders were at risk of foreclosure. It all stems from the end of COVID-19 related forbearance, which expired in October and left homeowners with large bills for missed payments. While there is a plan in place to help these borrowers transition back to making normal payments, it will apparently take 4-5 months to implement. As a result, the VA has called on loans servicers to enact a foreclosure moratorium until the changes can be made. No Foreclosures for VA Loan Borrowers Through May 31st, 2024 While the VA works to implement new loss mitigation procedures, they are asking loan servicers to pause foreclosures for military servicemembers and veterans. There are an estimated 147,000 veteran homeowners behind on their mortgage payments at this time. This means no foreclosures should be processed between now and May 31st, 2024. The move comes after an NPR investigation found that the Department of Veterans Affairs ended its Partial Claim Payment program and loan servicers began asking for lump sum payments. But this isn’t how it was supposed to work. Borrowers were told that missed mortgage payments would simply be tacked on to the back of their mortgages. The Veterans Assistance Partial Claim Payment (VAPCP) program would allow them to simply resume payments... --- > A new program called “Lock It, List It” allows real estate agents to secure a mortgage rate for a buyer before the property even hits the market. - Published: 2023-11-16 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/guaranteed-rate-launches-lock-it-list-it/ - Categories: Home Buying, Mortgage News, Mortgage Rates A new program called “Lock It, List It” allows real estate agents to secure a mortgage rate for a buyer before the property even hits the market. Chicago-based Guaranteed Rate launched the product just weeks after mortgage rates surpassed the dire 8% threshold. This has pushed housing affordability to the brink, while also turning off prospective home buyers and making it harder to sell a home. A below-market interest rate that is guaranteed could boost demand, and make it easier for a seller to unload their property. It'd be a win-win for all parties involved, including the buyer, seller, listing agent, and loan officer. How Lock It, List It Works As the name suggests, a mortgage rate is locked in before the property is listed on the market. Known as a mortgage pre-lock in industry jargon, the interest rate is secured before a buyer is found for the property. This is a rather novel approach, as pre-locks are typically for home buyers who lock in a rate for themselves then search for a property. In this scenario, the home seller is essentially locking in a rate on the home buyer’s behalf ahead of time. But it only works if the buyer agrees to use Guaranteed Rate to obtain their mortgage. Once a buyer makes an offer on the property, they would need to get approved for a mortgage with GR to take advantage of the offer. The deal would be structured by the listing agent and a Guaranteed Rate loan... --- > In the spring of 2019, “Zillow Home Loans” was launched by its parent company Zillow. You probably know them best for their popular Zestimates, which are - Published: 2023-11-15 - Modified: 2025-03-21 - URL: https://www.thetruthaboutmortgage.com/zillow-home-loans-review/ - Categories: Mortgage Tips In the spring of 2019, “Zillow Home Loans” was launched by its parent company Zillow. You probably know them best for their popular Zestimates, which are quick and dirty home value estimates. Given their strong engagement with prospective home buyers and existing homeowners, they eventually decided to launch their own mortgage division. The goal was to become “more of an end-to-end provider for housing-related services” like the many other companies out there trying to do it all. For you as the customer, it’s yet another mortgage lender to consider when seeking financing. Read on to learn more about them. Zillow Home Loans Fast Facts Direct-to-consumer mortgage lender Offers home purchase and refinance loans Founded in 2019, headquartered in Irvine, CA Parent company is publicly-traded Zillow Group Licensed to do business in 49 states and the District of Columbia Funded about $1. 5 billion in home loans last year Most active in California, Florida, Georgia, and Texas Zillow Home Loans, LLC is a subsidiary of Zillow Group (NYSE:Z). The company was officially launched in April 2019 after acquiring Mortgage Lenders of America in the fourth quarter of 2018. This gave them a quick in to the mortgage business, instead of having to start from the ground up. They originally operated out of Mortgage Lenders of America’s former headquarters in Overland Park, Kansas. But now appear to be headquartered in Irvine, CA, with an office in Seattle, WA as well. Mortgage Lenders of America was founded in the year 2000 and had... --- > Mortgage Q&A: “Is now a good time to refinance my home?” If you’re one of the few people asking this question right now, the short answer is most - Published: 2023-11-15 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/is-now-a-good-time-to-refinance-my-home/ - Categories: Mortgage Rates, Mortgage Tips, Refinance Mortgage Q&A: “Is now a good time to refinance my home? ” If you’re one of the few people asking this question right now, the short answer is most likely no. And the reason it’s a no is because mortgage rates have skyrocketed over the past 18 months or so. But like everything else in the mortgage world, the answer does depend on the situation. Not everyone has the same mortgage rate, nor do they have the loan product, or the same needs. Very Few Homeowners Benefit from a Refinance Right Now A refinance typically only makes sense if you can obtain a lower mortgage rate in the process This is very difficult to accomplish at the moment with rates averaging 7%+ Most homeowners already refinanced a couple years ago when rates were priced around 3% Refinancing will make sense again once rates fall and/or more borrowers take out mortgages at today's higher rates (giving them a future refinance opportunity) First things first, there are two main mortgage refinance options available to homeowners, including the rate and term refinance and the cash out refinance. There is also the streamline refinance, which is a fast-tracked type of rate and term refinance. For simplicity sake, a rate and term refinance allows a borrower to lower their interest rate, change their loan term, and/or switch loan products. The cash out refinance allows a borrow to tap their home equity and perhaps change their rate, term, and loan product as well. At the moment,... --- > Gone are the days of the zero-down mortgage. At least for the typical home buyer. Instead, the 2023 Profile of Home Buyers and Sellers from the National - Published: 2023-11-14 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/down-payments-on-houses-rise-to-highest-levels-in-over-20-years/ - Categories: Home Buying, Housing Market, Mortgage News Gone are the days of the zero-down mortgage. At least for the typical home buyer. Instead, the 2023 Profile of Home Buyers and Sellers from the National Association of Realtors (NAR) revealed that down payments haven’t been higher in decades. This, despite the widespread availability of low-down and zero-down home loan options. As for why, it could be because inventory remains low, which has kept competition lively in spite of much higher mortgage rates. Another reason might be those high interest rates themselves, which make it less attractive to take out a large loan. Median Down Payments Highest Since 1997 for First-Time Home Buyers Per the NAR report, the typical down payment for a first-time home buyer was 8%, which might not sound like a lot. But it is the highest figure since 1997, when it stood at 9%. If you look at the chart above, you’ll notice it dipped pretty close to zero in those bad years back in 2005-2006. At that time, creative financing and lax underwriting (aka no underwriting at all) allowed home buyers to purchase a property with nothing down. While that may have been risky on its own, they could also use stated income to qualify for the loan. And they could choose a super toxic loan type, such as the now forgotten option ARM, or qualify via an interest-only payment. That may explain why we experienced the worst mortgage crisis in recent history, followed by the nastiest housing market crash in generations. So certainly... --- > I’ve already written about it not being the best time to buy a home right now, at least from a pure investment standpoint. In short, home prices are - Published: 2023-11-13 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/it-now-takes-more-than-a-decade-to-break-even-on-a-home-purchase/ - Categories: Home Buying, Housing Market I’ve already written about it not being the best time to buy a home right now, at least from a pure investment standpoint. In short, home prices are expensive relative to incomes, mortgage rates have more than doubled, and there’s little quality inventory. And now we can quantify just how long it takes to break even on a house, per a new analysis from Zillow. Hint: it’s a long, long time, even if you’re able to muster a big 20% down payment. So if you’re thinking about buying a home today, prepare to stick around for the long-haul. How Long to Break Even on a House These Days? - 3% down payment: 13 years and six months to make a profit. - 5% down payment: 13 years and three months to make a profit. - 10% down payment: 12 years and seven months to make a profit. - 20% down payment: 11 years and three months to make a profit. A new Zillow analysis tried to determine how long you’d need to own your home before you could sell it for a profit. This factors in the closing costs associated with the home purchase, the mortgage interest paid, home maintenance costs, and the sales costs once it came time to list the property. Specifically, they assume 3% closing costs at purchase, 1% home maintenance fees, and 6% in closing costs at the time of sale, along with all that mortgage interest. In reality, it could be even higher. It’s not... --- > The longer the loan term and/or fixed-rate period, the higher the mortgage rate. If you want the cheapest mortgage rate, think shorter. - Published: 2023-11-10 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-mortgage-has-the-best-interest-rate/ - Categories: Mortgage Rates, Mortgage Tips Here’s an interesting question: “What mortgage has the best interest rate? ” Before we dive in, “best” questions are always a bit difficult to answer universally. What’s best to one person could be the worst for another. Or at least not quite the best. This is especially true when discussing mortgage questions, which tend to be a bit more complex. But we can still talk about what makes one mortgage rate on a certain product better than another. In a recent post, I touched on the different mortgage terms available, such as a 30-year, 15-year, and so on. That too was a “best” article, where I attempted to explain which mortgage term would be best in a particular situation. Related to that is the associated mortgage interest rate that comes with a given loan term. Together, they can drive your mortgage product decision. Longer Loan Term = Higher Mortgage Rate The longer the fixed-rate period, the higher the interest rate This compensates the lender (or their investor) for taking on more risk Because they're agreeing to a certain interest rate for a longer period of time For example, a 30-year fixed loan will price higher than a 15-year fixed loan Now I'm going to assume that by best you mean lowest, so we'll focus on that definition, even though it might not be in your best interest. A lot of puns just happened by the way, but I'm trying to ignore them. Simply put, a longer mortgage term generally translates... --- > It's time to check out "Inspire Home Loans," which is the lending partner of home builder Century Communities. They pride themselves on knowing how their - Published: 2023-11-09 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/inspire-home-loans-review/ - Categories: Mortgage Tips It's time to check out "Inspire Home Loans," which is the lending partner of home builder Century Communities. They pride themselves on knowing how their parent company’s construction timelines work so your home (and) loan remain on schedule. In addition, they offer special financing deals that are reserved only for the buyers of properties in their communities. This means you might be able to get your hands on a low mortgage rate that outside lenders just can’t beat. Read on to learn more about them to determine if they could be a good fit for your mortgage needs. Inspire Home Loans Offers Big Rate Buydowns Direct-to-consumer mortgage lender Offers home purchase loans Founded in 2016, headquartered in Newport Beach, CA A wholly owned subsidiary of Century Communities Parent company is publicly traded (NYSE: CCS) Licensed to lend in 18 states across the nation Funded about $2 billion in home loans in 2022 Most active in California, Colorado, Georgia, and Texas Also operates a title company and insurance agency Known for offering big mortgage rate buydowns Inspire Home Loans is a wholly owned subsidiary of Century Communities, which offers to-be-built and quick move-in homes in a handful of states nationwide. Their parent company consider themselves a top-10 home builder nationally, and is publicly traded under the NYSE symbol CCS. The lending division has been around since 2016 and is headquartered in Newport Beach, CA. Their primary focus is providing home purchase loans to buyers of newly-built homes in the many communities... --- > Thanks to a record number of price cuts and a big improvement in mortgage rates, home buying conditions have improved tremendously. Taken together, you - Published: 2023-11-09 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/redfin-says-its-the-best-time-to-buy-a-home-since-mid-september-should-you-buy-now-or-hold-on/ - Categories: Home Buying, Housing Market Thanks to a record number of price cuts and a big improvement in mortgage rates, home buying conditions have improved tremendously. Taken together, you might be able to snag a lower purchase price and finance the property with a mortgage rate about . 50% lower than what was on offer last month. Does this mean it’s time to rush out to buy a home? Or does it continue to pay to be patient? Personally, I’m still in the no-rush camp, but if you do see something you love, the price tag could be a little lower. And there may be less competition as it tends to drop off later in the year as buyers get consumed with other things. Unseasonal Increase in For-Sale Listings as Asking Prices Drop Redfin reported this morning that some “glimmers of hope” are emerging for prospective home buyers. The first one being that new listings increased 1. 5% from a year ago during the four weeks ending November 5th. This was just the second such increase since July 2022, a testament to the continued short supply plaguing the housing market. They noted that this increase is partly because new listings were falling during this period last year. At the same time, active listings are at their highest level since the beginning of 2023, and months of supply ticked up 0. 2 points to 3. 6 months. Inventory remains constrained nationally, with 4 to 5 months typically signifying healthy supply. But it is rising, which appears... --- > It’s time to check out “Toll Brothers Mortgage,” which is a subsidiary of home builder Toll Brothers. Toll Brothers is one of the largest home builders in - Published: 2023-11-07 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/toll-brothers-mortgage-review/ - Categories: Mortgage Tips It’s time to check out “Toll Brothers Mortgage,” which is a subsidiary of home builder Toll Brothers. Toll Brothers is one of the largest home builders in the United States, priding itself on being a luxury home builder. Instead of relying on third-party lenders to provide financing to their customers, they have a built-in financing division. This allows them to oversee the process firsthand and navigate the complexities of new construction financing. They say they’ve got a proven track record of smooth closings, and if they can offer you a mortgage rate the other guys can’t, they could be worth looking into. Toll Brothers Mortgage Offers Rate Specials to Its Home Builder Customers Direct-to-consumer retail mortgage lender Provides new construction lending and home purchase loans Parent company is nation’s 5th largest home builder Founded in 1967, headquartered in Fort Washington, PA Licensed to do business in 24 states nationwide and D. C. Funded nearly $2 billion in home loans last year Most active in California, Pennsylvania, and Texas Offers mortgage rate specials to Toll Brothers customers Also operates a full-service title and insurance company As noted, Toll Brothers is a major home builder, the fifth largest at last glance, behind only D. R. Horton, Lennar, Pulte, and NVR. They are a publicly-traded company (NYSE:TOL) and are currently valued at around $9 billion. The company was founded in 1967 and refers to itself as the nation’s leading builder of luxury homes. This includes both new construction homes and quick move-in homes.... --- > Mortgage rates finally caught a break last week after steadily rising throughout much of 2023. The 30-year fixed fell about a half a percentage point in - Published: 2023-11-06 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/ceo-of-nations-1-mortgage-lender-expects-mortgage-rates-to-be-lower-before-the-election/ - Categories: Mortgage News, Mortgage Rates Mortgage rates finally caught a break last week after steadily rising throughout much of 2023. The 30-year fixed fell about a half a percentage point in the matter of a week as softer economic data eased inflation concerns. At the same time, the Fed left its key policy rate unchanged and signaled it could be done raising rates. Now, investors are hoping the next policy move is a rate cut, as data is expected to continue to cool into 2024. Taken together, that could mean a return to more palatable mortgage rates in 2024. Lower Mortgage Rates Before the Presidential Election? The president and CEO of the nation’s top mortgage lender, United Wholesale Mortgage (UWM), is bullish on mortgage rates next year. During his monthly 3Points video, former college basketball player Mat Ishbia said he expects mortgage rates to drop before the election. The election in question is the 2024 Presidential Election, which takes place on Tuesday November 5th, 2024. “And I think it might even happen sooner like March, April, May,” he said in the video. But how much lower will rates fall? Well, that’s another story, as a return to 3% mortgage rates likely isn’t in the cards. Same goes for 4% rates, and maybe even 5% rates. However, that doesn’t mean smaller improvements can’t be impactful for the struggling mortgage industry. “We’re talking about dropping to 5 and a half, 6, even 6 and a half,” he added. “And it’ll be a massive refi opportunity. ” It’s... --- > If you’ve got your eye on a Taylor Morrison home, you may have come across their affiliated lender “Taylor Morrison Home Funding.” As with many other home - Published: 2023-11-01 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/taylor-morrison-home-funding-review/ - Categories: Mortgage Tips If you’ve got your eye on a Taylor Morrison home, you may have come across their affiliated lender “Taylor Morrison Home Funding. ” As with many other home builders, they’ve got their own in-house mortgage lender to streamline the home buying process. This affords them better control, ideally boosting customer service, and gives them the ability to offer special pricing incentives. With fewer parties involved, they should be able to get you from application to closing quicker than the other guys. And if they can throw in a big mortgage rate buydown as well, it might be a win-win. Read on to learn more about the company. Taylor Morrison Home Funding Is All About Home Buyers Affiliated lender for home builder Taylor Morrison Offers home purchase financing to new home buyers Founded in 1982, headquartered in Maitland, Florida Has 84 licensed mortgage loan officers Parent company is publicly traded (NYSE: TMHC) Licensed to lend in 11 states nationwide Funded over $3 billion in home loans in 2022 Most active in Texas, Florida, Arizona, and California Taylor Morrison is one the largest home builders in the United States, serving home buyers and renters in 19 markets across 11 states. Only a handful of builders are larger, including D. R. Horton, Lennar, Pulte, NVR, and Toll Brothers. The company was formed in 2007 after Taylor Woodrow Inc. and Morrison Homes Inc. merged. Dispute this recent development, their building operations date back to the early 1900s. They are now headquartered in Scottsdale, Arizona... --- > In order to make homeownership more accessible, loanDepot has launched a new program called “accessZERO.” As the name suggests, it allows prospective home - Published: 2023-10-31 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/loandepot-accesszero/ - Categories: Mortgage Tips In order to make homeownership more accessible, loanDepot has launched a new program called “accessZERO. ” As the name suggests, it allows prospective home buyers to purchase a property without a down payment. It comes at a time when affordability has rarely been worse, thanks to a combination of significantly higher mortgage rates and record high home prices. At last glance, the popular 30-year fixed was approaching 8%, up from around 3% in early 2022. And home prices continue to climb higher in most parts of the country, thanks to an ongoing lack of inventory. How loanDepot accessZERO Works To combat eroding affordability, SoCal-based direct lender loanDepot has unveiled accessZERO. It combines a regular 3. 5% down FHA loan with a repayable second mortgage that covers up to 5% of the purchase price. This 5% can be used for both the down payment and for closing costs, allowing a home buyer to come to the table with nothing out of pocket. The second mortgage is a 10-year, fully-amortized mortgage that is repaid like a normal mortgage. As such, the borrower has two mortgage payments to make each month, but nothing is required upfront at closing. For example, a buyer purchasing a $400,000 home could get a first mortgage for $386,000 and a $20,000 second mortgage to cover down payment and closing costs. The resulting payments could be something like $2,700 on the first mortgage, assuming a 7. 5% mortgage rate, and a somewhat nominal amount on the second because of... --- > While there has been some debate about the so-called mortgage rate lock-in effect, it appears to be a pretty legit force in the housing market today. As - Published: 2023-10-31 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/low-mortgage-rates-are-1-reason-homeowners-arent-moving/ - Categories: Mortgage Tips While there has been some debate about the so-called mortgage rate lock-in effect, it appears to be a pretty legit force in the housing market today. As the logic goes, existing homeowners aren’t moving because their mortgage rates are so low. But it’s not only that they’re so low, it’s also the cost of replacement, with prevailing market rates now edging closer to 8%. So it just doesn’t make a lot of financial sense for homeowners to move unless they absolutely have to. And for many, it’s probably not even doable, thanks to a massive increase in costs if exchanging a 3% rate for a near-8% rate. Is Mortgage Rate Lock-In a Real Thing? A new survey from Fannie Mae explored mortgage rate lock-in and found that while it is certainly a reason for staying put, it’s not the only reason. The company asked homeowners via their National Housing Survey if they planned to stay in their current homes longer than originally intended. And if so, why. They found that an equal 29% share of owners with a mortgage (mortgage borrowers) and outright owners (homeowners without a mortgage) planned to stay put longer. Of the mortgage borrower population, 21% indicated the decision was primarily due to having a low mortgage rate. But Fannie points out that this subset of homeowners only represents 6% of all mortgage borrowers. “These survey results lead us to conclude that there are multiple factors contributing to the historically low supply of existing homes for sale.... --- > You’ve probably heard of the mortgage rate lock-in effect, where homeowners are unwilling (or unable) to give up their ultra-low mortgage rates. Also - Published: 2023-10-30 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/lender-will-split-the-difference-if-you-give-up-your-3-mortgage-rate/ - Categories: Home Buying, Mortgage News, Mortgage Rates You’ve probably heard of the mortgage rate lock-in effect, where homeowners are unwilling (or unable) to give up their ultra-low mortgage rates. Also known as golden handcuffs, these low rates have arguably prevented many existing homeowners from moving, and certainly from refinancing. But now one bank may hold the key to unlocking some of these borrowers with their so-called “split-the-difference” mortgage rate program. As the name suggests, they’ll give you a mortgage rate in between your old rate and prevailing market rates if you apply for a new home loan. This could lessen the blow of moving at a time when home prices remain near all-time highs and mortgage rates also hover close to 21st century highs. Would You Be Willing to Move If Mortgage Rates Were a Little Bit Lower? Glenville, New York-based TrustCo Bank has come up with a novel concept to get homeowners moving again, literally. They’re offering below-market mortgage rates to existing home loan customers when they move into a new home. The catch is that they have to pay off their old home loan, which likely carries a significantly lower interest rate. The idea here is that the bank can get rid of a low-yielding mortgage while simultaneously giving their customer a more palatable mortgage rate in an 8% mortgage rate world. It’s arguably a win-win situation for both bank and borrower, assuming the homeowner wants to move elsewhere. The program works for TrustCo Bank because they’re a portfolio lender, meaning the loans they underwrite... --- > How does an additional $1 trillion in annual home loan origination volume sound? At the moment, it sounds incredible if you’re in the mortgage industry - Published: 2023-10-26 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/use-of-vantagescore-may-boost-annual-mortgage-volume-by-1-trillion/ - Categories: Mortgage News How does an additional $1 trillion in annual home loan origination volume sound? At the moment, it sounds incredible if you’re in the mortgage industry and struggling to drum up business. Volume has plummeted over the past year thanks to sky-high mortgage rates and a lack of for-sale inventory. But that could change if interest rates creep back down and inventory begins to rise again. Even if conditions don’t improve all that much, FICO score competitor VantageScore believes the implementation of their credit scoring model could help tremendously. FICO Scores Are the Only Game in Town, But That Will Soon Change At the moment, mortgage lenders rely solely on FICO scores to determine a borrower’s creditworthiness. These scores range from 300 to 850, with scores below 620 considered subprime. Come 2024, a new credit score provider will join the fray, at least for loans backed by Fannie Mae and Freddie Mac. The Federal Housing Finance Agency (FHFA), which oversees Fannie and Freddie, announced earlier this year that the implementation of the new credit score models is expected to roll out over two phases in 2024 and 2025. In the third quarter, they anticipate the delivery and disclosure of additional credit scores provided by VantageScore. And the replacement of FICO legacy scores with the new 10T model. By the fourth quarter of 2025, this will include the incorporation of the new scores into pricing, capital, and other processes. Along with that, they are transitioning from requiring three credit reports (known as... --- > The fourth largest home builder in the country, NVR, also operates its own financing division called “NVR Mortgage.” This allows them to complete more of - Published: 2023-10-26 - Modified: 2024-10-02 - URL: https://www.thetruthaboutmortgage.com/nvr-mortgage-review/ - Categories: Mortgage Tips The fourth largest home builder in the country, NVR, also operates its own financing division called “NVR Mortgage. ” This allows them to complete more of the home buying process in-house, as opposed to relying on third-party lenders. They exist exclusively to serve home buyers who work with Ryan Homes, NVHomes, and Heartland Homes. Ideally, this means they’re laser-focused on helping home buyers get to the finish line without any unnecessary costs or delays. Read on to learn more about their history, processes, rates/fees, and customer reviews. NVR Mortgage Provides Financing to Ryan Homes, NVHomes, and Heartland Homes Customers Wholly-owned subsidiary of NVR, Inc. , a top-5 home builder Parent company is publicly traded (NYSE: NVR) Founded in 1991, headquartered in Reston, VA Serve Ryan Homes, NVHomes and Heartland Homes customers exclusively Only offer home purchase loans (no refis) Funded $6. 3 billion in homes last year Most active in the states of Maryland, Pennsylvania, and Virginia Licensed to lend in 15 states and D. C. with branch office locations in 14 states Also operates NVR Settlement Services NVR Mortgage Finance, Inc. is a wholly-owned subsidiary of parent company NVR, Inc. , a home builder based out of Reston, Virginia. The lender got its start in the early 1990s, while the home builder’s roots stretch back to the mid-1900s. They operate three distinct brands, including Heartland Homes, NVHomes, and Ryan Homes. At last glance, they were the fourth largest home builder in the United States, behind PulteGroup, Lennar, and D.... --- > Lately, mortgage rate buydowns have been all the rage as a means to reduce home buying costs. This could come in the form a temporary or permanent rate - Published: 2023-10-25 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/are-adjustable-rate-mortgages-going-to-replace-mortgage-rate-buydowns/ - Categories: Home Buying, Mortgage Rates, Mortgage Tips Lately, mortgage rate buydowns have been all the rage as a means to reduce home buying costs. This could come in the form a temporary or permanent rate buydown. These reduce the mortgage rate for the first couple years or for the entire loan term, respectively. And in doing so, make a home purchase a bit more palatable at today’s still-high asking prices. But is the market about to shift to adjustable-rate mortgages instead? Home Builders Have Been Selling Homes with Big Rate Buydowns to Make the Math Work As mentioned, mortgage rate buydowns have been quite popular over the last couple years. Prior to early 2022, they were absolutely nonexistent because there wasn’t a need. After all, the 30-year fixed averaged about 3% in January 2022. But things changed in a hurry when the Fed halted QE, started QT, and began raising the fed funds rate feverishly. Nearly two years later, we’ve got a 30-year fixed mortgage rate close to 8%, or even above that level depending on individual loan attributes. As rates have skyrocketed, so too has the prevalence of rate buydowns, whether permanent or temporary. There are several reasons why home builders won't lower their prices. And instead look to special financing instead. The most common temporary buydown is the 2-1 buydown, which features an interest rate 2% below the note rate in year one and 1% below the note in year two. Then it reverts to the full note rate. For example, you could receive a... --- > Today we’ll check out another home builder’s in-house mortgage lender, this time KB Home’s “KBHS Home Loans.” As the name suggests, they are the - Published: 2023-10-25 - Modified: 2024-07-08 - URL: https://www.thetruthaboutmortgage.com/kbhs-home-loans-review/ - Categories: Mortgage Tips Today we’ll check out another home builder’s in-house mortgage lender, this time KB Home’s “KBHS Home Loans. ” As the name suggests, they are the affiliated lender for home builder KB Home, a SoCal-based company that has been around since the 1950s. KB Home has a big home building presence in its home state, along with nearby Arizona and Nevada, Texas, and Florida. To facilitate the sale of their homes, they lean on KBHS Home Loans to streamline the financing process. What’s perhaps more interesting is that they are backed by another lender, Guaranteed Rate, which is a top-10 lender nationally. KBHS Home Loans Is the In-House Mortgage Lender for KB Homes In-house mortgage lender for parent company KB Homes Founded in 1957, headquartered in Los Angeles, CA Parent company is publicly traded (NYSE: KBH) Licensed to lend in 10 states nationwide Funded nearly $3. 5 billion in home loans last year Most active in California, Florida, and Texas Also have an affiliated insurance agency and title company KBHS Home Loans is the in-house mortgage lender for parent company KB Homes. They primarily offer home purchase loans to the buyers of their newly-built homes located throughout the country. The Southern California based home builder has been around since 1957, having previously been named after founders Eli Broad and Donald Kaufman as the “Kaufman and Broad Building Company. ” One of their claims to fame is the creation of the “Townehouse” design, intended to woo consumers who would typically rent instead... --- > For those of you still wondering why home prices haven’t plummeted, despite significantly higher mortgage rates, it’s because there isn’t a negative - Published: 2023-10-24 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/higher-mortgage-rates-hurt-sales-volume-not-home-prices/ - Categories: Home Buying, Housing Market, Mortgage Rates For those of you still wondering why home prices haven’t plummeted, despite significantly higher mortgage rates, it’s because there isn’t a negative correlation. A lot of people seem to think that home prices and mortgage rates have an inverse relationship, but it simply isn’t true. Just look at history and you’ll see that it’s perfectly normal for home prices and interest rates to rise. Or for both rates and prices to fall in tandem. Ultimately, there isn’t a strong correlation either way. However, home sales certainly slow down when the cost of financing rises, as we’ve seen this year. Why Home Prices Go Up In Spite of Higher Mortgage Rates First off, let’s look at the current dynamic in the housing market. Both mortgage rates and home prices have risen considerably over the past year and change. The 30-year fixed has climbed from around 3% to start 2022 to 7. 63% today, per Freddie Mac weekly survey data. Despite this more than doubling in interest rates, home prices increased 4. 6% from July 2022 to July 2023, per the FHFA’s latest seasonally adjusted monthly House Price Index (HPI). This is higher than the annual growth rate since 1991, which seems like a head-scratcher. How could home prices outperform with mortgage rates surging? Well, higher mortgage rates generally indicate that the economy is hot, which it most certainly has been over the past year and change. More jobs and increased wages, coupled with a low interest rate environment, increased the money... --- > One of the nation’s largest home builders, PulteGroup, also operates its own financing division called “Pulte Mortgage.” This is a common setup employed - Published: 2023-10-24 - Modified: 2024-09-20 - URL: https://www.thetruthaboutmortgage.com/pulte-mortgage-review/ - Categories: Mortgage Tips One of the nation’s largest home builders, PulteGroup, also operates its own financing division called “Pulte Mortgage. ” This is a common setup employed by large builders that look to control the process from start to completion. It allows them to streamline operations and move their homes in a timely fashion, without relying on third parties that might cause delays. Their "one-stop shopping" experience allows them to work hand-in-hand with the builder to coordinate the processing of your loan with the construction of your new home. Read on to learn more about their lending process, rates and fees, loan programs, and customer reviews. Pulte Mortgage Is the Home Lending Division of Its Parent Company Captive mortgage lender for the PulteGroup Offers home purchase loans for its new home buyer clients Founded in 1972, headquartered in Englewood, Colorado Parent company is third largest home builder in the country Publicly traded company (NYSE:PHM) Funded over $7 billion in home loans last year Licensed to do business in 28 states Most active in Arizona, California, Florida, North Carolina, and Texas Also operates a title insurance and homeowners insurance agency Company hours are Monday - Friday: 7:00 am - 6:00 pm MT Pulte Mortgage is the home lending division of its parent company PulteGroup, a top-3 home builder in the United States. Only Lennar and D. R. Horton are bigger than them. The home builder’s roots stretch back to 1950 when then 18-year-old William “Bill” Pulte built a five-room bungalow near Detroit, Michigan. The... --- > As if you needed more evidence that it’s not a good time to buy a home. The latest piece comes from the WSJ, which revealed that renting is 50% more - Published: 2023-10-23 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/its-not-a-good-time-to-buy-a-home-and-everyone-knows-it/ - Categories: Home Buying, Housing Market As if you needed more evidence that it’s not a good time to buy a home. The latest piece comes from the WSJ, which revealed that renting is 50% more expensive than buying. This comes on top of a recent Fannie Mae survey that said home buyer sentiment matched an all-time survey low, with only 16% indicating it was a good time. The culprit continues to be mortgage rates, which surpassed 8% last week and continue to erode affordability. So is it better to hold off and keep renting or continue to house hunt? It’s Not Always a Good Time to Purchase a Home First off, it’s not always a good time to purchase a home, or condo for that matter. Ultimately, there are better times and worse times, at least if we’re framing the question in terms of investment returns. There’s also the sheer matter of affordability, which could jeopardize the transaction long-term if the buyer isn’t able to keep up with payments. That’s essentially what transpired in the early 2000s, when home buyers with no business buying homes went through with the transaction regardless. Often, this involved some creative financing and perhaps some stated income underwriting to get to the finish line. In the end, while they qualified for the loan and closed on the purchase, they often didn’t make it past the first few mortgage payments before they fell behind. Today, the situation is different because many of those questionable loan types, like stated income loans and... --- > This week, I read an article in the WSJ about paying the mortgage with a credit card. Either things are really bad in the economy, or things are really - Published: 2023-10-20 - Modified: 2025-02-13 - URL: https://www.thetruthaboutmortgage.com/an-alternative-to-paying-the-mortgage-with-a-credit-card/ - Categories: Mortgage Tips This week, I read an article in the WSJ about paying the mortgage with a credit card. Either things are really bad in the economy, or things are really bad at the WSJ. Or they're about to be. Regardless, it’s not a great strategy to put the mortgage on plastic, which is why most card issuers don’t allow it. Ultimately, they don’t want you paying your debt with other debt, especially secured with unsecured. But there might be a way to still keep your cash flow without putting the mortgage payment on a card. Take Advantage of the Many 0% APR Credit Cards Out There to Shift Your Spending When you think about making this payment or that payment, it all basically comes from the same place. Your bank account. So you can indirectly keep your cash flowing while paying the mortgage via traditional means if you shift other spending. To achieve this, you just need to offset other purchases. This can be achieved by pushing those other expenses to a 0% APR credit card. Many of these credit cards offer interest-free financing for anywhere from 12 to 18 months at the moment. This buys you time and allows those other expenses, which are totally allowed (and expected) to be paid with a credit card, to funnel to your 0% APR card. For example, say you’ve got a $2,500 monthly mortgage payment and another $2,000 in monthly expenses. We’ll call it gas, groceries, utilities, and other necessities, along with some... --- > The nation’s largest home builder, D.R. Horton, also has its own affiliated mortgage lender known as “DHI Mortgage.” Recently, new home sales have surged - Published: 2023-10-19 - Modified: 2025-04-23 - URL: https://www.thetruthaboutmortgage.com/dhi-mortgage-review/ - Categories: Mortgage Tips The nation’s largest home builder, D. R. Horton, also has its own affiliated mortgage lender known as “DHI Mortgage. ” Recently, new home sales have surged in popularity due to the mortgage rate lock-in effect. Essentially, existing homeowners aren’t selling their properties because they’ve got ultra-low fixed interest rates on their home loans. At the same time, mortgage rates have surged higher, resulting in big financing incentives from home builders to move their newly-built home inventory. Let’s take a hard look at what DHI Mortgage has to offer and whether an in-house lender is the way to go. DHI Mortgage Offers Purchase Loans and Refis Full service mortgage lender offering home purchase loans and refis Founded in 1997, headquartered in Austin, Texas Parent company D. R. Horton is the nation’s largest home builder Publicly traded company (NYSE: DHI) Also operate DHI Title and D. R. Horton Home Insurance Agency Aim to be a one-stop shop for newly-built home buyers Funded roughly $24 billion in home loans during 2024 (latest data available) Most active in the states of Texas, Florida, and California Licensed to do business in 34 states DHI Mortgage is a full-service mortgage lender owned by parent company D. R. Horton. They were founded in 1997 and are headquartered in Austin, Texas. D. R. Horton is the largest home builder in the United States, slightly bigger than competitor Lennar, which also has a captive mortgage company called Lennar Mortgage. The home builder got its start back in 1978 when... --- > If you thought 8% mortgage rates were bad, what about 9% mortgage rates? What was once unthinkable is now not so hard to believe, with 30-year fixed - Published: 2023-10-19 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/9-mortgage-rates/ - Categories: Mortgage Rates, Mortgage Tips If you thought 8% mortgage rates were bad, what about 9% mortgage rates? What was once unthinkable is now not so hard to believe, with 30-year fixed mortgage rates climbing ever higher. At last glance, the 30-year was priced at 7. 63%, per Freddie Mac’s lagging weekly survey. But other estimates have been higher, including MND’s daily index that put the 30-year at a ripe 8. 03%. And today I even saw someone calling for 12% mortgage rates by Q2 2024. Yikes! Are 9% Mortgage Rates Next? I’ve already written about 7% mortgage rates and 8% mortgage rates for that matter, at the time wondering if and when they’d arrive. Now here I am writing about 9% mortgage rates, which is worrisome given those past fears coming to fruition. However, that doesn’t necessarily mean we keep going higher from here, nor do we climb another 1% higher. If you look at mortgage rates over the past year, they’ve gone up, but not by an enormous amount. Take Freddie Mac’s weekly survey data, which pegged the 30-year fixed at 6. 48% to begin 2023. Today, they said the 30-year fixed averaged 7. 63%, which represents an increase of 1. 15%. Yes, it’s higher. And yes, it’s further eroding home buyer affordability and hurting housing demand. But an increase of just over 1% over more than 10 months isn’t massive movement. Consider the year 2022, when the 30-year kicked off January at 3. 22% and ended with a bang at 6. 42%... --- > If you have ever purchased a home and applied for a mortgage, you’ve likely come across the term “escrow.” Contrary to Portlandia’s definition, the “the - Published: 2023-10-18 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-is-escrow/ - Categories: Home Buying, Mortgage Tips If you have ever purchased a home and applied for a mortgage, you’ve likely come across the term “escrow. ” Contrary to Portlandia’s definition, the “the Egyptian god of waiting 30 days,” escrow refers to a third party that holds and distributes funds on behalf of two parties in a transaction. In the case of a home purchase, an escrow company may hold the earnest money deposit and distribute sales proceeds on behalf of a buyer and seller. The escrow company is deemed a safe and trusted intermediary, and also a neutral one, which facilities the flow of monies and documents during the home buying process. At loan closing, an escrow officer will also prepare a closing statement that itemizes all the costs and credits associated with the transaction. How Escrow Works When Buying a Home Once you agree to purchase a property from a seller and sign the required documents, you (likely your real estate agent) will select an escrow company to handle the transaction. When all parties agree to the terms of the transaction, you will be “in escrow. ” This typically involves ironing out details of the sale, such as purchase price and any contingencies (financing, appraisal, inspection), and providing an earnest money deposit as a sign of good faith. The earnest money deposit is often 3% of the purchase price, which should be sent to escrow within three days of offer acceptance. It shows the home seller you’re serious about buying their property and that you’ve... --- > One of the things prospective home buyers and existing homeowners seem to care most about is mortgage rates. And for good reason - the interest rate you - Published: 2023-10-18 - Modified: 2023-10-18 - URL: https://www.thetruthaboutmortgage.com/use-this-mortgage-payment-chart-to-easily-compare-rates/ - Categories: Mortgage Rates, Mortgage Tips One of the things prospective home buyers and existing homeowners seem to care most about is mortgage rates. And for good reason - the interest rate you receive on your home loan determines what you'll pay each month, sometimes for as long as the next 30 years. That's 360 months until the year 2054! The rate you receive can also completely make or break your home purchase, or sway the decision to refinance a mortgage. As such, I decided it would be prudent (and helpful) to create a “mortgage rate chart” that displays the difference in monthly mortgage payment across a variety of interest rates and loan amounts. This is especially important now that mortgage rates have bounced off record lows and are nearing 8%, the highest levels since the year 2000. 30-Year Mortgage Rates Chart Click to enlarge Use the 30-year mortgage rates chart above to quickly ballpark monthly principal and interest payments You can easily see different monthly P&I payments at various interest rates and loan amounts And if it's worth paying discount points at closing for an even lower rate While the chart is handy for estimates, don't forget to include the taxes and insurance! My original mortgage rate chart above highlights monthly payments at different rates for 30-year mortgages, with loan amounts ranging from $100,000 to $1 million. I went with a bottom of 3. 5%, seeing that mortgage interest rates were around that level when I created the chart, and generally don't seem to go... --- > On a day when mortgage rates are officially close to hitting 8%, I decided to write a post about why they might be a lot lower in 2024. Call me a - Published: 2023-10-17 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/8-mortgage-rates-look-imminent-but-could-that-be-their-peak/ - Categories: Mortgage News, Mortgage Rates On a day when mortgage rates are officially close to hitting 8%, I decided to write a post about why they might be a lot lower in 2024. Call me a contrarian. Or an optimist. Or perhaps just an individual that is looking at data and drawing some conclusions. While the trend for mortgage rates lately has undoubtedly been higher, higher, higher, we could be close to hitting a peak. I know, I've said that before... so much for the mortgage rate plunge. But maybe we just need to cross that psychological 8% threshold before things can turnaround. Sometimes you need to see/experience the worst before a recovery can take place. Here Come the 8% Mortgage Rates... The threat of 8% mortgage rates might last longer than the 8% mortgage rates themselves, assuming they actually materialize. This isn’t a new threat. I wrote all the way back in September 2022 to watch out for 8% mortgage rates. At that time, we inched closer to those levels before rates pulled back. More recently, Shark Tank’s Mr. Wonderful called for the same, arguing that the Fed wasn’t messing around when it came to its inflation fight. And now it appears he might be right, with the 30-year fixed averaging 7. 92%, at least by MND’s daily survey. But despite higher and higher mortgage rates over the past month and a half, the Fed has become more and more dovish. There have countless comments of late from Fed speakers essentially signaling a pause... --- > Today we’ll check out “Lennar Mortgage,” which is the financing division of parent company Lennar Corp. If you weren’t aware, Lennar is one of the - Published: 2023-10-16 - Modified: 2025-04-23 - URL: https://www.thetruthaboutmortgage.com/lennar-mortgage-review/ - Categories: Mortgage Tips Today we’ll check out “Lennar Mortgage,” which is the financing division of parent company Lennar Corp. If you weren’t aware, Lennar is one of the nation’s largest home builders, and is also nearly 70-years old. Like many large builders, they have an in-house mortgage company that facilitates their new home sales. Instead of outsourcing home loan lending to a third-party company, they’re able to provide the customer with a streamlined process from end to end. Read on to learn more about their history and what types of loan offerings they have available, including special incentives you won’t find elsewhere. Lennar Mortgage Is for New Construction Home Buyers The home loan division of parent company Lennar Corp. Lennar is the nation’s second largest home builder, founded in 1954 Formerly known as Eagle Home Mortgage before a name change in 2020 Headquartered in Miami, FL, founded in 1981 Currently have building operations in 26 states nationally Primarily utilized by home buyers who purchase a Lennar property Funded over $20 billion in home loans in 2023 (top-20 lender nationally) Known for offering big mortgage rate buydowns As noted, Lennar Mortgage is the financing unit of its parent company, Lennar Corp. , the second largest home builder in the United States. They only trail D. R. Horton, which also has an in-house lender by the name of DHI Mortgage. While their parent company is nearly 70 years old, Lennar Mortgage is a lot younger. In fact, they were acquired by Lennar back in 1999,... --- > The U.S. Department of Housing and Urban Development (HUD) announced today that lenders will now be able to count income from ADUs when underwriting FHA - Published: 2023-10-16 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/adu-income-to-qualify-for-an-fha-loan/ - Categories: Mortgage News The U. S. Department of Housing and Urban Development (HUD) announced today that lenders will now be able to count income from ADUs when underwriting FHA loans. Doing so may allow many more home buyers to qualify for a mortgage, even if the ADU doesn’t yet exist! The new guidelines are part of the Biden-Harris Administration’s Housing Supply Action Plan, which aims to increase access to homeownership by addressing affordable housing challenges. It also speaks to the immense affordability challenges in today’s housing market, driven by a severe lack of available for-sale inventory and much higher mortgage rates. Ideally, the growing popularity of ADUs addresses these concerns by increasing the housing stock and easing mortgage qualification. New ADU Rule Aims to Ease Affordability Woes and Increase Housing Stock The new FHA rules regarding accessory dwelling units (ADUs) will help more borrowers qualify for a home loan when purchasing a property with an ADU. They will also make it easier to add an ADU to an existing structure, or construct new homes with ADUs, because it's being extended to the FHA 203k loan and FHA construction loan. The revised FHA policy allows lenders to count income (rent) from these small housing units that are built inside, attached to, or on the same property as a primary residence. Additionally, the presence of these housing units will effectively increase the supply of affordable housing and help families create generational wealth via homeownership. Per the FHA, an ADU is “a single habitable living unit... --- > It’s common for home buyers to purchase a property in a certain school district. This ensures their children can attend a specific school if they’ve got - Published: 2023-10-12 - Modified: 2023-10-18 - URL: https://www.thetruthaboutmortgage.com/you-can-now-search-for-homes-for-sale-by-school-district-on-zillow/ - Categories: Home Buying, Housing Market, Mortgage News It’s common for home buyers to purchase a property in a certain school district. This ensures their children can attend a specific school if they’ve got their eye on one in particular. Heck, even those without kids might favor a certain home because it resides in a highly-sought after district. Now Zillow has made it easier for prospective home buyers to find properties in attendance zones or school districts simply by using the search bar. When using the company’s mobile app, you've got the option to search by school, just as you would city or neighborhood. Search by School on Zillow to Find a Home in Your Desired District The latest update to the Zillow app allows home shoppers to search by school attendance zone or school district. Simply open the app and navigate to the search bar. Instead of typing in a certain city or neighborhood, type the name of a school you like. From there, Zillow will automatically display the attendance zone boundaries on the associated map in the app. You’ll be able to see properties that are available for sale (or rent) within the attendance zone selected. And if you search for open enrollment, or for a charter or private school without an assigned boundary, Zillow will display homes within a 5-mile radius surrounding the school. The new search-by-school feature also allows home shoppers to receive instant or daily alerts when new for-sale or for-rent homes within their preferred school district or attendance zone come online. That... --- > If you’ve been keeping track lately, you might be wondering why mortgage rates plunged this week. Last week was a totally different story, with a - Published: 2023-10-11 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-did-mortgage-rates-plunge-this-week/ - Categories: Mortgage News, Mortgage Rates If you’ve been keeping track lately, you might be wondering why mortgage rates plunged this week. Last week was a totally different story, with a hotter-than-expected jobs report almost enough to push the 30-year fixed across the daunting 8% threshold. But then the unexpected happened over the weekend, as is often the case with geopolitical events. In times of uncertainty, bonds are typically a safe haven, and when demand for them rises, their associated yields (or interest rates) fall. This, coupled with some more dovish talk from Fed speakers, might explain the recent pullback in rates. How Much Have Mortgage Rates Plunged? First off, the word “plunge” might be a strong one given how much mortgage rates have climbed over the past 18 months. While mortgage rates have indeed fallen all week, they remain well above recent lows. And even much higher than levels seen this summer. If we want to use MND’s widely cited daily rate survey as the measure, the 30-year fixed now stands at 7. 60%. That’s down from 7. 81% on Friday October 6th. So basically mortgage rates have improved by about 20 basis points, or perhaps . 25% depending on the lender. It also reduced the year-over-year change in rates from 0. 77% to 0. 46%, providing a glimmer of hope that the worst could be behind us. And better yet, perhaps mortgage rates have peaked. While that remains to be seen, it’s been hard to get any meaningful relief lately. Typically, any pullback or... --- > These days, a lot of home buyers are using mortgage rate buydowns to make the deal work. They are particularly prevalent on new home purchases, with - Published: 2023-10-06 - Modified: 2024-03-07 - URL: https://www.thetruthaboutmortgage.com/how-to-supercharge-the-savings-of-a-mortgage-rate-buydown/ - Categories: Mortgage Rates, Mortgage Tips These days, a lot of home buyers are using mortgage rate buydowns to make the deal work. They are particularly prevalent on new home purchases, with builders offering massive incentives that push rates down as low as the 3-4% range. This can make buying a home more palatable at a time when affordability has rarely been worse, thanks in no small part to 7% mortgage rates. But while a lower mortgage rate means you’ll pay less interest and enjoy a lower payment, why stop there? There’s a simple way to make your mortgage rate buydown go even further, and shed years off your loan. Making the Old, Higher Payment After a Refinance (Or in This Case a Rate Buydown) If you have the means, you can save even more money on mortgage interest beyond what a buydown provides. Let me provide an example of refinance savings to highlight how the same could be done with a rate buydown. A common strategy used in the past (when mortgage rates were low! ) was to apply for a rate and term refinance and continue making the old, higher mortgage payment. So if a hypothetical homeowner had a 6% mortgage rate, and refinanced to 4%, they would still make the old mortgage payment as if it were 6%. And the difference between the lower monthly payment and the old, higher payment would be applied to the principal balance. For example, let’s assume the homeowner had a $500,000 loan amount and a 6% mortgage... --- > The other day I wrote about how adjustable-rate mortgages might soon make a comeback, given how high fixed mortgage rates have become. Now that the - Published: 2023-10-05 - Modified: 2025-02-04 - URL: https://www.thetruthaboutmortgage.com/adjustable-rate-mortgage-caps/ - Categories: Mortgage Rates, Mortgage Tips The other day I wrote about how adjustable-rate mortgages might soon make a comeback, given how high fixed mortgage rates have become. Now that the popular 30-year fixed is priced in the 7-8% range, some home buyers might be looking at alternative products. This may include the 5-year or 7-year ARM, both of which provide a fixed interest rate for a lengthy period of time before becoming adjustable. Given how much mortgage rates have increased in such a short time span, these could be viewed as short-term solutions until a refinance makes sense again in the future. But if for whatever reason you keep your ARM once it becomes adjustable, it’s important to understand how it works. Adjustable-Rate Mortgage Caps Limit Rate Movement Today we’re going to talk about caps on adjustable-rate mortgages, which limit how much the rate can move once it becomes a variable rate loan. As noted, many ARMs are hybrids, which means they offer a fixed-rate period initially before becoming adjustable. Two of the most popular ARM option are the 5/1 (or 5/6 ARM) and the 7/1 (or 7/6 ARM). They are fixed for 60 months and 84 months, respectively, before becoming adjustable for the remainder of the loan term. That loan term is the usual 30 years, so there are still 23-25 years left once it becomes adjustable. If there’s a 1 after the 5 or 7, it means the loan is annually adjustable. So it can adjust just once per year. If there’s a... --- > If you visit most bank/lender websites and navigate to their home loans section, you’ll likely only see fixed-rate mortgages advertised. This made perfect - Published: 2023-10-04 - Modified: 2025-02-04 - URL: https://www.thetruthaboutmortgage.com/are-adjustable-rate-mortgages-finally-a-good-deal/ - Categories: Mortgage Rates, Mortgage Tips If you visit most bank/lender websites and navigate to their home loans section, you’ll likely only see fixed-rate mortgages advertised. This made perfect sense over the past several years because interest rates on popular mortgage products like the 30-year fixed were at record lows. There was basically no need to look beyond it given the ultra-low rate and the security of a fixed interest for the entire loan term. But that was then, and this now. Today, the 30-year fixed mortgage is hardly a deal, with many priced in the 7-8% range (or higher). That begs the question; are adjustable-rate mortgages finally worth considering? Are ARMs Worth Considering Again Now That 30-Year Fixed Mortgage Rates Are Nearing 8%? In recent years, the adjustable-rate mortgage became a bit of a niche product. Last year, about 75% of the home loans funded featured a fixed interest rate, per HMDA data. And nearly 60% were 30-year fixed-rate mortgages, which are far and away the most popular loan choice. As noted, low fixed rates meant there wasn’t much need for anything else, barring the ultra-wealthy who may have taken out ARMs at rates as low as 1%. But for most homeowners, a 30-year fixed, or perhaps 15-year fixed, was all they really needed. And now homeowners who took out these loans in 2021 get to enjoy another 28 years of fixed rate goodness at rates as low as 2-3%. In case you haven’t heard, this is known as the mortgage rate lock-in effect, where... --- > If you don’t believe mortgage rates and home prices can fall together, just look at what home prices have done in the face of 7% mortgage rates. Despite - Published: 2023-10-03 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-and-home-prices-can-fall-together/ - Categories: Home Buying, Mortgage Rates, Mortgage Tips If you don’t believe mortgage rates and home prices can fall together, just look at what home prices have done in the face of 7% mortgage rates. Despite the 30-year fixed surging from sub-3% levels to near-8% levels in less than two years, home prices hit fresh all-time highs. So why is it so difficult to imagine the opposite scenario, where both interest rates and property values fall in tandem? It seems the human mind wants there to be an inverse relationship between rates and prices when there often is not. The good news is it’s possible that both rates and prices moderate from here, ushering in a better level of housing affordability. Home Prices and Mortgage Rates Don’t Have Much of a Relationship The Urban Institute wrote an article last year about the relationship between home prices and interest rates when mortgage rates were rapidly ascending. They noted that since 1976, there has been “a positive but weak relationship” between the two. In other words, higher mortgage rates are often accompanied by higher home price appreciation, though this tendency isn’t robust. Still, it defies the logic many housing bears and everyday humans possess, where they assume higher mortgage rates must equate to lower home prices. After all, if it becomes more expensive to purchase a home, the price must come down. That’s their argument at least. But when you look at other necessary items (shelter also being a necessity), people don’t stop buying them because the cost goes up.... --- > It’s looking more likely that there will be a government shutdown beginning October 1st, which begs the question, what happens to mortgage rates? Do they - Published: 2023-09-29 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-happens-to-mortgage-rates-during-a-government-shutdown/ - Categories: Mortgage News, Mortgage Rates It’s looking more likely that there will be a government shutdown beginning October 1st, which begs the question, what happens to mortgage rates? Do they go up even more, do they fall, or do they do nothing at all? At first glance, you might think that they’d rise because of the uncertainty involved with a shutdown. After all, if no one is quite sure of the outcome, or duration, banks and lenders might price their rates defensively. That way they don’t get burned if rates shoot higher. But history seems to tell a different story. Bond Yields Tend to Fall During Government Shutdowns As a quick refresher, mortgage rates track 10-year bond yields pretty consistently. So if the 10-year yield falls, long-term 30-year fixed rates often fall as well. Conversely, if 10-year yields rise, which they have quite a bit lately, mortgage rates also increase. The 10-year yield began 2022 at around 1. 80 and is around 4. 60 today. Since that time, the 30-year fixed has climbed from roughly 3% to 7. 5%. So there’s a pretty strong correlation between the two, though the spread between them has widened over the past couple years as well. Since mortgage bonds are inherently riskier than government bonds, there’s a premium, or spread that must be paid to investors. You used to be able to price the 30-year fixed mortgage at about 170 basis points above the 10-year yield. Today it might be closer to 275 bps or even more. Anyway, the... --- > Recently, a friend of mine with an adjustable-rate mortgage told me his rate was set to adjust significantly higher. His current loan, a 7/1 ARM, has an - Published: 2023-09-28 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-to-do-if-your-adjustable-rate-mortgage-is-about-to-adjust/ - Categories: Mortgage Tips, Refinance Recently, a friend of mine with an adjustable-rate mortgage told me his rate was set to adjust significantly higher. His current loan, a 7/1 ARM, has an interest rate of 3. 25%, but that’s only good for the first 84 months. After that, the loan becomes annually adjustable, and the rate is determined by the index and margin. In case you hadn’t noticed, 30-year fixed mortgage rates have skyrocketed over the past 18 months, climbing from around 3% to 7. 5% today. At the same time, mortgage indexes have also surged from near-zero to over 5%, meaning the loan will adjust much higher if kept long enough. First Look at Your Paperwork and Check the Caps When you took out your adjustable-rate mortgage (ARM) or any home loan for that matter, you were given a Closing Disclosure (CD). It lists all the crucial details of your loan, including the interest rate, loan amount, monthly payment, loan type, and whether or not it can adjust. If it’s an ARM, it will indicate that the monthly payment can increase after closing. It will also detail when it can increase and by how much. There will be a section on page 4 called the “Adjustable Interest Rate (AIR) Table” that provides additional information. This is probably the first place you should look if you’re unsure of when your ARM is set to adjust, and how much it might rise when it does. You’ll also find the mortgage index it’s tied to, along with... --- > Frost Bank, long absent from the mortgage industry, is back in the biz and rolling out a zero down home loan for its customers. The Texas-based - Published: 2023-09-26 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/frost-bank-re-enters-mortgage-biz-with-a-zero-down-home-loan/ - Categories: Home Buying, Mortgage News Frost Bank, long absent from the mortgage industry, is back in the biz and rolling out a zero down home loan for its customers. The Texas-based depository, which also just became the new sponsor of the San Antonio Spurs arena, calls their new offering the “Progress Mortgage. ” It is intended to help both low- and moderate-income borrowers realize the dream of homeownership. Aside from not needing a down payment, private mortgage insurance also isn’t required, and you can receive up to $4,000 in closing costs. Read on to learn more about this product and their companion home equity loan. Progress Mortgage Offers 100% Financing on a Home Purchase After sitting out of the mortgage industry for more than 20 years, Frost Bank has relaunched its home loan business in the state of Texas. While the bank is 155 years old, they exited the mortgage space in the early 2000s before getting back into the biz earlier this year. Some may think that’s unusual, given the tough housing market conditions (and high mortgage rates), but that hasn’t stopped them. And they’re coming to market with some pretty aggressive options to help home buyers land a property despite mounting affordability woes. Their so-called “Progress Mortgage” offers 100% financing, meaning home buyers don’t need a down payment to qualify. On top of that, private mortgage insurance (PMI) also isn’t required, despite the lack of a down payment. Typically it’s compulsory if you have a loan-to-value ratio (LTV) above 80%. Not the case... --- > Over the past year or so, home equity lines of credit (HELOCs) have become a lot more popular. As a quick refresher, HELOCs are typically taken out as - Published: 2023-09-26 - Modified: 2025-01-14 - URL: https://www.thetruthaboutmortgage.com/how-to-compare-helocs/ - Categories: Mortgage Tips Over the past year or so, home equity lines of credit (HELOCs) have become a lot more popular. As a quick refresher, HELOCs are typically taken out as second mortgages in order to tap equity. Importantly, this means the first mortgage is left intact, so the borrower gets to keep their low rate while also gaining access to cash in their property. If we consider that most existing homeowners have 30-year fixed-rate mortgages with interest rates below 4%, this approach begins to make a lot of sense. The question is how do you compare HELOC rates? Is it the same as comparing mortgage rates? Not quite, though there are some similarities. Why Are HELOCs Gaining in Popularity? As noted, HELOCs (and home equity loans for that matter) have become increasingly popular in recent years. Volume of home equity lines of credit and closed-end home equity loans surged 50% in 2022 compared to two years earlier, according to the MBA’s Home Equity Lending Study. It’s no surprise given the trajectory of mortgage rates, which hovered around 3% at the start of 2022, and are now closer to 7. 5%. Yes, you read that right. The 30-year fixed has more than doubled in less than two years, and might keep increasing (hopefully not). At the same time, homeowners are sitting on a ton of equity because home prices have surged since before the pandemic and beyond. This has created an odd situation where homeowners are equity rich, but not interested in tapping... --- > If you think home prices are too expensive, you wouldn’t be the only one. A new analysis from First American revealed that housing affordability is the - Published: 2023-09-25 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/home-prices-least-affordable-in-over-three-decades/ - Categories: Home Buying, Housing Market, Mortgage News If you think home prices are too expensive, you wouldn’t be the only one. A new analysis from First American revealed that housing affordability is the lowest it has been in more than three decades. In other words, it hasn't been this expensive to purchase a home since the 20th century. The title and settlement company’s Real House Price Index (RHPI) determines house-buying power using median household income, mortgage rates, and home prices. And they found that real house prices, adjusted for these factors, were up nearly 17 percent year-over-year in July. Blame Higher Mortgage Rates and Home Prices for a Lack of Affordability As for why housing affordability continues to erode, it’s a combination of factors. The first and most obvious issue is markedly higher mortgage rates, with the 30-year fixed mortgage now priced above 7%, assuming discount points aren’t paid. Per Freddie Mac, rates on this most-popular loan program are up about 1% from year-ago levels. First American pegs the annual change at a higher 1. 4 percentage point increase. And if we zoom out a bit more, this key interest rate was in the 3% range to start out 2022. So interest rates alone have wreaked havoc on housing affordability and home buying power. Just consider a loan amount of $400,000 at a 3% rate versus 7% rate. We’re talking about a monthly principal and interest payment of $1,686 vs. $2,661. That’s nearly $1,000 based on the interest rate increase alone. Then you have to factor in... --- > When you take out a mortgage, whether it’s a refinance or a home purchase, you may come across the phrase “cash to close.” Virtually all mortgages require - Published: 2023-09-21 - Modified: 2023-10-18 - URL: https://www.thetruthaboutmortgage.com/what-is-cash-to-close/ - Categories: Home Buying, Mortgage Tips When you take out a mortgage, whether it’s a refinance or a home purchase, you may come across the phrase “cash to close. ” Virtually all mortgages require some financial contribution from the borrower to fund the loan. It might be down payment funds, it might be lender fees, or it might be prepaid charges like property taxes and homeowners insurance. There’s a good chance it’ll be a combination of these things, which will need to be paid at closing via a verified account. Let’s talk more about the meaning of cash to close, how it’s calculated, and how it’s paid. Cash to Close on a Home Loan Is More Than Just Closing Costs If you look at your paperwork, you should see a list of closing costs associated with your home loan. You can see estimates of these costs on both your initial Loan Estimate (LE) and also on your Closing Disclosure (CD). And when it’s about time to close your loan, on the settlement statement prepared by your escrow officer or real estate attorney. On these documents, you should see things like the loan origination fee, underwriting and processing fees, and other lender fees. Additionally, there will likely be a charge for an appraisal, along with a charge for title insurance, homeowners insurance, and escrow services. Under that escrow/title umbrella, more fees will be listed, such as courier fees, wire fees, notary fees, loan tie in fees, settlement fees, and on, and on. There will also be recording... --- > Today was a rough day for mortgage rates as the market digested the Fed’s latest outlook, which confirmed its inflation fight is far from over. While they - Published: 2023-09-21 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/are-high-mortgage-rates-here-to-stay/ - Categories: Mortgage News, Mortgage Rates Today was a rough day for mortgage rates as the market digested the Fed’s latest outlook, which confirmed its inflation fight is far from over. While they didn’t raise their own fed funds rate yesterday, they did leave the door open for another hike in the future, assuming economic data warrants it. Their overall stance actually didn’t change, but their so-called “dot plot” revealed that more of the Federal Reserve’s policymakers expect another rate hike this year. Granted, it appears only one more quarter percent (0. 25%) hike is in the cards at this juncture. So while we might be going higher, it might only be a tiny bit higher. And after that, there may be more certainty for mortgage rates. Higher Mortgage Rates for Longer, However... After the Fed’s announcement, everyone seemed to adopt a simple takeaway: “higher for longer. ” In other words, most don’t expect the Fed to pivot and begin loosening monetary policy anytime soon. There had been some hope that we were at the terminal rate, where the Fed stops hiking. But maybe not just yet. As it stands, the Fed has raised their own fed funds rate 11 times since early 2022, and mortgage rates have risen along with those hikes. While the Fed doesn’t control mortgage rates, its policy decisions can affect the direction of long-term interest rates, such as those tied to 30-year fixed mortgages. Simply put, they don't set the rate on your 30-year fixed, but what they say or do... --- > Past Ginnie Mae president Ted Tozer has argued that the FHA should lower or completely eliminate its current 3.5% down payment requirement. He discussed - Published: 2023-09-20 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/former-ginnie-mae-boss-makes-the-case-for-a-zero-down-fha-loan/ - Categories: Housing Market, Mortgage News Past Ginnie Mae president Ted Tozer has argued that the FHA should lower or completely eliminate its current 3. 5% down payment requirement. He discussed the controversial take during a Community Home Lenders of America Roundtable in Washington, D. C. earlier this week, per Inside Mortgage Finance. This isn’t the first time he’s floated the idea of turning the FHA home loan program into a zero-down-payment program. In the past while arguing this same position, he noted that the Bush administration even proposed such a change all the way back in 2004. The question is does this invite more risk at a time when home prices and mortgage rates are already out of reach for most? Most FHA Loan Borrowers Need a Minimum 3. 5% Down Payment At the moment, FHA loan borrowers need to scrounge up 3. 5% of the purchase price when buying a home, assuming they have a 580 FICO score. Those with scores between 500 and 579 need at least a 10% down payment. While this is seemingly a pretty low bar, it still acts as a roadblock for many prospective home buyers, especially low-income borrowers with little savings. According to a semi-recent Federal Reserve study, the average American household had about $42,000 in savings. But if you break it down by age, those under 35 only had $11,250 and those 35 to 44 only about $28,000. A home purchase, even with a small down payment, could easily wipe out these accrued savings. And remember that... --- > One interesting aspect of the home loan process is the sheer number of individuals you’ll work with along the way. You don’t just speak to a salesperson - Published: 2023-09-19 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/who-are-all-the-people-involved-in-the-home-loan-process/ - Categories: Home Buying, Mortgage Tips One interesting aspect of the home loan process is the sheer number of individuals you’ll work with along the way. You don’t just speak to a salesperson and call it a day. Lots of people are involved in what is a very complex transaction. Aside from salespeople, there are loan underwriters, processors, appraisers, escrow officers, real estate attorneys, and more. Let’s discuss the roles these people hold to help you better understand what it takes to get a mortgage. Remember, you’re asking to borrow a large sum of money, so it’s going to take time and energy (and lots of people) to get to the finish line. The Sales Rep/Loan Officer/Mortgage Broker The first step in the home loan process typically involves a sales person, which can be a banker at your local branch or credit union, a loan officer, or a mortgage broker. If we’re talking about a purchase, this may come before/during your home search or after you’ve found your property with the assistance of a real estate agent. If it’s a mortgage refinance, you’d simply jump right to this step to rework the details of your existing home loan if you wanted a rate and term refinance or a cash out refi. You might be referred to an individual/company, or you might do your own discovery to find a suitable partner. Either way, always look beyond the referral you were given. Your real estate agent might know a great lender, but you your own research as well.... --- > At last glance, 30-year fixed mortgage rates were sitting above 7%. Despite this, there are virtually no homes for sale. One would assume that after such - Published: 2023-09-19 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-are-there-no-homes-for-sale/ - Categories: Home Buying, Housing Market, Mortgage News At last glance, 30-year fixed mortgage rates were sitting above 7%. Despite this, there are virtually no homes for sale. One would assume that after such a massive interest rate spike, demand would flounder and supply would flood the market. Yet here we are, looking at a housing market that has barely any for-sale inventory available. And when you remove the new home inventory (from home builders) from the equation, it’s even worse. Let’s explore what’s going on and what it might take to see listings return to the market. Why There Are No Homes for Sale Right Now? The housing market is highly unusual at the moment, and has been for quite some time. In fact, since the pandemic it’s never really been normal. The housing market came to a halt in early 2020 as the world stopped, but then took off like a rocket. If you recall, the 30-year fixed spent the entire second half of 2020 in the sub-3% range, fueling voracious demand from buyers. And as Zillow pointed out, the age demographics had already lined up nicely for a surge of demand anyway. Around that time, some 45 million Americans were expected to hit the typical first-time home buyer age of 34. When you combined the demographics, the record low mortgage rates, a pandemic (which allowed for increased mobility), and already limited inventory, it didn’t take much to create a frenzy. At the same time, you had existing homeowners buying up second homes on the cheap,... --- > How fast is fast enough? Ask Guaranteed Rate, which just launched “5 Minute Approval” for mortgage applications. This new “innovation” from the - Published: 2023-09-14 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/guaranteed-rate-5-minute-approval/ - Categories: Mortgage News How fast is fast enough? Ask Guaranteed Rate, which just launched “5 Minute Approval” for mortgage applications. This new “innovation” from the Chicago-based mortgage lender allows borrowers to get approved for a home loan in just five minutes (or less). Interestingly, it comes not long after their Same Day Mortgage, which apparently wasn’t quick enough for some. It might also be a sign of the times, with mortgage application volume at its lowest levels since the 1990s. As the name suggests, customers can get approved for a home loan in about five minutes and possibly close in just 10 days. How Does This New 5 Minute Mortgage Approval Work? Those who are in a really big rush to get a mortgage can now take advantage of Guaranteed Rate’s so-called 5 Minute Approval. As noted, the company only just launched Same Day Mortgage back in March, but apparently they had their sights set on faster. And faster is exactly what this is. How it works appears relatively simple. You visit their website, access the secure portal, sign the initial application package, then upload any requested documents. This can apparently be done without any human interaction as well, and is about three minutes faster than Rocket Mortgage’s 8-minute full approval launched back in 2015. To date, Guaranteed Rate has “successfully approved” more than 100 loans within 5 minutes via their pilot program. It’s unclear how much is needed from the borrower as they didn’t provide the details, but that obviously seems lightning... --- > A new startup called “Roam” has launched a service to make assuming a mortgage painless. The company is backed by some prominent real estate figures, - Published: 2023-09-13 - Modified: 2025-03-15 - URL: https://www.thetruthaboutmortgage.com/roam-home-review-new-assumable-mortgage-platform/ - Categories: Home Buying, Mortgage News, Mortgage Rates A new startup called “Roam” has launched a service to make assuming a mortgage painless. The company is backed by some prominent real estate figures, including Opendoor co-founder Eric Wu and former Fannie Mae CEO Tim Mayopoulos. The goal is to help more home buyers take advantage of the many low-rate mortgages in existence via a loan assumption. This includes FHA loans and VA loans, both of which are assumable by home buyers. Roam acts as a hands-on guide for buyers and sellers to ensure the process goes smoothly in exchange for a 1% fee. How Roam Makes It Easy to Assume a Mortgage While many home loans are assumable, including all government-backed loans (FHA/VA/USDA), the process isn’t so straightforward. Roam notes that the loan assumption process is “opaque and time-consuming,” and often requires buyers to fill out forms with paper and pen and fax them to the lender or loan servicer. There’ also uncertainty for the home seller, who might not be sure if they’re still liable for the loan post-assumption. To alleviate some of these pain points and ensure the process is done correctly, Roam manages all the operational details on behalf of the buyer, seller, and real estate agents. They don't approve the loans, but act as a facilitator and provide guidance/support throughout the process. In addition, Roam makes it easier to find homes for sale that feature an assumable mortgage. Once you sign up via their website, they’ll compile a set of for-sale listings that feature... --- > I don’t think it would be much of a stretch to assume nobody likes high mortgage rates. They make it more difficult for prospective home buyers to get to - Published: 2023-09-12 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/the-silver-lining-of-high-mortgage-rates/ - Categories: Mortgage Rates, Mortgage Tips, Refinance I don’t think it would be much of a stretch to assume nobody likes high mortgage rates. They make it more difficult for prospective home buyers to get to the finish line, especially with lofty asking prices. And they’ve led to countless mortgage layoffs and job losses in a number of related industries. Sure, investors might earn more interest on loans with higher mortgage rates, but only if the loans are held onto to. There’s a good chance they’ll be paid off sooner rather than later, making them a little less enticing. But there is one silver lining to these stubbornly high mortgage rates. There Will Be a Mortgage Refinance Boom in the Near Future The longer mortgage rates remain elevated, the larger the number of high-rate home loans in existence. It’s pretty straightforward. If lenders keep doling out new loans, they’ll undoubtedly have high interest rates. If you look at the chart above from Black Knight, the average interest rate on outstanding mortgages is around 3. 94%, but is inching higher as time goes on. As more high-rate mortgages are originated, this average rate will climb, thereby replenishing the very dry refinance pool. At last glance, the popular 30-year fixed mortgage is going for over 7%, up from the 2-3% range in 2021 and early 2022. Mortgage rates are now close to their 21st century highs, with the 30-year fixed reaching 8. 64% in May 2000. Hopefully we don’t go that high, but anything is possible these days. Even... --- > It’s time to check in on the state of the housing market. At last glance, mortgage rates were still above 7%, though they did see a little bit of relief - Published: 2023-09-08 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/fannie-mae-chief-economist-calls-current-housing-market-unusual/ - Categories: Housing Market, Mortgage News It’s time to check in on the state of the housing market. At last glance, mortgage rates were still above 7%, though they did see a little bit of relief in the past week. Meanwhile, housing supply continues to be heavily constrained, keeping home prices near all-time highs in most of the country. This has proved to be a boon for home builders, as they have no competition from existing supply. But it seems the home builders, and perhaps those with 2-3% 30-year fixed mortgage rates, are the only real winners right now. Home Purchase Sentiment Has Been Flat with High Rates and High Prices Fannie Mae’s latest monthly Home Purchase Sentiment Index (HPSI), which gauges the housing market’s temperature, was mostly unchanged from July. A total of six components make up the HPSI, including buying conditions, selling conditions, home price outlook, mortgage rate outlook, job loss concern, and change in household income. The percentage of respondents who said it is a good time to buy a home was unchanged at a very low 18%. Meanwhile, the percentage who said it is a bad time to buy stood at 82%. So nothing changed there. As a result, the net share of those who say it is a good time to buy remained unchanged month over month. When it came to selling a home, 66% of respondents (up from 64%) said it is a good time to unload a property. And just 34% said it’s a bad time to sell, down... --- > If you peruse real estate listings on Realtor.com, you might come across a new Airbnb integration. This week, the two companies announced a collaboration - Published: 2023-09-08 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/homeowners-can-now-see-how-much-theyll-make-renting-a-room-on-airbnb/ - Categories: Housing Market, Mortgage News If you peruse real estate listings on Realtor. com, you might come across a new Airbnb integration. This week, the two companies announced a collaboration that lets homeowners see how much they could fetch to rent out a room, or the entire house. It comes at a time when short-term rentals, or STRs for short, are somewhat under-fire given their immense growth. The Airbnb story also happens to coincide with a residential housing shortage, with some critics blaming STRs on the lack of supply. In any event, if you’re interested in seeing your Airbnb earnings estimates, you’ll need to add your property to Realtor’s My Home dashboard first. How to Find Your Airbnb Host Estimate on Realtor. com To get started, you’ll need to head over to the My Home dashboard on Realtor. com and add your property if you haven’t already. This will also entail creating an account on Realtor. com if you don't have one. It’s fairly simple and seems to only require an email and password. From there, you’ll see a variety of information pertaining to the property added, including its RealEstimate, which is the site’s take on a Zestimate. You’ll also see a tab titled “Host or rent,” which will contain your Airbnb host estimate. It provides both an entire home estimate and a room estimate. A sample of the entire home estimate can be seen in the screenshot above. The single room estimate can be seen below. It defaults to a 7 nights out of... --- > Lately, there’s been a lot of talk about a lack of affordability, even a potential housing bubble. And it comes as no surprise, given the massive shock of - Published: 2023-09-06 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/typical-home-sold-for-200000-more-than-seller-paid/ - Categories: Home Buying, Housing Market, Mortgage News Lately, there’s been a lot of talk about a lack of affordability, even a potential housing bubble. And it comes as no surprise, given the massive shock of a near-tripling of mortgage rates over just a year and a half. The 30-year fixed could be had in the low 3s, maybe even high 2s back in early 2022, and today is closer to 7%. At the same time, home prices haven’t come down, despite a slowing rate of appreciation. Together, this has brought the housing market to its knees and pushed many prospective buyers onto the sidelines. But those who sell are still reaping massive profits. Home Buying Is the Least Affordable Since 1984 Remember those 1980s mortgage rates that were in the double-digits? Well, today’s mortgage rates are nowhere close. However, due to sky-high home prices and elevated interest rates, home buying is the least affordable it has been since 1984. That’s right, it hasn’t been this bad in about 40 years, which illustrates just how challenging this housing market has become. Per Black Knight, it now requires 38. 3% of the median household income to make a monthly mortgage payment on an average-priced home. Using Freddie Mac’s 7. 23% average for a conforming 30-year fixed mortgage as of August 24th, the monthly principal and interest payment climbed to $2,423. And this assumes the buyer comes in with a 20% down payment, when in reality many borrowers can only muster 3-5%. To the point of it being a bubble,... --- > We all know mortgage interest rates have increased tremendously. While there were periods of relief here and there, the trajectory since early 2022 has - Published: 2023-09-05 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/one-really-simple-way-to-offset-a-higher-mortgage-rate/ - Categories: Mortgage Rates, Mortgage Tips We all know mortgage interest rates have increased tremendously. While there were periods of relief here and there, the trajectory since early 2022 has been decidedly higher. How much higher remains to be seen, but there’s a good chance the rate you receive on a mortgage today won’t be as low as it was a year ago, or perhaps even a month ago. Simply put, the 30-year fixed is no longer being offered at an absurd 3. 5%, thanks to surging inflation and the end of the Fed's mortgage-backed securities (MBS) buying spree. Today, you might be facing an interest rate of 7% or even higher, depending on the loan attributes, your FICO score, and so on. And while it might be hard to accept, there is something you can do to limit the damage of that higher rate. Just Pay More Toward Your Mortgage Each Month There’s no magic formula here or hoops to jump through If you have a higher interest rate than you’d like just pay more This is a simple way to pay your home loan down faster and lessen the blow The more you pay, the lower your effective mortgage rate It’s pretty straightforward. If you want your high-rate mortgage to cost you less, pay more each month. While the interest rate might be set in stone (barring a refinance), you’re generally allowed to make any payment you’d like each month, so long as it’s enough to satisfy the minimum payment. So if your monthly... --- > A week ago, it seemed like we were on the fast track to 8% mortgage rates. But then something spectacular happened, nearly a week’s worth of economic data - Published: 2023-08-31 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/shark-tanks-kevin-oleary-predicts-8-mortgage-rates/ - Categories: Mortgage News, Mortgage Rates A week ago, it seemed like we were on the fast track to 8% mortgage rates. But then something spectacular happened, nearly a week’s worth of economic data pushed rates back toward 6%. However, that hasn’t stopped some folks like Shark Tank’s Kevin O’Leary from warning the worst is yet to come. In an interview last Friday, he warned of a minimum of two additional rate hikes from the Fed, which he believes would push mortgage rates above 8%. So is he right, or is the economic data we saw this week proof that the existing hikes are beginning to work? Is Mr. Wonderful Right About Higher Mortgage Rates? As noted, Kevin O’Leary, or Mr. Wonderful as he’s known as Shark Tank, believes mortgage rates are going even higher than current levels. He told Fox News this last Friday, when the 30-year fixed was closer to 7. 50% and looking to move higher. But now that we have another four days of data at our fingerprints, the 30-year fixed appears to be trending lower. In fact, we could hit the high 6% range tomorrow if a favorable jobs report is delivered, which would make sense given the other reports seen lately. It’s certainly no guarantee, but it’s a real possibility. On the other side of the coin, a stronger-than-expected jobs report could unravel all the rate improvements we’ve seen this week in quick order. O’Leary’s argument is that Jerome Powell and the rest of the Fed isn’t messing around when... --- > This morning, the Job Openings and Labor Turnover Survey (JOLTS report) was released by the Labor Department. It revealed that the labor market wasn’t - Published: 2023-08-29 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-are-lower-job-openings-good-for-mortgage-rates/ - Categories: Mortgage News, Mortgage Rates This morning, the Job Openings and Labor Turnover Survey (JOLTS report) was released by the Labor Department. It revealed that the labor market wasn’t running as hot as it was previously, leading to a nice drop in the 10-year treasury bond yield. As a result, long-term mortgage rates, which track bonds like the 10-year, should also see some much needed relief. But why does seemingly bad economic news benefit consumer mortgage rates? Well, when you’re trying to fight inflation, which hurts bonds, any sign of a slowing economy is generally good news. JOLTS Report Reveals Cooler Labor Market Conditions As noted, this morning’s JOLTS report came in cooler than expected, prompting a sizable drop in treasury yields. With inflation and unemployment taking centerstage of late, reports like this have become a lot more important. Specifically, job openings dropped 338,000 to a total of 8. 827 million as of the last day of July. This is the lowest level of openings since March 2021, and well below the forecast of 9. 465 million job openings, per economists polled by Reuters. The report is essentially a barometer of labor demand, with fewer openings indicating less need from employers. At the same time, fewer openings mean it's more difficult to find work, which could lead to higher unemployment. Meanwhile, the so-called quits rate fell to 2. 3% from 2. 4% a month earlier, with totals quits decreasing 253,000 to 3. 5 million, the lowest level since February 2021. The quits are a proxy... --- > Today, Zillow Home Loans announced its “1% Down Payment” loan program, making them the latest lender to join the near-zero down fray. The move comes as - Published: 2023-08-24 - Modified: 2023-11-15 - URL: https://www.thetruthaboutmortgage.com/zillow-home-loans-1-down-mortgage/ - Categories: Home Buying, Mortgage News Today, Zillow Home Loans announced its “1% Down Payment” loan program, making them the latest lender to join the near-zero down fray. The move comes as mortgage rates hit 20-year highs, with the 30-year fixed now being quoted in the 7% range for many borrowers. Of course, this program simply addresses the down payment burden, but any little bit helps at the moment. Initially, the new offering will be available to applicants purchasing a home in the state of Arizona only. But the company does have plans to expand to other states if the pilot goes well. How Zillow’s 1% Down Payment Loan Program Works Zillow notes that most of the country is in the midst of an affordability crisis, thanks to a combination of high asking prices and equally high mortgage rates. At the same time, renters are grappling with asking rents that are 3. 6% higher than they were a year ago, making it difficult to set aside funds for a down payment. This means 64% of first-time home buyers are putting down less than 20% when purchasing a property, and 25% are only able to muster 5% or less. Many others don’t even have the necessary funds to bring in a minimum contribution, which could delay their home purchase. Looking at a hypothetical $275,000 purchase in Phoenix, Arizona, it would take only 11 months for someone saving 5% of their income (earning 80% of area median income) to save 1% down payment. Meanwhile, someone who needed a... --- > It’s been a rough month or so for mortgage rates. If we zoom out even further, it’s been a horrendous 18 months, with the 30-year fixed as low as 3% in - Published: 2023-08-23 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-will-it-take-for-mortgage-rates-to-fall-again/ - Categories: Mortgage Rates, Mortgage Tips It’s been a rough month or so for mortgage rates. If we zoom out even further, it’s been a horrendous 18 months, with the 30-year fixed as low as 3% in the spring of 2022. Today, you might be looking at an interest rate in the 7% range, or even the 8s if you have a particularly challenging scenario. This has eroded affordability and ground the housing market to a halt, driven mainly by the Fed’s ongoing inflation fight. So what will it take for mortgage rates to fall again? And how soon can we expect meaningful downward movement? Will Mortgage Rates Go Back to 3%? First things first, it’s doubtful mortgage rates go back to 3%. The 30-year fixed hit a record low of 2. 65% in January 2021, per Freddie Mac. The blue line above is the 30-year fixed, the green line the 15-year fixed. The chances of rates returning to those ridiculously low levels seems unlikely, though you should never say never. Anything is possible, though if we do get back there, it’s probably not going to happen anytime soon. Ultimately, the Federal Reserve engineered those record low mortgage rates by purchasing trillions in mortgage-backed securities (MBS) and lowering its own short-term fed funds rate to near-zero. The process is known as Quantitative Easing, or QE for short, and took place for much of the past decade. Unfortunately, this accommodative rate environment was artificial, and eventually led to massive inflation, perhaps because it ran for too long.... --- > Principal vs. Principle Attention loan officers, mortgage brokers, real estate agents, and so on The words "principal" and "principle" are two very - Published: 2023-08-22 - Modified: 2025-03-05 - URL: https://www.thetruthaboutmortgage.com/its-mortgage-principal-not-principle/ - Categories: Mortgage Tips Principal vs. Principle Attention loan officers, mortgage brokers, real estate agents, and so on The words "principal" and "principle" are two very different words They are constantly used incorrectly by those working in the housing industry Even by major mortgage companies and journalists that should know better! Allow me to get testy about grammar for a minute (moment). I know I know, it’s lame to be a member of the grammar police and go after folks for using a word incorrectly. I’m sure I use words incorrectly all the time. In fact, maybe I should have used a synonym of incorrectly that second time around to mix things up. But in this particular case, we’re talking about two completely different words that sound exactly the same but have entirely different meanings. And they often get confused in the mortgage world, with the word “principle” typically used in place of the correct “principal. ” The scary part is that mortgage professionals and high-ranking journalists make this mistake all the time, often when attempting to convey an important message about personal finances! Perhaps that's why I have a bone to pick. What Is Mortgage Principal? The word principal means "first" or "primary" But it has a different meaning when it comes to money It is defined as the original amount invested or loaned In other words, it's your loan amount if we're talking about a mortgage Well, the word principal generally means “first. ” That’s why the head of a school is... --- > While Fed rate hike forecasts indicate the worst is behind us, mortgage rates are still going up. In fact, they hit a new 52-week high this morning, - Published: 2023-08-21 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-are-mortgage-rates-still-going-up-if-the-fed-is-done-hiking/ - Categories: Mortgage News, Mortgage Rates While Fed rate hike forecasts indicate the worst is behind us, mortgage rates are still going up. In fact, they hit a new 52-week high this morning, surpassing the brief highs seen back in October. That puts the 30-year fixed at its highest level in more than 20 years, averaging around 7. 5%. This will likely grind the housing market to a halt, which was already grappling with affordability woes prior to this most recent leg up in rates. The question is why are mortgage rates still increasing if long-term signals indicate that relief is in sight? The 30-Year Fixed Mortgage Is Now Priced Close to 7. 5% Depending on the data you rely on, the popular 30-year fixed is now averaging roughly 7. 5%, up from around 6% to start the year. If we go back to the start of 2022, this rate was closer to 3. 5%, which is a shocking 115% increase in little over a year. And while mortgage rates in the 1980s were significantly higher, it’s the speed of the increase that has crushed the housing market. Additionally, the divide between outstanding mortgage rates held by existing homeowners and prevailing market rates has created a mortgage rate lock-in effect. In short, the higher mortgage rates go, the less incentive there is to sell your home, assuming you need to buy a replacement. Aside from it being extremely unattractive to trade a 3% mortgage for a rate of 7% or higher, it can be out of... --- > With 30-year mortgage rates now above 7%, a refinance likely isn’t in the cards for most homeowners. In fact, the total number of refinance candidates has - Published: 2023-08-17 - Modified: 2024-10-08 - URL: https://www.thetruthaboutmortgage.com/options-other-than-refinancing-your-mortgage/ - Categories: Mortgage Rates, Mortgage Tips, Refinance With 30-year mortgage rates now above 7%, a refinance likely isn’t in the cards for most homeowners. In fact, the total number of refinance candidates has plummeted as interest rates have more than doubled. Previously, around 18 million homeowners stood to benefit from a refinance. Today, it might be less than 100,000, per Black Knight. Either way, it’s clear that refinancing has fallen out of fashion big time. The math just doesn’t make sense for most. The question is what are your options other than refinancing, assuming you want a lower rate or cash out? Why a Mortgage Refinance Doesn't Make Sense Right Now Yesterday, the Mortgage Bankers Association (MBA) reported that mortgage rates hit their highest levels since 2001, matching those seen briefly in October 2022. They noted that refinance applications were off two percent from a week earlier and 35% from the same week a year ago. If you look at the graph above, you can see why. The number of refinance candidates has fallen off a cliff. Meanwhile, Freddie Mac said nearly two-thirds of all mortgages have an interest rate below 4%. As such, refinancing the mortgage just doesn't work for the majority of homeowners out there. Simply put, trading in a fixed interest rate below 4% for a rate above 7% isn't very logical, even if you really need cash. In fact, during the first half of 2023, nearly nine out of 10 conventional loan refinance originations were cash out refinances. Ultimately, if you're looking for... --- > At last glance, the 30-year fixed mortgage was back above 7%, depending on the data source. Prior to late July and early August, the popular loan product - Published: 2023-08-16 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-are-mortgage-rates-so-high/ - Categories: Mortgage Rates, Mortgage Tips At last glance, the 30-year fixed mortgage was back above 7%, depending on the data source. Prior to late July and early August, the popular loan product could be had for closer to 6. 5%. Or even in the high 5s if paying points. And forecasts from prominent economists pointed to rates making their way back to the 5s, or even the 4s by next year. Then rates suddenly reserved course and continued their upward climb, challenging the high levels seen last November. The question is, why are mortgage rates so high? And why aren’t they coming down if the Fed is done hiking and inflation is abating? Blame the Resilient Economy for High Mortgage Rates As a quick refresher, good economic news tends to lead to higher interest rates. And bad economic news typically results in lower interest rates. The general logic is a hot economy requires higher borrowing costs to slow spending, otherwise you get inflation. Meanwhile, a cool economy may require a rate cut to spur more lending and get consumers spending. Unfortunately, the economy continues to defy expectations, in spite of the many Fed rate cuts already in the books. Since March of 2022, the Fed has raised their key fed funds rate 11 times, from near-zero to a range of 5. 25-5. 50%. This was deemed necessary to battle inflation, which had spiraled out of control, causing the prices of everything, including single-family homes, to skyrocket. While the Fed has more or less signaled that... --- > While the most advantageous reason to use a mortgage broker might be their ability to shop your rate with multiple lenders, you still need to put in the - Published: 2023-08-04 - Modified: 2025-02-07 - URL: https://www.thetruthaboutmortgage.com/compare-mortgage-brokers/ - Categories: Mortgage Tips While the most advantageous reason to use a mortgage broker might be their ability to shop your rate with multiple lenders, you still need to put in the time to comparison shop. There are three main reasons I can think of offhand to explain this argument. At the same time, don’t forget to compare banks vs. brokers too if you want to truly exhaust all your options. Remember, gathering several mortgage quotes is a proven method to land a lower interest rate on your home loan, backed up by real studies. Yes, it takes more legwork, but the return on investment can be enormous when you look at the fraction of time involved to the potential money saved. 1. They Are Individuals with Different Skill Sets and Personalities Mortgage brokers are individuals just like real estate agents This means they have various experience levels and unique personalities You’ll want to choose one that is both competent and easy to work with Who takes the time to explain how everything works and answers your questions Let's talk about why you should compare mortgage brokers, even if they work with multiple lender partners. First off, mortgage brokers are often just individuals with their own small business (though larger shops exist as well). This means they have unique personalities and hold different skill sets, with some more experienced than others. They could also have different work hours, availability, and so on. Some may utilize assistants, while others may prefer to work with you... --- > With mortgage rates exceeding 7% again and home prices reaching new heights, some critics are sounding the alarm. The argument is that we’ve got an - Published: 2023-08-03 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/todays-housing-market-risk-factors/ - Categories: Housing Market, Mortgage News With mortgage rates exceeding 7% again and home prices reaching new heights, some critics are sounding the alarm. The argument is that we’ve got an unhealthy housing market, in which the typical American can’t afford a median-priced home. And when payments are out of reach, it’s just a matter of time before things correct. It is, after all, unsustainable. Some are even arguing that it’s 2008 (or whatever early 2000s year you want to use) all over again. But is the housing market really on the brink of another crash, or is housing simply unaffordable for new entrants? What Could Cause the Next Housing Crash? Over the past few years, I’ve been compiling a list of housing market risk factors. Just ideas that pop in my head about what could cause the next housing crash. I’m going to discuss them to see what kind of threat they pose to the stability of the housing market. This is what my list looks like at the moment: Single-family home investors selling all at once Climate-related issues Spike in mortgage rates Overbuilding (home builders going too far) Crypto bust (bitcoin, NFTs, etc. ) Forbearance ending (COVID-related job losses) Mass unemployment (recession) Contentious presidential election Mom and pop landlords in over heads Airbnb and STR saturation (especially in vacation markets) Increase in overextended homeowners (high DTIs, HELOCs, etc. ) Student loans turned back on (coupled with high outstanding debt) Buy now, pay later (lot of kicking the can down the road) The Spike in... --- > In a clear sign of the times, Zillow has announced a partnership to syndicate new-construction listings on Redfin. This means home shoppers will see more - Published: 2023-08-02 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/zillow-and-redfin-join-forces-to-push-more-new-construction-home-sales/ - Categories: Home Buying, Housing Market, Mortgage News In a clear sign of the times, Zillow has announced a partnership to syndicate new-construction listings on Redfin. This means home shoppers will see more new builds than they did in the past, at a time when existing housing supply has rarely been lower. It also means home builders will gain even more exposure, further boosting their already-high market share. Once launched, Redfin will source non-MLS new-construction listings exclusively from their competitor Zillow. And any new-construction listings that are available through an MLS will continue to be discoverable on the Redfin platform. Zillow and Redfin Linkup a Boon to Home Builders Zillow apparently has the largest selection of new-construction communities of all real estate U. S. websites. This seems to be due to their existing partnerships with home builders, whereby they advertise their properties on Zillow. To broaden their reach, these listings are slated to be syndicated to Redfin starting in the fourth quarter of 2023. And Redfin users will get to take advantage of new features designed specifically to discover new-construction communities and connect with home builders. Powered by Zillow's Community pages, they’ll list all available homes for sale within the community, along with their amenities. Shoppers will be able to view move-in ready homes, nearly complete homes, and even lots. Those interested will find a direct link to the home builder's website, along with pertinent contact information and sales center hours. New Home Sales Up Big Year-Over-Year The U. S. Census Bureau recently reported that sales of newly... --- > Everyone knows mortgage rates aren’t as low as they used to be. Understatement of the decade there. But this doesn’t just equate to a higher monthly - Published: 2023-08-01 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/the-hidden-danger-of-a-higher-mortgage-rate/ - Categories: Mortgage Rates, Mortgage Tips Everyone knows mortgage rates aren’t as low as they used to be. Understatement of the decade there. But this doesn’t just equate to a higher monthly payment. There are other negatives associated with a higher mortgage rate, some which may be overlooked. Today, I want to talk about loan amortization and how it differs between low and high mortgage rates. With the 30-year fixed closer to 7% these days, it’s going to take a lot longer to pay down your principal balance. And that could have unintended consequences. Higher Mortgage Rate = Slower Paydown As noted, mortgage rates are no longer a screaming bargain. In fact, they’re historically kind of high now, at least if you consider the last couple decades. At last glance, the popular 30-year fixed mortgage averaged 6. 81%, according to the latest weekly survey from Freddie Mac. For some borrowers, a rate in the 7s isn’t out of the question, depending on down payment, FICO score, and other pricing adjustments. A little more than a year ago, you could get a 30-year fixed closer to 3. 5%. And despite this rate jump, home prices haven’t budged in most places. In fact, they’ve reached new heights nationally, defying affordability constraints and the many Fed rate hikes that have taken place since. Unfortunately, this means today’s home buyers are facing significantly higher mortgage payments. But beyond that, they’re also facing much slower paydowns. Simply put, the higher your interest rate, the longer it takes to pay down principal.... --- > More news on the mortgage rate lock-in effect, this time from Zestimate creator Zillow. The company conducted a survey and found that homeowners with a - Published: 2023-07-31 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/zillow-says-homeowners-twice-as-likely-to-sell-if-their-mortgage-rate-is-above-5/ - Categories: Housing Market, Mortgage News, Mortgage Rates More news on the mortgage rate lock-in effect, this time from Zestimate creator Zillow. The company conducted a survey and found that homeowners with a mortgage rate above 5% are nearly twice as likely to sell. This appears to be the “rate-lock tipping point,” where it essentially no longer matters to give up your mortgage rate. On the other side of the coin, you have the homeowners with sub-5% rates that are essentially locked-in to their properties for fear of losing their low payments. The latter group explains why housing inventory continues to be at historically low levels, arguably keeping home prices elevated despite affordability issues. Low Locked-In Mortgage Rates Affect Housing Supply By analyzing data from the ZG Population Science Quarterly Survey of Homeowner Intentions and Preferences, Zillow discovered that low locked-in mortgage rates affect housing supply. A homeowner’s reluctance to sell “results in a shortage of housing options, resale supply, homeowner mobility, and places upward pressure on housing prices. ” Specifically, they learned that mortgage holders with interest rates above 5% are about twice as likely to have plans to sell their home over the next three years versus those with lower rates. As you can see from the graphic above, this ratio is 38% vs. 21%, illustrating just how important a low rate mortgage is to existing homeowners. And of the homeowners who reported plans to sell, 47% of homeowners with a mortgage rate above 5% have already listed their property for sale. Meanwhile, just 20% of... --- > Has residential housing supply finally bottomed? Are we finally going to see more single-family homes hit the market, after years of slim pickings? - Published: 2023-07-31 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/big-jump-in-homeowners-saying-theyll-sell-in-the-next-three-years/ - Categories: Housing Market, Mortgage News Has residential housing supply finally bottomed? Are we finally going to see more single-family homes hit the market, after years of slim pickings? Perhaps, if a new survey from Zillow turns out to be reality, and not just, well, a survey. A new finding from Zillow Group’s Quarterly Survey of Homeowner Intentions and Preferences (QSHIP) revealed a big jump in home selling intent. While surprising, given the current mortgage rate lock-in narrative, it could help alleviate a housing market desperate for new listings. Are Homeowners Finally Gearing Up to Sell? The survey in question found that 23% of homeowners surveyed in June 2023 expressed a willingness to sell their homes. This includes both those who say they are listing their home for sale or at least considering selling in the next three years. While the number is a relatively low 23%, it’s up from 19% in the first quarter and 15% a year ago. It was as low as 14% in the first quarter of 2021 and never higher than 19% since that time. If we look at it from the percentage standpoint, that’s a near-65% increase in selling sentiment. Granted, it’s been a few weird years (and I’d like to see data from pre-COVID years), but it’s still encouraging if you’re a prospective home buyer. Among the 23% who said selling was on the horizon, four in 10 said they are considering listing their property in the next year. And for mortgage holders who have a mortgage rate above... --- > While bulls and bears continue to argue the health of the housing market, a new report revealed that most existing homeowners are in a really good spot. - Published: 2023-07-27 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/nearly-half-of-homeowners-with-a-mortgage-are-equity-rich/ - Categories: Housing Market, Mortgage News While bulls and bears continue to argue the health of the housing market, a new report revealed that most existing homeowners are in a really good spot. The second-quarter 2023 U. S. Home Equity & Underwater Report from ATTOM found that 49% of mortgaged residential properties in the United States were considered “equity-rich. ” The term is defined as a property owner having at least 50 percent equity in their property, or a loan-to-value ratio (LTV) of 50% or less. This percentage of equity rich homeowners increased from 47% in the first quarter and is now at its highest point in at least four years. Compare this to the year 2012, when nearly 30% of homeowners with mortgages were seriously underwater. Home Price Reversal Boosts Equity Numbers in Second Quarter ATTOM noted that homeowner equity improved during the second quarter as prices for single-family homes and condos increased nationwide. This bucked the market slowdown that had run taken place in late 2022, when 30-year fixed mortgage rates rose above 7%. The company added that the median home value was up 10% in the second quarter, reaching a new all-time high of $350,000, after slipping 7% during the prior three quarters. At the same time, the number of seriously underwater borrowers continued to fall, and accounted for less than three percent of mortgaged homes in the U. S. during the quarter. That’s just one out of 36, defined as a homeowner who owes at least 25% more than the estimated market... --- > Another day, another affordable home loan program launches, this time “OneDown” from Guaranteed Rate. As the name implies, you only need to put 1% down - Published: 2023-07-26 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/guaranteed-rate-onedown/ - Categories: Mortgage News Another day, another affordable home loan program launches, this time “OneDown” from Guaranteed Rate. As the name implies, you only need to put 1% down when purchasing a home, which is about as close to zero as it gets. If you’re wondering why lenders are offering such mortgages, it comes down to affordability, or a lack thereof. Home prices remain at or near all-time lows, despite some pullback a few months back. And mortgage rates remain stubbornly high, with the 30-year fixed close to 7%. Guaranteed Rate OneDown: Their 1% Down Home Purchase Loan If you’re in the market to buy a home, despite those pesky high interest rates (and home prices), you might be feeling a little stretched. To alleviate some of that burden, Guaranteed Rate has joined other lenders in launching a 1% down mortgage, which they call OneDown. As you may or not know, Fannie Mae and Freddie Mac offer loans with just 3% down, such as HomeReady and Home Possible. But apparently that is still too much for some buyers, so Guaranteed Rate is chipping in an additional two percent contribution towards that down payment. They will provide 2% or up to $2,000 (whichever is lower), meaning you’ll probably get the full $2,000 in most cases unless you’re buying a sub-$100,000 home? I don’t think those exist anymore. On top of that, OneDown also provides borrowers with a $1,000 contribution toward their lender fees, such as underwriting, processing, origination fee, etc. So you can reduce your... --- > It’s no secret that homes just aren’t as affordable as they used to be. An unwelcome combination of significantly higher mortgage rates coupled with - Published: 2023-07-25 - Modified: 2025-03-26 - URL: https://www.thetruthaboutmortgage.com/homebuyer-assistance-programs/ - Categories: Home Buying, Mortgage Tips It’s no secret that homes just aren’t as affordable as they used to be. An unwelcome combination of significantly higher mortgage rates coupled with ever-higher asking prices has put a major dent in affordability. In May, the monthly mortgage payment on a median-priced home ($401,100) was over $2,000, up from around $1,000 back in 2020, according to the National Association of Realtors. And that assumes a 20% down payment, something that just isn’t a reality for many home buyers these days. The good news is there are lots of creative financing options out there, whether it's from a state housing agency or even a national lender. What Is Homebuyer Assistance? In short, homebuyer assistance is a special program or series of programs offered by a local municipality, state, or private lender that reduces borrowing costs and promotes homeownership. This can come via down payment assistance, closing cost assistance, reduced interest rates and mortgage insurance premiums, or a combination of these and other programs. Collectively, it makes homeownership more attainable, especially for first-time home buyers and/or those with low-to-moderate income. As noted, there are countless homebuyer assistance programs available, many of which are offered at the state or municipality level. For example, the California Housing Finance Agency, or CalHFA for short, offers a series of homebuyer assistance programs. The same goes for every other state in the nation. Programs are also offered for certain cities or underserved areas throughout the nation. At the city level, one example is LA’s Home Ownership... --- > You may have heard the phrase mortgage rate lock-in effect lately. As a quick refresher, it’s a homeowner's unwillingness to give up an ultra-low mortgage - Published: 2023-07-24 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/the-national-average-mortgage-rate-lock-in-effect-is-worth-55000/ - Categories: Mortgage News, Mortgage Rates You may have heard the phrase mortgage rate lock-in effect lately. As a quick refresher, it’s a homeowner's unwillingness to give up an ultra-low mortgage rate for a much higher one. Or simply the inability to give up their low rate, as qualifying for a home purchase at today’s much higher rates would be an impossibility. Regardless, there is now a value assigned to this so-called mortgage rate lock-in effect, with Freddie Mac putting the average at about $55,000. This means an existing homeowner needs a big incentive to sell, unless they want to forgo that value. How Valuable Is Your Low Mortgage Rate? Freddie Mac reported that six out of 10 borrowers now have a mortgage rate at or below 4%. And that the mortgage rate lock-in effect is a benefit to homeowners who hold fixed-rate mortgages. Now everyone knows a low mortgage rate can save you money, thanks to a lower monthly payment. But it also carries value, which can ebb and flow based on prevailing market rates. Never has this been truer than the last year and change. Simply put, mortgage rates more than doubled from their record low levels in 2021. As a result, those who locked in low rates around that time now hold something extremely valuable. For perspective, the 30-year fixed hit its all-time low of 2. 65% in early January 2021, per Freddie Mac. Last week, it averaged a significantly higher 6. 78%, which is a more than 150% increase. Aside from creating... --- > It’s been a tough year for the mortgage industry, with origination volume down substantially from the boom years of 2020 and 2021. Even 2022 was a pretty - Published: 2023-07-20 - Modified: 2024-01-31 - URL: https://www.thetruthaboutmortgage.com/carrington-mortgage-launches-a-40-year-mortgage/ - Categories: Home Buying, Mortgage News It’s been a tough year for the mortgage industry, with origination volume down substantially from the boom years of 2020 and 2021. Even 2022 was a pretty good year relative to what we’ve seen so far in 2023, with the harsh reality of near-7% mortgage rates firmly setting in. Aside from the more than doubling of mortgage rates virtually eliminating refinance demand, it’s also making it more expensive to purchase a home. After all, a $500,000 loan amount at 7% vs. 3% is a difference of roughly $1,200 per month. Because of this eroding affordability, mortgage lenders are getting increasingly creative with financing, the latest being Carrington Mortgage Services. Carrington Mortgage Services Add 40-Year Home Loans to Its Lineup This week, Carrington Mortgage Services’ launched a new home loan product aimed at affordability: the 40-year mortgage. The Anaheim-based lender, which operates in the retail, wholesale, and correspondent channels, believes it will provide several advantages. The main one being a lower monthly payment due to the longer amortization period. The other being the ability to qualify borrowers at the lower payment, thereby reducing their DTI ratio and potentially allowing them to afford more home. Because loan terms beyond 30 years were banned under the far-reaching Qualified Mortgage (QM) rule, this type of loan will be considered non-QM. But it's available across the company’s four non-QM suites, including Flexible Advantage, Flexible Advantage Plus, Prime Advantage, and Investor Advantage. Additionally, it is an option for both home purchase transactions and refinances, including Full... --- > There’s been a lot of speculation that home prices would crash as mortgage rates surged. The argument was especially convincing after the 30-year fixed - Published: 2023-07-18 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/wondering-where-home-prices-go-next-look-at-inventory-not-mortgage-rates/ - Categories: Housing Market, Mortgage News There’s been a lot of speculation that home prices would crash as mortgage rates surged. The argument was especially convincing after the 30-year fixed climbed from around 3% to over 7% in less than a year. This was unprecedented movement, even if mortgage rates remain below those crazy double-digits from the 1980s. Sure, they are still low historically, at around 6/7%, but the doubling in less than 12 months is what you need to pay attention to. Going from 12% to 15% isn’t fun either, but it’s not as much of a payment shock percentage-wise. Do Higher Mortgage Rates Mean Lower Housing Prices? At first glance, you’d think that mortgage rates and home prices have an inverse relationship. In that if one variable goes up, the other must come down. And vice versa. So if mortgage rates shoot higher, home prices must tumble lower. But here we are, looking at new all-time highs for home prices while the 30-year fixed averages nearly 7%. How is it possible that both home prices and mortgage rates rose in tandem? Well, for one, history reveals that they aren’t negatively correlated. In other words, they can rise together, or fall at the same time. As to why, remember how mortgage rates are determined. Much of their direction is based on the health of the economy. At the moment, the economy is strong, if not too strong, which is why the Fed began tightening the screws and raising its own fed funds rate in the... --- > The mortgage deals keep coming, the latest being the new "U.S. Bank Access Home Loan," which comes with up to $12,500 in down payment assistance and a - Published: 2023-07-13 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/u-s-bank-access-home-loan/ - Categories: Mortgage News The mortgage deals keep coming, the latest being the new "U. S. Bank Access Home Loan," which comes with up to $12,500 in down payment assistance and a lender credit up to $5,000. This particular loan is geared toward home buyers in markets where the minority population is more than 50%. However, borrowers do not need to be a first-time home buyers to qualify, though income limits do apply. At the moment, it’s being piloted in select cities nationwide, including Las Vegas, Los Angeles, Little Rock, Milwaukee, and St. Louis. Read on to learn more about this program, which allows FICO scores as low as 640. How the U. S. Bank Access Home Loan Works Between steep home prices and high mortgage rates, home buying has gotten expensive and out of reach for many. To help alleviate that, Minneapolis, MN-based U. S. Bank has committed $100 million to the new Access Home Loan program over the next five years. As stated, the goal of the loan is to increase access to homeownership for minority families. It also aligns with the company’s initiative focused on advancing Black homeownership. Specifically, this means residing in a market where the minority population is more than 50%, per census tract data. Additionally, the borrower’s income must be equal to or below the HUD Area Median Income in the area where they wish to purchase a property. However, it’s still possible to qualify for this loan if your earnings are above the median income, assuming the... --- > Late last year, Zillow said home prices needed to come down about 25% to become affordable again. Around that same time, mortgage rates hit their highest - Published: 2023-07-10 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-are-home-prices-not-dropping/ - Categories: Housing Market, Mortgage Rates Late last year, Zillow said home prices needed to come down about 25% to become affordable again. Around that same time, mortgage rates hit their highest point in 20 years, with the 30-year fixed surging above 7%. That led many to draw the conclusion that relief was in sight, at least if you were a prospective home buyer. And indeed, home prices did fall shortly after, coming down 3. 3% in March, per Redfin, the largest year-over-year decline since 2012. But that was then, and this is now. In May, home prices hit a new all-time record high. What on Earth is going on? After a Brief Pause, Home Prices Are Reaccelerating The pandemic-fueled housing market is the stuff of legends. Just look at this chart from the FHFA, which oversees Fannie Mae and Freddie Mac. Home prices had already surpassed the prior housing bubble peak before COVID-19 reared its ugly head. But just look how much higher they climbed from 2020 onward. This explosive growth worried the Fed, which was also dealing with out-of-control inflation. And led to Federal Reserve Chairman Jerome Powell calling for a housing market “reset,” which he believed could be accomplished via countless interest rate increases. As noted, it did indeed lead to a massive spike in mortgage rates, with the 30-year fixed more than doubling from the low-3% range to over 7% by late 2022. Eventually, that did dampen home prices, with some reporting it as the second largest home price correction of the... --- > It’s time to check out the top mortgage lenders in Nevada based on their total loan volume. Last year, more than 600 mortgage companies funded nearly $33 - Published: 2023-07-06 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-nevada/ - Categories: Mortgage Tips It’s time to check out the top mortgage lenders in Nevada based on their total loan volume. Last year, more than 600 mortgage companies funded nearly $33 billion in The Silver State, down from roughly $68 billion a year earlier. But as always, there can only be one #1, and those honors went to a company you’ve likely heard of. Yes, Rocket Mortgage was the top lender in the state, and by a very wide margin. Just like they were in 2021. Read on to see which other companies made the top 10 lists. Top Mortgage Lenders in Nevada (Overall) Ranking Company Name 2022 Loan Volume 1. Rocket Mortgage $1. 8 billion 2. UWM $1. 6 billion 3. Guild Mortgage $1. 5 billion 4. loanDepot $1. 2 billion 5. U. S. Bank $788 million 6. Wells Fargo $772 million 7. Zions Bancorp $662 million 8. Bank of America $578 million 9. DHI Mortgage $558 million 10. Lennar Mortgage $514 million Detroit-based Rocket Mortgage funded $1. 8 billion in home loans in the state of Nevada in 2022, per HMDA data from Richey May. That was a two hundred million more than necessary to beat out second place United Wholesale Mortgage, its crosstown rival. UWM works exclusively with mortgage brokers via the wholesale lending channel. Guild Mortgage, which hails out of San Diego, took third with a slightly smaller $1. 2 billion in origination volume. In fourth was nonbank loanDepot with $1. 2 billion, followed by U. S. Bank’s $788 million.... --- > Well, were about halfway through the year and mortgage rates seem to have settled in around the high 6% range. While averages vary based on the source, - Published: 2023-06-27 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/will-mortgage-rates-go-down-in-2023/ - Categories: Mortgage Rates, Mortgage Tips Well, were about halfway through the year and mortgage rates seem to have settled in around the high 6% range. While averages vary based on the source, Freddie Mac last posted a rate of 6. 67% for the popular 30-year fixed. This rate began the year 2023 around 6. 50% and has yo-yoed a bit since, falling as low as 6. 09% and climbing as high as 6. 79%. So it appears mortgage rates have become somewhat range-bound, hovering around double what they were in early 2022 (3. 25%). The question is when will they drop again? Or could they even rise higher from here? New Forecasts Put Mortgage Rates Back in the 5s by 2024 First the good news. Several economic forecasts predict that 30-year fixed mortgage rates will return to the 5s. The bad news is this might not happen until the second half of 2024. In other words, another full year of rates in the high 6s could be in store. Fannie Mae’s June 2023 Housing Forecast expects the 30-year fixed to peak at 6. 6% in the third quarter of 2023, then fall to 6. 3% in Q4. Thereafter, rates are forecast to trickle down to 6. 1% in Q1 2024, 5. 9% a quarter later, and eventually 5. 6% by year-end. So that’s something to be excited about if you’re in search of a lower mortgage rate. Similarly, Goldman Sachs pegs the 30-year fixed at 5. 9% in 2024, with a little bit of relief... --- > In the past few months, 1% down payment mortgages have returned with a vengeance. We’ve already seen Rocket Mortgage ONE+ and a similar product from rival - Published: 2023-06-13 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/guild-mortgage-launches-1-down-combined-with-a-temporary-buydown/ - Categories: Home Buying, Mortgage News In the past few months, 1% down payment mortgages have returned with a vengeance. We’ve already seen Rocket Mortgage ONE+ and a similar product from rival United Wholesale Mortgage. And even a zero down FHA loan from Movement Mortgage. The programs have emerged as both home prices and mortgage rates remain stubbornly high. Now San Diego-based Guild Mortgage has gone a step further by combining a 1% down loan with a temporary buydown. If this isn’t enough to persuade a borrower to purchase a home, who knows what is? Guild Mortgage 1% Down Payment Advantage The new “1% Down Payment Advantage” program from Guild Mortgage allows borrowers to finance up to 99% of a home purchase. On top of that, the company will lower your mortgage rate for the first year by 1% as well. This is known as a temporary buydown, in which funds are placed in a buydown escrow account and dispersed during the first 12 months. As a result, the home buyer enjoys a lower monthly payment for the first year, and only needs a 1% down payment. The down payment piece works by combining a 3% down conforming loan and a 2% non-repayable grant offered by Guild, putting the loan-to-value (LTV) ratio at 97%. The maximum amount of said grant is $5,000, meaning a maximum purchase price of $250,000 to get the full 2%. A minimum FICO score of 620 is required and area median income limits apply (80% or less AMI) . Additionally, it has... --- > 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. - Published: 2023-06-08 - Modified: 2023-07-25 - URL: https://www.thetruthaboutmortgage.com/chase-offering-200-if-it-cant-meet-or-beat-your-mortgage-offer/ - Categories: Mortgage News 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... --- > Lately, there’s been a lot of talk about buying now and refinancing later, once mortgage rates drop. Of course, that’s if mortgage rates do indeed fall at - Published: 2023-06-07 - Modified: 2024-11-04 - URL: https://www.thetruthaboutmortgage.com/navy-federal-no-refi-rate-drop/ - Categories: Mortgage News, Mortgage Rates Lately, there’s been a lot of talk about buying now and refinancing later, once mortgage rates drop. Of course, that’s if mortgage rates do indeed fall at some point in the near-future. There’s no guarantee they will, but if inflation does settle down, we could see a return to more reasonable interest rates before long. And that would support the marry the house, date the rate supporters, who believe it’s better to buy now while rates are high. After all, if rates drop again, competition to buy a home could heat up fast. Enter the Navy Federal No-Refi Rate Drop While there’s logic to buying now and refinancing later, it still involves a pesky mortgage refinance. And even if rates are lower, there are downsides to refinancing. For one, it’s time-consuming and paperwork-intensive. There are also closing costs involved, stress, and of course you need to qualify for the thing. That's never a guarantee if your situation changes. Or if home prices fall, etc. To alleviate some of this concern, select lenders have been offering to waive fees on subsequent refinances if you use them for a home purchase loan. But this still requires the borrower to go through the entire home loan process a second time. Not fun. That's where Navy Federal Credit Union's “No-Refi Rate Drop” comes in. They've taken both the big cost and hassle out of it. As the name implies, you can refinance your high-interest rate mortgage into a lower-rate mortgage without refinancing. That way... --- > Mortgage rate Q&A: “Why are mortgage rates different?” Why is the sky blue? Why are clouds white? Why won't your neighbor trim their tree branches? - Published: 2023-06-01 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-are-mortgage-rates-different/ - Categories: Mortgage Rates, Mortgage Tips Mortgage rate Q&A: “Why are mortgage rates different? ” Why is the sky blue? Why are clouds white? Why won't your neighbor trim their tree branches? These are all good questions, and ones that often puzzle even the most savvy of human beings. First things first, take a look at how mortgage rates are determined to better understand how banks and mortgage lenders come up with interest rates to begin with. From there, you'll need to consider why mortgage rates are different for consumer A vs. consumer B, and from lender to lender. No One Size Fits All for Mortgage Rates Mortgages are kind of like snowflakes in that no two are exactly the same (OK, not really) The subject property and the borrower will always have somewhat unique characteristics This means the risk on the underlying loan will vary and so too will the interest rate received Lenders also price their mortgages differently so even identical scenarios can result in variable pricing Mortgages are complicated business, and there certainly isn't a one-size-fits-all approach in this industry. First off, there are thousands of different banks, lenders, and credit unions that offer home loans, some of them entirely unique and proprietary. These companies compete with one another to offer the lowest rate and/or the best customer service. The well-known names might offer higher rates in exchange for their perceived trust and familiarity. Meanwhile, the smaller guys might offer rock-bottom rates to simply stay in contention with the big players. A big... --- > There was a new top mortgage lender in Illinois in 2022, per the latest HMDA data. And it was Chicago's very own Guaranteed Rate, which was able to knock - Published: 2023-06-01 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-illinois-mortgage-lenders/ - Categories: Mortgage Tips There was a new top mortgage lender in Illinois in 2022, per the latest HMDA data. And it was Chicago's very own Guaranteed Rate, which was able to knock JPMorgan Chase off its perch. The company funded a strong $5. 6 billion in the Land of Lincoln, beating out other national brands and hometown lenders. They grabbed a 6. 5% market share in the process, despite volume being down considerably from a year earlier. Read on to learn more about the biggest mortgage lenders in the state of Illinois. Top Illinois Mortgage Lenders (Overall) Ranking Company Name 2022 Loan Volume 1. Guaranteed Rate $5. 6 billion 2. Chase $5. 4 billion 3. U. S. Bank $2. 9 billion 4. Wells Fargo $2. 7 billion 5. Huntington Bank $2. 5 billion 6. Rocket Mortgage $2. 3 billion 7. UWM $2. 2 billion 8. Fifth Third Bank $1. 5 billion 9. loanDepot $1. 5 billion 10. Pennymac $1. 3 billion As mentioned, Guaranteed Rate led the pack with nearly $6 billion in home loan origination volume in 2022, per Richey May’s HMDA data. That was just enough to overtake Chase, which is the nation's fourth largest mortgage lender overall. Unfortunately, volume was nearly half what it was in 2021, when Guaranteed Rate mustered $10. 6 billion in home loan origination. Coming in a distant third was Minneapolis-based depository U. S. Bank with $2. 9 billion. In fourth was Wells Fargo with $2. 7 billion. Despite their controversies, they continue to be the... --- > You’ve heard it a million times, but I’ll say it again. It pays to shop around for your mortgage. Freddie Mac told us a while back, and now the Consumer - Published: 2023-05-25 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/cfpb-mortgage-rates-range-by-a-half-percent-among-lenders/ - Categories: Mortgage News, Mortgage Rates You’ve heard it a million times, but I’ll say it again. It pays to shop around for your mortgage. Freddie Mac told us a while back, and now the Consumer Financial Protection Bureau (CFPB) has echoed the same. And it’s not a trivial amount of savings. The bureau found that price dispersion for mortgages is often 50 basis points (. 50%) of the APR. When looking at a median loan amount of about $300,000, we’re talking a difference of roughly $100 per month. That’s $1,200 annually in extra costs (or savings) and $6,000 through the first five years of the loan term. Mortgage Lenders Offer the Same Exact Products at Different Prices Similar to just about any other business, mortgage lenders offer the same products for different prices (why are mortgage rates different? ). Home loans aside, a lot of companies sell the exact same product. That’s why there are comparison websites or Google shopping. You enter a product and you’re presented with various prices, shipping costs, and so on. Throw in a coupon code or pricing special and one company could be offering quite the bargain relative to the rest. While mortgages are a little more unique, as you’re working with a team of individuals to close your loan, the underlying product is generally the same, a 30-year fixed mortgage. Most home buyers and even existing homeowners who refinance choose a 30-year fixed-rate loan. This means you’re getting the same product regardless of where you get it from. The... --- > If you haven’t heard, the 30-year fixed has once again surpassed 7%, at least by some accounts. After settling in around 6.5% in early May, mortgage rates - Published: 2023-05-24 - Modified: 2025-01-02 - URL: https://www.thetruthaboutmortgage.com/why-are-mortgage-rate-spreads-so-high-right-now/ - Categories: Mortgage News, Mortgage Rates If you haven’t heard, the 30-year fixed has once again surpassed 7%, at least by some accounts. After settling in around 6. 5% in early May, mortgage rates have steadily risen over the past couple weeks. At the same time, the spread between the 30-year fixed and 10-year Treasury yield has widened to levels way above historical norms. There’s always a premium on mortgages versus government bonds because the latter is guaranteed to be paid back. But the gap between the two is now nearly double the average, which begs the question, why? The Relationship Between Mortgages and the 10-Year Treasury First things first, let’s discuss why 30-year mortgages and 10-year Treasuries even have a relationship to begin with. Without getting too convoluted here, mortgage-backed securities (MBS) and 10-year Treasuries share common investors. After home loans fund, they are typically bundled as mortgage-backed securities (MBS) and resold. While these mortgages often have 30-year loan terms, which is triple the length of time of a 10-year bond, they are often paid off a lot quicker. This is due to a variety of factors, whether it’s a mortgage refinance, a home sale, or simply paying off the mortgage early. Long story short, the average mortgage only lasts about a decade, making it a pretty good match duration-wise for the 10-year Treasury. However, investors demand a premium for taking on the risk of a mortgage-backed security vs. a government bond, as seen in the FRED graph above. The red line is the 10-year... --- > As housing affordability wanes, mortgage lenders have gotten increasingly creative to help borrowers qualify. The latest innovative product is “Movement - Published: 2023-05-23 - Modified: 2023-09-21 - URL: https://www.thetruthaboutmortgage.com/movement-mortgage-launches-zero-down-fha-loan/ - Categories: Mortgage News As housing affordability wanes, mortgage lenders have gotten increasingly creative to help borrowers qualify. The latest innovative product is “Movement Boost,” a zero-down FHA loan offered by South Carolina-based Movement Mortgage. Instead of requiring a minimum 3. 5% down payment, home buyers can take out a repayable second mortgage that covers those funds and closing costs if needed. This means a home buyer doesn’t need any cash to close in some cases, which often proves to be a roadblock. Read on to learn more about the new loan program. How Movement Boost Works Movement Boost takes the standard FHA loan and supercharges it by removing the 3. 5% down payment requirement. Instead, borrowers wind up with a first and second mortgage, the latter covering the down payment and up to 1. 5% in closing costs if necessary. The first mortgage is set at 96. 5% of the purchase price, with the remaining 3. 5% funded via a repayable second lien. This second lien features a mortgage rate 2% above that of the first mortgage. And the loan term is 10 years. For example, if you purchased a $300,000 home, you’d take out a first mortgage at $289,500. You’d typically need $10,500 to make the minimum down payment of 3. 5%. But with Movement Boost, that $10,500 could be financed via a second mortgage. Additionally, you could tack on another 1. 5% ($4,500) for closing costs. Let’s pretend the interest rate on the first mortgage is set at 6. 5%. That... --- > Rocket Mortgage is the latest company to offer a 1% down payment mortgage to address ongoing affordability concerns. The new program, coined “ONE+,” - Published: 2023-05-22 - Modified: 2024-10-31 - URL: https://www.thetruthaboutmortgage.com/rocket-mortgage-one/ - Categories: Mortgage News Rocket Mortgage is the latest company to offer a 1% down payment mortgage to address ongoing affordability concerns. The new program, coined “ONE+,” offers a 2% grant from the Detroit-based lender to supplement the borrower’s 1% down payment. Additionally, it offers private mortgage insurance at no cost that would typically be compulsory with such a small down payment. Together, this could enable more prospective home buyers to cross the finish line in what has proven to be a challenging environment. It’s available for both first-time home buyers and repeat buyers, as long as they meet income and property requirements. How Rocket Mortgage ONE+ Works In a nutshell, it’s a 3% down mortgage backed by Fannie Mae, where Rocket Mortgage provides 2% in the form of a grant. This means the home buyer only needs to come up with 1% of the purchase price to qualify for the loan, but they close with 3% equity. For example, a $300,000 home purchase would require a down payment of $9,000 if putting down 3%. If you used ONE+, you could come in with just $3,000, with Rocket providing the remaining $6,000. That would leave you with a loan amount of $291,000, as if you had come with the full 3%, which is the minimum required for a conforming loan. To sweeten the deal even further, ONE+ “completely eliminates” private mortgage insurance, which is required for loans above 80% loan-to-value (LTV). This lack of a mortgage insurance premium can provide additional savings, as it’s... --- > Those looking to buy a home, along with existing owners, may have come across the term “mortgage rate lock-in effect” lately. It’s a relatively new phrase - Published: 2023-05-18 - Modified: 2025-03-05 - URL: https://www.thetruthaboutmortgage.com/what-is-the-mortgage-rate-lock-in-effect/ - Categories: Mortgage Rates, Mortgage Tips Those looking to buy a home, along with existing owners, may have come across the term “mortgage rate lock-in effect” lately. It’s a relatively new phrase that came about thanks to the ultra-low mortgage rates that were available in 2020-2022. During those years, it was entirely possible to snag a 30-year fixed in the 2-3% range. In fact, some lucky homeowners might have even got their hands on a mortgage rate that starts with 1. Here’s the problem – now that rates have doubled, many of these homeowners don’t want to give up their low rate. Or perhaps worse, can’t. Mortgage Rate Lock-In Effect 101 The "mortgage rate lock-in effect" was caused by ultra-low fixed mortgage rates (2-3% from 2020-2021) quickly rising to 7%+ in 2022-2023 Has made existing homeowners reluctant to sell their properties because it would mean giving up a very low rate in exchange for a much higher one Also known as “golden handcuffs”— a bittersweet scenario where homeowners are stuck in their homes because of their low mortgage rates Homeowners are disincentivized to move because they face much higher rates if they purchase a replacement property For example, a $500,000 home with a 2. 75% rate ($1,632. 96/month) vs. a $475,000 home at 6. 5% ($2,401. 86/month) increases payments by 47% ($770 more per month! ) Critics of lock-in argue that life events (job changes, family needs) will prompt moves regardless of interest rates And the value of a low-rate mortgage diminishes over time as payments... --- > Mortgage rates aren’t so low these days. In fact, they’ve basically doubled since early 2022. While this clearly isn’t great news for aspiring home buyers - Published: 2023-05-09 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/temporary-vs-permanent-mortgage-buydowns/ - Categories: Home Buying, Mortgage Rates, Mortgage Tips Mortgage rates aren’t so low these days. In fact, they’ve basically doubled since early 2022. While this clearly isn’t great news for aspiring home buyers or those looking to refinance, it has opened the doors to some creative solutions. Lately, the temporary buydown has taken center stage after being a very niche product. And many home buyers are opting to pay discount points at closing to lower their rate. The question is do you want to permanently buy down your rate, or only do so temporarily? Temporary vs. Permanent Mortgage Buydowns First, you need to know the difference between a temporary buydown and a permanent buydown. Permanent Buydown (Paying Points at Closing for a Reduced Rate for the Life of the Loan) The permanent buydown involves paying discount points at closing to lower your mortgage rate for the life of the loan. For example, say you’ve got a $500,000 loan amount and are offered a rate of 6. 5% on a 30-year fixed mortgage with no points. That would result in a monthly principal and interest payment of $3,160. 34. You’re not too impressed because you’ve seen advertised rates in the 5% range and so you inquire about that. The loan officer or broker explains that you can get a rate of 5. 75% if you’re willing to pay two discount points at closing. You’d owe $10,000 at closing to buy down the mortgage rate but you’d have that rate locked in for all 30 years. The payment would drop... --- > Last year, Rocket Mortgage was the top mortgage lender in the nation, per the latest HMDA data. While that wasn’t a big surprise, as they’ve topped the - Published: 2023-05-03 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-2022/ - Categories: Mortgage News Last year, Rocket Mortgage was the top mortgage lender in the nation, per the latest HMDA data. While that wasn’t a big surprise, as they’ve topped the leaderboard for several years now, it was a lot closer than in years’ past. The Detroit-based nonbank lender narrowly beat out its crosstown rival United Wholesale Mortgage by only roughly $100 million. A year earlier, the gap between first and second place was more than $100 billion! So it’s possible there might be a new #1 mortgage lender in 2023. Read on to see who else topped the lists. Top Mortgage Lenders of 2022 (Overall) Ranking Company Name 2022 Loan Volume 1. Rocket Mortgage $128. 9 billion 2. United Wholesale Mortgage $128. 8 billion 3. Wells Fargo $124. 8 billion 4. Chase $99. 1 billion 5. Pennymac $71. 7 billion 6. U. S. Bank $67. 5 billion 7. Bank of America $56. 4 billion 8. loanDepot $52. 9 billion 9. Truist $48. 4 billion 10. AmeriHome Mortgage $47. 5 billion As mentioned, Rocket Mortgage came in first again in 2022 with $128. 9 billion in home loans funded, per HMDA data from Richey May. That was just enough to beat out Pontiac, Michigan-based UWM, which funded a very close $128. 8 billion. And UWM did it by relying solely on mortgage broker partners, whereas Rocket originates loans via the retail and wholesale channel. Coming in a close third was Wells Fargo with $124. 8 billion, which recently announced plans to pull back on... --- > Those new mortgage fees you’ve probably heard about are causing quite a stir. So much so that Pennsylvania State Treasurer Stacy Garrity sent a letter to - Published: 2023-05-01 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/27-states-oppose-new-fannie-freddie-mortgage-fees/ - Categories: Mortgage News, Mortgage Rates Those new mortgage fees you’ve probably heard about are causing quite a stir. So much so that Pennsylvania State Treasurer Stacy Garrity sent a letter to the FHFA and President Joe Biden today pleading for their elimination. And the letter is backed by another 32 fiscal officers from 26 other states, all of whom oppose the new mortgage pricing. In a nutshell, they believe it’s unfair that high-FICO score borrowers are essentially subsidizing low-FICO score borrowers by having to pay more than they used to. It’s a big deal because the new pricing applies to mortgages backed by Fannie Mae and Freddie Mac, which account for about 60% of the residential mortgage market. First Some Background on Fannie, Freddie, and the FHFA As noted, Fannie Mae and Freddie Mac back the majority of mortgages that exist today. They are easily the most common type of home loan available. Such loans are known as conforming mortgages because they adhere to the underwriting guidelines of Fannie or Freddie. They are overseen by the Federal Housing Finance Agency (FHFA), which only came into existence in 2008. Since then, the pair have been in conservatorship (thanks to the massive housing crisis) and are essentially quasi-government entities. One of the FHFA's jobs is to set a single-family pricing framework for mortgages backed by Fannie and Freddie. All conforming mortgages, other than some low-income options like HomeReady, are subject to loan-level price adjustments, known as LLPAs. These fees are charged for things like credit score, loan-to-value... --- > A new analysis from Zillow revealed that nearly half of mortgage applicants opted to pay points when taking out a home loan last year. These optional - Published: 2023-04-26 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/nearly-half-of-home-loan-applicants-paid-mortgage-points-in-2022/ - Categories: Mortgage News, Mortgage Rates A new analysis from Zillow revealed that nearly half of mortgage applicants opted to pay points when taking out a home loan last year. These optional costs allow homeowners to buy down their interest rate at closing. Doing so lowers their monthly mortgage payment for the duration of the loan term. And it saves them money on interest via a lower mortgage rate, meaning more of each payment goes toward principal. But are points actually a good deal for homeowners? And do they make sense when interest rates are high? A Lot More Homeowners Are Paying Mortgage Points These Days Zillow Home Loan’s analysis, which used data from the Home Mortgage Disclosure Act (HMDA), found that roughly 45% of conventional primary home borrowers paid mortgage discount points in 2022. As noted, these points allow borrowers to obtain a lower mortgage rate. They are a form of prepaid interest. The result in a reduced monthly mortgage payment and a lower interest expense during the loan term. What’s interesting is a lot more homeowners are paying these points than in prior years. For example, when mortgage rates were at or near record lows, far fewer applicants paid points. To put it in perspective, just 29. 6% of borrowers paid points in 2021, 28. 4% in 2020, and 27. 3% in 2019. As for why, it’s probably because the mortgage rate offered was so low that there was little need to pay points. And probably little desire. Zillow notes that buying points is... --- > In its latest housing forecast, Fannie Mae has become much more optimistic with regard to mortgage rates. We’re talking 30-year fixed rates nearly 0.75% - Published: 2023-04-24 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/fannie-mae-is-predicting-much-lower-mortgage-rates-by-year-end/ - Categories: Mortgage News, Mortgage Rates In its latest housing forecast, Fannie Mae has become much more optimistic with regard to mortgage rates. We’re talking 30-year fixed rates nearly 0. 75% lower by the end of 2023 than in their previous forecast. And mortgage rates that could flirt with the high-4% range by the end of 2024. This would be welcome news to both existing homeowners and those still looking to buy. Let’s dig into the details. A 30-Year Fixed at 5. 7% by the End of 2023 Now does a 30-year fixed priced below 5. 75% sound? A year ago, it probably sounded horrible. Today, it sounds not half-bad. That’s Fannie Mae’s latest prediction from their April 2023 Housing Forecast released Friday. And it’s down significantly from their report released a month earlier, due to an “economy that decelerated meaningfully toward the end of the first quarter of 2023. ” If the Fed’s rate hikes are working and the economy does indeed fall into a recession, as Fannie Mae expects at the beginning of the second half of the year, interest rates should also ease. Here’s a comparison of their mortgage rate forecast from April and March for the popular 30-year fixed-rate mortgage, which is currently priced around 6. 40%, per Freddie Mac. Fannie Mae April 2023 Mortgage Rate Forecast Q1: 6. 4% (actual) Q2: 6. 1% Q3: 5. 9% Q4: 5. 7% Fannie Mae March 2023 Mortgage Rate Forecast Q1: 6. 4% (actual) Q2: 6. 6% Q3: 6. 6% Q4: 6. 4% Fannie Mae... --- > It's time to talk mortgage rate shopping, which has become an absolute must in 2023. Simply put, you've got to be more proactive to get your hands on a - Published: 2023-04-20 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-rate-shopping-10-tips-to-get-a-better-deal/ - Categories: Mortgage Rates, Mortgage Tips, Refinance It's time to talk mortgage rate shopping, which has become an absolute must in 2023. Simply put, you've got to be more proactive to get your hands on a low rate today than you did a year ago. Aside from rates doubling from around 3% last year to 6%+ today, there's a lot of rate dispersion right now. Because of all the interest rate volatility, you could see rates 1% apart for the same exact product. Fortunately, there are a number of ways to score a better deal on your home loan, though a little bit of legwork on your behalf is definitely required. After all, you're not buying a TV. How to Get the Best Mortgage Rate If you’re not willing to put in the work, you might be disappointed with the mortgage rate you receive. But if you are up for the challenge, the savings can make the relatively little time you put in well worth it. The biggest takeaway is to shop around, since you can’t really determine if a mortgage rate is any good without comparing it to other quotes. Many prospective and existing homeowners simply gather one quote, typically from a friend or real estate agent’s reference, and then kick themselves later for not seeing what else is out there. At the moment, there's a wide range of rates on offer for the same exact loan programs. This means one bank might advertise a rate of 6. 5% on a 30-year fixed, while another pitches... --- > March was a rough month for home prices. The median U.S. home price fell a sizable 3.3% in March to $400,528, the largest year-over-year decrease in more - Published: 2023-04-19 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/home-prices-just-experienced-the-biggest-annual-decline-since-2012/ - Categories: Housing Market, Mortgage News March was a rough month for home prices. The median U. S. home price fell a sizable 3. 3% in March to $400,528, the largest year-over-year decrease in more than a decade. That was on top of the 1. 2% decline in February, which was the first annual decline in prices since 2012, per Redfin. At the same time, pending home sales fell to their lowest level since the beginning of the COVID-19 pandemic. And while supply continues to be an issue, there is also a lack of buyers too thanks to much higher mortgage rates. Home Price Drop Worst Since Mortgage Crisis Bottom The 3. 3% drop in home prices from March 2022 to March 2023 was the worst annual performance since 2012, according to Redfin. The median price also experienced a 3. 6% month-to-month drop from February. If you recall, home prices bottomed in 2012 after the Global Financial Crisis (GFC) ravaged property values in preceding years. Back then, the decline in home prices was led by subprime mortgages and stated income underwriting. Today, the decline might simply be a symptom of eroded affordability. It’s an important distinction because it could dictate what happens next. Most pundits have blamed the recent reversal in home prices on affordability, with the average rate on the popular 30-year fixed the main culprit. It has risen from the high-2% range to nearly 7% in the span of 12 months, wreaking havoc on prospective buyers’ pocketbooks. But if you ignore that piece, there... --- > A new survey from John Burns Research & Consulting found that 5.5% is the “magic mortgage rate.” By magic, they mean the threshold for a home buyer - Published: 2023-04-13 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/we-need-5-5-mortgage-rates-to-attract-home-buyers/ - Categories: Home Buying, Mortgage News, Mortgage Rates A new survey from John Burns Research & Consulting found that 5. 5% is the “magic mortgage rate. ” By magic, they mean the threshold for a home buyer before they balk at a purchase. Looked at another way, if mortgage rates were 5. 5% or lower, most prospective home buyers would proceed with the transaction. At last glance, the average rate on a 30-year fixed was 6. 27%, according to Freddie Mac. This means we’re pretty close to mortgage rates no longer being a roadblock for new home buyers. 5. 5% Mortgage Rates Are Within Reach As noted, the 30-year fixed is averaging around 6. 25% at present. While this might sound high, rates have fallen for five consecutive weeks, per Freddie Mac. You can thank the short-lived banking crisis and some favorable economic reports (with regard to inflation) for that. Still, they’re a far cry from the 2-3% rates on offer back in 2020 and 2021. But because it’s been a while now, rates are only up about 1% from a year ago. The 30-year fixed averaged 5. 00% at this time in 2022, not a huge jump. And rates exceeded 7% back in October. So as it stands, mortgage rates aren’t terrible. And older generations will argue that they’re historically low. Or point you to mortgage rates in the 1980s. Regardless of all that, it appears today’s home buyer is OK with a 5. 5% mortgage rate. But anything beyond that might be a deal breaker. 71%... --- > The nation’s leading mortgage lender, United Wholesale Mortgage, has re-launched the 1% down payment home loan. It comes at a time when housing - Published: 2023-04-12 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/nations-top-mortgage-lender-launches-a-1-down-payment-home-loan/ - Categories: Mortgage News The nation’s leading mortgage lender, United Wholesale Mortgage, has re-launched the 1% down payment home loan. It comes at a time when housing affordability continues to be pressured by high asking prices and equally high mortgage rates. While it may be seen as a boon to prospective buyers, it will surely have its critics as well. Like other low-down payment programs, it targets those with lower incomes who would otherwise struggle to qualify for a home purchase. It’s reminiscent of the frothy days in the early 2000s, when creative financing allowed high home prices to persist. The Return of Conventional 1% Down Home loans backed by Fannie Mae and Freddie Mac, known as conforming loans, typically require a 3% minimum down payment. But the re-launch of this loan program, known as “Conventional 1% Down,” requires just a 1% down payment from the borrower. For example, a $200,000 home purchase would require just $2,000 from the buyer. And UWM would chip in the other 2%, $4,000 in this example, to put the loan-to-value (LTV) ratio at the minimum 97%. This would technically make the loan a 3% down mortgage set at 97% LTV, thereby qualifying for backing by Fannie Mae or Freddie Mac. It would also lessen the burden of coming up with a down payment, often a roadblock for home buyers. Proponents will argue that it allows would-be buyers to get into a home sooner, instead of waiting to save for a larger down payment. Those against it will argue... --- > Due to ongoing mortgage rate volatility, Zillow has launched a new feature that lets users search by monthly payment. Traditionally, Zillow users would - Published: 2023-04-10 - Modified: 2023-10-18 - URL: https://www.thetruthaboutmortgage.com/zillow-now-lets-users-filter-homes-by-monthly-payment/ - Categories: Home Buying, Housing Market, Mortgage News Due to ongoing mortgage rate volatility, Zillow has launched a new feature that lets users search by monthly payment. Traditionally, Zillow users would enter a maximum purchase price to view homes in their price range. But over the past year, monthly mortgage costs increased by more than $431, and even saw swings of $100+ per month. This meant a certain price range may have fallen out of affordability along the way, complicating the user’s home search. Instead of entering a static list price filter, the company’s new filter lets shoppers search for homes by a range of all-in monthly mortgage costs. Shop for Homes by Total Housing Cost Instead of Purchase Price Zillow’s new filter will show you a list of homes within a range of all-in monthly costs. For example, between $2,500 and $3,000. This includes the principal and interest tied to the mortgage interest rate, along with estimates for homeowners insurance, property taxes, and HOA fees (if applicable). Often, these costs are either overlooked or completely ignored. And as I’ve mentioned in the past, these expenses can alter the affordability picture in a hurry. If you ignore some of these items, you might be surprised to find out that your maximum purchase price is actually a lot lower. And you won’t want to waste your time or that of the seller’s. This is further compounded by ever-changing mortgage rates, which can change daily. Zillow noted that last year's doubling in mortgage rates (from around 3% to 6%+) increased... --- > More mortgage M&A activity today. Homepoint announced this morning that it has entered into a definitive agreement to sell the company’s wholesale - Published: 2023-04-07 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/homepoint-exits-mortgage-origination-sells-wholesale-division-to-the-loan-store/ - Categories: Mortgage News More mortgage M&A activity today. Homepoint announced this morning that it has entered into a definitive agreement to sell the company’s wholesale origination unit to The Loan Store, Inc. As a result, the Ann Arbor-based mortgage lender will no longer be a direct participant in the loan origination space. However, Homepoint will continue to manage its mortgage servicing rights (MSR) portfolio, which it expects “to generate significant returns and cash flow over time. ” Prior to this move, Homepoint was the third largest wholesale mortgage lender in the country, behind just United Wholesale Mortgage and Rocket Mortgage TPO. Homepoint Was a Top-10 Mortgage Lender Homepoint saw explosive growth since its founding in 2015 via the acquisition of Maverick Funding. It took them less than a decade to grow out a 2,000+ employee workforce and become a top-10 mortgage lender. In 2021, the company originated an impressive $96 billion in home loans, landing them in ninth place overall. However, due to difficult market conditions, namely a doubling in mortgage rates, profitability became an issue, leading to a series of layoffs nationwide. Prior to this announcement, the company operated solely in the wholesale channel via mortgage brokers, meaning they will no longer have a place in the mortgage origination business. In the past, they also operated a correspondent and retail division before shrinking operations. Today, Homepoint made what they felt was the “best decision for our company to continue to deliver value to Home Point shareholders. ” But due to the sale,... --- > The housing market has been stubbornly frustrating for prospective home buyers. Not only have mortgage rates doubled over the past year, but home prices - Published: 2023-04-06 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/home-prices-are-still-too-high-but-will-they-actually-come-down/ - Categories: Housing Market, Mortgage News The housing market has been stubbornly frustrating for prospective home buyers. Not only have mortgage rates doubled over the past year, but home prices remain highly elevated, despite some minor improvements. Sure, you might hear that the housing market is crashing, or that we’re in a home price correction. But that doesn’t mean a whole lot when you zoom out and look at home prices over the past couple years. What’s worse is despite abysmal affordability, home prices may not even come down. Home Prices Are Up 5. 3% From a Year Ago While there have been declines in certain overheated metros nationwide, home prices are up 5. 3% nationwide from January 2022 to January 2023. This is according to the latest Federal Housing Finance Agency (FHFA) seasonally adjusted monthly House Price Index (HPI). And they rose 0. 2% in January from a month earlier after registering a 0. 1% monthly price decline in December 2022. If we drill in a bit more, looking at the nine census divisions, seasonally adjusted monthly home prices from December 2022 to January 2023 showed a wider range. Home prices were off 0. 6% in the Pacific division and up 2. 0% in the New England division. On a 12-month basis, prices were -1. 5% in the Pacific division and +9. 6% in the South Atlantic division. As I always say, real estate is local, and this is especially true these days with some markets in different stages than others. But just look at... --- > Rocket Mortgage has rolled out a new program called "BUY+" that offers a credit of up to $10,000 when you use a Rocket Homes Partner Real Estate Agent to - Published: 2023-04-05 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/rocket-mortgage-buy-plus/ - Categories: Mortgage News Rocket Mortgage has rolled out a new program called "BUY+" that offers a credit of up to $10,000 when you use a Rocket Homes Partner Real Estate Agent to find a home. Prospective home buyers who use a real estate agent that participates in Rocket Homes' Partner Network receive a 1. 5% credit that can be applied toward closing costs. For example, someone putting down 5% on a $500,000 home purchase would get a credit of $7,125. This could be used to offset closing costs and keep out-of-pocket costs to a minimum. Sister company Rocket Homes is also offering rebates when you a sell a home via their network. How Rocket Mortgage BUY+ Works As noted, those who use Rocket Mortgage to obtain their home loan and a Rocket Homes Partner Real Estate Agent will receive a 1. 5% lender credit. This credit is based on the loan amount. As seen in the example above, 1. 5% of $475,000 would be $7,125. The lender credit cannot exceed $10,000, so those with loan amounts above ~$667,000 would be maxed. The funds can be used toward various closing costs, such as the appraisal fee, title insurance, discount points, and so on. If there happens to be any credit left over, it will be applied to the principal balance of your loan. The aim of the program is to make it easier for prospective home buyers to get to the closing table, with a smaller cash burden required. Even those who use an... --- > Crypto lending platform Moon Mortgage has launched its own “crypto mortgage.” The move is designed to “help crypto investors materialize their digital - Published: 2023-04-05 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/moon-mortgage-crypto-mortgage/ - Categories: Mortgage News Crypto lending platform Moon Mortgage has launched its own “crypto mortgage. ” The move is designed to “help crypto investors materialize their digital wealth,” without the need to sell. So if you’re a bitcoin hodler who wants to get a taste of real assets without giving up on the ultimate goal, this product could be for you. It follows in the footsteps of Figure’s crypto mortgage (same name), which was launched back in March 2022. The difference with this product is the minimum loan amount is a hefty $1 million. Read on to learn more. How the Moon Mortgage Crypto Mortgage Works Similar to Figure’s offering, you pledge your crypto assets as collateral for a home purchase. Moon Mortgage then places a traditional lien against the property and the borrower pays a “competitive rate. ” It’s unclear what those interest rates are like or what kind of loan term and payments are required. They say a good rule of thumb is to post 100% collateral, so if you need a $1 million mortgage, you’ll need to provide $1 million in crypto. But future products may have different collateral requirements, so stay tuned. In terms of liquidation risk, Moon Mortgage says it won’t liquidate your holdings unless they drop by a “pre-agreed to value” during the underwriting process. You can use their crypto mortgage on either an owner-occupied home or an investment property. At the moment, their crypto mortgage product is available to home buyers in the states of Colorado, Florida,... --- > Today we’ll do a deep dive into SoFi, short for Social Finance, which offers mortgages, personal loans, student loan refinancing, and even a credit card. - Published: 2023-04-03 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/sofi-mortgage-review/ - Categories: Mortgage Tips Today we’ll do a deep dive into SoFi, short for Social Finance, which offers mortgages, personal loans, student loan refinancing, and even a credit card. Their overall goal is to “help people get their money right,” but we’ll focus on the mortgage part for the purposes of this review. Chances are you’ve heard of the company, perhaps because SoFi Stadium is the home of both the LA Rams and LA Chargers. Or maybe they refinanced your student loan at some point in the past. The San Francisco-based online bank is also making a bigger push into the home loan space. So if you’re a prospective home buyer or existing owner, you may want to add them to your list of lenders to consider. SoFi Mortgage Is Geared Toward Younger Homeowners Retail direct-to-consumer bank and mortgage lender Offers home purchase financing and mortgage refinancing Founded in 2011, headquartered in San Francisco, CA Licensed to do business in 49 states and the District of Columbia Funded roughly $3 billion in home loans during 2021 Also offers student loan refinancing, personal loans, insurance, and banking services Publicly traded company (NASDAQ: SOFI) Offers an on-time closing guarantee and waived fees on refinances Do not currently offer FHA, VA or USDA home loans Social Finance Inc. , or SoFi for short, was founded in 2011 by a group of students from Stanford Graduate School of Business. They initially offered student loans and later expanded into personal loans, mortgages, credit cards, checking and savings accounts, and... --- > With fixed-rate mortgages no longer on sale, I thought it’d be useful to take a look at the top adjustable-rate mortgage lenders nationwide. These are the - Published: 2023-03-30 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-adjustable-rate-mortgage-lenders/ - Categories: Mortgage Tips With fixed-rate mortgages no longer on sale, I thought it’d be useful to take a look at the top adjustable-rate mortgage lenders nationwide. These are the companies that originated the most ARMs on a loan volume basis for the most recent year data is available. In 2021, some $611 billion in ARMs were funded by over 3,000 mortgage companies. So it clearly wasn't a niche product. But 10 companies stood above the rest. And guess what? They’re all banks! Read on to see the top 10 lists for more details. Top Adjustable-Rate Mortgage Lenders in the U. S. Ranking Company Name 2021 Loan Volume 1. Chase $41. 8 billion 2. Bank of America $33. 5 billion 3. First Republic Bank $23. 8 billion 4. Wells Fargo $21. 1 billion 5. U. S. Bank $18. 0 billion 6. PNC Bank $11. 7 billion 7. Charles Schwab Bank $11. 6 billion 8. Citizens Bank $11. 0 billion 9. Union Bank $10. 1 billion 10. Citibank $10. 0 billion Coming in first place was JPMorgan Chase with nearly $42 billion in adjustable-rate mortgages (ARMs) funded in 2021, per HMDA data from Richey May. That was more than enough to take the top spot, with second place Bank of America mustering $33. 5 billion in ARMs. In third was First Republic Bank (yes that bank) with $23. 8 billion funded, making them a huge ARM loan player as well. And if the recent fallout is permanent, it will create a sizable gap in the... --- > The nation’s largest mortgage lender has launched a credit card, known as the “Rocket Visa Signature Card.” It allows cardholders to earn 5% back toward a - Published: 2023-03-28 - Modified: 2023-03-29 - URL: https://www.thetruthaboutmortgage.com/rocket-visa-signature-card/ - Categories: Mortgage News The nation’s largest mortgage lender has launched a credit card, known as the “Rocket Visa Signature Card. ” It allows cardholders to earn 5% back toward a down payment on a home, or 2% toward their principal balance at Rocket Mortgage. There is a $95 annual fee, which is waived for existing Rocket Mortgage servicing clients (if they hold your mortgage). To celebrate the launch, the card offers a $200 statement credit to those who spend $3,000 in the first 90 days from approval. Is this something worth looking at, or are consumers better off with a general purpose card instead? Rocket Visa Signature Card Earns Rewards That Can Be Used for a Down Payment The new Rocket Visa Signature Card is a credit card that has the prospective home buyer or existing homeowner in mind. Each dollar spent using the metallic card earns 5 Rocket Rewards points, and there is no limit on how many points you can earn. These points can be redeemed for closing costs, down payment, mortgage principal, or simply cash back via a statement credit. If you use Rocket Mortgage for your home loan needs, 25,000 Rocket Rewards are worth $250, which is the full 5% cash back value. So for every $5,000 spent using the card, you’d get $250 off your Rocket Mortgage closing costs. If you spent $50,000 in a year, we’re talking $2,500 that could be applied toward a down payment on a home. Or simply toward closing costs. Tip: The card... --- > The California Housing Finance Agency has launched a new shared appreciation loan for home buyers. The program, known as the “Dream For All Shared - Published: 2023-03-27 - Modified: 2024-08-27 - URL: https://www.thetruthaboutmortgage.com/california-dream-for-all-shared-appreciation-loan/ - Categories: Mortgage News The California Housing Finance Agency has launched a new shared appreciation loan for home buyers. The program, known as the “Dream For All Shared Appreciation Loan,” allows Californians to build wealth via homeownership without a down payment. In lieu of that down payment, they must share a portion of their home’s future appreciation. While that can be a costly tradeoff, it does eliminate the need for a significant amount of money at closing. And by avoiding a larger loan amount or second mortgage, a home purchase can remain affordable. Update: As of 04/07/2023, available funds for the California Dream For All Shared Appreciation Loan program have been reserved. How the Dream For All Shared Appreciation Loan Works In a nutshell, home buyers in the state of California can get their hands on a zero down mortgage, but they must trade a portion of future home price appreciation. So if a prospective buyer doesn’t have a 20% down payment (or even a 5% down payment), they can take out a shared appreciation loan instead. For example, if the purchase price were $500,000 they could obtain a $400,000 first mortgage at 80% loan-to-value (LTV). Then CalHFA would provide a $100,000 DFA (Dream For All) loan that doesn’t require monthly payments. Instead, the shared appreciation loan is paid back only when the property is sold or transferred, or the mortgage refinanced. As a result, the homeowner would have a smaller loan amount ($400,000) and the borrower would avoid costly private mortgage insurance. Shared... --- > Yesterday, the Federal Reserve raised its benchmark federal funds rate a quarter point (.25%). As a result, some may have expected consumer mortgage rates - Published: 2023-03-23 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-do-mortgage-rates-go-down-when-the-fed-raises-rates/ - Categories: Mortgage Rates, Mortgage Tips Yesterday, the Federal Reserve raised its benchmark federal funds rate a quarter point (. 25%). As a result, some may have expected consumer mortgage rates to also rise by . 25%. So if the 30-year fixed were priced at 6. 75%, it would climb to 7. 00% due to the Fed’s action. But the opposite occurred. The 30-year fixed actually fell by about a quarter-point, from 6. 75% down to 6. 50%. What gives? How can the two move in opposite directions? Mortgage Rates Can Go Down Even If the Fed Raises Rates As noted, the Federal Reserve raised its federal funds rate. That’s an interest rate they directly control. And it’s what banks charge one another for overnight use of excess reserves. It’s not a consumer interest rate, nor is it a mortgage rate. However, it does play a role in consumer lending, as there’s often a trickle-down effect. Basically, banks and lenders take cues from the Federal Reserve. But the rate change in the Fed announcement might totally counteract the movement of consumer rates such as those on home loans. Why? Because the Fed isn’t just raising or lowering rates when it releases its Federal Open Market Committee (FOMC) statement. It’s also providing context for why its raising or lowering its fed funds rates. And from that context we get movement in mortgage rates. What Happened Yesterday? The Fed Raised Rates and Mortgage Rates Fell In the March 22nd, 2023 FOMC statement, the Federal Reserve increased the target... --- > It’s time to check out the top mortgage lenders in Oklahoma based on closed loan volume. These are the companies that funded the largest dollar amount of - Published: 2023-03-22 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-oklahoma/ - Categories: Mortgage Tips It’s time to check out the top mortgage lenders in Oklahoma based on closed loan volume. These are the companies that funded the largest dollar amount of home loans in the Sooner State. Over 700 mortgage companies funded roughly $33 billion in home loans in the state during 2021. In terms of who took first place, it was very close, with two companies funding nearly the same exact amount. But only one can hold the crown. Read on to see who snagged the top spot, along with those landing in the top-10. Top Mortgage Lenders in Oklahoma (Overall) Ranking Company Name 2021 Loan Volume 1. U. S. Bank $1. 7 billion 2. Rocket Mortgage $1. 7 billion 3. First United Bank $1. 3 billion 4. Arvest Bank $1. 1 billion 5. Wells Fargo $1. 1 billion 6. Associated Mortgage $925 million 7. AmeriHome Mortgage $892 million 8. Cornerstone Home Lending $878 million 9. Pennymac $853 million 10. Gateway Mortgage $840 million As noted, things were extremely tight at the top, but U. S. Bank edged out Rocket Mortgage for the #1 spot. Both companies originated roughly $1. 7 billion in home loans in Oklahoma in 2021, per HMDA data from Richey May. But U. S. Bank did that little bit more. However, Rocket closed more loans, about 9,500 versus 8,800. Taking third was Durant, Oklahoma’s own First United Bank with $1. 3 billion funded, followed by Arvest Bank and Wells Fargo, each with about $1. 1 billion. The bottom half... --- > Down payments are falling as the housing market slows and competition wanes. A new report from Redfin revealed that the median down payment in January - Published: 2023-03-22 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/median-down-payment-on-a-house-falls-to-10-down-from-14-a-year-ago/ - Categories: Home Buying, Housing Market, Mortgage News Down payments are falling as the housing market slows and competition wanes. A new report from Redfin revealed that the median down payment in January 2023 was 10%, down from 13. 6% a year earlier and well off the pandemic-era peak of 17. 5% last May. They are now similar to levels seen between 2015 and early 2021, before the so-called pandemic home buying boom. Simply put, today’s home buyers don’t need to come in with a large down payment to write a winning offer. And buyers are able to utilize low-down payment options like FHA loans and VA loans again. Median Down Payment Falls to $42,375 in January 2023 The median down payment by dollar amount was $42,375 in January, a 10. 3% decline from a year ago. Driving the decline is a lack of bidding wars, less competition, higher borrowing costs (aka mortgage rates), and lower home prices. Collectively, this has pushed down payments more in line with levels seen prior to the COVID-19-fueled buyer’s market. Thanks to much higher mortgage rates, home prices have fallen back to earth. That lower sales price results in a lower down payment. Home buyers also have less cash to put down because of higher anticipated monthly housing costs. And some buyers are using that money to fund a mortgage rate buydown, assuming the seller or lender doesn’t cover it. We’ve also seen a big bounce in FHA loan lending, which had sunk to around a 10% market share last summer. It... --- > Today we’ll check out who the top mortgage lenders in Louisiana were based on the most recent year’s loan volume. In 2021, more than 600 banks and lenders - Published: 2023-03-21 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-louisiana/ - Categories: Mortgage Tips Today we’ll check out who the top mortgage lenders in Louisiana were based on the most recent year’s loan volume. In 2021, more than 600 banks and lenders originated nearly $39 billion in home loans in the Pelican State, per HMDA data. It was a good year for most lenders, but one company managed to outpace the rest of the pack quite easily. And it was a hometown bank headquartered in the state, not a big national lender. Read on to see who it was and to view the complete list of the largest mortgage lenders in Louisiana. Top Mortgage Lenders in Louisiana (Overall) Ranking Company Name 2021 Loan Volume 1. GMFS $2. 7 billion 2. Rocket Mortgage $1. 8 billion 3. Pennymac $1. 5 billion 4. Freedom Mortgage $1. 2 billion 5. UWM $1. 1 billion 6. AmeriHome Mortgage $1. 0 billion 7. First Horizon Bank $978 million 8. Homepoint $933 million 9. Hancock Whitney $932 million 10. Assurance Financial $890 million Just like in 2020, GMFS Mortgage was the top mortgage lender in Louisiana with $2. 7 billion funded, per HMDA data from Richey May. The Baton Rouge-based lender was founded in 1999 and only operates in 12 states, mostly in the South. They were trailed by overall #1 Rocket Mortgage with $1. 8 billion, and SoCal-based Pennymac in third with $1. 5 billion. Fourth and fifth went to Freedom Mortgage and United Wholesale Mortgage (UWM) with $1. 2 billion and $1. 1 billion, respectively. The rest of... --- > Mortgage Q&A: “What happens to my mortgage if my bank fails?” It's happening again - banks are failing. The latest being Signature Bank and Silicon - Published: 2023-03-15 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-happens-to-my-mortgage-if-my-bank-fails/ - Categories: Mortgage Tips Mortgage Q&A: “What happens to my mortgage if my bank fails? ” It's happening again - banks are failing. The latest being Signature Bank and Silicon Valley Bank, the third and second largest failures on record, respectively. Washington Mutual's mortgage-driven failure in 2008 still stands as the largest bank failure in U. S. history. But will it retain its crown? Prior to this latest, unexpected drama, a bank hadn't failed for nearly 900 days, which was a good run (no pun intended). Back in 2009-2010, banks were failing at a pretty steady clip (at least one every week, sometimes several). At that time, many homeowners pondered what would happen if their bank failed. And some may have gotten excited at the thought of their mortgage being instantly extinguished. After all, it seems everyone else got bailed out. Why not homeowners? Not so fast... it doesn't work that way. It'd be nice though, right? It Starts with a Bank Run If the bank that owns/holds your mortgage fails (or is at risk of failing) There might be a bank run on deposits and eventually an FDIC take over But don't expect your home loan to be paid off in the process Or for the entire loan balance to immediately become due in full Some folks already know what happens when a bank fails, especially if they had uninsured deposits and scrambled down to their local branch for an old-timey bank run. It's crisis-mode and largely bad news. And potentially lost money... --- > Mortgage rates fell. Then mortgage rates rose. Then mortgage rates fell again. What the heck is going on out there? Bank runs, bank failures, no more Fed - Published: 2023-03-15 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-are-very-volatile-right-now-heres-what-to-watch-for/ - Categories: Mortgage Rates, Mortgage Tips Mortgage rates fell. Then mortgage rates rose. Then mortgage rates fell again. What the heck is going on out there? Bank runs, bank failures, no more Fed rate hikes? It’s called uncertainty, which leads to volatility in everything from stocks to bonds and mortgage rates. So if you’re not sure what’s going on, join the club. No one quite knows, which is why you’re going to be seeing a lot of movement in all directions. And for that reason, you need to be on top of your game if you’re even remotely thinking about taking out a home loan. Keep an Eye on the Stock Market and 10-Year Bond Yield Mortgage rates can be pretty complex, but there a few simple things to look at to predict their direction. Generally, if the stock market is falling, so are mortgage rates. The two tend to move in tandem. The thinking is bad news and/or economic uncertainty brings down stocks and mortgage rates. Conversely, bond prices go up as investors seek so-called “safe haven” bonds. That pushes down the associated yield. A good bellwether bond yield to keep an eye on is the 10-year treasury because it has a similar maturity to a home loan (paid off in a decade or so). It was priced around 4%, but since this bank failure business got started, has fallen closer to 3. 5%. To my point about ups and downs, it went from 4% to 3. 75% to 3. 5%, then back to around... --- > A lot of folks have pondered the buy now or buy later question when it comes to a home purchase. The waiters are waiting for home prices to fall, knowing - Published: 2023-03-14 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/heres-an-argument-for-the-wait-to-buy-a-home-crowd/ - Categories: Home Buying, Housing Market, Mortgage Rates, Mortgage Tips A lot of folks have pondered the buy now or buy later question when it comes to a home purchase. The waiters are waiting for home prices to fall, knowing affordability is historically low. The non-waiters either can’t wait or don’t want to wait because they expect competition to heat up once things turn around. Or they simply bought not knowing prices had peaked. But is it possible to get the best of both worlds? Can you buy a home for less and refinance to a lower rate later? Let’s look at the math to see how this would pan out. Those Who Didn’t Wait to Buy a Home I’m going to use the Austin, Texas metro for this exercise. Prices there are apparently down about 13% from their 2022 peak. Let’s assume someone bought a home there during the “peak” for $600,000 and put down 20%. That’s a down payment of $120,000 and a loan amount of $480,000. We’ll assume they got a 30-year fixed set at 3. 75%. The monthly principal and interest payment is $2,222. 95. Pretty low payment, but they visit Redfin/Zillow and find that their property is now valued at around $525,000. Ouch. Thanks to their 20% down payment they aren’t in a negative equity position. But their LTV is now over 90%, at least on paper. They’re basically not going anywhere, but they’ve got that awesome 3. 75% fixed-rate mortgage for the next three decades. Those Who Waited to Buy but Missed the Mortgage... --- > You’ve heard about, you know about it. Last week, Silicon Valley Bank was the target of a bank run, prompting the FDIC to take over the troubled company - Published: 2023-03-13 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-vs-bank-failures/ - Categories: Mortgage News, Mortgage Rates You’ve heard about, you know about it. Last week, Silicon Valley Bank was the target of a bank run, prompting the FDIC to take over the troubled company on March 10th. It was the first bank failure since October 2020, and was quickly followed by another failure, NYC-based Signature Bank. That prompted the Federal Reserve to create the Bank Term Funding Program (BTFP) over the weekend. It offers loans to banks, credit unions, etc. for up to one year, using U. S. Treasuries, agency debt, and mortgage-backed securities as collateral, valuing the assets at par. The move is intended to backstop these institutions and calm financial markets. But what will happen to mortgage rates? Silicon Valley Bank Was First Bank Failure in 870 Days Before the Silicon Valley Bank (SVB) failure, we had gone a cool 870 days without a bank failure. My guess is prior to last week, the term “bank failure” wasn’t a big search term, nor was it a concern on anyone’s radar. Instead, we were all fixated on inflation and the Fed’s many rate hikes to tackle said inflation. Somewhat ironically, those very rate hikes are what did in SVB. The company held a bunch of long-term debt like mortgage-backed securities, which had lost a ton of value due to rising rates. This time it wasn’t subprime mortgage debt, but rather agency-backed 30-year fixed mortgage debt. It wasn’t toxic on the surface, but because mortgage rates had risen from sub-3% to around 7% in just over... --- > If you’re an active duty or veteran homeowner (or aspiring home buyer), chances are you’ve heard of Veterans United Home Loans. They are the largest VA - Published: 2023-03-09 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/veterans-united-home-loans-review/ - Categories: Mortgage Tips If you’re an active duty or veteran homeowner (or aspiring home buyer), chances are you’ve heard of Veterans United Home Loans. They are the largest VA home purchase lender in the nation. And have been since 2016 (seven consecutive years). Their specialty is providing financing to veterans looking to buy homes. And about 75% of their overall business consisted of purchase loans. In 2022, the Missouri-based lender also took the overall lead in the VA lending category. So chances are they’re pretty knowledgeable when it comes to helping military members buy homes. Read on to learn more. Veterans United Home Loans Fast Facts Direct-to-consumer mortgage lender Founded in 2002, headquartered in Columbia, Missouri A DBA of Mortgage Research Center, LLC Focuses primarily on VA loans but offers FHA and conventional too Licensed to do business in all 50 states and D. C. The #1 VA lender nationally in 2022 Funded $26. 5 billion in VA loans last year 30th largest home loan lender overall Has physical branches in 17 states As noted, Veterans United Home Loans is a juggernaut in the VA lending world, having ascended to the top of the pile in 2022, per HMDA data. Last year, the company funded more than $31 billion in home loans, with about 95% of it VA loans. They also doled out nearly $2 billion in conventional loans, FHA loans, and even some USDA loans. But they’re clearly best known for being a VA loan lender. Veterans United acts as a direct-to-consumer... --- > Back in the good old days, pre-mortgage crisis, you could get a fully-underwritten mortgage approval the same day. In fact, you could get approved for a - Published: 2023-03-08 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/guaranteed-rate-brings-back-same-day-mortgage-underwriting/ - Categories: Mortgage News Back in the good old days, pre-mortgage crisis, you could get a fully-underwritten mortgage approval the same day. In fact, you could get approved for a mortgage by early afternoon if you submitted a complete loan package that same morning. In 2004-2007, this was basically the norm. Then things slowed down a lot. And the process changed considerably. Gone were the same-day approvals and in their place came long waiting periods. We’re talking weeks to simply get approved for a mortgage. Instead of quickly being given a conditional loan approval that required many items to be delivered after the fact, lenders began collecting lots of documentation upfront to get a squeaky-clean loan package from the start. The logic was sound – why rush out an approval if it turns out the borrower isn’t truly qualified once all the numbers are verified? It could prove to be a big waste of the mortgage underwriter’s time. Conversely, making a buyer wait weeks to show a seller they’re qualified to buy their home is also problematic. Guaranteed Rate Same Day Mortgage Chicago-based lender has launched a new expedited underwriting initiative Known as Guaranteed Rate Same Day Mortgage Can generate a "final approval" in just 1 business day Home buyers who provide requested docs within 8 hours also eligible for a $250 lender credit It seems things are shifting back to speed again in the mortgage industry. Surely nothing to do with applications being at their lowest point since 1995. Jokes aside, the move... --- > Typically, borrowers refinance their home loans to take advantage of lower mortgage rates. But recently, the average refinance has resulted in an interest - Published: 2023-03-06 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/94-of-homeowners-who-refinanced-recently-raised-their-mortgage-rate-a-lot-in-the-process/ - Categories: Mortgage News, Refinance Typically, borrowers refinance their home loans to take advantage of lower mortgage rates. But recently, the average refinance has resulted in an interest rate 2. 4% higher than the rate prior to the transaction. As to why, it’s mostly because the only homeowners refinancing these days are doing so to tap equity. The last time we saw a similar phenomenon was in 2018, when roughly 70% of refinances involved an interest rate increase. Back then, borrowers saw an average rate increase of 0. 4%. What’s going on? Rate and Term Refinancing Hits an All-Time Low A new report from Black Knight revealed that 96% of the 216,000 mortgage refinances completed in the fourth quarter of 2022 were cash-out loans, the highest quarterly share on record. Meanwhile, there were less than 10,000 rate and term refinances, the lowest on record. Prior to Q4 2022, the lowest quarterly total was 76,000 in 2018. The average has been 650,000 per quarter going back 15 years. And in the first quarter of 2021 alone, there were 1. 8 million rate/term refis, 190 times the Q4 2022 total. For all of 2022, 1. 98 million cash out refinances were completed, accounting for more than 80% of all refinances for the year. In other words, the refinance market has been dominated by cash out refinances, which makes total sense. With mortgage rates close to 7%, there’s very little reason to refinance unless you’re tapping home equity. The only other reason, other than say removing someone from... --- > The housing bears have ratcheted up their rhetoric lately, calling for an impeding crash. It’s not a crazy notion with home prices clearly unaffordable - Published: 2023-03-03 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/todays-homeowners-cant-afford-to-sell/ - Categories: Housing Market, Mortgage News, Mortgage Rates The housing bears have ratcheted up their rhetoric lately, calling for an impeding crash. It’s not a crazy notion with home prices clearly unaffordable and mortgage rates no longer anywhere near 3%. But generally, a crash or bubble is preceded by creative financing of some sort. Back in 2006, it was zero down mortgages, stated income loans, option ARMs, and other much worse things. Today, the culprit is a higher-priced 30-year fixed mortgage, which isn’t all that creative. Home Sellers Can’t Afford to Sell Right Now The housing market is super weird at the moment. Even if homeowners want to sell, they often can’t. Or have little desire to due to the strange mortgage rate environment. In short, most existing owners have mortgage rates at or below 5%, per recent HMDA data. And most hold 30-year fixed-rate mortgages. Some refer to these home loans as “golden handcuffs” because they trap homeowners, but also offer something of value. The issue is these homeowners can’t move because you can’t take your mortgage with you (mortgage disruptors are you listening? ). Let’s consider a homeowner who purchased a property in 2018 for $500,000 and then refinanced in 2021 when the 30-year fixed was sub-3%. We’ll pretend their property is now valued at $700,000, and their loan amount is just over $360,000. Their monthly principal and interest payment is about $1,550. What a steal. Now consider they’re looking to move up to a larger home to accommodate a growing family. The asking price is... --- > Mortgage Q&A: "Mortgage rates vs. home prices." Today, we’ll look at the impact of home prices and mortgage rates on your decision to buy a property, - Published: 2023-03-02 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/home-prices-vs-mortgage-rates/ - Categories: Housing Market, Mortgage Matchups, Mortgage Rates, Mortgage Tips Mortgage Q&A: "Mortgage rates vs. home prices. " Today, we’ll look at the impact of home prices and mortgage rates on your decision to buy a property, along with the relationship they share. Obviously, both are very important not only in terms of whether you should buy (from an investment standpoint), but also with regard to how much house you can afford. The general logic is that mortgage rates and home prices have an inverse relationship, in that if one goes up, the other goes down. And vice versa. But is this actually true? Or are there situations where both can rise together, making real estate even more expensive than it already is? Mortgage Rates Are No Longer on Sale What's more important (beneficial) to a prospective home buyer? A super low mortgage interest rate they can lock in for 30 years... Or a cheaper home purchase price at the outset? Let's do the math and find out! At the moment, mortgage rates are more than twice as high as they were a year ago. The popular 30-year fixed-rate mortgage averaging 6. 50% last week, according to the latest data from Freddie Mac. This has stopped the housing market in its tracks, and there are fears they could rise even higher over the next year and beyond. Meanwhile, home prices remain close to all-time highs on a nominal basis, but perhaps not in real terms, though most folks feel they’re quite high, and perhaps even unsustainable. This is made clear... --- > It’s been tough sledding for mortgage rates over the past month. They were actually on a roll to start off 2023, falling for the entire month of January - Published: 2023-03-02 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-you-might-still-be-seeing-5-mortgage-rates/ - Categories: Mortgage Rates, Mortgage Tips It’s been tough sledding for mortgage rates over the past month. They were actually on a roll to start off 2023, falling for the entire month of January before things took a nasty turn. Without getting too long-winded here, strong economic data pushed rates back toward decade highs. The culprits were a CPI report and a jobs report, both of which came in hotter than expected. Those basically derailed the argument that inflation had peaked. Still, you might come across 5% mortgage rates when the news is telling you they’re 7%. Why? How It’s Still Possible to Offer 5% Mortgage Rates The latest weekly survey from Fannie Mae put the 30-year fixed at 6. 65%, it’s highest level of 2023. And its highest level since November 2022. Prior to that, 30-year fixed mortgage rates didn’t exceed 7% since April 2002. Yes, it was a good 20-year run folks. In early February of this year, rates were back below 6%, albeit just barely, but it was still a sign that we had possibly turned a corner. Then there was the January jobs report, followed by the CPI report in mid-February, which turned rates on their head. All that progress from November was gone in a flash. Today, you’re probably seeing headlines that say mortgage rates are back at 7% (and above). But if you do comparison shopping on mortgage websites, you might still come across rates in the 5% range? How? The answer is simple; discount points. If You Pay More... --- > An in-depth look at two of the most popular mortgage options available today, the FHA loan and the conventional loan. - Published: 2023-03-01 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/fha-loan-vs-conventional-loan/ - Categories: Mortgage Matchups, Mortgage Tips It's time for another edition of mortgage match-ups: "FHA vs. conventional loan. " Our latest bout pits FHA loans against conventional loans, both of which are extremely popular loan options for home buyers these days. In short, conventional loans are non-government mortgages, typically backed by Fannie Mae or Freddie Mac. Whereas FHA loans are government-backed mortgages that are insured by the Federal Housing Administration (FHA). Both can be a good choice depending on your credit profile and homeownership goals, but there are key differences. Let's discuss the pros and cons of both loan programs to determine if and when one might be the better choice. FHA and Conventional Loans Both Offer a Great Low Down Payment Option It's possible to get an FHA loan with a 3. 5% down payment and a 580 FICO score Or a conventional loan with just 3% down payment and a 620 FICO score FHA lending is more flexible in terms of credit score but requires a little bit more down Be sure to consider the cost of mortgage insurance when comparing the two loan programs First off, whether you go FHA or conventional, know that the down payment requirement is minimal. You need just 3. 5% down for FHA loans and only 3% for conventional. So you don't need much in your bank account to get approved for either type of loan. The main selling point of an FHA loan is the 3. 5% minimum down payment requirement coupled with a low credit score... --- > Better Mortgage has launched a new product called “Equity Unlocker” to help Amazon employees purchase homes. The innovative loan program allows borrowers - Published: 2023-02-28 - Modified: 2023-02-28 - URL: https://www.thetruthaboutmortgage.com/better-equity-unlocker/ - Categories: Mortgage News Better Mortgage has launched a new product called “Equity Unlocker” to help Amazon employees purchase homes. The innovative loan program allows borrowers to pledge vested equity as collateral in lieu of a traditional down payment. This means home buyers can come to the closing table with a $0 down payment, yet borrow like they put 20% down. Because many Amazon employees receive a good chunk of their overall compensation in stock, it gives them an opportunity to buy a home without selling shares. Better Equity Unlocker is now available in the states of Florida, New York, and Washington for current (and former) Amazon employees with vested equity in Amazon. What Is Equity Unlocker? Equity Unlocker from Better Mortgage allows Amazon employees to pledge vested company shares toward a down payment on a home. Instead of having to sell their stock (potentially at an inopportune time), they can pledge shares at a 50% advance rate. For example, $200,000 in vested Amazon stock would be worth a $100,000 down payment. And unlike some other products like margin loans, the terms of the loan won’t change if the value of the stock does. The Amazon shares are valued at the time of the home appraisal and the the rate and term of the mortgage can be locked based on that. This means no surprises if the shares change value in the future, along with the certainty of a 30-year fixed loan. However, Better will apparently charge a premium for mortgages with employee-pledged stock.... --- > If you’re curious who the top VA loan lenders were last year, wonder no longer. The biggest was Veterans United Home Loans. The Columbia, Missouri-based - Published: 2023-02-27 - Modified: 2025-03-24 - URL: https://www.thetruthaboutmortgage.com/top-va-loan-lenders/ - Categories: Mortgage News If you’re curious who the top VA loan lenders were last year, wonder no longer. The biggest was Veterans United Home Loans. The Columbia, Missouri-based lender wrested the lead away from Freedom Mortgage, a direct lender out of Boca Raton, Florida that had topped the list for two years prior. United Wholesale Mortgage took second, followed by Rocket Mortgage, though both were behind by a large margin. Dropping to fourth was Freedom Mortgage, followed by Navy Federal FCU rounding out the top five. Read on to see the rest of the largest VA loan lenders in the country. Top VA Loan Lenders in 2022 Ranking Company Name 2022 VA Loan Volume 1. Veterans United $26. 5 billion 2. UWM $18. 0 billion 3. Rocket Mortgage $16. 7 billion 4. Freedom Mortgage $14. 0 billion 5. Navy Federal $13. 0 billion 6. Pennymac $9. 1 billion 7. loanDepot $7. 9 billion 8. USAA $6. 1 billion 9. Caliber Home Loans $4. 7 billion 10. Fairway Independent $4. 7 billion As noted, Veterans United Home Loans was the #1 VA loan lender in the country in 2022, per statistics from the VA for fiscal year 2022. The company originated over $26. 5 billion in VA loans, which was easily more than the rest of the bunch. In fact, the home purchase specialist held a near-$10 billion cushion above second place UWM. But the numbers pale in comparison to 2021, when Freedom originated a staggering $59. 6 billion in VA loans. Interestingly, Veterans... --- > These days, mortgage rates aren’t as cheap as they used to be. And that is the understatement of the century. The 30-year fixed is currently priced around - Published: 2023-02-24 - Modified: 2023-02-24 - URL: https://www.thetruthaboutmortgage.com/is-it-worth-using-a-mortgage-lender-now-for-the-promise-of-waived-fees-in-the-future/ - Categories: Mortgage Rates, Mortgage Tips, Refinance These days, mortgage rates aren’t as cheap as they used to be. And that is the understatement of the century. The 30-year fixed is currently priced around 7%, more than double the ~3% rate offered in early 2022. That has mortgage lenders scrambling to separate themselves from the crowd amid a shrinking pool of eligible borrowers. We’ve seen the temporary buydown gain steam lately, where the interest rate is reduced the first year or two, typically paid by the home seller or lender. Another common tactic is to waive lender fees on subsequent transactions, with the expectation mortgage rates will get better. But is it a good deal? Use a Mortgage Lender Now That Promises No Fees Later? Some mortgage lenders are offering no lender fees when you use them a second time. Think of it as a sort of "mortgage loyalty program. " For example, pick them as your lender today and you’ll be offered the chance to refinance in the future sans the typical fees. This means they’ll waive whatever fees they charge, such as a loan origination fee, underwriting and processing fees, and so on. Generally, third-party fees such as title insurance, credit report, and home appraisal will still be charged. However, this could amount to thousands in savings depending on the loan amount. On a $500,000 mortgage, a 1% loan origination fee alone is $5,000. Throw in a couple thousand more for underwriting/processing and your savings are pretty significant. This is the pitch some lenders are... --- > In an effort to make mortgage costs a little more bearable, the U.S. Department of Veterans Affairs (VA) is lowering the VA funding fee. This applies to - Published: 2023-02-24 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/va-funding-fee-being-reduced-for-home-purchases-and-cash-out-refis/ - Categories: Mortgage News In an effort to make mortgage costs a little more bearable, the U. S. Department of Veterans Affairs (VA) is lowering the VA funding fee. This applies to VA loans used for a home purchase or new construction, and even cash out refinances, which likely aren’t being utilized at the moment with interest rates as high as they are. The one-time fee is paid to lower the cost of VA loans for U. S. taxpayers since the VA home loan program doesn’t require monthly mortgage insurance. It can be paid at closing all at once or rolled into the loan and paid off over time by financing it. For loans closed on or after April 7th, 2023, the VA funding fee is being reduced by 15 to 30 basis points (. 15% to . 30%). New VA Funding Fees for 2023 Pictured above is the new VA funding fee chart that applies to VA loans closed on or after April 7th, 2023 and prior to November 14th, 2031, announced in VA circular 26-23-06. As you can see, those who put down less than 5% on a VA-backed home purchase will pay a funding fee of 2. 15%. It’s based on the loan amount, which is often the purchase price since VA loans do not require a down payment. The new fee is 15 basis points less than the current fee of 2. 30% for a home purchase with less than 5% down. On a $300,000 home purchase with nothing down... --- > The housing market is in trouble. The latest blow being mortgage rates returning to 7%. But the ongoing issue has been a severe lack of inventory, which - Published: 2023-02-23 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/can-free-and-clear-homeowners-save-the-housing-market/ - Categories: Housing Market, Mortgage Rates The housing market is in trouble. The latest blow being mortgage rates returning to 7%. But the ongoing issue has been a severe lack of inventory, which differs greatly from conditions around the time of the Great Recession. And the higher mortgage rates go, the worse the inventory situation gets. This is because existing homeowners are disincentivized to sell and lose their low rates. At last glance, 84% of all outstanding mortgages had a mortgage rate at or below 5%, per 2022 HMDA data. And 63% had a rate at or below 4%. Simply put, these homeowners don’t want to give up their low rate and replace it with a new 30-year fixed priced near 7%. The Housing Market Is Hurting Due to a Lack of Inventory As noted, the current state of the housing market is a lot different than the one seen back in 2008. At that time, there were way too many existing homes on the market. And countless new housing developments littering the country. In fact, there were so many homes that many projects were halted before they finished. I vividly remember driving around the outskirts of Los Angeles and Phoenix, documenting the many new subdivisions that were desperately attempting to unload inventory. There were so many vacant homes that it seemed nearly impossible for them to sell, ever. Meanwhile, disgruntled owners who were often the only ones living on a particular street would post warnings to would-be buyers. One owner literally had a sign posted... --- > In an effort to make homeownership more affordable, the U.S. Department of Housing and Urban Development (HUD) is reducing fees on FHA loans. - Published: 2023-02-22 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/annual-mortgage-insurance-premium-on-fha-loans-reduced-30-basis-points/ - Categories: Mortgage Tips In an effort to make homeownership more affordable, the U. S. Department of Housing and Urban Development (HUD) is reducing fees on FHA loans. Specifically, HUD in conjunction with the Biden-Harris Administration will slash the annual mortgage insurance premium (MIP) by 30 basis points. The move is expected to save the average homeowner about $800, or roughly $67 per month, and even more for those with larger loan amounts. Collectively, it should translate to an estimated $600 million in savings over the next year alone, and “many billions over the next decade. ” New pricing applies to forward mortgages endorsed on or after March 20th, 2023. FHA Annual Mortgage Insurance Premium Drops to 0. 55% for Most Home Loans The FHA MIP reduction announced today is the first improvement in pricing in about eight years. It lowers the annual insurance cost on most FHA loans from 0. 85% to 0. 55%. I say most because that pricing applies to loan-to-value (LTV) ratios of 95%+ with mortgage terms greater than 15 years. Many FHA borrowers put down 3. 5% and take out 30-year fixed mortgages, so this is the most common insurance pricing. On a $450,000 loan, the monthly insurance premium will drop from roughly $319 to $206 per month. That’s a savings of about $113, or $1,356 annually. It’s significant enough to make borrowers rethink the FHA vs. conventional loan argument. If you’re a prospective home buyer, be sure to carefully compare the total payment on both types of loans.... --- > It feels like déjà vu. Mortgage rates are going up again. What gives? I thought they peaked. Not so fast. The Fed warned us time and time again that this - Published: 2023-02-16 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-are-mortgage-rates-going-up-again/ - Categories: Mortgage News, Mortgage Rates It feels like déjà vu. Mortgage rates are going up again. What gives? I thought they peaked. Not so fast. The Fed warned us time and time again that this inflation fight wasn’t going to be easy. Or short. And it appears they might be right, based on the latest economic reports released in the past week. Simply put, the economy is too strong and inflation remains a major problem. This explains why mortgage rates are headed back toward 7%! Mortgage Rates Don’t Like Inflation In early 2022, mortgage rates took off like a bottle rocket. The 30-year fixed averaged 3. 22% during the first week of January, per Freddie Mac. Rates then increased nearly every week of the year, hitting a staggering 7. 08% in early November, before coming back down slightly. The issue was (and is) inflation, which had spiraled out of control, forcing the Fed to begin aggressively raising its fed funds rate. Long story short, the economy was overheated and prices were out of control. And only higher rates could potentially shrink the outsized money supply. Concurrently, the Fed halted its purchases of mortgage-backed securities (MBS) and Treasuries, which was known as QE. The absence of a huge buyer of MBS, coupled with a defensive appetite from remaining buyers, meant much higher mortgage rates. No one could have imagined mortgage rates doubling in less than a year, but they did. It was the first time in history. Consumer Prices Are Too Expensive and the Labor Market... --- > I recently wrote that you should look for a mortgage before searching for a property to buy because unless you have lots of cash, you’re going to need a - Published: 2023-02-14 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/10-things-you-should-do-before-applying-for-a-mortgage/ - Categories: Mortgage Tips I recently wrote that you should look for a mortgage before searching for a property to buy because unless you have lots of cash, you’re going to need a loan. Now let’s talk about what you should do before you apply for a mortgage to avoid common setbacks that could, well, set you back. Preparation is paramount when it comes to getting a home loan. And you don't get a second chance to make a first impression. Get these details right the first time around and your mortgage experience should be a lot smoother. 1. Rent a Place First While it might sound like a no-brainer, renting before you buy a home or condo is a smart move for several different reasons. For one, it’ll show you firsthand what goes into homeownership. If things break or go wrong while renting, you can typically call the property management company or landlord for help. Once it’s your own place, you’ll be fixing it yourself or paying out of your own pocket for a professional to assist you. Additionally, if you rent first you'll have a lower chance of payment shock, which is when monthly housing payments jump exponentially. Mortgage lenders like applicants who have shown in the past that they can handle large housing payments to ensure they don’t default for that very reason. So renting will make you both a more knowledgeable homeowner and a better candidate for a mortgage. That being said, it's perfectly acceptable to live at your parents'... --- > Mortgage Q&A: "What time of year are mortgage rates lowest?" We're all looking for an angle, especially if it’ll save us some money. Whether it’s a - Published: 2023-02-09 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/when-are-mortgage-rates-lowest/ - Categories: Mortgage Rates, Mortgage Tips Mortgage Q&A: "What time of year are mortgage rates lowest? " We're all looking for an angle, especially if it’ll save us some money. Whether it’s a stock market trend, a home price trend, or a mortgage rate trend, someone always claims to have unlocked the code. Unfortunately, it’s usually all nonsense, or predicated on the belief that what happened in the past will occur again in the future. Sometimes history repeats itself, sometimes it doesn’t. We probably only hear about the times when it does because it makes the individual behind it sound like a genius. Now if you're wondering if there is a "best time of year to get a mortgage," the answer is there could be. And certainly better (and worse) times than others. What Time of Year Are Mortgage Rates the Lowest? In reality, it’s very difficult to predict anything, even the weather, so when it comes to complex stuff like mortgage interest rates, success rates probably move a lot lower. That being said, I set out to see if there were any mortgage rate trends we could glean from available data, using Freddie Mac’s historical mortgage rates that go back to 1971. With 50 years of data at our fingertips, you would think some trends would appear, right? Were mortgage rates lower in certain months, higher during others, or is it all just random? Let’s find out. For the record, I looked at monthly averages for the 30-year fixed-rate mortgage over the past three decades... --- > There’s been a lot of buzz lately regarding another 2008 housing crisis unfolding in 2023. I’m hearing the phrases underwater mortgage and foreclosure - Published: 2023-01-30 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-the-its-the-2008-housing-crisis-all-over-again-argument-falls-short/ - Categories: Housing Market, Mortgage News There’s been a lot of buzz lately regarding another 2008 housing crisis unfolding in 2023. I’m hearing the phrases underwater mortgage and foreclosure again after more than a decade. To be sure, the housing market has cooled significantly since early 2022. There’s no denying that. You can mostly thank a 6% 30-year fixed-rate mortgage for that. Roughly double the 3% rate you could snag a year prior. But this alone doesn’t mean we’re about to repeat history. Goldman Sachs Forecasts 2008 Style Home Price Drops in Four Cities The latest nugget portending some kind of massive real estate market crash comes via Goldman Sachs. The investment bank warned that four cities could see price declines of 25% from their 2022 peaks. Those unfortunate names include Austin, Phoenix, San Diego, and San Jose. All four have been hot places to buy in recent years. And it’s pretty much for this reason that they’re expected to see sharp declines. These markets are overheated. Simply put, home prices got too high and with mortgage rates no longer going for 3%, there has been an affordability crisis. Properties are now sitting on the market and sellers are being forced to lower their listing prices. A 6. 5% Mortgage Rate By the End of 2023? Of course, it should be noted that Goldman’s “revised forecast” calls for a 6. 5% 30-year fixed mortgage for year-end 2023. It’s unclear when their report was released, but the 30-year fixed has already trended lower since the beginning of... --- > You’ve heard the term “no free lunch.” Well, the same is true of home loans. There is no “free mortgage.” Sure, banks and lenders will offer deals that - Published: 2023-01-26 - Modified: 2023-01-26 - URL: https://www.thetruthaboutmortgage.com/there-is-no-free-mortgage/ - Categories: Mortgage Rates, Mortgage Tips, Refinance You’ve heard the term “no free lunch. ” Well, the same is true of home loans. There is no “free mortgage. ” Sure, banks and lenders will offer deals that make it look that way. They’ll give you a mortgage without closing costs. Or without points. But that doesn’t mean it’s free. At the end of the day, everything has a cost. It’s simply how you pay for it that changes. And in the mortgage world, you’ve got options. You can accept a higher mortgage rate and pay nothing out-of-pocket. Or save each month via a lower interest rate instead. Zero Origination Fee Doesn’t Mean Free Mortgage First things first. A zero origination fee doesn’t mean your mortgage is free. It just means the bank, lender, or mortgage broker isn’t charging an origination fee. An origination fee is an upfront fee that is charged to the borrower to provide compensation to the originator. Some mortgage companies charge it, others don’t. However, those that do not can still (and likely will) earn a commission a different way. Remember, nobody is taking time out of their day to help you get a mortgage without making money. That would be nice, but that’s just not how life works. And why shouldn’t someone get paid? If they’re helping you apply for and fund your home loan, they should be compensated. It's actually hard work. Lender-Paid Compensation on Mortgages Many mortgage brokers get paid via lender-paid compensation. This means the lender pays them instead of... --- > One of the first "fintech" mortgage lenders that came into existence in recent years was Better Mortgage. Launched in 2014, they managed to fund more than - Published: 2023-01-25 - Modified: 2025-02-05 - URL: https://www.thetruthaboutmortgage.com/better-mortgage-review/ - Categories: Mortgage Tips One of the first "fintech" mortgage lenders that came into existence in recent years was Better Mortgage. Launched in 2014, they managed to fund more than $100 billion in home loans and at one point cracked the top-25 list nationally, despite being a very young company. However, like any other company, they've also had challenges, including the infamous mass firing of employees during a Zoom call back in 2021. They've also made a lot of changes over the years, going from a no fee, commission-free loan officer arrangement to quite the opposite. But they may still be worth a look if you're looking for speed and convenience, especially if their mortgage rates best their competitors. Jump to Better Mortgage Review topics: - How to Apply with Better Mortgage - Better One Day Mortgage - Loan Programs Offered by Better Mortgage - Better Mortgage Lender Fees - Better Mortgage Rates - Better Price Guarantee - Where Better Mortgage Is Licensed - Better Mortgage Reviews - Better Mortgage Pros and Cons - Better Mortgage vs. Rocket Mortgage Better Mortgage Used to Be a Top-25 Lender Direct-to-consumer mortgage lender Founded in 2014, headquartered in New York City Offers home purchase loans, mortgage refinances, and HELOCs Claims to offer a 100% online loan process that is mostly paperless Currently licensed in 50 states and the District of Columbia Funded $2 billion in home loans in 2023 Also operates a settlement company and insurance agency First a little history. The company was born out of... --- > The Fed has played a major role in consumer mortgage rates over the past decade and change. Back in 2008, they began purchasing hundreds of billions in - Published: 2023-01-24 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/how-the-fed-could-benefit-from-lower-mortgage-rates/ - Categories: Housing Market, Mortgage News, Mortgage Rates The Fed has played a major role in consumer mortgage rates over the past decade and change. Back in 2008, they began purchasing hundreds of billions in mortgage-backed securities (MBS). This was known as quantitative easing, or QE for short. The goal was to drive interest rates lower and increase the money supply. Doing so would boost economic activity, aka lending, and help us out of the Great Recession. But there were consequences to such a plan – namely something called inflation. The Fed also knew it couldn’t hold onto these assets forever, but how would they unload without riling the markets? Quantitative Easing Led to Raging Inflation The Fed conducted four rounds of quantitative easing, which involved buying both MBS and U. S. treasuries. The final round of QE extended all the way into 2020 as the COVID-19 pandemic dislocated the world economy. In the process, mortgage rates hit all-time record lows. The 30-year fixed dipped as low as 2. 65% during the week ending January 7th, 2021, per Freddie Mac. And the 15-year fixed fell to 2. 10% on July 29th, 2021. These low rates were unprecedented. They were so cheap that they set off a housing market frenzy, with home prices rising nearly 50% from late 2019 to mid-2022. Clearly this was unhealthy growth, and a symptom of easy money. Fed Finally Takes Action to Cool the Housing Market The Fed realized that they had an inflation problem. They also realized housing demand had gotten completely out... --- > Mortgage Q&A: “What is the easiest type of mortgage to get?” Relative to other types of loans, it can be difficult to get approved for a mortgage. - Published: 2023-01-23 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-is-the-easiest-type-of-mortgage-to-get/ - Categories: Mortgage Tips Mortgage Q&A: “What is the easiest type of mortgage to get? ” Relative to other types of loans, it can be difficult to get approved for a mortgage. After all, mortgage lenders typically require a tri-merge credit report, steady income and employment, and assets in the bank. They don’t just take your word for it like they might on a credit card application. All of those items must be documented to ensure you’re a creditworthy borrower capable of financing a piece of real estate. Easiest Types of Mortgages to Get, Ranked 1. FHA loan (lowest combination of credit score and down payment) 2. Conforming loan (lower min. down payment but need 620 FICO) 3. VA loan (zero down and no min. FICO but must be active duty/veteran) 4. USDA loan (zero down, no min. FICO but must be rural location and there are income limits) 5. Jumbo loan (usually need 10%+ down payment, 680+ FICO, and asset reserves) FHA loans are the easiest mortgage to get because of the 3. 5% down payment and 580 minimum FICO score required. Conforming loans are a close second, despite a lower 3% minimum down payment, due to the higher 620 minimum FICO score required. Both USDA and VA loans don’t require a down payment and technically don’t have a minimum FICO requirement, but are more specialized products. Thus not as easy. Jumbo loans are typically the hardest to get because they are larger (loan amounts) and aren’t backed by Fannie/Freddie or the government.... --- > Now it’s time to check out the top mortgage lenders in DC, the capital of the United States. In 2021, nearly 800 mortgage companies originated roughly - Published: 2023-01-20 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-dc/ - Categories: Mortgage Tips Now it’s time to check out the top mortgage lenders in DC, the capital of the United States. In 2021, nearly 800 mortgage companies originated roughly $139 billion in home loans in The District. That was one of the bigger totals for a state, even though the District of Columbia isn't actually a state Anyway, there can be only one... top mortgage lender to rule the rest. And as you may have guessed, it was Rocket Mortgage. Some local companies made the top-10 lists as well. Read on to see who. Top Mortgage Lenders in DC (Overall) Ranking Company Name 2021 Loan Volume 1. Rocket Mortgage $8. 4 billion 2. Pennymac $6. 4 billion 3. Freedom Mortgage $5. 5 billion 4. Truist $5. 4 billion 5. Wells Fargo $5. 1 billion 6. loanDepot $4. 7 billion 7. Mr. Cooper $3. 3 billion 8. McLean Mortgage $3. 1 billion 9. Intercoastal Mortgage $3. 1 billion 10. UWM $3. 1 billion In 2021, Rocket Mortgage led the District of Columbia with a solid $8. 4 billion funded, per HMDA data from Richey May. They were trailed by Los Angeles-based Pennymac with $6. 4 billion, which is a top correspondent lender. In third was Freedom Mortgage with a close $5. 4 billion, followed by Truist with $5. 1 billion and Wells Fargo with $4. 7 billion. The bottom half of the top 10 included loanDepot, Mr. Cooper, McLean Mortgage, Intercoastal Mortgage, and United Wholesale Mortgage. Both McLean Mortgage and Intercoastal Mortgage can be... --- > It used to be that a 720 FICO score was all you needed to ensure you qualified for the lowest rate on a mortgage. At least credit-wise. In other words, - Published: 2023-01-19 - Modified: 2025-03-19 - URL: https://www.thetruthaboutmortgage.com/780-fico-score-mortgage/ - Categories: Mortgage News, Mortgage Rates It used to be that a 720 FICO score was all you needed to ensure you qualified for the lowest rate on a mortgage. At least credit-wise. In other words, anything higher than a 720 FICO didn’t really matter, beyond bragging rights, and perhaps a safety cushion if your score dipped a bit prior to application. Then came the arrival of the 740 FICO threshold, making it slightly more difficult to qualify for the best rate when applying for a home loan. Now, Fannie Mae and Freddie Mac are upping the ante, and perhaps rubbing salt in the wounds of anyone interested in getting a mortgage. They have unveiled not one, but two new FICO thresholds for most conforming mortgages. A 760+ bracket and a 780+ bracket. A 780 FICO Score Matters for Mortgages Now In case you’re not aware, mortgage lenders have pricing adjustments for all types of loan attributes. This can include property type, occupancy, loan type, loan-to-value ratio (LTV), credit score, and many others. Perhaps the biggest factor in loan pricing is the borrower’s credit score, as it plays a major role in potential default rates. Simply put, a borrower with a higher FICO score is entitled to better loan pricing on the basis that they’re a lower default risk. The opposite is also true. As noted, you only needed a 720 FICO score to qualify for the best pricing on a conforming mortgage back in the day. Then came the 740 tier, which made things a... --- > Today we’ll discuss the key differences between a mortgage co-borrower and a mortgage co-signer. While the two phrases sound pretty similar, and are - Published: 2023-01-19 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-co-borrower-vs-co-signer/ - Categories: Home Buying, Mortgage Tips Today we’ll discuss the key differences between a mortgage co-borrower and a mortgage co-signer. While the two phrases sound pretty similar, and are sometimes used interchangeably, there are important distinctions that you should be aware of it considering either. In either case, the presence of an additional borrower or co-signer is likely there to help you more easily qualify for a home loan. Instead of relying on your income, assets, and credit alone, you can enlist help from your spouse or a family member. This may allow you to qualify for a larger loan amount, snag a lower interest rate, or even win a bidding war via a stronger offer. What Is a Mortgage Co-Borrower? A mortgage co-borrower is an individual who applies for a home loan alongside the main borrower. Typically, this would be a spouse that will also be living in the subject property. To that end, they share financial responsibility and ownership, and are both listed on title. For example, a married couple may decide to purchase a home. They apply together as co-borrowers. Doing so allows them to pool together their income, assets, and credit history. Ideally, it makes them collectively stronger in the eyes of the lender and the home seller. This could mean the difference between an approved or rejected loa application, and even a winning vs. losing bid on a property. Just imagine a home seller who is deciding between two competing bids with their real estate agent. Do they go with the... --- > A recent podcast from First American economists discussed the current state of the housing market. The subject was the rebalancing of the housing market, - Published: 2023-01-17 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/a-1-decrease-in-mortgage-rates-is-worth-an-11-drop-in-home-prices/ - Categories: Home Buying, Housing Market, Mortgage Rates, Mortgage Tips A recent podcast from First American economists discussed the current state of the housing market. The subject was the rebalancing of the housing market, which has been out of whack for a while now. Over the past several years, it’s been decidedly slanted toward home sellers, who have enjoyed bidding wars and above-asking offers. As 2023 gets underway, it appears to finally be shifting in the opposite direction, in favor of the home buyer. But there’s still the question of affordability, and what exactly will happen with mortgage rates and home prices. 1% Drop in Mortgage Rates = 11% Drop in Home Prices One interesting thing that stood out was the following line: “Today, a one percentage point decline in mortgage rates has the same impact on affordability as an 11% decline in house prices. ” The argument of home prices vs. mortgage rates has been around for years. Most believe it’s a seesaw. If one goes up, the other must go down, often by an equal amount. But data says otherwise. In reality, both can move in tandem. For example, it’s possible for both home prices and interest rates to rise if the economy is doing well. Assuming wages are increasing and the average American is making more, it’s supports home price growth. But the year 2022 was unlike any other year in history with regard to mortgage rates. We didn't see a typical increase in rates, we saw an unprecedented rise in rates. 2022 Was a Very Strange... --- > Now that the housing market is turning in favor of home buyers, the phrase “seller concessions” might become a lot more common. Over the past decade, home - Published: 2023-01-13 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-are-seller-concessions/ - Categories: Home Buying, Housing Market, Mortgage Tips Now that the housing market is turning in favor of home buyers, the phrase “seller concessions” might become a lot more common. Over the past decade, home sellers have had the upper hand, often unloading their properties above list price. In many cases, home buyers were forced to enter bidding wars, assuming they were lucky enough to get the opportunity. But now that mortgage rates have doubled, and home prices are on a downward trajectory, the situation is quite the opposite. If you’re a prospective home buyer, you need to know what seller concessions are and how they work. How Seller Concessions Work A seller concession is a financial contribution from a home seller that reduces a home buyer’s closing costs. One of the biggest hurdles prospective home buyers face, other than DTI constraints, is having the necessary funds (assets) to close on a home purchase. Seller concessions lessen that burden, making it easier to qualify for a home loan and acquire a property. The funds are typically generated via a slightly higher contract price, which reduces the buyer’s out-of-pocket expenses. However, this means the borrower will wind up with a larger loan amount, and finance those costs over time via a higher monthly mortgage payment. For example, if a buyer offers $360,000 for a property with $10,000 in seller concessions, the seller may say, “Sure, it’s all yours for $370,000. ” You’re not really getting money for free since the purchase price rises by the amount requested. But it... --- > A new survey from U.S. News & World Report found that nearly half of homeowners with adjustable-rate mortgages regret the decision. This is based on a - Published: 2023-01-11 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/nearly-half-of-homeowners-regret-their-adjustable-rate-mortgage/ - Categories: Mortgage News A new survey from U. S. News & World Report found that nearly half of homeowners with adjustable-rate mortgages regret the decision. This is based on a nationwide survey of more than 1,200 respondents that took place between December 14th and 20th, 2022, via a company called PureSpectrum. Only respondents with an adjustable-rate mortgage (ARM) were included in the study. Perhaps the biggest takeaway was that 43% of the survey respondents regret choosing an ARM. As for why, the most common response “was that their interest rate adjusted to a higher rate than expected. ” Homeowners Took Out Adjustable-Rate Mortgages Because They Wanted a Lower Payment The survey also asked these homeowners why they opted for an adjustable-rate mortgage versus a more popular option, such as the 30-year fixed mortgage. As expected, the top response was to obtain “a lower monthly payment. ” This is basically the sole reason anyone would consider an ARM. If it doesn’t save you money via a lower interest rate, there’s essentially no point in choosing one over the safety and stability of a fixed-rate product. Interestingly, another 37% of respondents said they believe interest rates will be lower once their rate adjusts. That’s a timely take because mortgage rates have doubled over the past year, and there’s a decent expectation that they fall back down to earth this year. In fact, my 2023 mortgage rate predictions post has the 30-year fixed falling to the low-5% range by the second half of the year. So... --- > Despite long being the #1 mortgage lender in the country, Wells Fargo has announced plans to shrink its mortgage business. The San Francisco-based bank - Published: 2023-01-10 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/wells-fargo-to-exit-correspondent-lending-shrink-mortgage-business/ - Categories: Mortgage News Despite long being the #1 mortgage lender in the country, Wells Fargo has announced plans to shrink its mortgage business. The San Francisco-based bank said it will exit its correspondent lending business, while focusing more on bank customers and minority communities. Additionally, the company will reduce the size of its loan servicing portfolio, in which it collects monthly payments from homeowners. As a result, the company will significantly reduce its mortgage footprint, which had been the largest prior to the rise of Rocket Mortgage. In the fourth quarter of 2017, Quicken Loans unseated Wells Fargo and basically never looked back. They changed their name to Rocket Mortgage in May 2021. Wells Fargo Exits Correspondent Lending First things first, Wells Fargo is exiting the correspondent mortgage lending business, which is basically the resale of their loan products by third-party companies like credit unions. These smaller entities “originate, underwrite and close mortgage loans before selling them to Wells Fargo Funding,” their website states. Per HMDA data from Richey May, Wells Fargo funded roughly $228. 6 billion in home loans in 2021(most recent year available). Of that total, about $69 billion, or 30%, was via the correspondent lending channel. It shows another $11 billion, or five percent, originated via the wholesale lending channel, which is reserved for mortgage broker partners. But Wells Fargo had exited wholesale lending back in 2012, so it’s unclear if that number is accurate. In any case, they were the second largest mortgage lender in the United States in... --- > There’s been a recent phenomenon where mortgage lenders are requiring borrowers to pay upfront points when obtaining a home loan. This runs counter to the - Published: 2023-01-09 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-do-mortgage-lenders-charge-points/ - Categories: Mortgage Rates, Mortgage Tips There’s been a recent phenomenon where mortgage lenders are requiring borrowers to pay upfront points when obtaining a home loan. This runs counter to the typical experience where you can easily acquire a no cost home loan with no points or closing costs required. As to why this is happening, it’s basically because the mortgage market has been so volatile lately. Simply put, it’s difficult to determine the value of a mortgage loan because it’s unclear where mortgage rates go next. To mitigate that unknown, many lenders are charging points to ensure some profits are being captured upfront. Why Do Mortgage Lenders Charge Points? Mortgage lenders charge points to collect profit upfront as opposed to over time via regular monthly interest payments. Or to offer lower-than-market interest rates to entice mortgage rate shoppers to go with them instead of someone else. This money is obtained from the borrower via a loan origination fee or via discount points, the latter being a form of prepaid interest. Instead of waiting to collect interest each month once the loan is closed, they can collect some money upfront. In exchange, you should get a lower mortgage rate versus the borrower who doesn't pay points. Collecting more now means less has to be paid later (via a higher interest rate) to account for the unknown, such as prepayment. Of course, many lenders sell their loans to investors shortly after closing, but the same principle applies. If you opt to pay little or nothing at closing,... --- > Another year has nearly passed, which means it’s time for the 2023 mortgage rate predictions. I think we can all agree that the 2022 predictions were the - Published: 2022-12-28 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/2023-mortgage-rate-predictions/ - Categories: Mortgage News, Mortgage Rates Another year has nearly passed, which means it’s time for the 2023 mortgage rate predictions. I think we can all agree that the 2022 predictions were the worst on record. After all, mortgage rates had never doubled in a year before. Just about everyone (or in fact, everyone) got 2022 totally wrong, though you can’t blame them. The year 2022 was the worst on record for mortgage rates, with the 30-year fixed rising from the high 2% range to beyond 7%. Hopefully the year 2023 will be more favorable in terms of mortgage rates, though you can never be 100% sure. MBA 2023 Mortgage Rate Predictions First quarter 2023: 6. 2% Second quarter 2023: 5. 6% Third quarter 2023: 5. 4% Fourth quarter 2023: 5. 2% As always, we start with the Mortgage Bankers Association (MBA), using their monthly Mortgage Finance Forecast from late December (12/19/22). Last year, they were way off, but then again, so was everybody else. Perhaps they’ll do a little better in 2023. To their credit, they were the only group that predicted a 4% 30-year fixed by the end of 2022, whereas other forecasters stayed in the high 3% range. For the first quarter of 2023, they expect the 30-year fixed to average a much higher 6. 2%, which is basically close to where rates stand today. A year ago, the MBA predicted a 3. 2% 30-year fixed, to provide some context for how much higher rates are today. And while 6. 2% sounds pretty... --- > It’s time to find out who the top mortgage lenders in Kentucky are, based on total loan volume. More than 750 banks, direct lenders, and credit unions - Published: 2022-12-21 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-kentucky/ - Categories: Mortgage Tips It’s time to find out who the top mortgage lenders in Kentucky are, based on total loan volume. More than 750 banks, direct lenders, and credit unions originated home loans in the state of Kentucky last year. Altogether, this group funded more than $40 billion in mortgages, though only one can claim to be #1. As is the case with many other states in the nation, Rocket Mortgage led the way in The Bluegrass State. Keep reading to see which other mortgage companies made the top-10 list. Top Mortgage Lenders in Kentucky (Overall) Ranking Company Name 2021 Loan Volume 1. Rocket Mortgage $2. 2 billion 2. Wells Fargo $1. 2 billion 3. Freedom Mortgage $1. 1 billion 4. U. S. Bank $1. 1 billion 5. UWM $1. 0 billion 6. Homepoint $1. 0 billion 7. Fifth Third Bank $952 million 8. Chase $938 million 9. Pennymac $885 million 10. AmeriHome Mortgage $844 million Rocket Mortgage snagged the top spot in Kentucky with $2. 2 billion in home loans funded in 2021, per HMDA data compiled by Richey May. That was about a billion more than second place Wells Fargo, which managed about $1. 2 billion in origination volume last year. Coming in third was Boca Raton-based Freedom Mortgage with $1. 1 billion, narrowly beating out U. S. Bank’s similar total. In fifth was United Wholesale Mortgage with $1 billion, a company that relies solely on mortgage brokers to generate business. The rest of the top 10 included Homepoint, Fifth Third... --- > In a rather surprising move, United Wholesale Mortgage president and CEO Mat Ishbia is set to acquire the Phoenix Suns and Phoenix Mercury. The deal is - Published: 2022-12-20 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/uwm-ishbia-to-buy-the-phoenix-suns-and-mercury/ - Categories: Mortgage News In a rather surprising move, United Wholesale Mortgage president and CEO Mat Ishbia is set to acquire the Phoenix Suns and Phoenix Mercury. The deal is reportedly valued at somewhere near $4 billion, per sources who spoke to ESPN. The sale would be a record high for an NBA franchise, well above the then NBA-record of $2. 35 billion for the Brooklyn Nets back in 2019 to Joe Tsai. It comes at an interesting time, with mortgage volume down markedly from a year ago thanks to significantly higher mortgage rates. But it could be a way for Ishbia to diversify his assets and not be fully reliant on mortgage lending. Ishbia to Purchase the Phoenix Suns for Around $4 Billion As noted, Ishbia will reportedly acquire the Phoenix Suns and WNBA franchise Phoenix Mercury for around $4 billion, per ESPN. And while he might be best known as the owner of United Wholesale Mortgage, the largest wholesale mortgage lender in the country, he has a lot of basketball ties. For one, he was a walk-on at Michigan State, one of the best college basketball programs in the nation. Additionally, he was part of the Spartans’ 2000 National Championship winning team, though his playing time was very limited. Back in the summer of 2021, he inked a “name, image and likeness” (NIL) deal for UWM with Michigan State, offering $500 per month to MSU athletes during the 2021-2022 season. Prior to that, UWM made a deal with the Detroit Pistons to... --- > Let’s talk about the top mortgage lenders in Connecticut, based on their total loan volume. Nearly 700 companies originated home loans in The Constitution - Published: 2022-12-19 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-connecticut/ - Categories: Mortgage Tips Let’s talk about the top mortgage lenders in Connecticut, based on their total loan volume. Nearly 700 companies originated home loans in The Constitution State during 2021, with overall funding volume exceeding $58 billion. But one company beat out the competition, though not by a significantly wide margin. Yes, it was the nation’s top lender, Rocket Mortgage, which you may have already guessed. Read on to which other banks and mortgage lenders made the leaderboard in Connecticut. Top Mortgage Lenders in Connecticut (Overall) Ranking Company Name 2021 Loan Volume 1. Rocket Mortgage $3. 2 billion 2. Chase $2. 9 billion 3. Wells Fargo $2. 3 billion 4. Citizens Bank $2. 1 billion 5. Bank of America $1. 8 billion 6. loanDepot $1. 7 billion 7. U. S. Bank $1. 7 billion 8. Total Mortgage $1. 4 billion 9. Webster Bank $1. 3 billion 10. UWM $1. 2 billion As noted, the #1 spot went to Rocket Mortgage, which funded $3. 2 billion in Connecticut in 2021, per HMDA data from Richey May. That wasn’t a huge surprise, as they are also the top mortgage lender in the country overall. In second was NYC-based Chase Bank, which came close with $2. 9 billion funded. It then dropped off a bit with San Francisco-based Wells Fargo funding $2. 3 billion. Two more banks rounded out the top five, including Citizens Bank and Bank of America. Citizens Bank is basically a local institution as they are headquartered in nearby Providence, Rhode Island. The... --- > While most homeowners probably don’t have a refinance on their radar (due to the big jump in interest rates), take note that fees for cash out refis are - Published: 2022-12-16 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/cash-out-refinance-fees-are-going-up-in-early-2023/ - Categories: Mortgage News, Mortgage Rates, Refinance While most homeowners probably don’t have a refinance on their radar (due to the big jump in interest rates), take note that fees for cash out refis are going up in about a month. Back in October, Fannie Mae and Freddie Mac announced new loan-level pricing adjustments (LLPAs) for cash out refinances. The move was intended to help the Federal Housing Finance Agency (FHFA) better support “core mission borrowers,” aka promoting affordable housing. That same announcement included the elimination of upfront fees on HomeReady and Home Possible loans, and for first-time home buyers with limited incomes. Those fee reductions went into effect December 1st, but the increased cash out fees don’t go live until February 1st, 2023. Cash Out Refinance Fees More Than Doubling in Some Cases There aren’t a ton of reasons to refinance at the moment, given the doubling in mortgage rates from the start of 2022 until now. But those in need of cash might consider a cash out refinance depending on the circumstances. Unfortunately, these transactions are set to get even more expensive come February 1st, 2023. The FHFA, which oversees both Fannie Mae and Freddie Mac (roughly 80% of the mortgage market), said it has “targeted increases to the upfront fees for most cash-out refinance loans. ” As you can see from the chart above, LLPAs will be more than doubling in some cases on cash out refinances. For example, a borrower with 740 FICO score and an 80% loan-to-value (LTV) ratio will see the... --- > Today we’ll check out the top mortgage lenders in Hawaii based on total loan volume. These companies closed the most home loans in The Aloha State last - Published: 2022-12-15 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-hawaii/ - Categories: Mortgage Tips Today we’ll check out the top mortgage lenders in Hawaii based on total loan volume. These companies closed the most home loans in The Aloha State last year, beating out nearly 300 others that do business there. In general, there are fewer mortgage companies operating in the state of Hawaii, so you tend to see only the bigger household names along with local banks and credit unions. Still, one company managed to originate a lot more than the competition, making them the go-to spot for a mortgage in Hawaii. Read on to see which bank or mortgage company ranked #1 in Hawaii. Top Mortgage Lenders in Hawaii (Overall) Ranking Company Name 2021 Loan Volume 1. Bank of Hawaii $3. 0 billion 2. loanDepot $2. 0 billion 3. First Hawaiian Bank $1. 9 billion 4. Freedom Mortgage $1. 8 billion 5. American Savings Bank (HI) $1. 6 billion 6. Rocket Mortgage $1. 4 billion 7. UWM $1. 4 billion 8. Central Pacific Bank (HI) $1. 3 billion 9. Guaranteed Rate $1. 2 billion 10. Homepoint $1. 0 billion Coming in first was Honolulu’s own Bank of Hawaii, which funded $3 billion in mortgages during 2021, per Richey May. That was a full billion more than second place SoCal-based loanDepot, which originated a respectable $2 billion there. In third was another Hawaiian institution, First Hawaiian Bank, also Honolulu based, with a close $1. 9 billion. Taking the fourth spot was Boca Raton, Florida-based Freedom Mortgage with $1. 8 billion, followed by Honolulu-based... --- > Let’s take a look at the top mortgage lenders in Idaho, based on annual loan origination volume. The Gem State was one of the hotter housing markets last - Published: 2022-12-12 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-idaho/ - Categories: Mortgage Tips Let’s take a look at the top mortgage lenders in Idaho, based on annual loan origination volume. The Gem State was one of the hotter housing markets last year, seeing an influx of buyers from other states nationwide. That, plus rising home prices, led to over $42 billion in home loan origination volume there last year. And while some 500+ mortgage companies took part, only one could claim the top spot. Interestingly, the #1 mortgage lender in Idaho is homegrown. Read on to find out who it is. Top Mortgage Lenders in Idaho (Overall) Ranking Company Name 2021 Loan Volume 1. Idaho Central CU $4. 2 billion 2. Rocket Mortgage $2. 4 billion 3. U. S. Bank $1. 3 billion 4. Fairway Independent $1. 2 billion 5. UWM $1. 1 billion 6. Wells Fargo $1. 1 billion 7. Academy Mortgage $1. 0 billion 8. Guild Mortgage $911 million 9. Glacier Bank $843 million 10. Willamette Valley Bank $834 million Even if you’re headquartered in a particular state, it’s difficult to beat out the national mortgage brands. But Idaho Central Credit Union did just that, originating $4. 2 billion in home loans in the state of Idaho in 2021, per HMDA data from Richey May. That was more than enough to take out top ranked Rocket Mortgage, which only mustered $2. 4 billion. Pretty impressive feat, and a testament to how much Idahoans like their own local lender. It’s also one of the few credit unions (if only) to rank #1... --- > It's nearly 2023, which means it's time for a fresh batch of mortgage and real estate predictions for the new year. My assumption is everyone wants 2022 - Published: 2022-12-09 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/2023-mortgage-and-real-estate-predictions/ - Categories: Housing Market, Mortgage News It's nearly 2023, which means it's time for a fresh batch of mortgage and real estate predictions for the new year. My assumption is everyone wants 2022 to come to an end as quickly as possible, as it hasn't been kind to anyone. Much higher mortgage rates have completely derailed the housing market, leading to lots of layoffs and closures across the industry. And there remains a lot of uncertainty about what next year will bring, though I'm somewhat optimistic. Read on to see what I think 2023 has in store for the housing market and the mortgage industry. 1. Mortgage rates will move lower in 2023 Let’s start with the elephant in the room; mortgage rates. They’ve been the story of 2022, without question. Sadly, because they increased at an unprecedented clip and derailed the hot housing market’s decade-long bull run. Of course, this was by design as the Fed believed the U. S. housing market was in bubble territory and unsustainable. However, I believe interest rates overshot the mark and are due to see some relief in 2023. The 30-year fixed has already fallen from its 2022-highs, and could continue to drop back in the 5% range and even the high-4% range. So that’s something to look forward to. See my 2023 mortgage rate predictions for more details on that. 2. The housing market won’t crash in 2023 Related to lower mortgage rates is the health of the housing market. Ultimately, the housing market only really stalled because... --- > Today we’ll take a look at the top mortgage lenders in Alabama, based on their most recent year’s loan volume. This is a list of the largest mortgage - Published: 2022-12-05 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-alabama/ - Categories: Mortgage Tips Today we’ll take a look at the top mortgage lenders in Alabama, based on their most recent year’s loan volume. This is a list of the largest mortgage lenders in the state, not necessarily the top-rated ones (though those two things can coexist). Despite being a less populated state, more than 800 lenders still managed to fund more than $51 billion in home loans there. But like the other 49 states, one company managed to beat out the competition, and by a wide margin at that. Read on to see which companies topped the list in the state of Alabama last year. Top Mortgage Lenders in Alabama (Overall) Ranking Company Name 2021 Loan Volume 1. Rocket Mortgage $3. 0 billion 2. Pennymac $2. 0 billion 3. Regions Bank $2. 0 billion 4. Freedom Mortgage $1. 5 billion 5. Fairway Independent $1. 5 billion 6. Wells Fargo $1. 5 billion 7. Trustmark $1. 3 billion 8. UWM $1. 2 billion 9. Renasant Bank $1. 2 billion 10. Homepoint $1. 1 billion If you had to guess which mortgage company did the most lending in Alabama, you’d probably guess right. That’s because the nation’s top mortgage lender overall was also the biggest lender in Bama. Yes, I’m talking about Rocket Mortgage, which funded $3 billion, according to HMDA data from Richey May. That was 150% more than their closest competitor, Pennymac, which came in second with $2 billion. Birmingham, Alabama-based Regions Bank snagged third with a similar $2 billion, a positive development... --- > High mortgage rates are bad. They reduce affordability, lead to fewer home sales, and can cause lots of industry-related job losses. The year 2022 has - Published: 2022-12-01 - Modified: 2022-12-01 - URL: https://www.thetruthaboutmortgage.com/the-beauty-of-high-mortgage-rates/ - Categories: Mortgage Rates, Mortgage Tips High mortgage rates are bad. They reduce affordability, lead to fewer home sales, and can cause lots of industry-related job losses. The year 2022 has probably been the worst on record as far as mortgage rates go, with the 30-year fixed climbing from sub-3% levels to over 7%. This single-handedly shocked the housing market, leading to big price reductions, thousands of mortgage layoffs and related closures, and a quick shift from a seller’s market to a buyer’s market. But there could be a silver lining to a near tripling of mortgage rates in the span of less than a year. And that’s if and when they begin to really improve, they’ll feel a lot lower than they actually are. Your Brain Will Soon Think a 5% Mortgage Rate Is Pretty Good Because we’ve seen 30-year fixed mortgage rates exceed 7%, and even flirt with the idea of 8%, anything lower will feel like a huge relief. It’s human nature. Once you’ve experienced worse, anything better will feel a lot better, even if it's still worse than before. I think it’s safe to say that we won’t see a 3% 30-year fixed mortgage rate being offered anytime soon. Those days have come and gone. However, recent developments have pointed to the potential for substantially lower mortgage rates. While there’s been a lot of pain in 2022, the 30-year fixed has enjoyed nearly a month of declines lately. It all got started back on November 10th, when the CPI report showed a... --- > Mortgage basics: “How to shop for a mortgage.” Every now and then I focus on mortgage 101 because it seems the obvious stuff isn’t always so obvious. - Published: 2022-11-30 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/how-to-shop-for-a-mortgage/ - Categories: Mortgage Rates, Mortgage Tips Mortgage basics: “How to shop for a mortgage. ” Every now and then I focus on mortgage 101 because it seems the obvious stuff isn’t always so obvious. While you would think that shopping for just about anything is relatively straightforward, it’s often not. This is especially true of mortgages, which come with added confusion and potential pitfalls. Let’s discuss how best to shop for a home loan to obtain the best interest rate with the lowest fees. Oh, and ensure you wind up with a competent lender. First Off, Make Sure You Actually Shop! It’s cliché, but it’s true, and bears repeating. Very few consumers shop around for their mortgage. And it can cost them, a lot. In fact, yet another survey, the latest from Zillow Home Loans, revealed that prospective home buyers spend more time researching their next car purchase or vacation than their mortgage. This despite the fact that the mortgage will be paid for the next 30 years in some cases, and weigh heavily on their pocketbook. These individuals also indicated that they spend about the same amount of time researching TVs to buy as they do mortgage lenders. I guess people watch a lot of TV, so it is pretty important to get a quality set. Jokes aside, this is a problem if you want to save money. Why? Because there are real studies that prove that shopping around is the key to saving money on your mortgage. Of course, Zillow’s survey also found that... --- > A dollar ain’t worth what it used to be; just take a look at the newly released 2023 conforming loan limits. Yes, they will exceed $1 million in high-cost - Published: 2022-11-29 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/2023-conforming-loan-limits/ - Categories: Mortgage News A dollar ain’t worth what it used to be; just take a look at the newly released 2023 conforming loan limits. Yes, they will exceed $1 million in high-cost areas beginning next year, which is a testament to just how much property values have risen lately. Of course, the year-over-year change actually pales in comparison to the jump seen a year earlier. This is due to a slowdown in home prices, which was somewhat captured by the Federal Housing Finance Agency’s (FHFA) third quarter report. For one-unit properties, the national baseline will rise to $726,200, an increase of $79,000 from $647,200 in 2022. 2023 Baseline Conforming Loan Limit Rises to $726,200 • One-unit property: $726,200 • Two-unit property: $929,850 • Three-unit property: $1,123,900 • Four-unit property: $1,396,800 The FHFA determines the conforming loan limit each year, basing it on the average U. S. home value over the past four quarters. They utilize their own Federal Housing Finance Agency House Price Index (FHFA HPI®) to determine how much home prices have risen in the preceding 12 months. This captures home price movement from the third quarter of 2021 to the third quarter of 2022. Their latest HPI found that property values had risen 12. 21% over the past four quarters, which allowed them to raise the conforming loan limit by the same amount. As such, home buyers and those looking to refinance will be able to get a mortgage backed by Fannie Mae or Freddie Mac (conforming loan) as large as... --- > While it seemed mortgage rates just couldn't catch a break, a positive CPI report has led to a huge rally. This is one of the bright sides to a decidedly - Published: 2022-11-10 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-vs-cpi/ - Categories: Mortgage News, Mortgage Rates While it seemed mortgage rates just couldn't catch a break, a positive CPI report has led to a huge rally. This is one of the bright sides to a decidedly negative environment, where if and when good news finally does materialize, it can make a big impact. That good news was a Consumer Price Index (CPI) report that showed inflation slowing in October from September. As such, bond prices rallied and corresponding yields fell, allowing interest rates on long-term mortgages to improve. Long story short, 30-year fixed mortgage rates are back below 7%, and even in the mid-6% range after moving above 7. 25% earlier this month. Why Does CPI Matter to Mortgage Rates? There are a number of factors that help determine the price and direction of long-term mortgage rates like the popular 30-year fixed. But a big one is inflation, which at the moment has taken center stage. Mortgage rate watchers and the Fed have been fixated on inflation lately. It is, after all, why mortgage rates more than doubled from around 3. 25% to start the year to around 7% this week. In short, the Fed began purchasing hundreds of billions in mortgage-backed securities and treasuries to lower interest rates and spur more lending, known as Quantitative Easing (QE). This allowed mortgage rates to drop to record lows as the Fed bought up as much as lenders could churn out (they created constant demand). However, in doing so they increased the money supply and that led to... --- > Similar to how Rocket Mortgage overtook Wells Fargo, United Wholesale Mortgage (UWM) has now risen above Rocket to become the nation’s top mortgage lender - Published: 2022-11-04 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/uwm-becomes-top-mortgage-lender-in-the-nation/ - Categories: Mortgage News Similar to how Rocket Mortgage overtook Wells Fargo, United Wholesale Mortgage (UWM) has now risen above Rocket to become the nation’s top mortgage lender overall. During the third quarter, the Pontiac, Michigan-based wholesale lender originated some $33. 5 billion in home loans, up from $29. 9 billion in the second quarter. While it was a big year-over-year decline from $63 billion in the third quarter, it was still enough to claim the top spot. It’s even more impressive given the fact that UWM works solely with mortgage brokers via the wholesale lending channel. They don’t operate in the retail, consumer-facing space, which also tells you mortgage brokers are back in a major way. How UWM Unseated Rocket Mortgage to Take #1 Spot UWM, which refers to itself as the historic #1 wholesale and #1 purchase mortgage originator in America, finally took the top spot for total origination volume. As noted, their $33. 5 billion funded in the third quarter of 2022 was more than enough to unseat Detroit-based Rocket’s $25. 6 billion. In fact, their loan volume was nearly 31% higher than Rocket’s during the three months ended September 30th, 2022. It was also much higher than former #1 Wells Fargo, which mustered just $21. 5 billion during the quarter, with nearly half of their volume coming via the correspondent channel. Meanwhile, Chase only managed $15. 2 billion, illustrating the big banks diminishing share of the total mortgage market. How UWM was able to originate so much more than other... --- > Direct lender loanDepot has launched a so-called “Digital HELOC” to help homeowners tap into their massive amounts of home equity. The Southern - Published: 2022-11-03 - Modified: 2025-02-12 - URL: https://www.thetruthaboutmortgage.com/loandepot-digital-heloc/ - Categories: Mortgage News, Refinance Direct lender loanDepot has launched a so-called “Digital HELOC” to help homeowners tap into their massive amounts of home equity. The Southern California-based company cited the fact that the average homeowner now has roughly $300,000 in home equity, per a CoreLogic report from September. While they might not have as much today, thanks to recent pressure on home prices, millions of Americans do have home equity that is ripe to be tapped. This is especially true if they need cash and hold a low fixed-rate mortgage in the 2-4% range. With first mortgage rates now above 7%, a second mortgage such as HELOC could make a lot more sense than a refinance. How the loanDepot Digital HELOC Works As the name suggests, the Digital HELOC from loanDepot is a paperless, 100% digital application process for a home equity line of credit (HELOC). Instead of requiring meetings, phone calls, and trips to the bank, the company says you can apply for their HELOC from the comfort of your couch. Potential customers can obtain no-obligation quotes without impacting their credit scores, and go from quote to close in as little as seven days. Once you submit an application, a hard inquiry to one or more of the consumer reporting agencies will land on your credit report. And like a first mortgage, the company will still need to perform income, asset, and employment verification. But thanks to new technology, much of this can be done paperlessly and digitally, by linking accounts and plugging... --- > The nation’s number one lender, Rocket Mortgage, has launched a new loyalty program called “Rocket Rewards.” Similar to other loyalty programs, consumers - Published: 2022-11-01 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/rocket-rewards-loyalty-program/ - Categories: Mortgage News The nation’s number one lender, Rocket Mortgage, has launched a new loyalty program called “Rocket Rewards. ” Similar to other loyalty programs, consumers can earn rewards for completing certain activities. And those points can be redeemed for closing cost credits if and when they become Rocket Mortgage clients. To get started, those who create a free Rocket account and visit the rewards page will receive a 7,500-point welcome bonus. Existing Rocket account holders can also snag the 7,500 points when they complete their first rewards activity. How Rocket Rewards Works The Rocket Rewards program is a new initiative by Rocket Mortgage to engage potential customers who might apply for a home loan in the future. Members of the Rocket Rewards program can earn points by reading educational articles or watching videos in the Rocket Mortgage learning center. Points can also be banked simply by using a mortgage calculator on their website, and you can apparently earn points up to 10 times for each calculator. The Your Activities page will show you what’s available, whether it’s an article or a calculator, working on a loan application, or something else. As noted, new members can earn 7,500 just for signing up and visiting the rewards page. Those points are good for $75 in closing cost credit, which can offset closing costs on your loan. Over time, you can accrue more and more points to potentially save hundreds off your closing costs. There is no cost to join, and once you create a... --- > Now we’ll rank the top mortgage lenders in Wisconsin, based on the most recent year’s completed loan volume. These are the largest lenders in The Badger - Published: 2022-11-01 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-wisconsin/ - Categories: Mortgage Tips Now we’ll rank the top mortgage lenders in Wisconsin, based on the most recent year’s completed loan volume. These are the largest lenders in The Badger State based on available HMDA data for 2021. Collectively, more than 800 lenders funded $70 billion there during the year. Interestingly, it appears that Wisconsinites are big on using their own local companies instead of larger, national brands. At least when it comes to home loans, as the top three mortgage companies are all headquartered in the state. Read on to see which company led the way in mortgage origination last year in Wisconsin. Top Mortgage Lenders in Wisconsin (Overall) Ranking Company Name 2021 Loan Volume 1. Summit CU $2. 7 billion 2. Associated Bank $2. 4 billion 3. UW Credit Union $2. 4 billion 4. Rocket Mortgage $2. 3 billion 5. Wells Fargo $2. 0 billion 6. Chase $1. 9 billion 7. U. S. Bank $1. 8 billion 8. Landmark CU $1. 8 billion 9. Fairway Independent $1. 7 billion 10. Johnson Bank $1. 6 billion As noted, a Wisconsin-based lender topped the charts in 2021, per HMDA data from Richey May. It was none other than Madison-based Summit Credit Union, which funded $2. 7 billion in the state of Wisconsin last year. In second was Green Bay-based Associated Bank with a close $2. 4 billion, followed by Madison-based University of Wisconsin Credit Union (UW Credit Union) with $2. 4 billion. This is interesting for a few reasons – one being that the... --- > A friend of mine asked me over the weekend how mortgage interest works? His coworker had posed a similar question to him, and he was passing it on to me. - Published: 2022-10-31 - Modified: 2024-01-31 - URL: https://www.thetruthaboutmortgage.com/how-mortgage-interest-works/ - Categories: Mortgage Rates, Mortgage Tips A friend of mine asked me over the weekend how mortgage interest works? His coworker had posed a similar question to him, and he was passing it on to me. At first, I didn’t know how to answer the question as it was fairly broad. I said what do you mean by that? He said, if you have a rate of 3% and a loan amount of $1 million, does that equate to $30,000 in interest? Wishful thinking, right? I explained that mortgage rates should be viewed as annual interest rates. Long story short, you pay a lot more than the interest rate on the loan because that rate of interest is paid annually for 30 years in most cases. Look at Mortgage Rates as Annual Interest Charges A better way to understand how mortgage interest works is to consider the mortgage rate on an annual basis. So if your 30-year fixed mortgage rate is 5% and your loan amount is $500,000, you’d pay roughly $25,000 in interest the first year. Note that I said the first year and roughly. The reason it’s a rough estimate is because the loan amount isn’t fixed. Each month, you pay a portion of interest and a portion of principal. As such, your outstanding loan balance falls with each payment. This means less interest is due on subsequent monthly payments, and because mortgages are amortized (same payment amount each month), the composition of the payment changes. As each payment is made, less interest is... --- > Month after month, and week after week, articles continue to focus on mortgage rates in the 1980s, to seemingly paint a picture that rates are still - Published: 2022-10-26 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-in-the-1980s/ - Categories: Mortgage Rates, Mortgage Tips Month after month, and week after week, articles continue to focus on mortgage rates in the 1980s, to seemingly paint a picture that rates are still historically low. And it’s pretty much always the same narrative – be happy with your 6%, 7%, and maybe 8% mortgage rate today because there was a time when it was a lot worse. It runs parallel to the stories of having to walk to school uphill both ways, in the snow, without shoes or a jacket. Suck it up, stop complaining. Today’s mortgage rates aren’t that high! That’s the message. It also doubles as a sales pitch to remind you that a 7% mortgage rate isn’t bad, and could be much higher, so don’t look a gift horse in the mouth. Why Do 1980s Mortgage Rates Matter Today? There’s an article from CNN that talks about mortgage rates in the 1980s, complete with the “Think mortgage rates are high now? ” headline. It goes on to talk about how baby boomers dealt with interest rates as high as 19% in late 1981 when they peaked. The 30-year fixed averaged around 9% in early 1978, before climbing to 10% later that year, 13% in 1979, and near 15% in 1980. Mortgage rates then hit an all-time high in October 1981, averaging a staggering 18. 45%, per Freddie Mac data. The chart above from FRED illustrates this movement. But guess what? Earlier generations not only dealt with them, but were delighted to close with a... --- > Two new credit scores will be used if and when you apply for a mortgage backed by Fannie Mae or Freddie Mac in the near future. On October 24th, 2022, the - Published: 2022-10-25 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/fico-10-t-and-vantagescore-4-0-approved-for-fannie-mae-and-freddie-mac-mortgages/ - Categories: Credit Scores, Mortgage News Two new credit scores will be used if and when you apply for a mortgage backed by Fannie Mae or Freddie Mac in the near future. On October 24th, 2022, the Federal Housing Finance Agency (FHFA) announced the validation and approval of both "FICO 10 T" and "VantageScore 4. 0. " These new credit scoring models will replace legacy credit scores that the Enterprises have relied upon for almost 20 years. The FHFA notes that they “improve accuracy” through the capture of new payment histories including rent, utility, and telecom payments. They also ignore paid off collections, and reduce the impact of unpaid medical debt, meaning credit scores of prospective home buyers might rise. What Are FICO 10 T and VantageScore 4. 0? In short, FICO 10 T and VantageScore 4. 0 are the latest credit score models available. FICO 10 T is issued by FICO (formerly Fair Isaac), while VantageScore 4. 0 is the latest iteration of the credit score model developed jointly by the three main credit bureaus, Equifax, Experian, and TransUnion. These newer scoring models include payment history for things like rent, utilities, and cell phone payments. Often, consumers with “thin credit files” don’t have enough history to generate a traditional credit score. Generally, this is referred to as having fewer than five accounts, typically because the individual doesn’t have credit cards, auto loans, or mortgages on their credit report. This creates a catch-22 situation where the applicant is unable to get approved for a new loan... --- > A new report from Zillow revealed that home prices need to come down by about 25% to become affordable again. But chances are they won’t, despite a lot of - Published: 2022-10-24 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/home-prices-need-to-fall-25-but-they-probably-wont/ - Categories: Housing Market, Mortgage News A new report from Zillow revealed that home prices need to come down by about 25% to become affordable again. But chances are they won’t, despite a lot of sensationalist media calling for a housing crash. At the end of the day, home prices have gotten inflated, but limited supply and homeowner lock-in effect, combined with mostly healthy mortgages should limit downside movement. Additionally, if and when mortgage rates do come back down to more reasonable levels, affordability can also improve. So a combination of factors could rebalance the housing market without an outright crash. Typical Home Purchase Now Requires 30% of Household Income Per Zillow, it now requires 30. 2% of income to afford a mortgage on a typical U. S. home, which they say is “well above the norm. ” That’s also beyond the 30% threshold for a household to be considered “cost burdened,” and significantly higher than the 22. 8% average seen from 2005–2021. While high home prices are partially to blame, the real tipping point of late has been mortgage rates, which have increased about 400 basis points since the start of 2022. Yes, a 30-year fixed mortgage is pricing around 7. 25% today versus 3. 25% back in January, as crazy as that appears. Zillow adds that the typical monthly mortgage payment is now about $1,850, up 75. 5% (or $800) from a year ago. On more expensive properties throughout the nation, we’re talking thousands more per month to pay the mortgage. This has shocked... --- > Today we’ll take a look at the top mortgage lenders in Missouri, based on loan volume. This means the biggest mortgage companies that operate in the The - Published: 2022-10-20 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-missouri/ - Categories: Mortgage Tips Today we’ll take a look at the top mortgage lenders in Missouri, based on loan volume. This means the biggest mortgage companies that operate in the The Show-Me State, but aren’t necessarily headquartered there. Nearly 900 different companies originated home loans there in 2021, funding more than $72 billion in the process. But there can only be one #1 lender, and surprisingly it wasn’t the nation’s largest. Instead, it was U. S. Bank, which calls Minneapolis, Minnesota home. Read on to see the rest. Top Mortgage Lenders in Missouri (Overall) Ranking Company Name 2021 Loan Volume 1. U. S. Bank $3. 6 billion 2. Rocket Mortgage $2. 9 billion 3. Wells Fargo $2. 8 billion 4. Flat Branch Home Loans $2. 3 billion 5. USA Mortgage $2. 3 billion 6. Pennymac $2. 0 billion 7. Guild Mortgage $1. 9 billion 8. Freedom Mortgage $1. 7 billion 9. AmeriHome Mortgage $1. 7 billion 10. Central Bank $1. 6 billion U. S. Bank funded $3. 6 billion in home loans in the state of Missouri last year, per Richey May’s HMDA data. That was more than enough to beat out the top lender in the United States, Rocket Mortgage. Detroit-based Rocket only managed $2. 9 billion in loan volume, which illustrates the strength of U. S. Bank in the state. In third was another depository, San Francisco-based Wells Fargo, which funded $2. 8 billion despite their mortgage controversies. Fourth place went to homegrown lender Flat Branch Home Loans (Columbia, MO) with $2.... --- > While mortgage rates have a good chance of getting worse before they get better, hope might be on the horizon. The long and the short of it is that - Published: 2022-10-19 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/the-case-for-sub-5-mortgage-rates-by-2023/ - Categories: Housing Market, Mortgage Rates, Mortgage Tips While mortgage rates have a good chance of getting worse before they get better, hope might be on the horizon. The long and the short of it is that mortgage rates go up as inflation goes up, which explains some of the recent increase. The other driver was the end of the Fed’s mortgage-backed securities (MBS) purchase program, known as Quantitative Easing (QE). As inflation began to surge, and the Fed dropped out as a buyer of MBS, mortgage rates skyrocketed from below 3% to around 7% today. However, if and when inflation falls back to more typical levels, mortgage rates could quickly follow suit. A Sub-5% 30-Year Fixed in the Next Six Months? While it appears to be a very bold prediction, Barry Habib recently said “we think there’s a high probability that mortgage rates come back below five percent within the next six months. ” His interview on Mauldin Economics was posted on October 14th, meaning mortgage rates could be back in the high 4% range by mid-April. It sounds crazy, given the current trajectory. After all, NAR chief economist Lawrence Yun just said mortgage rates could test 8. 5% next. And they’re currently over 7% for a standard, vanilla loan scenario, so to think they could drop back to below 5% in short order sounds like a long shot. But Habib eats, breathes, and sleeps mortgage rates and is the brains behind MBS Highway, which provides in-depth market insights on a daily basis. So if one person... --- > There is a plausible scenario where mortgage rates continue higher for a short period and then eventually correct. Possibly as soon as next year. At the - Published: 2022-10-18 - Modified: 2023-10-18 - URL: https://www.thetruthaboutmortgage.com/buy-a-house-before-mortgage-rates-come-back-down/ - Categories: Home Buying, Housing Market, Mortgage Rates There is a plausible scenario where mortgage rates continue higher for a short period and then eventually correct. Possibly as soon as next year. At the moment, 30-year fixed mortgage rates stand at about 7%, thanks to ongoing inflation concerns and action by the Federal Reserve to cool the housing market. But this battle might be relatively short-lived, with rates returning to more reasonable levels by early or mid-2023. If and when that happens, the housing market could wake up from its newfound slumber and return to frenzied buying again. While that’s just a thought, it makes the argument to buy a home before that happens somewhat appealing. High Mortgage Rates Have Frozen Demand Now that mortgage rates are well above levels seen earlier this year, demand for residential real estate has cooled significantly. We’ve already seen appreciation slow, that is, lower year-over-year gains in home prices. And we’re also seeing outright monthly declines now in some markets. The Fed is taking credit for this housing slowdown, which they believe had grown too hot in recent months/years. It’s hard to disagree. By raising the fed funds rate from near zero to about 3%, they’ve effectively pumped the brakes on low interest rates for consumers. That, they argue, should dampen demand, which had been fueling the housing frenzy, not so much a lack of housing supply. With demand now in check, there is more of an equilibrium in the housing market. The seller’s market has finally come to an end. And... --- > The year 2022 has been absolutely dreadful with respect to mortgage rates. We’ve seen the popular 30-year fixed rise from sub-3% levels to around 7% in - Published: 2022-10-17 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/are-mortgage-rates-going-to-8-5-next/ - Categories: Mortgage News, Mortgage Rates The year 2022 has been absolutely dreadful with respect to mortgage rates. We’ve seen the popular 30-year fixed rise from sub-3% levels to around 7% in the matter of about 10 months. And despite that unprecedented increase, the worse may be yet to come. That’s if you buy into the latest remarks from National Association of Realtors (NAR) chief economist Lawrence Yun. His belief isn’t based on a gut feeling, but rather a technical analysis. Next Stop 8. 5% for the 30-Year Fixed? If you thought a 7% mortgage rate was bad, how about an 8% mortgage rate? Or worse, an 8. 5% mortgage rate. While the thought of fixed mortgage rates that high sounded impossible a few months ago, now it’s not so far out there. During a presentation last week at the National Association of Real Estate Investors in Atlanta, Yun spoke of rates breaking through the 7% threshold. At last glance, they are still technically below 7%, assuming we use the highly-cited Freddie Mac mortgage rate survey as our gauge. That pinned the 30-year fixed at 6. 92% during the latest week ending October 13th, though data often lags reality. Because the survey collects mortgage rate data from loan originators between Monday and Wednesday, any rate increases midweek or beyond aren’t factored in until the following week, assuming they hold. Anyway, that means the additional bad news of the hot CPI report wasn’t included, which pushed mortgage rates above 7% later in the week. That, according to... --- > Now let’s talk about the top mortgage lenders in Indiana, based on their most recent year’s loan volume. In 2021, nearly 900 mortgage companies funded - Published: 2022-10-17 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-indiana/ - Categories: Mortgage Tips Now let’s talk about the top mortgage lenders in Indiana, based on their most recent year’s loan volume. In 2021, nearly 900 mortgage companies funded about $73 billion in home loans there, with the average loan amount about $199,000. But two lenders stood above the rest, and made the race for first place a very close one. However, the nation’s top lender, Rocket Mortgage, managed to hold off a much smaller competitor, just barely. Read on to see which other mortgage companies were some of the largest in Indiana. Top Mortgage Lenders in Indiana (Overall) Ranking Company Name 2021 Loan Volume 1. Rocket Mortgage $3. 5 billion 2. Ruoff Mortgage $3. 4 billion 3. Caliber Home Loans $2. 4 billion 4. Chase $2. 1 billion 5. Freedom Mortgage $1. 9 billion 6. 3Rivers FCU $1. 9 billion 7. Huntington Bank $1. 5 billion 8. Wells Fargo $1. 3 billion 9. Fifth Third Bank $1. 3 billion 10. Newrez $1. 3 billion Last year, Rocket Mortgage funded $3. 5 billion in home loans in the state of Indiana, per HMDA data from Richey May. That was just enough to hold off second place Ruoff Mortgage, which put up a very good fight with $3. 4 billion funded. The company is based in Fort Wayne, IN, and did their best to take the top spot in their home state. In third was Coppell, TX-based Caliber Home Loans with an admirable $2. 4 billion, followed by Chase with $2. 1 billion and Freedom... --- > It’s official, you can get a mortgage at Walmart now. So next time you’re grocery shopping, or picking up other essentials, you can apply for a home loan - Published: 2022-10-12 - Modified: 2022-11-01 - URL: https://www.thetruthaboutmortgage.com/walmart-mortgage/ - Categories: Mortgage News It’s official, you can get a mortgage at Walmart now. So next time you’re grocery shopping, or picking up other essentials, you can apply for a home loan as well. There was talk of a “Walmart Mortgage” years ago, as there was an Amazon Mortgage. Back then, it seemed every major company, whether in the financial space or not, was pondering the idea of offering home loans. But it seems only Walmart has made good on it, at a most unusual time. The First Walmart Mortgage Location Has Launched On Friday, the very first Walmart-based in-store branch Lenders One location opened in Newton, New Jersey. To unpack that real quick, Lenders One is a national cooperative of mortgage and real estate companies owned by publicly-traded Altisource. Lenders One consists of more than 250 mortgage companies, including banks, credit unions, independent mortgage bankers, and real estate/home builder-affiliated firms. The companies apparently originate anywhere between $50 million to $25 billion per year. So a third-party company (that consists of many smaller companies) has opened up shop inside a Walmart location. This particular Lenders One company is Family First Funding, LLC, which was founded in 2011. They are based in Toms River, NJ, which is about 100 miles away from the Walmart. In that sense, a locally operated mortgage company has opened a branch within Walmart. This is somewhat similar to the arrangement independent mortgage companies had via the Costco Mortgage program. However, the Costco program merely provided a list of preferred lenders... --- > It’s time to check out the top mortgage lenders in South Carolina, based on who did the most business. Last year, more than 1,000 mortgage companies - Published: 2022-10-12 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-south-carolina/ - Categories: Mortgage Tips It’s time to check out the top mortgage lenders in South Carolina, based on who did the most business. Last year, more than 1,000 mortgage companies collectively funded more than $80 billion in home loans in the state. But one particular company did a lot more business than the rest, and also happens to be the top mortgage lender in the U. S. Yes, I’m referring to Rocket Mortgage (formerly Quicken Loans), nearly doubling the volume of their nearest competitor. Read on to see which other companies dominated the mortgage biz in The Palmetto State. Top Mortgage Lenders in South Carolina (Overall) Ranking Company Name 2021 Loan Volume 1. Rocket Mortgage $5. 0 billion 2. Wells Fargo $2. 8 billion 3. Pennymac $2. 5 billion 4. Freedom Mortgage $2. 2 billion 5. Truist $2. 1 billion 6. SouthState Bank $1. 9 billion 7. Movement Mortgage $1. 9 billion 8. Guild Mortgage $1. 6 billion 9. UWM $1. 5 billion 10. Newrez $1. 5 billion Coming in first both in South Carolina (and nationally) was none other than Rocket Mortgage with $5. 0 billion funded in 2021, per HMDA data from Richey May. As noted, that was nearly double second placed-Wells Fargo, which managed just $2. 8 billion during the year. In a somewhat close third was Pennymac, a mostly correspondent lender that originated $2. 5 billion. Fourth went to Boca Raton-based Freedom Mortgage with $2. 2 billion, while Charlotte-based Truist took fifth with $2. 1 billion. Another Florida-based bank, SouthState... --- > I was watching some football this weekend and happened upon an ad for “Inflation Buster” from Rocket Mortgage. I’m always intrigued when I see a mortgage - Published: 2022-10-10 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-is-inflation-buster-from-rocket-mortgage/ - Categories: Mortgage News I was watching some football this weekend and happened upon an ad for “Inflation Buster” from Rocket Mortgage. I’m always intrigued when I see a mortgage advertisement because it gives me an opportunity to analyze the thing and share it with readers. Knowing the mortgage industry is so inventive, it’s fun to see what they cook up to combat today’s higher mortgage rates. The current climate has been very difficult for both prospective home buyers and mortgage lenders, but this is when creativity tends to flourish. Let’s see what this new program is all about to determine if it’s a good option for you. What Is Inflation Buster? How Does It Work? The nation’s top mortgage lender, Rocket Mortgage, launched “Inflation Buster” in mid-September to combat high mortgage rates. In case you haven’t heard, the 30-year fixed is averaging close to 7% these days, up from around 3% to start the year. This has clearly wreaked havoc on both home buyers and mortgage lenders. It has made affordability a problem for many and pushed home prices lower. To offset some of that pain, Rocket Mortgage is providing customers with a little relief during year one of their new mortgage. In short, the company is offering a buydown mortgage that lowers the interest rate for the first 12 months by 1%. Each month during the first year of the loan term, the borrower makes a reduced mortgage payment based on that lower interest rate. Similar to other mortgage buydowns, a special... --- > Let’s check out the top mortgage lenders in Minnesota based on the most recent year’s loan volume. Around 750 mortgage companies originated roughly $91 - Published: 2022-10-10 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-minnesota/ - Categories: Mortgage Tips Let’s check out the top mortgage lenders in Minnesota based on the most recent year’s loan volume. Around 750 mortgage companies originated roughly $91 billion in home loans in The North Star State last year. But only one company bested the rest – and they’re actually headquartered in Minnesota! Yes, I’m referring to U. S. Bank, which is located in Minneapolis, MN. Read on to see which other mortgage lenders were active in the Land of 10,000 Lakes. Top Mortgage Lenders in Minnesota (Overall) Ranking Company Name 2021 Loan Volume 1. U. S. Bank $6. 4 billion 2. Wells Fargo $4. 8 billion 3. Bell Bank $4. 4 billion 4. Rocket Mortgage $3. 9 billion 5. UWM $2. 7 billion 6. Summit Mortgage $2. 6 billion 7. Pennymac $2. 2 billion 8. CrossCountry Mortgage $2. 1 billion 9. Chase $1. 7 billion 10. loanDepot $1. 6 billion As mentioned, U. S. Bank took the top spot in its home state with $6. 4 billion in home loans funded during 2021, per HMDA data from Richey May. That was more than enough to beat out its closest rival, Wells Fargo, which originated $4. 8 billion in the state. A third bank, Bell Bank, out of nearby Fargo, North Dakota, took third place with $4. 4 billion in home loan volume. It’s rare these days to see a depository bank lead in the mortgage world, and even more uncommon to see the top three all big banks. Nowadays, it is nonbanks like... --- > Real estate doom and gloom articles are going to ramp up big time in coming months, if they haven’t already. You’re going to hear that the second biggest - Published: 2022-10-07 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/the-truth-about-falling-home-prices/ - Categories: Foreclosure, Housing Market, Mortgage News Real estate doom and gloom articles are going to ramp up big time in coming months, if they haven’t already. You’re going to hear that the second biggest housing crash since the Great Depression is upon us. It’ll all be super scary and negative and panic-inducing. You’ll be led to believe that it’s 2008 all over again. Except, it’s not. Nor will it be. Interestingly, this latest housing downturn, or "correction," was manufactured by the Fed. The same Fed that basically orchestrated the housing frenzy that preceded it. The good news is it’ll likely be short-lived and really nothing like the Great Recession. Why Are Home Prices Falling? First, let’s talk about why home prices are beginning to stall, and gasp, even go down. Long story short, home price appreciation was absolutely out of control over the past couple years since the pandemic got underway. We’re talking a 50% increase in prices. A combination of limited supply, cheap money (i. e. record low mortgage rates), and the sheer desire to own property propelled home prices to new heights. Not only did home prices hit all-time highs, but monthly and annual gains hit records as well. We were seeing consistent double-digit gains in property values, which we all know simply can’t be sustainable over time. The Fed saw this happening and basically decided to pump the brakes. They discovered that recent home price gains were driven by excess demand, not just short supply. As such, they knew that raising their own... --- > If you’re a senior, you might be wondering who the top reverse mortgage lenders in the nation are. Unlike the traditional home loan market, the reverse - Published: 2022-10-06 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-reverse-mortgage-lenders/ - Categories: Mortgage Tips If you’re a senior, you might be wondering who the top reverse mortgage lenders in the nation are. Unlike the traditional home loan market, the reverse mortgage industry is dominated by a small handful of companies. Typically, these lenders specialize in reverse mortgage lending, as opposed to simply offering the loans alongside other options. As a quick refresher, a reverse mortgage loan allows homeowners 62 and older (55 in some cases) to access cash in their property without monthly payments. In 2021, reverse lenders originated 59,000 loans, a 36% increase from the 43,000 the year prior. Read on to see who made the top-10 list last year. Top Reverse Mortgage Lenders Ranking Company Name 2021 Loan Count 1. AAG 18,407 (31. 3% share) 2. FOA Reverse 10,575 (18% share) 3. Reverse Mortgage Funding 6,177 (10. 5% share) 4. PHH Mortgage 4,319 (7. 3% share) 5. Mutual of Omaha 4,101 (7% share) 6. Longbridge Financial 3,636 (6. 2% share) 7. Cornerstone First 3,296 (5. 6% share) 8. Open Mortgage 2,444 (4. 2% share) 9. HighTechLending 1,144 (1. 9% share) 10. Nationwide Equities 705 (1. 2% share) Last year, the top reverse mortgage lender in the country was American Advisors Group, or AAG for short. The company originated more than 18,000 reverse mortgages in 2021, per HMDA data from the Consumer Financial Protection Bureau (CFPB). While that might not sound like a lot of loans, it represented a staggering 31. 3% market share. So one company grabbed nearly a third of the... --- > A credit union out of Cheyenne, Wyoming has launched a crowdfunded, zero down mortgage loan for its customers. It comes at a time when still sky-high home - Published: 2022-10-05 - Modified: 2022-10-05 - URL: https://www.thetruthaboutmortgage.com/crowdfunded-zero-down-mortgage-launched/ - Categories: Housing Market, Mortgage News A credit union out of Cheyenne, Wyoming has launched a crowdfunded, zero down mortgage loan for its customers. It comes at a time when still sky-high home prices and extremely elevated mortgage rates are severely eroding affordability. During challenging times like these, it’s not uncommon for unique programs like this to surface. We’ve also seen the return of buydown loans that reduce interest rates for the first year or two of the loan term. What makes this new offering more interesting is that other customers can get in on the action and earn higher yields on their deposits. The No Money Down Mortgage at Blue First it was Bank of America’s zero down mortgage, and now it’s “The No Money Down Mortgage at Blue. ” Yes, I’m referring to a new pilot program that offers zero down mortgages from Cheyenne, WY-based Blue Federal Credit Union. While not quite as large as BofA, they still describe their new zero-down product as a “game-changing” mortgage. Blue says it has a “twofold plan” to deal with rising home prices and the inability to save for a 20% down payment. They say first-time home buyers can obtain 100% financing on a purchase (no down payment) without being subject to the pesky private mortgage insurance (PMI). PMI is typically required for loans above 80% loan-to-value (LTV). Of course, as I always say, if it’s not being charged, it’s likely just baked into the interest rate in a different way. Anyway, that could theoretically keep monthly... --- > Lately, I’ve been seeing the old “marry the house, date the rate” adage thrown around a lot. The idea is relatively straightforward. You buy a home you - Published: 2022-10-05 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/marry-the-house-date-the-rate/ - Categories: Home Buying, Mortgage Rates, Mortgage Tips Lately, I’ve been seeing the old “marry the house, date the rate” adage thrown around a lot. The idea is relatively straightforward. You buy a home you really want, regardless of available financing terms. And the mortgage rate you receive, even if high today, isn’t your forever rate because you can always refinance down the road. But is it truly that simple? And does the whole thing hinge on interest rates being more favorable in the future? What if you want to divorce the house? But you’re too afraid to leave that low rate behind? Marry the House. Like for Forever? Let’s dissect the term by breaking it down into its two sections. First, we’ll discuss the “marry the house” piece. A lot of folks buy a particular piece of property because they fall in love with it. It's typically emotional. There’s also a presumption that many people buy a forever home that they plan to keep, well, forever. Simply put, they plan to stay in the property for the long haul, and as such are essentially marrying the thing. After all, a marriage is expected to persist, not just last a year or two. In reality, we know this isn’t the case, but the intention is there, despite what may transpire after the wedding day. At last glance, the average tenure for an American homeowner was 13. 2 years, per the National Association of Realtors (NAR). This was for the year 2021, a slight dip from 13. 5 in... --- > Today we’ll take a hard look at the top mortgage lenders in Tennessee by loan volume. Last year, nearly 1,200 mortgage companies battled it out for first - Published: 2022-10-03 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-tennessee/ - Categories: Mortgage Tips Today we’ll take a hard look at the top mortgage lenders in Tennessee by loan volume. Last year, nearly 1,200 mortgage companies battled it out for first place, but only one could claim the top spot. Collectively, these lenders funded about $102 billion in mortgages in The Volunteer State, which was likely an annual record. Despite being located a couple states due north of Tennessee, Rocket Mortgage was the top lender in the state. Read on to see who else made the top 10 list. Top Mortgage Lenders in Tennessee (Overall) Ranking Company Name 2021 Loan Volume 1. Rocket Mortgage $5. 6 billion 2. Pennymac $3. 6 billion 3. U. S. Bank $2. 7 billion 4. Wells Fargo $2. 6 billion 5. Mortgage Investors Group $2. 6 billion 6. Pinnacle Bank $2. 3 billion 7. FirstBank $2. 2 billion 8. AmeriHome Mortgage $2. 2 billion 9. Freedom Mortgage $2. 2 billion 10. loanDepot $2. 1 billion Rocket Mortgage came in first with $5. 6 billion in home loan volume in the state of Tennessee during 2021, per HMDA data from Richey May. The Detroit-based company had no problem beating out the competition, with second place Pennymac only able to muster $3. 6 billion in annual loan volume. They were trailed by U. S. Bank with $2. 7 billion and Wells Fargo with $2. 6 billion funded. In fifth was Knoxville, Tennessee’s own Mortgage Investors Group (MIG) with $2. 6 billion. The rest of the top 10 included Nashville-based Pinnacle Bank... --- > You’ve probably heard that maintaining an excellent credit score is very important when it comes to getting a mortgage. Not only will it help ensure you - Published: 2022-09-29 - Modified: 2023-10-13 - URL: https://www.thetruthaboutmortgage.com/heloc-credit-score/ - Categories: Mortgage Rates, Mortgage Tips You’ve probably heard that maintaining an excellent credit score is very important when it comes to getting a mortgage. Not only will it help ensure you qualify for a mortgage, a tip-top score will also make you eligible for the lowest mortgage rates available. Yes, you’ll need to document income, assets, and employment as well, but your credit score can have the biggest impact on pricing. The same is true for HELOC rates, which are tied to the prime rate (currently 6. 25%) and a credit risk-based margin. The margin you receive is heavily impacted by credit score. So if you plan to apply for a HELOC, better make sure your FICO scores are as high as can be. How the Lender Determines Your HELOC Rate I was looking at a rate sheet the other day for home equity lines of credit. Similar to rate sheets for closed-end first mortgages, there are pricing adjustments. But because HELOCs are tied to the prime rate, which is essentially controlled by the Fed, individual banks provide varying margins to come up with your fully-indexed rate. The margin is the risk-based piece of the equation that relates to your default risk. In short, the prime rate plus your margin equals your HELOC rate. For example, if your margin were 1% and prime were 6. 25%, your rate would be 7. 25%. If and when the Fed lowers or raises the fed funds rate, the prime rate will follow suit by the same amount. Since... --- > With all the talk of a housing market crash, there’s not a lot of data to support it. Sure, home price gains have moderated significantly after recording - Published: 2022-09-22 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-homeowners-arent-selling/ - Categories: Home Buying, Housing Market, Mortgage News With all the talk of a housing market crash, there’s not a lot of data to support it. Sure, home price gains have moderated significantly after recording massive gains, but they’re still up year-over-year. In fact, the median existing-home price was $389,500 in August, a 7. 7% increase from a year earlier, per the National Association of Realtors. That marked 126 consecutive months of year-over-year increases, the longest streak on record. At the same time, the median sales price has fallen for two months in a row, signaling a potential top of the market. Still, most homeowners are staying put. Most Homeowners Aren’t Going Anywhere While it’s starting to feel more like a buyer’s market, given the more-than-doubling in mortgage rates since the start of the year, it’s certainly not a full-blown one. While the higher mortgage rates may have seriously dented demand, there's still the issue of short supply. Per the same existing-homes report from NAR from August, unsold inventory fell to 1. 28 million units as of the end of August. That represented just a 3. 2-month supply at the current monthly sales pace, and bucked the trend of five successive monthly increases in supply. Additionally, existing home sales fell 0. 4% from July to a seasonally adjusted annual rate of 4. 80 million in August. On a year-over-year basis, sales plummeted 19. 9% from their 5. 99 million pace during the same period in 2021. In other words, homeowners aren’t selling. But why? With home prices still... --- > Now that interest rates have resumed their upward climb, do we have to worry about 8% mortgage rates next? Back in July, I questioned if 7% mortgage rates - Published: 2022-09-21 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/8-percent-mortgage-rates/ - Categories: Mortgage News, Mortgage Rates Now that interest rates have resumed their upward climb, do we have to worry about 8% mortgage rates next? Back in July, I questioned if 7% mortgage rates were on the horizon, given the steady rise seen at that time. While rates hadn’t officially hit 6% then, by Freddie Mac’s measure at least, they were in that range and seemingly heading higher. But shortly after they got a much-needed reprieve and began drifting back to the lower 5s and even the high 4% range. That was then and this is now – today, a 30-year fixed might be priced at 6. 5% or worse. And 7% might not be unheard of either. Could 8% be in play next? What Are Mortgage Rates Currently? It Depends Who You Ask As noted, mortgage rates officially surpassed 6% during the week ending September 15th, per Freddie Mac. They run the most highly cited mortgage rate survey in the nation, and thus are seen as the official scorekeeper. According to Freddie, the 30-year fixed averaged 6. 02% last week, the first time it crossed the 6% threshold since late 2008. Of course, we know the 30-year fixed was in the 6% range at times during early summer, even if it wasn’t reflected in the survey. Regardless, mortgage rates have surged even higher since last week, and the Freddie survey will likely show a big jump, potentially something close to 6. 25% or higher. Here’s the thing though. These average rates are for prime borrowers... --- > Today we’ll take a look at the top mortgage lenders in Oregon, based on total loan volume. Nearly 700 different mortgage companies duked it out last year - Published: 2022-09-15 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-oregon/ - Categories: Mortgage Tips Today we’ll take a look at the top mortgage lenders in Oregon, based on total loan volume. Nearly 700 different mortgage companies duked it out last year in a bid to take first place in Oregon, originating about $91 billion in home loans in the process. And like many other states in the nation, a certain Rocket Mortgage topped the rankings in The Beaver State. That doesn’t come as much of a surprise given their dominance throughout the country, and their national #1 ranking. Read on to see who else made the top 10 lists for home purchase lending and mortgage refinancing. Top Mortgage Lenders in Oregon (Overall) Ranking Company Name 2021 Loan Volume 1. Rocket Mortgage $4. 6 billion 2. UWM $3. 5 billion 3. Guild Mortgage $3. 2 billion 4. Umpqua Bank $3. 2 billion 5. U. S. Bank $3. 1 billion 6. Caliber Home Loans $3. 0 billion 7. Chase $2. 8 billion 8. OnPoint Community CU $2. 7 billion 9. Wells Fargo $2. 5 billion 10. loanDepot $2. 1 billion As stated, Detroit-based Rocket Mortgage took the top spot in Oregon with $4. 6 funded in 2021, per HMDA stats from Richey May. Their crosstown rival United Wholesale Mortgage (UWM) was on their tail with $3. 5 billion in second place. Third went to San Diego, California-based Guild Mortgage with a close $3. 2 billion funded during the year. In fourth we finally see a hometown lender represented, Portland-based Umpqua Bank and their $3. 2 in... --- > The topic du jour lately has been a housing market on the edge of disaster. But no one can quite agree whether it’s an affordability crisis, home price - Published: 2022-09-13 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/housing-crash-imminent-the-national-ltv-is-below-30/ - Categories: Housing Market, Mortgage News The topic du jour lately has been a housing market on the edge of disaster. But no one can quite agree whether it’s an affordability crisis, home price normalization, a housing correction, or an even-worse impending housing crash. The takeaway is that home price gains are cooling, and could in fact begin falling as well, after some record years of appreciation. This isn’t a huge shock, given the fact that the 30-year fixed basically doubled since the start of the year. It doesn’t take a genius to figure out that the combination of sky-high home prices and much higher financing costs will dent demand. But is a housing crash really coming? The National Loan-to-Value Ratio (LTV) Is a Ridiculously Low 29. 5% As I’ve pointed out for a while, pundits and casual observers love to compare now to 2006-2008, when the housing market last crashed. After all, why not just say history is repeating itself, and look to the most recent example to make your argument. But there are stark differences between now and then, which I’ve shared on several occasions recently. For example, back then most home buyers (and existing homeowners) had a loan-to-value ratio (LTV) of 100% or more. Yes, or more. Because many homeowners also elected to take out pay option ARMs, which allowed negative amortization. That is, borrowing more than the home was worth. We all seem to remember what happened next, since a lot of folks are now calling for the same widespread destruction. But... --- > If you’re curious who the top mortgage lenders in Utah are, I’ve got some answers. Last year, more than 500 lenders in The Beehive State originated nearly - Published: 2022-09-13 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-utah/ - Categories: Mortgage Tips If you’re curious who the top mortgage lenders in Utah are, I’ve got some answers. Last year, more than 500 lenders in The Beehive State originated nearly $100 billion in home loans. But one mortgage company far exceeded the others, so much so that it wasn’t even close. Interestingly, this company isn’t headquartered in the state of Utah, nor does it operate retail locations. I’m talking about United Wholesale Mortgage, or UWM for short. Read on to see who else ranked in the top 10. Top Mortgage Lenders in Utah (Overall) Ranking Company Name 2021 Loan Volume 1. UWM $9. 3 billion 2. Rocket Mortgage $4. 5 billion 3. Intercap Lending $3. 6 billion 4. Mountain America CU $2. 9 billion 5. First Colony Mortgage $2. 9 billion 6. Homepoint $2. 7 billion 7. America First CU $2. 4 billion 8. Academy Mortgage $2. 2 billion 9. SecurityNational $2. 1 billion 10. Wells Fargo $2. 1 billion Yep, a wholesale mortgage lender topped the rankings in the state of Utah, originating about $9. 3 billion there in 2021, per HMDA data from Richey May. As such, we might say that a legion of mortgage brokers is #1, as wholesale lenders rely on these intermediaries to generate all their business. What’s surprising is the margin above second place Rocket Mortgage, which funded just $4. 5 billion there. This meant UWM doubled the volume of its nearest competitor, who also happens to be the top lender nationwide. In third was Draper, Utah-based... --- > Let’s check out the top mortgage lenders in Michigan based on the most recent year’s loan volume. The state of Michigan is an interesting one because it’s - Published: 2022-09-07 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-michigan/ - Categories: Mortgage Tips Let’s check out the top mortgage lenders in Michigan based on the most recent year’s loan volume. The state of Michigan is an interesting one because it’s home to two of the top three mortgage lenders in the country. The lenders in question are none other than Rocket Mortgage, and wholesaler United Wholesale Mortgage (UWM). Seeing that they dominate the entire nation, you’d expect them to rule their home state as well. Read on to see if that’s the case, or if some other hometown (or non-hometown) companies gave them a run for their money. Top Mortgage Lenders in Michigan (Overall) Ranking Company Name 2021 Loan Volume 1. Rocket Mortgage $12. 0 billion 2. UWM $7. 9 billion 3. Lake Michigan CU $4. 8 billion 4. Huntington Bank $3. 8 billion 5. Chase $3. 5 billion 6. Fifth Third Bank $2. 3 billion 7. Flagstar Bank $2. 1 billion 8. Wells Fargo $1. 8 billion 9. Mortgage 1 Inc. $1. 7 billion 10. Caliber Home Loans $1. 7 billion Suspense aside, Rocket Mortgage did indeed beat out the rest of the competition in their home state last year. It would have seemed unlikely not to given their #1 ranking nationwide. Still, you never know. The Detroit-based mortgage behemoth funded a whopping $12 billion in home loans in Michigan in 2021, per HMDA data from Richey May. That was more than enough to trounce their cross-town rival UWM, which happens to be located in Pontiac. UWM, which works solely with mortgage... --- > Today we’ll have a look at the top mortgage lenders in Maryland based on their annual loan volume. Like other states in the nation, it wasn’t a big shock - Published: 2022-09-06 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-maryland/ - Categories: Mortgage Tips Today we’ll have a look at the top mortgage lenders in Maryland based on their annual loan volume. Like other states in the nation, it wasn’t a big shock that America’s largest lender also topped the charts in Maryland. Yes, I’m referring to Rocket Mortgage, which had no problem beating out another 750 or so banks, mortgage lenders, and credit unions to take the #1 spot. Collectively, these mortgage companies originated about $140 billion in home loans in the Old Line State last year. Read on to see who else ranked in the top 10, including some local names. Top Mortgage Lenders in Maryland (Overall) Ranking Company Name 2021 Loan Volume 1. Rocket Mortgage $8. 7 billion 2. Pennymac $6. 0 billion 3. Truist Financial $5. 7 billion 4. Freedom Mortgage $5. 1 billion 5. Wells Fargo $4. 1 billion 6. First Home Mortgage $3. 9 billion 7. Mr. Cooper $3. 6 billion 8. U. S. Bank $3. 5 billion 9. UWM $3. 1 billion 10. Caliber Home Loans $2. 9 billion As stated, Rocket Mortgage led the way in Maryland with an admirable $8. 7 billion in home loan volume in 2021, per HMDA data courtesy of Richey May. That was more than enough to beat out second place Pennymac’s $6 billion. Many consumers may not even recognize Pennymac as they do a lot of business via the correspondent channel. This means their product is resold by smaller companies, whether it’s a local credit union or bank. In third... --- > This week, Bank of America unveiled a zero down mortgage option as part of their Community Homeownership Commitment. In short, they want to help more - Published: 2022-09-01 - Modified: 2023-07-25 - URL: https://www.thetruthaboutmortgage.com/bank-of-america-zero-down-mortgage/ - Categories: Mortgage News This week, Bank of America unveiled a zero down mortgage option as part of their Community Homeownership Commitment. In short, they want to help more “modest-income” and first-time home buyers achieve the American Dream of homeownership. Specifically, they said they’re targeting “certain Black/African American and/or Hispanic-Latino neighborhoods” throughout the country. To accomplish this goal, they’ve rolled out some enhancements to their existing Affordable Loan Solution. This includes both closing cost assistance and down payment help, along with more liberal underwriting guidelines, to tackle affordability constraints. BofA’s Community Affordable Loan Solution Combines a 3% down mortgage With an up to 3% down payment grant ($10,000 maximum) And up to $7,500 in closing cost assistance Borrowers can come to the closing table with basically no money No minimum credit score or mortgage insurance requried Applies to properties in select markets nationwide Borrowers must complete homebuyer education Property must be owner-occupied Must take out a fixed-rate mortgage Can be a conventional, FHA, or VA loan The new loan program is coined the “Community Affordable Loan Solution,” an enhanced version of their 3% down Affordable Loan Solution. It is in addition to the bank’s $15 billion Community Homeownership Commitment, which is a goal to help 60,000 individuals/families purchase affordable homes by the year 2025. Thus far, Bank of America has already helped 36,000+ become homeowners, with more than $9. 5 billion in low down payment loans and over $350 million in non-repayable down payment and/or closing cost grants. And two-thirds of these loans and... --- > Today we’re going to talk about the “home equity loan,” which is quickly becoming all the rage with mortgage rates so much higher. In short, many - Published: 2022-08-31 - Modified: 2025-01-14 - URL: https://www.thetruthaboutmortgage.com/home-equity-loan/ - Categories: Mortgage Tips Today we’re going to talk about the “home equity loan,” which is quickly becoming all the rage with mortgage rates so much higher. In short, many homeowners have first mortgages with fixed interest rates in the 2-3% range. Now that a typical 30-year fixed is closer to 6%, these homeowners don’t want to refinance and lose that rate in the process. But if they still want to access their valuable (and plentiful) home equity, they can do so via a second mortgage. Two popular options are the home equity line of credit (HELOC) and the home equity loan, the latter of which features a fixed interest rate and the ability to pull out a lump sum of cash from your home. What Is a Home Equity Loan? A home equity loan allows you to borrow against the value of your property to access needed cash. That cash can then be used to pay for things such as home improvements, to pay off other higher-interest loans, fund a down payment for another home purchase, pay for college tuition, and more. Ultimately, you can use the proceeds for anything you wish. The home equity loan simply allows you to tap into your accrued home equity without selling the underlying property. Of course, like a first mortgage, you must pay back the loan via monthly payments until it is paid in full, refinanced, or the property sold. Similarly, you can obtain a home equity loan from a bank, credit union, or direct mortgage... --- > Today we’ll take a look at the top mortgage lenders in Pennsylvania based on their annual loan volume. The state of Pennsylvania is unique in that it - Published: 2022-08-30 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-pennsylvania/ - Categories: Mortgage Tips Today we’ll take a look at the top mortgage lenders in Pennsylvania based on their annual loan volume. The state of Pennsylvania is unique in that it borders both the Midwest and the Northeast. This means consumers might gravitate toward a big NYC-based bank or a smaller, independent mortgage lender located closer to say Ohio. Despite these regional nuances, the nation’s top mortgage lender also grabbed the top spot in The Keystone State. Read on to see who the other big mortgage players are in Pennsylvania. Top Mortgage Lenders in Pennsylvania (Overall) Ranking Company Name 2021 Loan Volume 1. Rocket Mortgage $7. 9 billion 2. Wells Fargo $7. 3 billion 3. Citizens Bank $5. 0 billion 4. Allied Mortgage Group $4. 1 billion 5. Pennymac $3. 2 billion 6. CrossCountry Mortgage $3. 0 billion 7. AmeriHome Mortgage $3. 0 billion 8. PNC Bank $2. 9 billion 9. Newrez $2. 9 billion 10. Freedom Mortgage $2. 6 billion You guessed it. The top mortgage lender in Pennsylvania was none other than Rocket Mortgage, which incidentally is also the nation’s #1 lender. The Detroit-based company originated $7. 9 billion in home loans last year, per HMDA data from Richey May. That was enough to beat out second place Wells Fargo, which came close with $7. 3 billion funded during the year. In third place was Providence, Rhode Island-based Citizens Bank with $5 billion in home loan volume. Allied Mortgage Group grabbed fourth with $3. 2 billion, while big correspondent lender Pennymac took... --- > Today we’re going to talk about a “temporary buydown,” the latest effort by the mortgage industry to provide much-needed payment relief to borrowers. In - Published: 2022-08-25 - Modified: 2025-03-12 - URL: https://www.thetruthaboutmortgage.com/buydown-mortgage/ - Categories: Home Buying, Mortgage Rates, Mortgage Tips Today we’re going to talk about a “temporary buydown,” the latest effort by the mortgage industry to provide much-needed payment relief to borrowers. In recent months, mortgage rates effectively doubled, straining affordability and cooling the hot housing market. These higher rates have also had a big impact on the mortgage industry, which is typically reliant on low rates to fuel its important mortgage refinance business. Mortgage lenders understand the impact these higher rates have had on borrowers and prospective home buyers, so there’s a good chance you’ll see more of these offers pop up soon. Let’s discuss how these buydown mortgages work, if they can save you money, and the general pros and cons. What Is a Temporary Buydown Mortgage? In short, a temporary buydown is a home loan that features a reduced interest rate for a temporary period of time, whether it’s one, two, or three years. The interest rate may be 2% lower in year one, 1% lower in year two, and then the standard note rate thereafter. An upfront cost covers these lower monthly payments, with the required funds set aside in a buydown account. Each month during the temporary buydown period, the borrower makes a reduced monthly payment, with the additional amount released from the buydown account to cover the difference. This makes monthly payments more affordable during the beginning of the loan term. Typically, borrowers opt for these buydowns because they expect their income to increase in the near future. Or the buydown is offered... --- > Might 2023 be good to mortgage rates? If you believe the latest Housing Forecast from Fannie Mae, then yes. Most everyone knows 2022 has wreaked absolute - Published: 2022-08-24 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/4-5-mortgage-rates-in-2023/ - Categories: Housing Market, Mortgage Rates Might 2023 be good to mortgage rates? If you believe the latest Housing Forecast from Fannie Mae, then yes. Most everyone knows 2022 has wreaked absolute havoc on mortgage rates, with the 30-year fixed up more than 225 basis points from a year earlier. This, combined with rising home prices, has eroding affordability to the point of being at its worst since prior to the previous housing boom (and eventual bust). But lately mortgage rates have seen some relief after pushing 6%, and they could even fall back into the 4s next year. That would be huge for the flagging mortgage industry, and also a boon to home builders attempting to unload new inventory. Mortgage Rates Might See Some Relief in 2023 In Fannie Mae’s previous Housing Forecast (for July), they expected the 30-year fixed to average 5. 1% in 2023, which actually doesn’t sound too bad. But their latest release has rates down to 4. 5% for 2023, with rates drifting from 5. 1% in the third quarter of 2022 to 4. 4% in the second half of 2023. Assuming that comes to fruition, the mortgage industry, along with home buyers and the home builders, could see some serious relief. After all, many builders have had to cut prices or scale back on building altogether, while prospective buyers have pulled out of purchase contracts. If mortgage rates fall back to the mid-4% range, there’d likely be a surge of demand and an uptick in home sales once again. It... --- > Now let’s check out the top mortgage lenders in Massachusetts, based on loan volume. In 2021, roughly $164 billion in home loans were originated in The - Published: 2022-08-24 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-massachusetts/ - Categories: Mortgage Tips Now let’s check out the top mortgage lenders in Massachusetts, based on loan volume. In 2021, roughly $164 billion in home loans were originated in The Bay State, making it one of the more productive states in the nation. As to who led the way, it wasn’t the nation’s number one mortgage lender, Rocket Mortgage. It was Chicago-based Guaranteed Rate, which outmuscled the competition despite being only the 13th largest mortgage lender nationwide. Read on to see who else topped the mortgage lending charts in Massachusetts. Top Mortgage Lenders in Massachusetts (Overall) Ranking Company Name 2021 Loan Volume 1. Guaranteed Rate $7. 9 billion 2. Rocket Mortgage $7. 2 billion 3. Chase $6. 1 billion 4. Leader Bank $5. 9 billion 5. Citizens Bank $5. 2 billion 6. U. S. Bank $4. 7 billion 7. Fairway Independent $3. 7 billion 8. UWM $3. 6 billion 9. Bank of America $3. 5 billion 10. Newrez $3. 5 billion Taking the top spot overall was Chicago, Illinois-based direct lender Guaranteed Rate with $7. 9 billion funded, per HMDA data from Richey May. That was more than enough (although it was close) to beat out Rocket Mortgage, which came in second with $7. 2 billion. New York City-based JPMorgan Chase took third with $6. 1 billion funded, decent but perhaps it could have been better given their proximate location. A pair of banks, Leader Bank and Citizens Bank, took fourth and fifth with $5. 9 billion and $5. 2 billion, respectively. The rest... --- > Today we’ll check out “Orchard Mortgage,” formerly known as Orchard Home Loans. The direct lender is backed by its parent company Orchard (previously - Published: 2022-08-23 - Modified: 2024-08-09 - URL: https://www.thetruthaboutmortgage.com/orchard-mortgage-review/ - Categories: Mortgage Tips Today we’ll check out “Orchard Mortgage,” formerly known as Orchard Home Loans. The direct lender is backed by its parent company Orchard (previously Perch), a tech-enabled real estate brokerage that offers iBuying and cash-backed offers. One of their more popular services allows you to buy before you sell, similar to companies like HomeLight, Knock, and UpEquity. But they offer a complete end-to-end solution, including the mortgage, making them a potential one-stop shop. They also appear to offer low mortgage rates, which when combined with the latest tech, could make them worth considering. Orchard Mortgage Fast Facts Direct-to-consumer mortgage lender (online mortgage brokerage) Founded in 2020, headquartered in New York City Offers home purchase loans, refinances, and all-cash offers Its loan officers do not work for commissions Currently licensed do business in 24 states nationwide Acquired San Diego-based Loan Monkey in early 2022 Formerly known as Orchard Home Loans (rebranded in August 2022) Orchard Mortgage is a direct-to-consumer mortgage lender that got started in 2020. They appear to operate as a mortgage broker, meaning they work as a liaison between borrowers and third-party wholesale lenders. This gives them the ability to shop mortgage rates on your behalf to find the best deal out there. The company is headquartered in New York City and was formerly known as Orchard Home Loans. In early 2022, the company acquired Loan Monkey and rebranded its loan division as Orchard Mortgage. Aside from offering mortgages to home buyers and existing homeowners, the parent company offers Buy... --- > With mortgage rates nearly double what they used to be, you might wonder if an alternative product like a "50-year mortgage" could improve affordability. - Published: 2022-08-22 - Modified: 2025-03-24 - URL: https://www.thetruthaboutmortgage.com/50-year-mortgage/ - Categories: Mortgage Rates, Mortgage Tips With mortgage rates nearly double what they used to be, you might wonder if an alternative product like a "50-year mortgage" could improve affordability. Yes, I said 50 years, that’s not a typo. A full 20 years longer than the typical 30-year loan term most of us are used to. It's not just a pipedream. Last week, a mortgage lender in the UK received a license to offer fixed-rate mortgages with loan terms as long as 50 years. While there’s no sign of a 50-year mortgage stateside, could it be a strategy to lessen the blow of higher mortgage rates? And also make it possible to buy a more expensive home than what your budget allows? Let’s find out. What Is a 50-Year Mortgage? First things first, let’s define this thing. A 50-year fixed mortgage is a home loan with a 50-year loan term and an interest rate that never changes. This is essentially no different than a 30-year fixed mortgage, other than those extra two decades to pay the thing off. Simply put, someone who took out a 50-year mortgage at age 25 wouldn’t pay it off until they were 75, assuming it was held to term. While that sounds ridiculous (and is), most mortgages aren’t kept to term, or anywhere near it. So theoretically, a home buyer could take out a 50-year mortgage, then refinance into a shorter-term mortgage after a few years. If they didn’t, that mortgage debt would be with them for a long, long time,... --- > Sound the alarm. A severe housing downturn may now be in the cards in the United States. That is, if you believe the latest commentary from credit rating - Published: 2022-08-18 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/a-severe-housing-downturn-is-now-possible/ - Categories: Housing Market, Mortgage News Sound the alarm. A severe housing downturn may now be in the cards in the United States. That is, if you believe the latest commentary from credit rating agency Fitch Ratings. To be clear, they actually said “the likelihood of a severe downturn in US housing has increased. ” They still believe such a scenario is not probable, and instead we’ll see a more moderate pullback in the housing space. That mostly affects home builders, who are already struggling, though it could lead to a decline in home prices. Real Estate Crash vs. Correction vs. Housing Recession There’s been a lot of negativity in the housing market lately, as I said there would be a while back. We have entered a negative news cycle regarding real estate, mortgage rates, and the economy at large. Back in June, economist Mark Zandi of Moody’s, another credit rating agency, said we were in a housing correction. What he meant by that was that we finally arrived at the tail end of the housing boom. In other words, the good days were over. This was mostly led by a doubling in mortgage rates, creating an affordability crisis that stalled home price gains. Still, many market watchers believe home prices will continue to rise, at least nominally. Once factored for inflation, they might be flat or technically lower. And of course, certain markets will be impacted more than others, namely those that saw unsustainable run-ups over the past several years. Also this week, the National... --- > Now it’s time to take a look at the top refinance companies in the country, based on who closed the most loans last year. As you may have guessed, Rocket - Published: 2022-08-17 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-refinance-companies/ - Categories: Mortgage Tips Now it’s time to take a look at the top refinance companies in the country, based on who closed the most loans last year. As you may have guessed, Rocket Mortgage (formerly known as Quicken Loans) led the way by a mile. And by a mile, I mean $100+ billion over their nearest competitor, United Wholesale Mortgage. It’s no surprise really seeing that they were the top mortgage lender overall in 2021 as well. Read on to see which other mortgage companies made the top 10. Top Refinance Companies (Overall) Ranking Company Name 2021 Loan Volume 1. Rocket Mortgage $275. 7 billion 2. UWM $139. 6 billion 3. Wells Fargo $126. 0 billion 4. Chase $113. 6 billion 5. loanDepot $97. 7 billion 6. Freedom Mortgage $94. 1 billion 7. Pennymac $71. 4 billion 8. Homepoint $66. 4 billion 9. Mr. Cooper $65. 0 billion 10. Newrez $58. 2 billion As mentioned, Detroit-based mega lender Rocket Mortgage easily took first place in the refinance category with $275. 7 billion funded in 2021, per Richey May's HMDA data. There are two main types of mortgage refinances: the rate and term refinance (used to lower your rate and/or change your loan type/term) and the cash out refinance, utilized to tap equity. Rocket shined in both categories as scores of homeowners sought both lower mortgage rates and cash. Their total was nearly double second place United Wholesale Mortgage (UWM), a company that works exclusively with mortgage brokers. In third was Wells Fargo with... --- > A new shock poll (I just wanted to utter that phrase) found that half of Americans don’t even know what the word “mortgage” means. The findings are based - Published: 2022-08-15 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/half-of-americans-dont-even-know-what-a-mortgage-is/ - Categories: Mortgage News A new shock poll (I just wanted to utter that phrase) found that half of Americans don’t even know what the word “mortgage” means. The findings are based on a survey of 2,000 Americans on behalf of mortgage lender PrimeLending, conducted by OnePoll. Perhaps more amazingly, 73% of those polled were homeowners, yet many still couldn’t identify the correct definition of a mortgage. Regarding that definition, it was presented as “An agreement between you and a money lender that allows them to take your property if you can’t repay your loan. ” This was the correct choice from a list of other options, which weren’t revealed in the study details. At least I couldn't find them anywhere. Why Do We Call It a Mortgage Anyway? That got me to thinking. Why do we need a special name for a home loan anyway? Why can’t we just call it a home loan? Well, if we did, I’d need a new name for this blog... but we don’t give special names to other types of consumer loans. There isn’t a special French word (uttered by Americans) for auto loan or personal loan. And for those wondering, yes, the word mortgage is of French origin. It essentially means death pledge, in that the loan is terminated when paid in full or repossessed by the lender if not paid as agreed. Perhaps it has to do with the legal aspects of a mortgage and homeownership, which carry big consequences, as noted. You can lose... --- > Today we’ll do a deep dive into the top mortgage lenders in New Jersey. Using HMDA data, we can see which companies originated the most home loans in the - Published: 2022-08-15 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-new-jersey/ - Categories: Mortgage Tips Today we’ll do a deep dive into the top mortgage lenders in New Jersey. Using HMDA data, we can see which companies originated the most home loans in the state last year. I break this down by both home purchase loans and refinance loans to determine who specializes in what. After all, the home buying experience can differ quite a bit from the mortgage refinance process, the latter of which is reserved for existing homeowners. As you may have guessed, Rocket Mortgage topped the list in 2021. Read on to see the others in the top-10. Top Mortgage Lenders in New Jersey (Overall) Ranking Company Name 2021 Loan Volume 1. Rocket Mortgage $9. 9 billion 2. Wells Fargo $8. 9 billion 3. Chase $6. 8 billion 4. loanDepot $6. 2 billion 5. NJ Lenders Corp. $4. 5 billion 6. Newrez $4. 3 billion 7. UWM $4. 2 billion 8. Pennymac $3. 6 billion 9. Bank of America $3. 5 billion 10. Guaranteed Rate $3. 3 billion Detroit-based Rocket Mortgage funded $9. 9 billion in home loans in New Jersey in 2021, per HMDA data from Richey May. That was a full billion more than second place Wells Fargo, which mustered $8. 9 billion in the Garden State last year. Nearby New York-based Chase grabbed third, but was well behind the two leaders with $6. 8 billion in home loan origination volume. Far away, SoCal-based loanDepot took fourth place with $6. 2 billion, beating out hometown lender NJ Lenders Corp. ,... --- > Now we’ll check out the top mortgage lenders in Virginia, which like many other states, was led by Rocket Mortgage. The nation’s #1 overall mortgage - Published: 2022-08-11 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-virginia/ - Categories: Mortgage Tips Now we’ll check out the top mortgage lenders in Virginia, which like many other states, was led by Rocket Mortgage. The nation’s #1 overall mortgage lender had little trouble beating out the rest of the competition in the state of Virginia. This isn’t always the case, but Rocket tends to “win” around 20 states nationally, and the Old Dominion was one of them in 2021. Wells Fargo had been the top lender in the state in 2020, but could only muster third place last year. Read on to see which other mortgage companies did the most business in Virginia. Top Mortgage Lenders in Virginia (Overall) Ranking Company Name 2021 Loan Volume 1. Rocket Mortgage $11. 6 billion 2. Pennymac $9. 3 billion 3. Wells Fargo $8. 6 billion 4. Freedom Mortgage $7. 6 billion 5. Truist Financial $7. 3 billion 6. loanDepot $5. 5 billion 7. UWM $4. 1 billion 8. AmeriHome $4. 1 billion 9. Mr. Cooper $4. 0 billion 10. Navy FCU $3. 8 billion As noted, Rocket Mortgage led the way with $11. 6 billion funded, per HMDA data from business intelligence company Richey May. That was more than enough to beat out second place Pennymac, which originated $9. 3 billion in home loans. Much of Pennymac’s business comes via the correspondent channel, meaning their loan products are resold via smaller banks and credit unions. Interestingly, the company was founded by a handful of ex-Countrywide employees after it went belly up. In third place was former #1... --- > The housing market is cooling. There’s really no debate. Things are slowing down. You can mostly thank a doubling in mortgage rates and high home prices - Published: 2022-08-10 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-is-the-housing-market-cooling/ - Categories: Housing Market The housing market is cooling. There’s really no debate. Things are slowing down. You can mostly thank a doubling in mortgage rates and high home prices for that. However, talks of a more severe housing bubble might be overstated. Sure, it’s easy to compare today to 2007 or 2008, if you don’t take time to dig down into the details. After all, home prices are lofty, the stock market is shaky, and the economy is looking as uncertain as ever. But let’s talk about why things aren’t the same as they were 15 years ago. Yes, Home Prices Are Too High First things first, home prices are too high. Similar to pretty much every other asset, whether it’s a tech stock or bitcoin, home prices overshot the mark. This was arguably driven by the easy money days of the past decade, exacerbated by a pandemic and a frenzy to own real estate, especially in the suburbs and exurbs. For example, everyone wanted lots of space all of a sudden, far from urban centers. This ran counter to the trend of moving into cities and ditching cars for pedestrian-friendly, urban hubs. The reason was COVID-19, which has now mostly abated, making those who purchased in far out places question the decision. Certain cities saw massive inflows, like Boise, Idaho, which are now expected to see the biggest declines. We’ve also had a massive supply/demand imbalance, with far too few homes available to satisfy the appetite of prospective home buyers. Together, this... --- > Today we’ll take a look at the top mortgage lenders in Colorado. Interestingly, the top lender in the state isn’t a direct lender or a depository bank. In - Published: 2022-08-09 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-colorado/ - Categories: Mortgage Tips Today we’ll take a look at the top mortgage lenders in Colorado. Interestingly, the top lender in the state isn’t a direct lender or a depository bank. In fact, aspiring home buyers and existing homeowners can’t even work with this company directly. Instead, they’ll need to work with an intermediary to access the loan programs offered by this behemoth of a mortgage company. This company was also the top mortgage lender in the state of Arizona, giving them a strong foothold in the Mountain West region of the United States. Top Mortgage Lenders in Colorado (Overall) Ranking Company Name 2021 Loan Volume 1. UWM $11. 7 billion 2. Rocket Mortgage $9. 5 billion 3. Chase $8. 5 billion 4. Wells Fargo $4. 6 billion 5. U. S. Bank $4. 6 billion 6. Homepoint $4. 5 billion 7. Fairway Independent $4. 2 billion 8. American Financing $4. 1 billion 9. Pennymac $4. 0 billion 10. loanDepot $3. 9 billion As alluded to, the top Colorado mortgage lender last year was actually a wholesale lender that works with mortgage brokers. This runs counter to the more traditional retail lending channel offered by big banks and household lenders like Rocket Mortgage. Yet somehow United Wholesale Mortgage (UWM) managed to beat the competition quite easily with $11. 7 billion in loan origination volume, per HMDA data from Richey May. That was more than enough to take out national #1 overall Rocket Mortgage’s $9. 5 billion, and JPMorgan Chase’s $8. 5 billion. In order to... --- > Now let’s take a look at the top mortgage lenders in New York, based on overall loan volume produced last year. The state of New York is unique in that - Published: 2022-08-08 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-new-york/ - Categories: Mortgage Tips Now let’s take a look at the top mortgage lenders in New York, based on overall loan volume produced last year. The state of New York is unique in that many of the top lenders are depository banks that actually hold the loans on their books. Or at least offer checking and savings accounts to customers alongside mortgage offerings. This counters the recent rise of nonbanks dominating the mortgage space, which has worried some market watchers. Anyway, topping the list in 2021 (most recent year available) was JPMorgan Chase, which happens to be headquartered in New York City. Top Mortgage Lenders in New York (Overall) Ranking Company Name 2021 Loan Volume 1. Chase $20. 9 billion 2. Wells Fargo $19. 1 billion 3. Rocket Mortgage $11. 2 billion 4. Citibank $9. 1 billion 5. Bank of America $7. 5 billion 6. Citizens Bank $7. 0 billion 7. loanDepot $6. 1 billion 8. UWM $5. 8 billion 9. First Republic Bank $4. 8 billion 10. TD Bank $4. 1 billion Overall, the state of New York accounted for about 4% of the nation's home loan volume in 2021, per HMDA data presented by Richey May. And it’s not often the top mortgage lender in a particular state is also a native of the state, but this happens to be true in the case of New York. Chase grabbed the top spot with $20. 9 billion in home loan origination volume during the year, about 10% of their national total. It was... --- > With all the seesaw movement in the first eight months of 2022, I wanted to throw out some mortgage rate predictions for the rest of the year. Note that - Published: 2022-08-02 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-rate-predictions-for-the-rest-of-the-year-2022/ - Categories: Mortgage Rates, Mortgage Tips With all the seesaw movement in the first eight months of 2022, I wanted to throw out some mortgage rate predictions for the rest of the year. Note that these are just my predictions, and subject to being completely wrong. Or with any luck, maybe right, as I’m feeling slightly optimistic. The 30-year fixed averaged 5. 30% in the latest week, per Freddie Mac’s most recent weekly survey. It was down from 5. 54% a week earlier (a large amount over seven days) as the Fed indicated the worst of its own rate rises might be behind us. There’s also talk of a looming (or present) recession, which generally leads to lower interest rates. Mortgage Rates Could Fall Back Into the 4% Range Later This Year While the first half of 2022 was the worst (or one of the worst) on record for mortgage rates, the second half could be pretty good. I say pretty good because it’s hard (basically impossible) to erase all the increases seen during the first six months. After all, 30-year fixed mortgage rates essentially doubled before beginning to fall significantly in the latest week. So it’s going to take a lot, too much really, for rates to return to those levels. And I’m not going to tell you how high rates were in the 1980s versus now! No one cares. All that matters is present day. Now some good news. While there have been some ebbs and flows in 2022, the recent downward movement has... --- > If you reside in Arkansas or a nearby state, chances are you’ve heard of Arvest Central Mortgage. Or perhaps you already have a checking or savings - Published: 2022-07-29 - Modified: 2024-10-16 - URL: https://www.thetruthaboutmortgage.com/arvest-central-mortgage-review/ - Categories: Mortgage Tips If you reside in Arkansas or a nearby state, chances are you’ve heard of Arvest Central Mortgage. Or perhaps you already have a checking or savings account with their parent company Arvest Bank, the oldest in the state. You may have also heard that the bank is owned by the Walton family, which incidentally owns Walmart. If that’s not enough for you, the company happens to be the largest mortgage lender in the state of Arkansas too. So it’s clear they’ve got quite the pedigree. Read on to learn more about them. Arvest Central Mortgage Fast Facts Founded in 1997, headquartered in Little Rock, AR Operated by the largest and oldest bank in Arkansas Parent company owned by the Walton family (of Walmart fame) The #1 mortgage lender in the state of Arkansas (based on HMDA loan volume) Also very active in Oklahoma and Missouri Funded nearly $6 billion in home loans last year Licensed in 45 states and the District of Columbia Arvest Central Mortgage is a direct-to-consumer retail mortgage lender with a network of physical branches in Arkansas, Kansas, Oklahoma, and Missouri. They are a division of Arvest Bank, the oldest and largest bank in the state of Arkansas. As mentioned, they are majority-owned by the Walton family, which also owns mega retailer Walmart. At the moment, they lend in every state nationwide other than Delaware, Rhode Island, Maryland, New Hampshire and New York. Last year, the company funded a solid $5. 6 billion in home loans, with... --- > If you reside in the Pacific Northwest, you might wonder who the top mortgage lenders in Washington State are. Yes, I’m referring to the state of - Published: 2022-07-27 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-washington-state/ - Categories: Mortgage Tips If you reside in the Pacific Northwest, you might wonder who the top mortgage lenders in Washington State are. Yes, I’m referring to the state of Washington, not the nation's capital, the District of Columbia. Last year, the Evergreen State accounted for about 4% of all home loans, per HMDA data for 2021. This made it one of the more active of the 50 states, only bettered by the likes of California, Florida, New York, Texas. As to which company did the most home loan lending in the state, it was none other than nonbank Caliber Home Loans. Top Mortgage Lenders in Washington State (Overall) Ranking Company Name 2021 Loan Volume 1. Caliber Home Loans $12. 2 billion 2. Rocket Mortgage $11. 8 billion 3. Wells Fargo $8. 3 billion 4. Chase $8. 0 billion 5. Fairway Independent $7. 1 billion 6. loanDepot $6. 8 billion 7. UWM $6. 3 billion 8. BECU $5. 2 billion 9. Guild Mortgage $4. 9 billion 10. KeyBank $4. 9 billion Caliber Home Loans seems like an unlikely candidate, but still managed to beat out of the rest of competition, even Rocket Mortgage. The Texas-based mortgage lender funded $12. 2 billion in the state of Washington last year, according to HMDA data from Richey May. This was enough to take out the nation’s number one mortgage lender, Rocket Mortgage, which managed only $11. 8 billion. Coming in third place was San Francisco-based depository Wells Fargo with $8. 3 billion in home loan volume. JP... --- > Interested in a 40-Year Fixed Mortgage? If you need even more time to pay off your mortgage Or need to get the monthly payment down to boost affordability - Published: 2022-07-27 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/do-40-year-mortgages-make-any-sense/ - Categories: Mortgage Tips Interested in a 40-Year Fixed Mortgage? If you need even more time to pay off your mortgage Or need to get the monthly payment down to boost affordability A 40-year fixed mortgage could be one alternative to consider But they're harder to come by these days and aren't well-suited for everyone Every now and then, I take a look at a specific mortgage product to determine if it could be a good fit for a prospective (or existing) homeowner. Today, we’ll discuss a formerly popular home loan option, the “40-year mortgage. ” It was all the rage during the prior housing boom in the early 2000s. But also partially to blame for the housing crisis that took place shortly after. Still, with mortgage rates now double what they were to start the year, they could make a resurgence. What Is a 40-Year Mortgage? A 40-year mortgage is a home loan with a loan term that lasts for 40 years. This is 10 years longer than the typical 30-year loan term attached to most mortgages. You may already be thinking, “40 years? I thought mortgages had terms of 30 years? ” Is this a mistake? Well, you’d be mostly right. The majority of mortgages issued today do have terms of 30 years. It's certainly the most common loan term out there. In fact, aside from 30-year fixed mortgages, which clearly last for 30 years, as the name implies, most adjustable-rate mortgages also have terms of 30 years, despite lacking any reference... --- > If you’re curious who the top mortgage lenders in Arizona are, you’ve come to the right place. I’ve compiled several top-10 lists for overall volume, home - Published: 2022-07-26 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-in-arizona/ - Categories: Mortgage Tips If you’re curious who the top mortgage lenders in Arizona are, you’ve come to the right place. I’ve compiled several top-10 lists for overall volume, home purchase volume, and refinance volume. Interestingly, a wholesale mortgage lender actually topped the overall list in 2021 (the latest year available). That’s impressive given the fact that wholesale lenders only work with mortgage brokers, as opposed to retail lenders that are consumer-facing. Anyway, the lender in question was United Wholesale Mortgage, or UWM for short, with a solid $12. 1 billion. Read on to find out who the other big players were. Top Mortgage Lenders in Arizona (Overall) Ranking Company Name 2021 Loan Volume 1. United Wholesale Mortgage $12. 1 billion 2. Rocket Mortgage $11. 5 billion 3. Chase $6. 6 billion 4. Fairway Independent $6. 3 billion 5. loanDepot $5. 4 billion 6. Wells Fargo $5. 4 billion 7. Nova Home Loans $4. 8 billion 8. U. S. Bank $4. 8 billion 9. Freedom Mortgage $4. 0 billion 10. Pennymac $3. 8 billion As noted, UWM topped the charts in the Copper State with over $12 billion in home loan volume, beating out its crosstown rival Rocket Mortgage, per HMDA data from Richey May. Rocket mustered an also impressive $11. 5 billion in home loan origination volume, beating out third place Chase’s $6. 6 billion quite easily. Also in the top five were Fairway Independent Mortgage with $6. 3 billion, and loanDepot with $5. 4 billion. The rest of the top-10 also consisted... --- > Mortgage Q&A: "Does Having A Mortgage Help Your Credit Score?" If you’ve ever pulled your credit report and/or viewed your scores, you may have - Published: 2022-07-20 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/does-having-a-mortgage-help-your-credit-score/ - Categories: Credit Scores, Mortgage Tips Mortgage Q&A: "Does Having A Mortgage Help Your Credit Score? " If you’ve ever pulled your credit report and/or viewed your scores, you may have noticed that the lack of a mortgage could actually be holding you back from credit score perfection. Even if you already have a seemingly great credit score, the credit report “notes” could imply that an installment account like a home loan would further improve your scores. But before you run out and get a mortgage, it’s important to point out that the impact may not be substantial, and you certainly shouldn’t take out of a mortgage for the sake of your credit. That would be plain silly. You Can Raise Your Credit Scores By Improving Your Credit Mix So, why would the presence of a mortgage help your credit scores anyway? You’re taking on all that new debt. Doesn't that make you riskier? What gives? Well, aside from the giant pile of new debt, when you take out a mortgage you essentially tell prospective creditors that you’ve made a very serious financial and lifestyle commitment. Yep, you're a grownup now. And most mortgages have loan terms of 30 years, so you’re not going anywhere fast. With a mortgage, you automatically add stability to your credit profile, which is certainly a good thing. On top of that, mortgages also tend to come in very high dollar-amounts, unlike credit cards or auto loans/leases. Instead of getting a $10,000 credit line, you’re probably looking at a six-figure dollar... --- > It seems mortgage rates can’t catch a break in 2022, despite a few pullbacks here and there. However, those moments are often short-lived, and met with - Published: 2022-07-01 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/seven-percent-mortgage-rates/ - Categories: Mortgage Rates, Mortgage Tips It seems mortgage rates can’t catch a break in 2022, despite a few pullbacks here and there. However, those moments are often short-lived, and met with new highs not long after. The 30-year fixed started the year in the low 3% range, and has since surpassed 6%, depending on the mortgage lender in question. That has led to industry-wide carnage, including thousands of mortgage layoffs, along with sticker shock for prospective home buyers. The question now is a 7% mortgage rate next? Or have we seen the worst of it? Next Stop for Mortgage Rates 7%? While 30-year fixed mortgage rates haven’t officially hit 6%, if you consider Freddie Mac the source, they sure are close. During the last week, the popular loan program averaged 5. 70%, down from 5. 81% a week earlier. Yes, it was an improvement from last week, but even Freddie Mac chief economist Sam Khater referred to it as a “pause” in the survey press release. In other words, it could just be a brief respite before mortgage rates continue marching higher. Similar to a stock market rally in a bear market, which erases itself the next day, mortgage rates have been trending decidedly higher. So even if good news pops up one day, it’s usually absorbed via the broader negative picture within a day or two. Ultimately, it’s hard to get too excited about any sort of mortgage rate rally at the moment, just like it’s hard to look at your stock portfolio or... --- > Lately, I’ve been hearing a lot about a “housing correction,” which at first glance looks and sounds kind of bad. Not as bad as say a housing crash, but - Published: 2022-06-29 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-is-a-housing-correction/ - Categories: Housing Market, Mortgage News Lately, I’ve been hearing a lot about a “housing correction,” which at first glance looks and sounds kind of bad. Not as bad as say a housing crash, but still pretty bad. The most outspoken economist on the subject lately has been Moody’s Mark Zandi, who says we’re officially in a housing correction. But what does that mean exactly? And is it nationwide or only in select markets where home prices have run rampant? Let’s discuss and take a moment to highlight the difference between a correction and a crash. The Definition of a Housing Correction If you’re at all familiar with the stock market, you’ve likely heard the old stock market correction phrase on numerous occasions. It’s actually a pretty easily defined situation where stocks fall by 10% or more, but no more than 20%. And it typically happens when stocks are overbought, aka overpriced. In unison, investors wake up one day and decide it’s time to sell. The market tanks and everyone panics, which likely exacerbates things even more and eventually creates an oversold environment. This in turn creates a buying opportunity for the non-freaked cohort out to purchase securities on the relative cheap. If stocks exhibit losses of more than 20%, it becomes a market crash. Then the future is a little less clear. Assuming it persists, it’s called a “bear market,” opposite a bull market. That is actually what’s happening currently in the U. S. stock market. Similar to home prices, stocks were on a tear... --- > Because mortgage rates have more than doubled lately, interest in adjustable-rate mortgages has taken off. The popular 30-year fixed, which was priced as - Published: 2022-06-28 - Modified: 2022-06-28 - URL: https://www.thetruthaboutmortgage.com/how-to-save-money-with-an-adjustable-rate-mortgage/ - Categories: Mortgage Rates, Mortgage Tips Because mortgage rates have more than doubled lately, interest in adjustable-rate mortgages has taken off. The popular 30-year fixed, which was priced as low as 2. 65% in early 2021, is now closer to 6%! At the same time, alternative loan products like the 5/1 ARM are now pricing at a sizable discount. For example, the 30-year fixed averaged 5. 81% during the past week, per Freddie Mac, while the 5/1 ARM came in at a much lower 4. 41%. That discount can save you a lot of money on your home loan for the first five years. Here’s how to make that discount even more powerful. ARMs Are Back Because They’re Finally Cheap Again As noted, adjustable-rate mortgages are staging a bit of a comeback. They held a nominal share of the overall mortgage market for years. Simply put, they priced the same or very similar to fixed-rate mortgages, so there was virtually no reason to get one. But in the latest week, they accounted for 10. 6% of total home loan applications, per the most recent report from the Mortgage Bankers Association (MBA). While this is still a small share overall, it’s much higher than the paltry 2-3% share ARMs held for many years when fixed-rate mortgages were silly cheap. Of course, times have changed, and fixed-rate mortgages are no longer anywhere close to their record lows. The 30-year fixed is pricing around 6% and could be headed even higher in coming months. This has caused prospective home... --- > It’s time for another mortgage match-up, the latest installment “mortgage rates vs. recessions.” This is a timely post seeing that mortgage rates have - Published: 2022-06-27 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-vs-recessions/ - Categories: Mortgage Rates, Mortgage Tips It’s time for another mortgage match-up, the latest installment “mortgage rates vs. recessions. ” This is a timely post seeing that mortgage rates have gone absolutely bonkers lately and talks of another recession are heating up. The Fed created a very accommodative monetary policy over the past decade via Quantitative Easing (QE), which pushed mortgage rates to record lows. But that (combined with COVID-19 and war-related supply chain issues) eventually triggered troubling inflation, forcing the Fed to act aggressively the other way, which could result in a recession sometime soon. The question is does a recession portend lower mortgage rates, higher mortgage rates, or nothing at all? Mortgage Rates Typically Fall During Recessions First off, a recession is defined as “a significant decline in economic activity that is spread across the economy and that lasts more than a few months,” per the National Bureau of Economic Research (NBER). In simple terms, this means a receding economy as opposed to a growing economy for a sustained period of time. This could be evidenced by a contraction in the gross domestic product (GDP) over consecutive quarters. Basically, consumers curb spending, companies output less product, layoffs happen, and so on. The dynamic shifts from easy money spenders to stingy savers. As noted, the Fed engineered low interest rates via QE. They purchased hundreds of billions in Treasuries and agency mortgage-backed securities (MBS) to boost liquidity and encourage lending. This turned out to be great for the mortgage industry, as interest rates fell to... --- > If you want a more personal home loan experience, take a look at AnnieMac Home Mortgage. The New Jersey-based lender believes the complex mortgage process - Published: 2022-06-15 - Modified: 2024-11-19 - URL: https://www.thetruthaboutmortgage.com/anniemac-mortgage-review/ - Categories: Mortgage Tips If you want a more personal home loan experience, take a look at AnnieMac Home Mortgage. The New Jersey-based lender believes the complex mortgage process needs human interaction. Or better yet, deserves it. This defies the en vogue tech-heavy disruptor model, which is built on the premise that humans are no longer required. So if you’re looking for a little more guidance/service during an important life event, they could be worth checking out. The good news is they also offer all the latest tech to complement that human touch. Read on to learn more. AnnieMac Mortgage Fast Facts Retail, direct-to-consumer mortgage lender Founded in 2010, headquartered in Mount Laurel, NJ Employ approximately 1,000 team members over 100 locations nationwide Currently licensed in 47 states and Washington D. C. Funded roughly $5. 4 billion in home loans last year Most active in their home state of New Jersey Also do a lot of business in Florida, Pennsylvania, and Texas Operate a wholesale channel for mortgage broker partners And online mortgage lender LoFi Direct AnnieMac Home Mortgage, a dba of American Neighborhood Mortgage Acceptance Company, LLC, is a retail, direct-to-consumer mortgage lender. They offer both home purchase financing and mortgage refinance loans to customers throughout the United States. The Mount Laurel, New Jersey-based company only got its start back in 2010 but has already grown into a multi-billion-dollar producer. Last year, the lender managed to fund about $5. 4 billion in home loans, with a roughly 60/40 split of home purchase loans... --- > Just about everyone with a home loan ponders the idea of paying a little extra, whether it’s via biweekly mortgage payments, or just once a year after - Published: 2022-06-13 - Modified: 2023-09-05 - URL: https://www.thetruthaboutmortgage.com/paying-more-today-wont-lower-future-monthly-mortgage-payments/ - Categories: Mortgage Rates, Mortgage Tips, Refinance Just about everyone with a home loan ponders the idea of paying a little extra, whether it’s via biweekly mortgage payments, or just once a year after receiving a sizable bonus or tax refund. Whatever the method, you should first consider why you’re thinking about paying your mortgage off early as opposed to putting the money elsewhere. This is a particularly important question to ask in the super-low mortgage rate environment we’ve been enjoying for some time. Simply put, mortgage borrowing has been really cheap, and is probably the least expensive debt you've got, so prioritizing it over other debt may not make sense. For example, if you have student loan or credit card debt, it might be more beneficial to pay that off first. A Mortgage Is an Amortizing Loan with Equal Monthly Payments Most mortgages have a set loan term in which they are paid off in full Fully-amortizing payments consist of a principal and interest portion The monthly payment amount typically doesn't change unless it's an ARM But the portion that goes to principal/interest will adjust over time as your loan is paid off Assuming you decide to make extra mortgage payments, whether significantly larger or just a little more than required, your next monthly payment won’t change due to the previous payment. You will still owe what you owed the month before, regardless of your principal balance being smaller. While this might sound unfair, it all has to do with math and the fact that a... --- > While prospective home buyers continue to grapple with high mortgage rates and limited supply, existing owners are getting richer. A new report from Black - Published: 2022-06-06 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/tappable-equity/ - Categories: Mortgage Rates, Mortgage Tips, Refinance While prospective home buyers continue to grapple with high mortgage rates and limited supply, existing owners are getting richer. A new report from Black Knight revealed that the average American homeowner is sitting on more than $207,000 in tappable equity. The phrase “tappable equity” means an amount that leaves a 20% equity buffer in place, aka 80% loan-to-value (LTV). This is generally what banks and mortgage lenders will allow homeowners to borrow to ensure they have some skin in the game. The question though is how do you tap into that equity, especially in a rising rate environment? Does a Cash Out Refinance Still Make Sense? Mortgage holders withdrew more than $75 billion in the first quarter of 2022 via cash out refinances The cash out refinance share jumped to 75% during Q1 as rate/term refis waned Early Q2 data suggests higher mortgage rates will dampen demand going forward As noted, American homeowners are sitting on a staggering amount of available home equity. At last glance, it was over $11 trillion, or roughly $207,000 per mortgage holder. That figure is up from $127,000 at the start of the pandemic, and more than 2X the levels seen back in 2006 during the prior market height. Here’s the problem though – mortgage rates have also basically doubled since the start of the pandemic, making a refinance a tough sell. Still, cash out refinance volume doubled over the past 12 months, with such loans accounting for 75% of all refinances in the first... --- > Yes, adjustable-rate mortgages are still available, even though your lender may have hidden them from you for the past few years. Ultimately, ARMs just - Published: 2022-06-02 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/can-you-still-get-an-adjustable-rate-mortgage/ - Categories: Mortgage News, Mortgage Rates Yes, adjustable-rate mortgages are still available, even though your lender may have hidden them from you for the past few years. Ultimately, ARMs just didn’t make sense for most homeowners because fixed mortgage rates were at/near record lows. This made the ARM argument a poor one, as there’d be no reason to take on the risk for little to no reward. As such, banks and mortgage lenders rarely touted these seemingly forgotten mortgages. But with the 30-year fixed now priced above 5% for the first time in a decade, ARMs have returned. Do ARM Mortgages Still Exist? Banks and mortgage lenders funded over $600 billion in ARM loans last year They accounted for roughly 10% of all mortgages originated in 2021 The 30-year fixed was the most popular loan choice with a ~70% share But ARMs are set to surge in popularity now that fixed mortgage rates are much higher They sure do, and you’ll be hearing a lot more about them in coming months and years. Why? Because the popular 30-year fixed is no longer on sale. A year ago, it averaged 2. 99%, per Freddie Mac. This week, it was pricing around 5. 09%, while the soon to be in fashion 5/1 ARM came in at a much lower 4. 04%. During the last several years, ARMs like the 5/1 were priced higher than their fixed-rate counterparts, making them totally useless. But the spread has normalized and widened in recent months as fixed-rate mortgages have surged in price.... --- > If you’re looking for a home purchase lending expert in the Midwest, you may want to check out “Flat Branch Home Loans.” The Columbia, MO-based company is - Published: 2022-06-01 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/flat-branch-home-loans-review/ - Categories: Mortgage Tips If you’re looking for a home purchase lending expert in the Midwest, you may want to check out “Flat Branch Home Loans. ” The Columbia, MO-based company is the #1 home purchase lender in the state, beating out the very biggest names in the industry. They’re also the top USDA lender in the states of Missouri, Kansas, and Illinois, as well the eighth largest nationwide. That’s pretty impressive, and could be directly related to their 1,000+ years of combined mortgage experience. So if you’re a prospective home buyer looking for a little extra guidance, they could be a good fit. Flat Branch Home Loans Fast Facts Employee-owned, direct-to-consumer mortgage lender Offers home purchase loans and mortgage refinances Founded in 2005, headquartered in Columbia, MO Funded about $3. 75 billion in home loans last year #1 retail home purchase lender in the state of Missouri Roughly two-thirds of overall business comes from home state Also very active in Illinois, Kansas, and Oklahoma Currently licensed in 30 states nationwide Flat Branch Home Loans is an employee-owned, direct-to-consumer retail mortgage lender located in Columbia, Missouri. They were founded by current president Jim Yankee in 2005, and have since grown to a 700-employee strong company. Their claim to fame is being #1 home purchase lender in the state of Missouri, as well as a big-time USDA loan lender. This makes it obvious that they’re a solid choice for home buyers, though they also do a good deal of mortgage refinancing as well. Last year,... --- > With a name like "NJ Lenders Corp.," there’s no question who they’re focused on; folks in the Garden State! What’s more interesting is the fact that - Published: 2022-05-26 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/nj-lenders-corp-review/ - Categories: Mortgage Tips With a name like "NJ Lenders Corp. ," there’s no question who they’re focused on; folks in the Garden State! What’s more interesting is the fact that something like 70% of their mortgage loans are derived from previous customer referrals. In other words, they constantly get recommended by friends and neighbors, instead of having to rely solely upon advertising. And when you focus so heavily on one geographical area, you definitely want to get it right. So far, they seem to be accomplishing their goals, as evidenced by their thousands of 5-star reviews. Read on to learn more. NJ Lenders Corp. Fast Facts Retail, direct-to-consumer mortgage lender Offers home purchase loans and refinances Founded in 1991, headquartered in Little Falls, NJ Funded roughly $5. 5 billion in home loans last year More than 80% of business done in home state of New Jersey Also active in New York, Massachusetts, and Florida Currently licensed in 14 states and the District of Columbia NJ Lenders Corp. is a direct-to-consumer mortgage lender with branches in three states, mostly located in New Jersey. They got their start way back in 1991, which if you’re not keeping track is more than 30 years ago. Since that time, they’ve grown from a modest single office into a multi-billion-dollar mortgage originator. They’ve closed more than 100,000 mortgage loans, with loan volume exceeding $40 billion. Last year, they funded a solid $5. 5 billion in home loans, which was probably their biggest annual production on record. Business was... --- > If you’re an existing homeowner or an aspiring one, you may have heard the phrase “house poor,” typically uttered by an overextended borrower. It may also - Published: 2022-05-23 - Modified: 2023-10-18 - URL: https://www.thetruthaboutmortgage.com/what-does-it-mean-to-be-house-poor/ - Categories: Home Buying, Housing Market, Mortgage Tips If you’re an existing homeowner or an aspiring one, you may have heard the phrase “house poor,” typically uttered by an overextended borrower. It may also serve as a warning to a first-time home buyer from a seasoned homeowner, especially right now with home prices so high. The Definition of House Poor Buying too much house for your budget Even if you technically make enough money to afford it Because a substantial portion of your paycheck goes toward the mortgage each month And other monthly housing expenses like utilities, maintenance, repairs, etc. First, let’s define what it means to be house poor. At first glance, it might sound like someone who lives in a small or meager dwelling, but this isn’t the case. It’s actually quite the opposite – someone who is house poor has likely bitten off more than they can chew, and is spending too much of their income on housing payments. This means they could have purchased a McMansion and don’t have much left over for other recurring costs, or even everyday expenses. It could also mean that they took out a mortgage that was too large for their salary, even if the property is more modest. It’s really dictated by a borrower’s ability to make housing payments each month, not necessarily the grandeur of the home, as budgets will vary by financial situation. For example, a really wealthy individual could buy a multi-million dollar home, but struggle to make mortgage payments because their lifestyle is too... --- > If you’re looking for personalized service, instead of a call-center home loan, you might want to check out Summit Mortgage. The privately-owned direct - Published: 2022-05-23 - Modified: 2024-10-16 - URL: https://www.thetruthaboutmortgage.com/summit-mortgage-review/ - Categories: Mortgage Tips If you’re looking for personalized service, instead of a call-center home loan, you might want to check out Summit Mortgage. The privately-owned direct lender was started by husband and wife loan originators Diana and Robert Carter way back in 1992. The goal was to create a business from an originator’s point-of-view, focused on providing an “unparalleled homebuying experience. ” That meant identifying the traditional pain points of getting a home loan and taking steps to avoid them. After all, buying a home is supposed to be an exciting moment, one they believe shouldn’t be overshadowed by a miserable mortgage experience. Summit Mortgage Fast Facts Direct-to-consumer mortgage lender Offers home purchase loans and mortgage refinancing Founded in 1992, headquartered in Plymouth, MN Licensed to do business in 17 states Funded more than $6 billion in home loans last year About two-thirds of last year’s volume was home Summit Mortgage Corp. is a direct-to-consumer mortgage lender that offers home purchase financing and mortgage refinances. The Plymouth, Minnesota-based company got its start way back in 1992, making them one of the older lenders in existence. Last year, they produced more than $6 billion in home loans, with a 67% home purchase share and 33% refinance share. This tells me they have strong relationships with local real estate agents, and the ability to close loans on time. Summit Mortgage is a big-time mortgage lender in their home state of Minnesota, which accounts for about 40% of total production. In fact, they ranked 6th there... --- > Now that the Home Mortgage Disclosure Act (HMDA) data is out, we can check out the top mortgage lenders of 2021. As you may have guessed, Rocket Mortgage - Published: 2022-05-18 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-2021/ - Categories: Mortgage News Now that the Home Mortgage Disclosure Act (HMDA) data is out, we can check out the top mortgage lenders of 2021. As you may have guessed, Rocket Mortgage took the top spot yet again, beating out its long-time adversary Wells Fargo. Coming in third was Rocket’s crosstown rival United Wholesale Mortgage, which also secured the third position in 2020. Chase remained in 4th for 2021, as it did in 2020, while loanDepot usurped Freedom Mortgage to take fifth. Collectively, residential mortgage lenders had a banner year with more than $4 trillion in loan volume last year. Top Mortgage Lenders Overall in 2021 Ranking Company Name 2021 Loan Volume 1. Rocket Mortgage $342. 7 billion 2. Wells Fargo $228. 6 billion 3. United Wholesale Mortgage $227 billion 4. Chase $205 billion 5. loanDepot $136. 7 billion 6. Pennymac $124. 7 billion 7. U. S. Bank $115. 6 billion 8. Freedom Mortgage $113. 1 billion 9. Homepoint $96. 2 billion 10. Newrez $92. 9 billion Rocket Mortgage mustered a staggering $342. 7 billion in loan volume last year, up from roughly $314 billion a year earlier, per data deconstructed by Richey May. Once again, it was more than enough to hold off depository bank Wells Fargo, which could only come up with $228. 6 billion. The San Francisco-based bank actually saw its production fall year-over-year from $267 billion. But it was just enough to hold off United Wholesale Mortgage ($227B), which works exclusively with mortgage brokers via the wholesale lending channel. Chase... --- > Today we’ll take a look at the top USDA lenders by loan volume in 2021. In case you need a refresher, USDA loans are reserved for properties located in - Published: 2022-05-13 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-usda-lenders/ - Categories: Mortgage News Today we’ll take a look at the top USDA lenders by loan volume in 2021. In case you need a refresher, USDA loans are reserved for properties located in rural parts of the United States. They are one of the four major home loan types, which includes conventional loans, FHA loans, and VA loans. The mortgage companies on the list below managed to originate more rural home loans than the rest of their peers. While not a huge market relative to the other types of mortgages mentioned, banks and lenders still funded more than $33 billion worth of USDA loans last year. Top USDA Lenders in 2021 Ranking Company Name 2021 Loan Volume 1. Pennymac $5. 4 billion 2. CMG Mortgage $1. 2 billion 3. Newrez $893 million 4. Freedom Mortgage $880 million 5. Planet Home Lending $846 million 6. Fairway Indpt. Mortgage $641 million 7. Caliber Home Loans $575 million 8. U. S. Bank $568 million 9. Amerihome Mortgage $567 million 10. Homepoint $525 million The lenders above beat out about 1,100 other mortgage companies to earn the distinction of top-10 USDA lender, per data parsed by Richey May. The number one spot easily went to Pennymac, which is a big correspondent lender. That means their product may be resold via smaller local banks and credit unions. Still, their $5. 4 billion in USDA loan volume was well above their closest competitor, CMG Financial, which mustered just $1. 2 billion. For the record, Pennymac was also the top FHA... --- > If you’re in need of an FHA loan, you might be curious who the top FHA lenders are. By top, I mean largest. While biggest certainly doesn’t mean best, or - Published: 2022-05-11 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/top-fha-lenders/ - Categories: Mortgage Tips If you’re in need of an FHA loan, you might be curious who the top FHA lenders are. By top, I mean largest. While biggest certainly doesn’t mean best, or cheapest for that matter, it can helpful to know the major players. If nothing else, these companies should at least have a good understanding of the process and a decent track record of closing such loans. This can be especially important if you’re purchasing a home and need a competent lender that will actually get you to the finish line. However, the smaller shops (and even mortgage brokers) could be a perfectly viable option as well, assuming they’re well-versed in FHA lending. Top FHA Loan Lenders (Overall) Ranking Company Name 2021 Loan Volume 1. Pennymac $32. 3 billion 2. Freedom Mortgage $32. 0 billion 3. Rocket Mortgage $27. 8 billion 4. Lakeview Loan Servicing $20. 9 billion 5. Caliber Home Loans $12. 9 billion 6. Newrez $12. 1 billion 7. Amerihome Mortgage $11. 9 billion 8. United Wholesale Mortgage $11. 6 billion 9. Nationstar Mortgage $11. 1 billion 10. U. S. Bank $10. 8 billion Last year, nearly a half-trillion ($475 billion) in FHA loans were originated by a couple thousand banks, credit unions, and independent mortgage lenders. But some companies did a lot more volume than others and dominated the FHA lending space. That brings us to the top-10 list, which is based on HMDA data for 2021 compiled by advisory firm Richey May. The number one spot for... --- > As mortgage rates continue their ascent toward 6%, more and more folks are talking housing market crash. But high interest rates aren’t really a catalyst - Published: 2022-05-10 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-you-might-not-want-to-get-too-excited-or-nervous-about-a-housing-crash/ - Categories: Housing Market, Mortgage News, Mortgage Rates As mortgage rates continue their ascent toward 6%, more and more folks are talking housing market crash. But high interest rates aren’t really a catalyst for a crash, especially if the high rates aren’t really high. Emphasis on “real,” as in inflation-adjusted. Everything has gone up in price, and wages should also be rising. This means a higher mortgage rate isn’t even a roadblock, or really as bad as it seems. And because rates remain historically low, once you factor inflation, they could still be seen as a screaming deal. High Mortgage Rates Don’t Crash Housing Markets I’ve said it countless times, and I’ll repeat it again. Higher mortgage rates don’t automatically lower home prices. Or lower them at all. If one goes up, the other doesn’t go down. And vice versa. It’s possible both can move in tandem, or opposite one another, based on many other factors. So those who have been watching 30-year fixed mortgage rates absolutely surge from below 3% to nearly 6% must be beside themselves. How could home prices not fall, or at the very least, not continue to rise? This makes no sense. Why would home buyers continue to pay such outrageous prices now that interest rates aren't at record lows? Part of the answer is they want/need shelter, so they’re willing to pay “top dollar” for it. Another reason is it’s still not that expensive once you factor in inflation and growing wages for these home buyers. The other key factor continues to... --- > It might not make sense (or save you money) to choose a promotional mortgage rate, such as 2.99%. Learn why. - Published: 2022-05-04 - Modified: 2022-05-04 - URL: https://www.thetruthaboutmortgage.com/sometimes-its-better-to-choose-the-higher-mortgage-rate/ - Categories: Mortgage Rates, Mortgage Tips With mortgage rates hovering around 5. 5%, there might be the temptation to snag a 30-year fixed at say 4. 875%, or 4. 99% if a lender offers a promotional rate. The same might be true of any home loan product, whether it’s a 5/1 ARM or 15-year fixed. Getting a rate just below a whole number. After all, 4. 99% sounds a lot better than 5. 5%, and makes it feel like you're still receiving something special. But here’s the thing – a rate just below a key threshold may cost a lot more, and not actually deliver the savings you're looking for. It could do little more than make you feel good psychologically, without saving you much money. Or any money at all. A 4. 99% 30-Year Fixed Sounds Pretty Good, Doesn't It? This week, the 30-year fixed rose to 5. 10%, per the latest Freddie Mac survey. In reality, it's closer to 5. 5% at a lot of banks and lenders. And it doesn’t appear to be going down anytime soon. As it stands, we’re only about 50 basis points away from hitting that scary 6% mark, which hasn't been seen since 2008. Meanwhile, rates on the 15-year fixed mortgage are averaging roughly 4. 40%, well above their recent levels around 2%. Because we’re so close to some big psychological thresholds, mortgage lenders might start offering rates below these key levels to entice borrowers. Or to simply make it seem like there are still some decent interest... --- > How’s this for a dramatic headline: “Home prices are falling!” But before you get too excited, assuming you’re a prospective home buyer, there are some - Published: 2022-04-25 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/are-home-prices-falling/ - Categories: Housing Market, Mortgage News How’s this for a dramatic headline: “Home prices are falling! ” But before you get too excited, assuming you’re a prospective home buyer, there are some strings. What was almost unthinkable a month or two ago is now apparently becoming reality. A new analysis from Realtor. com found that asking prices are actually down year-over-year in several large metropolitan areas nationwide. Does this mean the seller’s market is finally coming to an end, driven by markedly higher mortgage rates? Let’s find out. Where Home Prices Are Down the Most The Realtor. com data team analyzed year-over-year median list prices in the 100 largest metros nationwide in the month of March. They then limited their list to just one metro per state as a means to ensuring “geographic diversity. ” The result is a top-10 list of metros “where home prices are falling the most. ” The list is as follows: 1. Toledo, Ohio (-18. 7%) 2. Rochester, New York (-17%) 3. Detroit, Michigan (-15. 4%) 4. Pittsburgh, Pennsylvania (-13. 7%) 5. Springfield, Massachusetts (-5. 8%) 6. Tulsa, Oklahoma (-5%) 7. Los Angeles, California (-5%) 8. Memphis, Tennessee (-4. 6%) 9. Chicago, Illinois (-3. 7%) 10. Richmond, Virginia (-3. 4%) As you can see, there is quite a range in listing price drops among the top ten, with a high of -18. 7% in hard-hit Toledo, to a mere 3. 4% drop in Richmond, VA. So what exactly is going on here? Weren’t home prices expected to keep rising, despite significantly... --- > It’s time for another mortgage match-up folks. Today, we’ll look at 10-year mortgages versus the 30-year fixed mortgage to see how these home loans stack - Published: 2022-04-20 - Modified: 2025-03-31 - URL: https://www.thetruthaboutmortgage.com/30-year-vs-10-year-mortgages/ - Categories: Mortgage Matchups It’s time for another mortgage match-up folks. Today, we’ll look at 10-year mortgages versus the 30-year fixed mortgage to see how these home loans stack up against one another. My guess is the more 30-year fixed mortgage rates rise, the more consumers will be looking into alternative loan products like these. But before we get started, it’s important to note that there are two very different types of 10-year mortgages out there. One is a fixed-rate mortgage that is paid off in just a decade, and the other is an adjustable-rate mortgage, which takes three full decades to pay off. So clearly you need to pay real close attention here to ensure you know what you're getting yourself into. Two Very Different Types of 10-Year Mortgages There are two types of 10-year mortgages available to homeowners today The 10-year ARM (it's fixed for the first 10 years and adjustable for the remaining 20 years of the loan term) And the 10-year fixed-rate mortgage (it features a fixed interest rate for the entire 10-year loan term) Be sure you know what you're actually getting when comparing loan programs There are 10-year fixed mortgages, which have a mortgage term of 10 years. Yep, just a decade and they are paid off in full. Then there are 10-year adjustable-rate mortgages, which have a term of 30 years. Huge difference for a number of reasons. The first type of mortgage is pretty straightforward. It’s similar to a 30-year or 15-year fixed mortgage, only shorter.... --- > We’ve got 5% mortgage rates and record high home prices. Does this mean the seller’s market is finally over? You would think so, given the massive - Published: 2022-04-14 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/now-that-weve-got-5-mortgage-rates-is-the-sellers-market-finally-over/ - Categories: Housing Market, Mortgage Rates We’ve got 5% mortgage rates and record high home prices. Does this mean the seller’s market is finally over? You would think so, given the massive increase in monthly housing payments since last year. And the fact that the 30-year fixed now averages 5%, well above the sub-3% range seen six months ago. Surely it’s time for home buyers to receive some concessions (literally and figuratively) in this overheated housing market? Well, despite all that, it appears the housing market is still chugging along just fine, though some new trends are emerging. It’s Never Been More Expensive to Buy a Home as Payments Increase 35% From Last Year A new blog post from Redfin revealed that the median home sale price increased 17% year-over-year to a record high of $389,178 during the four-week period ending April 10th, 2022. At the same time, the median asking price of newly-listed properties jumped 14% year-over-year to $397,747. This is despite the fact that current 30-year fixed-rate mortgage rates are averaging 5%, up from 3. 04% during the same period in 2021. The typical home buyer’s monthly payment is now up 35% from a year ago to an all-time high of $2,288. You’d think home sellers would need to take this into account and stop being so greedy, but so far it’s mostly business as usual. In fact, 58% of homes under contract received an accepted offer within the first two weeks on the market, an all-time high (and up from 55% a year... --- > We know mortgage rates are projected to keep rising, so what’s a cost-effective solution if you need a home loan today? Well, one idea is to look beyond - Published: 2022-04-12 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/is-an-adjustable-rate-mortgage-a-good-short-term-strategy-until-interest-rates-cool-off/ - Categories: Mortgage Rates, Mortgage Tips We know mortgage rates are projected to keep rising, so what’s a cost-effective solution if you need a home loan today? Well, one idea is to look beyond the popular 30-year fixed, which is no longer a screaming bargain. For the past several years, fixed-rate mortgages were often priced the same or even lower than adjustable-rate mortgages. That was somewhat odd, but a product of the Fed buying up billions in mortgage-backed securities tied to 30-year and 15-year fixed-rate maturities. Now that the Fed is done with that, we’ve got a level playing field again, which means an ARM could be worth another look. A 6% 30-Year Fixed Could Be in the Cards This Summer First things first, there’s a lot of upward pressure on the 30-year fixed right now. Despite interest rates already rising from below 3% to 5% in a matter of three months, they could go even higher. The expectation is that the Fed is going to keep aggressively raising its target fed funds rate, which could translate to higher interest rates for consumer loans like mortgages. This could go on for some time as a means to control inflation and cool down an overheated economy. Simply put, mortgage rates could get worse before they get better. But I do expect them to get better within a reasonable timeframe, which I why I recently argued that they could be close to peaking. However, we may still face higher rates through the summer, which is why an ARM... --- > For those new to mortgages, the number five might feel a bit foreign. Over the past decade and even longer, rates on the popular 30-year fixed mortgage - Published: 2022-04-06 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/allow-me-to-introduce-you-to-the-5-mortgage-rate/ - Categories: Mortgage News, Mortgage Rates For those new to mortgages, the number five might feel a bit foreign. Over the past decade and even longer, rates on the popular 30-year fixed mortgage have always been in the 2-4% range. We were spoiled. Recently though, mortgage rates have jumped due to a variety of factors, including a strong economy, surging inflation, and the end of an accommodative monetary policy. The latest setback is a very aggressive Fed, which has indicated a faster reduction in its bond and mortgage-backed securities (MBS) holdings. We mostly knew that was coming, but not necessarily at the extreme pace signaled in Federal Reserve Governor Lael Brainard's comments. Why Are Mortgage Rates Going Up So Much? Mortgage rates were engineered lower via the Fed's QE monetary policy They purchased billions in agency-backed mortgage-backed securities over recent years The associated interest rates fell significantly, but also greatly increased the money supply, leading to worrisome inflation The Fed has finally acknowledged the need to end this accommodative policy, which is spiking interest rates Since 2008, the Federal Reserve has been buying mortgage-backed securities (MBS) in an effort to lower mortgage rates. It worked, brilliantly, leading to record low mortgage rates never before seen in our lifetimes. During early 2021, the 30-year fixed fell to its lowest level on record, an absurdly cheap 2. 65%, per Freddie Mac. The 15-year fixed also hit an all-time low of 2. 10% during the week ended July 29th, 2021. The good times rolled and mortgage lenders enjoyed record... --- > Two weeks ago, I wrote about how mortgage rates jumped, something just about everyone is aware of. But I also attempted to quantify the actual impact in - Published: 2022-04-04 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/have-mortgage-rates-peaked/ - Categories: Mortgage Rates, Mortgage Tips Two weeks ago, I wrote about how mortgage rates jumped, something just about everyone is aware of. But I also attempted to quantify the actual impact in terms of monthly mortgage payment. For the typical home, the principal and interest payment went up about 20%, or $230 per month. Not great news, but not necessarily a deal breaker for well qualified home buyers. The question now is have mortgage rates peaked, or is the worst yet to come? Mortgage Rates Have Rarely Moved This Much Higher, This Fast Drawing on another prior post, I said the cure to high mortgage rates might be high mortgage rates. In other words, the higher they go, the harder it is for them to keep moving higher. And if they go really high, in a short span of time, they might overshoot the mark, and fall back down to earth. This is similar to stock market moves, where the market itself or select securities become oversold, or overbought. Then prices usually rise or fall to reach an equilibrium that traders and the market seem to demand. In the case of mortgage rates, this falling back down to earth moment has yet to happen, but it could be in the cards. After all, rates have moved about 1. 50% higher since the beginning of 2022, a mostly unprecedented event. It’s actually only happened five times since mortgage rate tracking began in the 1970s. And Freddie Mac deputy chief economist Len Kiefer charted those prior movements.... --- > They say real estate is cyclical, much like the stock market and the wider economy. It ebbs and flows, goes up and down, experiences booms and busts, can - Published: 2022-03-31 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/are-we-near-the-peak-of-the-current-housing-cycle/ - Categories: Housing Market, Mortgage News They say real estate is cyclical, much like the stock market and the wider economy. It ebbs and flows, goes up and down, experiences booms and busts, can make us feel rich one day and poor the next. It doesn’t follow a straight line up or down over time – instead, it can be rather erratic, thanks to, well, us. We speculate, we get emotional, we create all sorts of creative financing to keep the party going, even if it doesn’t fundamentally “make sense. ” And it seems now the state of the housing market is being seriously questioned. So, are we finally peaking? Housing Bubble Chatter Seems Positively Correlated with Higher Mortgage Rates While I continue to argue that home prices and mortgage rates can be negatively correlated, it seems housing bubble fears and higher interest rates share a positive correlation. In other words, with mortgage rates surging, housing bubble anxiety is also beginning to surface just about everywhere. It’s not just a quiet side conversation anymore. Instead, you’re seeing it in the headlines daily, and even the Dallas Fed is weighing in. The researchers and economists at the Federal Reserve Bank of Dallas released a new blog post titled, “Real-Time Market Monitoring Finds Signs of Brewing U. S. Housing Bubble. ” In it, they argue that housing “is in the primary expansionary phase of a bubble when price rises are out of step with market fundamentals. ” But they stop short of calling it a “bubble,” noting that... --- > Now that 30-year fixed mortgage rates are flirting with 5%, there’s been quite the uptick in housing bubble chatter. The basic reasoning is because - Published: 2022-03-29 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/are-the-housing-bears-being-too-rational/ - Categories: Housing Market, Mortgage News Now that 30-year fixed mortgage rates are flirting with 5%, there’s been quite the uptick in housing bubble chatter. The basic reasoning is because interest rates are higher, the balloon that is inflated home prices must certainly pop. On the surface, it’s a seemingly logical argument. The financing cost of a home purchase has gone up substantially, so the price should come down. But the cost of just about everything has gone up, and we’re still buying it, whether it’s bread, toothpaste, toilet paper, gas, you name it. Because we want and need it, similar to shelter! Here I attempt to argue why the rates up, prices down theory might not be correct. And why we could be rushing the eventual downturn. Do Higher Mortgage Rates Really Lower Home Prices? I’ve already written an entire article on the supposed negative correlation between mortgage rates and home prices. But to revisit, the simple argument is that if one goes down the other goes up. And vice versa. For example, if interest rates go up (the cost of financing a home purchase), property values must go down to compensate. In essence, nothing changes, the net price stays the same? You get a lower mortgage rate but a higher home price. A higher mortgage rate but a lower home price? The cost of housing just stays constant no matter what? Once you start to look beyond this apparent obvious correlation, it seems to make a lot less sense, at least to me. My... --- > For the individual who eschews fiat currency, but still needs a mortgage, look no further than Figure. The company originally came onto the scene by - Published: 2022-03-24 - Modified: 2024-05-23 - URL: https://www.thetruthaboutmortgage.com/figure-crypto-mortgage-review/ - Categories: Mortgage News For the individual who eschews fiat currency, but still needs a mortgage, look no further than Figure. The company originally came onto the scene by offering a unique HELOC that came with a fixed interest rate. Later, they expanded to mortgage refinances, and in the summer of 2021 announced a merger with Homebridge Financial Services. Now they appear focused on being pioneers of so-called “crypto mortgages,” which as the name suggests are backed by cryptocurrencies like Bitcoin and Ethereum. They’ve got two new products to choose from, both of which allow you to keep your crypto holdings while purchasing a home. Figure’s Crypto Mortgage Their flagship product is known as “Crypto Mortgage,” a unique home loan that lets you borrow against your crypto holdings to purchase a home. Figure allows you to borrow up to 100% of the home price using up to 100% of your available crypto holdings. This is akin to a mortgage lender letting you buy a home with no money down, aka 100% loan-to-value (LTV). The difference is that you pledge your assets as collateral for the loan, and the property also backs it. What makes it even more special is you can take out a loan amount for up to $20 million. So if you’ve got lots of bitcoin, you’re in luck. For the record, the minimum loan amount is $75,000. They say the underwriting is “limited,” and also note that there is no need to sell your crypto, which could trigger a taxable event.... --- > Today we’ll check out “Diamond Residential Mortgage Corp.,” a Midwest mortgage lender that’s named after its founder, not the precious gem. The company is - Published: 2022-03-23 - Modified: 2024-07-24 - URL: https://www.thetruthaboutmortgage.com/diamond-residential-mortgage-review/ - Categories: Mortgage Tips Today we’ll check out “Diamond Residential Mortgage Corp. ,” a Midwest mortgage lender that’s named after its founder, not the precious gem. The company is relatively young, having been founded in 2009, but is already a billion-dollar per year originator. What stands out about them is their wide array of available loan programs, including ITIN mortgages, bank statement loans, and reverse mortgages. So if you’re in need of some creative home loan financing, they could be a good alternative to a big bank or household name. And they’ve got stellar reviews from thousands of past customers, meaning you should be in good hands whether you need a plain vanilla mortgage or something less conventional. Diamond Residential Mortgage Fast Facts A Midwestern-based mortgage banker Offers home purchase loans, refinances, and reverse mortgages Founded in 2009, headquartered in Lake Forest, Illinois Currently licensed to do business in 19 states 30 branch locations throughout the United States Funded roughly $1. 2 billion in home loans last year Most active in the states of Illinois and Indiana Diamond Residential Mortgage Corp. describes itself as a Midwestern-based mortgage banker that offers a wide range of solutions not typically available at local banks. They believe everyone deserves to be a homeowner, and are committed to serving the underserved via their many unique loan offerings. The company is headquartered in Lake Forest, Illinois and was founded in 2009 by mortgage veteran Paul Diamond, who has been in the business for over 35 years. DRMC prides itself on... --- > A 5/1 ARM can save you a lot of money versus the more expensive 30-year fixed. Learn how and if it could be a good fit for your situation. - Published: 2022-03-23 - Modified: 2025-06-17 - URL: https://www.thetruthaboutmortgage.com/30-year-fixed-vs-51-arm/ - Categories: Mortgage Matchups Now that mortgage rates have jumped, it might be time to consider alternatives to the 30-year fixed, such as the once-popular "5/1 ARM. " Everyone has heard of the 30-year fixed-rate mortgage – it’s far and away the most popular type of mortgage loan out there. Why? Because it's the easiest to understand and presents no risk of adjusting during the entire loan term. It's also fairly cheap, or was... It's basically the default home loan option whenever mortgage lenders advertise interest rates, and the pre-selected option when using a mortgage calculator. But what about the 5/1 ARM? What the heck is that slash doing there! ? While it might looks confusing, it's actually pretty straightforward. And can save you money! 5-Year ARM Quick Facts An adjustable-rate mortgage with a fixed interest rate for the first five years Interest rate is variable for the remaining 25 years (features a 30-year loan term) After five years rate can adjust higher based on index + margin (fully-indexed rate) 5/1 ARM means it can adjust once annually beginning in year six 5/6 ARM means it can adjust twice each year starting in year six Rate caps are in place to limit movement but payments could still become unaffordable 5/1 ARM vs. 30-Year Fixed: An Illustration Jump to 5/1 ARM topics: - 5/1 ARM Mortgage Rates - 5/1 ARM Example - 5/1 ARMs Will Likely Adjust Higher - Is a 5/1 ARM a Good Idea? - Pros and Cons of 5/1 ARMs - There's... --- > In a word, bad. At least in terms of historic interest rate moves, which have rarely rivaled the massive increases we’ve seen in such a short span. But - Published: 2022-03-22 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-have-jumped-just-how-bad-is-it/ - Categories: Mortgage News, Mortgage Rates In a word, bad. At least in terms of historic interest rate moves, which have rarely rivaled the massive increases we’ve seen in such a short span. But you have to consider context as well, such as the starting point for mortgage rates before this recent spike higher (near all-time lows). Along with how impactful the increase in monthly payment will be for home buyers and those looking to refinance. One should also consider that just about everything is going up in price (or already has), and that the U. S. dollar isn’t what it was once. Taken together, it may not be all that horrible, though it does depend on individual circumstances, and for home buyers, is clearly another piece of unwelcome news. Let’s Compare Monthly Payments on a Typically Priced Home The typical home is valued at about $332,000, per the Zillow Home Value Index, a 20. 3% increase from a year ago. Meanwhile, the average 30-year fixed mortgage rate is pricing around 4. 75% for vanilla scenarios, aka those with excellent credit, a 20% down payment, and so on. At the start of 2022, the 30-year fixed was priced closer to 3. 25%, so the move higher has been substantial. No one can debate that. But let’s look at how it might affect the average home buyer’s pocketbook, instead of simply freaking out at the difference in rate. We’ll assume our hypothetical home buyer purchases a property for $332,000 and puts down 20%. That leaves them with... --- > What year is it? 2006? The nation’s largest wholesale mortgage lender, United Wholesale Mortgage, has just announced the availability of bank statement - Published: 2022-03-17 - Modified: 2022-03-24 - URL: https://www.thetruthaboutmortgage.com/uwm-bank-statement-loans/ - Categories: Mortgage News What year is it? 2006? The nation’s largest wholesale mortgage lender, United Wholesale Mortgage, has just announced the availability of bank statement loans. Does this mean we’re headed down a familiar road of credit loosening, and a subsequent housing crash? At first glance, it’s reminiscent of the easy lending days seen in the early 2000s, though upon closer inspection it might not be. But the timing certainly is interesting, seeing that mortgage rates have surged higher, weighing on lenders’ ability to keep up production. Read on to learn more about what this new stated income loan program is and is not. How Bank Statement Loans Used to Work Before we get into all the details on UWM’s program, we need some context. Back in the day, bank statement loans, or stated income loans, were developed to help home buyers like doctors and business owners more easily navigate the loan process. Instead of requiring them to provide complicated tax returns, banks and lenders were OK with applicants simply stating their income and providing supporting asset documentation. Of course, that proved to be a slippery slope because before long, such programs were available to anyone, even those who simply claimed they did X for a living and made Y. This gave them the rather notorious nickname of “liar’s loan,” as they allowed for quite a bit of freedom in terms of well, honesty. The widespread use of stated income loans in the early 2000s led to the worst housing crisis in modern... --- > There’s an old adage in the commodities market that says, “the best cure for high prices is, high prices.” No, it’s not a typo. The logic is basically - Published: 2022-03-16 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/is-the-best-cure-for-high-mortgage-rates-high-mortgage-rates/ - Categories: Mortgage Rates, Mortgage Tips There’s an old adage in the commodities market that says, “the best cure for high prices is, high prices. ” No, it’s not a typo. The logic is basically that an elevated price over time will naturally lead to a decrease in demand. And as we all know, if demand for something falls, prices must come down, otherwise you risk an oversupply. Since the beginning of 2022, mortgage rates have surged to levels not seen since 2019, which as I’ve argued are basically a commodity because they’re not much different from one another. So, is it time for mortgage rates to come down simply because they’ve been up for so long? What Goes Up Must Eventually Come Down, Right? The year 2022 might as well be known as the mortgage rate reckoning. After pundits wrongly predicted rates would rise in 2019, 2020, and 2021, they finally did! And let’s just say they’ve made up for lost time. The popular 30-year fixed ended 2021 at an average of 3. 11%, per Freddie Mac. Today, you would be lucky to get your hands on a 30-year fixed mortgage rate at 4. 5%. Yes, in less than three months, interest rates have basically gone up 50%. Perhaps that’s exactly what they need to finally reverse course though. When a price rises so much, so quickly, it’s surely due for a relief rally, right? Well, I’ve been thinking that for a while, but it’s yet to materialize. While there have been some pullbacks, they’ve... --- > Not many mortgage companies have been around since the 1980s, but “Sun West Mortgage” has. However, that doesn’t mean they operate their business like a - Published: 2022-03-14 - Modified: 2025-04-09 - URL: https://www.thetruthaboutmortgage.com/sun-west-mortgage-review/ - Categories: Mortgage Tips Not many mortgage companies have been around since the 1980s, but “Sun West Mortgage” has. However, that doesn’t mean they operate their business like a dinosaur. Quite the contrary. They employ the latest digital technology and offer numerous tools to make your mortgage experience a pleasant one, and also a fast one. The SoCal based lender refers to itself as a “mortgage factory,” in the sense that they’re a well-oiled machine that has been honed to perfection over decades. And their thousands of customer reviews seem to back that up. Read on to learn more about them. Sun West Mortgage Fast Facts Direct-to-consumer retail mortgage lender Offers home purchase loans, refis, and renovation loans Founded in 1980, headquartered in Buena Park, CA Licensed in 48 states, D. C. , Puerto Rico, and the U. S. Virgin Islands Funded more than $11 billion in home loans last year Most active in home state of California (35% of total loan volume) Also operate wholesale and correspondent divisions and LowRates. com Sun West Mortgage Company, Inc. is a direct-to-consumer retail mortgage lender based out of Buena Park, California. They got started all the way back in 1980, and today are a $10 billion+ a year mortgage originator. The company refers to themselves as "minority-owned" and says it focuses on underserved communities. In 2021, their physical branch count surpassed 80, which means you can apply in person or online depending on your preference. They are mostly a refinance lender, with such loans accounting for... --- > Mortgage Q&A: “What is a conventional mortgage loan?” A “conventional loan” simply refers to any residential mortgage loan that is not insured or - Published: 2022-03-10 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-is-a-conventional-mortgage-loan/ - Categories: Mortgage Tips Mortgage Q&A: “What is a conventional mortgage loan? ” A “conventional loan” simply refers to any residential mortgage loan that is not insured or guaranteed by the federal government. The word conventional means standard, regular, or normal, which is basically saying that these types of loans are typical and common. And that makes a lot of sense because conventional home loans make up the largest share of mortgages issued in the United States. Their counterpart, government mortgages, account for the rest, albeit a smaller slice of the pie. Conventional loans account for about 85% of the residential mortgage market, with government loans the remaining 15%. What Makes a Loan Conventional? Conventional just means anything that is non-government By that definition it can include many different types of home loans The most common are conforming loans backed by Fannie Mae and Freddie Mac Along with jumbo loans and non-conforming loans that don't meet agency guidelines What makes a loan conventional? Simply put, not being backed by the government. That's it. This means conventional mortgage loans can be both fixed mortgages or adjustable-rate mortgages, including the 30-year fixed, 15-year fixed, hybrid ARMs. They can also be used to purchase a home or refinance an existing mortgage. Additionally, these types of loans may be conforming or non-conforming loans, with the former meeting the standards set forth by government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac. Same goes for interest-only loans, non-QM loans, 40-year loans, and so on. Basically anything under the sun. The... --- > If you’re a prospective home buyer, you need to prepare for the worst. And by worst, I mean a much higher-than-anticipated asking price. Maybe not - Published: 2022-03-08 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/if-you-want-to-buy-a-home-adjust-your-max-purchase-price-filter-a-lot-lower/ - Categories: Housing Market If you’re a prospective home buyer, you need to prepare for the worst. And by worst, I mean a much higher-than-anticipated asking price. Maybe not everywhere, but in many major metros nationwide, the real estate market remains red hot. And there’s really no sign of abating, even with mortgage rates back above 4% and the uncertainty of a war in Ukraine hanging over our heads. The latest sign that things aren’t slowing down is a report from Redfin that revealed nearly 6,000 homes sold for $100,000 or more above asking. What’s scarier is that data is only through February 15th, at a traditionally slower time of year for the housing market. 2022 Housing Market Comes Out Hot! It’s now safe to say that the 2022 housing market isn’t much different than the 2021 housing market. If you thought things were finally going to take a breather, well, they haven’t, at least not yet. Despite a 30-year fixed mortgage rate that is now above 4% with many banks and mortgage lenders, competition among home buyers remains fierce. A new Redfin analysis found that a staggering 5,897 homes sold for $100,000+ above asking from January 1st to February 15th. For perspective, that’s up from the 2,421 that sold for that premium a year earlier, a sign of the housing market’s strength as we roll into 2022. On a percentage basis, some 1. 8% of homes sold for at least $100,000 above asking, up from 0. 7% during this same period in 2021.... --- > Mortgage Investors Group, or MIG for short, has a familiar story in that they were founded by a small group of loan officers before growing into a - Published: 2022-03-08 - Modified: 2024-10-16 - URL: https://www.thetruthaboutmortgage.com/mortgage-investors-group-review/ - Categories: Mortgage Tips Mortgage Investors Group, or MIG for short, has a familiar story in that they were founded by a small group of loan officers before growing into a billion-dollar independent mortgage bank. What makes them more special is the fact that they’ve been around since 1989, a testament to their staying power in the very unforgiving mortgage industry. That means surviving a few housing booms and busts, yet carrying on and continuing to grow along the way. A couple of their claims to fame include being the Tennessee Housing Development Agency’s (THDA) top lender annually since 2003. And the number one USDA home loan lender in Tennessee every year since 2014. Let’s learn more about them. Mortgage Investors Group Fast Facts Direct-to-consumer retail mortgage lender Offers home purchase loans, refinances, and reverse mortgages Founded in 1989, headquartered in Knoxville, TN Funded about $4 billion in home loans last year The 3rd largest mortgage lender in the state of Tennessee The Tennessee Housing Development Agency’s (THDA) top lender since 2003 The #1 USDA home loan lender in TN since 2014 Mortgage Investors Group is a direct-to-consumer retail mortgage lender based out of Knoxville, Tennessee (pictured above is the Sunsphere from the 1982 World's Fair there). As noted, they got started all the way back in 1989 by co-founders Chuck Tonkin II and Chrissi Rhea, along with five colleagues. Today, the company has grown to 26 branch locations and 450 employees, with more than $20 billion in closed loans since inception. This means... --- > Sadly, there's another war taking place, this time Russia's invasion of neighboring Ukraine. While it doesn't involve the United States directly, a - Published: 2022-03-02 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-vs-war-the-silver-lining/ - Categories: Mortgage Matchups, Mortgage Rates Sadly, there's another war taking place, this time Russia's invasion of neighboring Ukraine. While it doesn't involve the United States directly, a dispute between Russia and effectively Europe has sent shock waves across the globe. Unfortunately, war, or even just a military strike, is not without its consequences. Aside from the human toll, there’s a good chance world economies will also take a knock. For starters, oil prices have already skyrocketed on supply concerns, as Russia will no longer be a trade partner for most. As a result, gas prices will likely tick higher, meaning businesses will spend more, and consumers will pay more at the pump. But what about mortgage rates? War Means Seeking Shelter When a war breaks out or threatens to break out Most people seek shelter both literally and figuratively For investors that means ditching risky stocks and jumping into bonds Bonds are considered a safe haven during uncertain times like these When a war breaks out, or even fears of a war, investors tend to seek shelter for their assets (too), a safe place to earn a return and avoid a collapse. The obvious place is always bonds, and the number one place to flee from is the stock market. So that’s probably why we saw stocks take a big dive yesterday. Investors take the “flight-to-quality,” exchanging high-risk stocks for relatively low-risk, safe haven assets like gold and Treasury bonds. This phenomenon explains why the 10-Year Treasury yield fell from around 2% late last week... --- > The latest company looking to tackle the buy before you sell quandary goes by the name “UpEquity.” They’re also making it easier for first-time home - Published: 2022-03-01 - Modified: 2024-09-03 - URL: https://www.thetruthaboutmortgage.com/upequity-review/ - Categories: Mortgage Tips The latest company looking to tackle the buy before you sell quandary goes by the name “UpEquity. ” They’re also making it easier for first-time home buyers to make a successful bid in a competitive market. It all has to do with their “proof of funds” approach to mortgage underwriting. Instead of simply providing a pre-approval, they give you the ability to make real cash offers, even if you need a home loan. Let’s learn more about their various financing programs to see if one could be a good fit. UpEquity Is a Mortgage Lender That Lets You Make Cash Offers Direct-to-consumer tech-enabled mortgage lender Specializes in all-cash offers, refinancing, and iBuying Founded in 2019, headquartered in Austin, Texas Funded roughly a half billion in home loans since inception Currently licensed to do business in 11 states Expected to launch in eight more states this year UpEquity is a direct-to-consumer mortgage lender based in Austin, Texas. They actually describe themselves as a tech-enabled lender, but what sets them apart is their ability to let you make all-cash offers on houses. This goes for first-time home buyers and move-up buyers, the latter who often must juggle a home purchase and home sale at the same time. The company was founded in 2019 by Harvard Business School alum Tim Herman, who like many other folks missed out on his dream home. To rectify that, he and partner Louis Wilson set out to “solve accessibility problems in real estate. ” In other words,... --- > Today we’ll take a thorough look at “Waterstone Mortgage,” a residential mortgage lender backed by a billion-dollar depository bank. Despite being the - Published: 2022-02-22 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/waterstone-mortgage-review/ - Categories: Mortgage Tips Today we’ll take a thorough look at “Waterstone Mortgage,” a residential mortgage lender backed by a billion-dollar depository bank. Despite being the subsidiary of a large publicly-traded company, they still have the feel of a local, independent mortgage lender. The main advantage of that backing is a much bigger lending menu, which gives them the ability to offer unique loan products the other guys can’t. They also pride themselves on being home purchase loan experts, a big plus if you’re attempting to buy in today’s ultra-competitive housing market. But existing homeowners can benefit from their endless product menu too – let’s learn more to see if they could be a good fit for you. Waterstone Mortgage Fast Facts Retail, direct-to-consumer mortgage lender Offers home purchase financing, refinances, and construction loans Founded in 2000, headquartered in Pewaukee, Wisconsin A wholly owned subsidiary of WaterStone Bank SSB Funded roughly $4. 5 billion in home loans last year Nearly 20% of business comes from New Mexico (2nd largest in the state) Also very active in Arizona, Florida, and Wisconsin Licensed in all 50 states and the District of Columbia Waterstone Mortgage is a retail, direct-to-consumer mortgage lender based in Pewaukee, Wisconsin, which is a suburb of Milwaukee. They were founded in the year 2000 as a three-person team, and quickly expanded before being sold to Wauwatosa Savings Bank in 2006. Just two years later, that company changed its name to WaterStone Bank, making them a wholly owned subsidiary. This means they have the... --- > You may have heard that home buying sentiment is horrible at the moment, what with home prices and mortgage rates rising in tandem. The continued lack of - Published: 2022-02-09 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/number-who-say-its-a-good-time-to-buy-a-home-hits-an-all-time-low-however/ - Categories: Housing Market, Mortgage Rates You may have heard that home buying sentiment is horrible at the moment, what with home prices and mortgage rates rising in tandem. The continued lack of inventory coupled with rising prices and eroding affordability isn’t making many prospective buyers happy. And it’s apparently the worst for young households, who are having to put their homeownership aspirations on hold at a critical time. This is arguably much worse than the quandary for existing homeowners, who simply can’t make a lateral move too easily. Sure, they can sell for top dollar, but then they’re in a similar boat with other buyers chasing too few "overpriced" homes. The Survey Says... It’s a Horrible Time to Buy a Home! A new survey from mortgage financier Fannie Mae noted that just 25% of respondents said it was a good time to buy a home last month. The January reading was the lowest in the history of Fannie Mae’s National Housing Survey (NHS), which dates back to mid-2010. At the same time, 70% said it was a bad time to buy a home, up from 66% a month earlier. Taken together, the net good time to buy is -45%, down 5 percentage points from a month earlier and 60 percentage points from a year ago. At this time last year, about 52% of respondents still felt it was a good time to buy a home, while only about 37% felt it was a bad time. Since then, the good time and bad time trajectories have... --- > With home prices on the rise, and only expected to go higher this year, you might be wondering how to get a bigger mortgage. After all, you might need one - Published: 2022-02-03 - Modified: 2023-10-18 - URL: https://www.thetruthaboutmortgage.com/get-a-bigger-mortgage/ - Categories: Home Buying, Mortgage Tips With home prices on the rise, and only expected to go higher this year, you might be wondering how to get a bigger mortgage. After all, you might need one if the purchase price is above than your original estimate, or if you're short on down payment funds. These days, bidding wars are the norm, and it’s likely you’ll have competition when making an offer on a property. The good news is mortgage rates remain super low, despite some recent headwinds due to inflation concerns. This means you can borrow more for relatively cheap, which is a good thing. And enjoy a low fixed rate for 30 years or longer. 1. Improve Your Credit Scores Want a bigger mortgage? Improve your credit scores so you can qualify for a mortgage at a lower interest rate. A lower rate equates to a smaller monthly payment, which will increase your purchasing power. For example, if your three FICO scores average 660, your rate might be a half point higher than someone with a 740 FICO. That could save you more than $100 per month on a $500,000 home purchase with 20% down. As a result, you’ll be able to borrow more at the lower interest rate. You’ll also save money in the process by paying less interest. You should always aim for high credit scores whether affordability is an issue or not. 2. Shop Around for a Lower Rate To that same end, anything you can do to lower the mortgage rate... --- > It’s a question I see consumers ask whenever they size up a lender: “Is X mortgage company legit?” Ultimately, borrowers want to know that the company - Published: 2022-02-02 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/is-this-mortgage-company-legit/ - Categories: Mortgage Tips It’s a question I see consumers ask whenever they size up a lender: “Is X mortgage company legit? ” Ultimately, borrowers want to know that the company they’re considering is above board, and not some fly by night operation. After all, a mortgage is a major financial transaction, and not one to leave to chance. The last thing you want is to get paired up with an inept individual or institution that fails to close your home loan. Or worse, takes you for a ride and scams you out of money. Here are some tips to pick a quality lender. Check the Lender’s Online Reviews These days, I write a lot of mortgage reviews to help consumers navigate the literal thousands of options they have. Not all of these mortgage lenders are household names, but that doesn't mean they aren't good companies. In fact, smaller can sometimes be better. One good place to start when determining a mortgage broker or lender’s legitimacy is to check out their reviews. You can find an abundance of information with a few clicks, whether it’s their Google listing, Facebook page, or an outright review site like Trustpilot or Experience. com. Take a few minutes to find their listing on a handful of review sites, and while you’re at it, read some of those reviews. Find the bad reviews and read those even more carefully – it might be a one-off incident related to an employee working for the lender, or it could be a... --- > Do you want a low mortgage rate and a good experience to boot while obtaining a home loan? While that basically sounds impossible, a company called “Loan - Published: 2022-02-01 - Modified: 2024-09-05 - URL: https://www.thetruthaboutmortgage.com/loan-factory-review/ - Categories: Mortgage Tips Do you want a low mortgage rate and a good experience to boot while obtaining a home loan? While that basically sounds impossible, a company called “Loan Factory” might be worth looking into. That’s the dual promise they make to prospective clients, and they appear to put their money where their mouth is. They say their rates are on average $1,000 less than their competitors, and instead of hiding them, you can find them right on their website without logging in. What makes them unique from big banks and lenders is the fact that they’re a mortgage broker, which gives them access to lots of different rates. This allows them to shop and negotiate on your behalf so you don’t have to. If that sounds good, read on to learn more. Loan Factory Fast Facts Mortgage broker that offers home purchase and refinance loans Founded in 2006, headquartered in San Jose, CA Licensed to do business in 40 states and the District of Columbia 25 physical branches located throughout the country Have funded $10. 1 billion in home loans since inception Their CEO was the #1 loan originator in 2020 per Scotsman Guide rankings As noted, Loan Factory is a mortgage broker, or middleman between you the homeowner (or home buyer) and a wholesale lender. They work as a liaison to help you secure financing, whether it’s a home purchase loan or a mortgage refinance. The company got their start back in 2006 and are headquartered in San Jose, California.... --- > Today we’ll deep dive into “InstaMortgage,” formerly known as Arcus Lending, a lender that promises low rates, legendary service, and a mortgage at record - Published: 2022-01-31 - Modified: 2024-10-24 - URL: https://www.thetruthaboutmortgage.com/instamortgage-review/ - Categories: Mortgage Tips Today we’ll deep dive into “InstaMortgage,” formerly known as Arcus Lending, a lender that promises low rates, legendary service, and a mortgage at record speed. They’re also big on tech (being located just down the road from Silicon Valley) and offer a smartphone app you can use to close your home loan. What’s unique about them is that they’re minority-owned and immigrant-led, with more than half of their loans going to minorities. The company is helmed by mortgage industry veteran Shashank Shekhar, who aside from running a mortgage company is also an Amazon #1 best-selling author. He prides himself on empowering consumers via financial literacy, and if his company can deliver on their promises, they might be worth looking into if you need a home loan. Let’s learn more. InstaMortgage Fast Facts Direct-to-consumer mortgage lender and mortgage broker Offers home purchase loans and mortgage refinances Founded in 2008, headquartered in San Jose, CA Formerly known as Arcus Lending Currently licensed to do business in 26 states Claim that 80% of their mortgages close 20-70% faster than industry average Committed to diversity, inclusion, and minority homeownership InstaMortgage is a direct-to-consumer mortgage lender (and mortgage broker) located in San Jose, California that offers home purchase financing and mortgage refinances to existing homeowners. The company was started in 2008 around the time of the Great Recession, which even founder Shekhar admits was the worst year for the economy (and perhaps to start a business). Bad timing aside, InstaMortgage recently made it onto the... --- > In an effort to make loan closings even faster, United Wholesale Mortgage (UWM) is offering an appraisal credit on home purchase loans submitted through - Published: 2022-01-28 - Modified: 2022-01-28 - URL: https://www.thetruthaboutmortgage.com/uwm-offering-no-cost-appraisals-on-home-purchase-loans/ - Categories: Mortgage News In an effort to make loan closings even faster, United Wholesale Mortgage (UWM) is offering an appraisal credit on home purchase loans submitted through March 31st, 2022. Often times, appraisals slow down what’s already a lengthy mortgage process, a critical issue on time-sensitive transactions like home purchases. To motivate their mortgage broker partners, they’re offering a credit for up to $600 if they utilize their “CD at Initial Underwrite” process. This entails verifying a few details related to the property value, property taxes, and homeowners insurance upfront. Doing so allows the lender to release the Closing Disclosure (CD) when the loan is conditionally approved, which can get borrowers to their closing date an average of eight days earlier. How to Qualify for the No-Cost Appraisal As noted, your mortgage broker will need to complete a few steps early on in the loan process to qualify for the no-cost appraisal. There are three categories that require their attention, including the appraisal, taxes, and homeowners insurance. They must upload a document in each category to satisfy these requirements. For the home appraisal, a sales contract is good enough because the sales price is used as the preliminary value. The taxes for the subject property can be verified simply by uploading the MLS listing. And the homeowners insurance piece can be satisfied simply by obtaining a quote from an insurance company with the subject property’s address. Lastly, the loan must be locked as well, meaning no floating allowed if you want to take... --- > Today we’ll check out “Cake Mortgage Corp.,” which as the name implies wants to make the home loan process a piece of, well, cake. They believe cake isn’t - Published: 2022-01-26 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/cake-mortgage-review/ - Categories: Mortgage Tips Today we’ll check out “Cake Mortgage Corp. ,” which as the name implies wants to make the home loan process a piece of, well, cake. They believe cake isn’t just for birthdays, but for life, aka a full 30 years on your fixed-rate mortgage and beyond. Despite being around for only a few years, Cake has already funded billions in home loans and accrued nearly a thousand excellent reviews from their customers. The story behind the company is driven by the founder’s disdain for predatory lending, which cost his mother her home during the Great Recession. That means you should experience a transparent, hassle-free loan process and hopefully snag a low rate in the process. Cake Mortgage Fast Facts Direct-to-consumer mortgage lender Offers home purchase loans and mortgage refinances Founded in 2018, headquartered in Chatsworth, CA Formerly known as Millennial Home Lending Licensed to do business in 42 states and Washington D. C. Funded more than $3. 5 billion in home loans since inception Cake Mortgage Corp. is a direct-to-consumer mortgage lender based out of Chatsworth, California, which is a suburb of Los Angeles. The company got its start in 2018, but has already funded more than $3. 5 billion in home loans. Cake was launched by David Abelyan, a former top producer at PennyMac who decided to branch off on his own after witnessing what he viewed as “absurd fees” being charged to a veteran. He originally started Millennial Home Lending in September 2018 with just one other employee,... --- > Most homeowners know what a mortgage refinance is, but aren’t necessarily familiar with the process and many steps that take place along the way. If - Published: 2022-01-24 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-refinance-process-steps/ - Categories: Mortgage Tips, Refinance Most homeowners know what a mortgage refinance is, but aren’t necessarily familiar with the process and many steps that take place along the way. If you’ve never refinanced your mortgage, or haven’t in a while, it can be beneficial to refresh your memory so you know what to expect. Whether you’re looking to refinance your home loan for a lower rate and/or cash out, the process is mostly the same. Expect the entire thing to take anywhere from 30-60 days depending on your particular loan scenario and how busy lenders are when you apply. Let’s break it down from start to finish. Note that stuff can happen concurrently or slightly differently depending on the company you work with. Step 1. Prepare your finances and check your credit (3-6 months) Before you even speak to anyone, you need to get your house in order. This means setting aside liquid assets in a verifiable account and making sure they’re seasoned for at least two months, preferably three. It also means getting a copy of your credit report (Credit Karma or another free service) and knowing your credit scores. Again, lots of free options like your bank or credit card company. Along these same lines, stop spending on all your credit cards as much as possible if income is tight and qualifying could be close. Reducing credit card spending could also improve your FICO scores, as could paying off credit cards in advance. To make things really simple, you may want to go... --- > These days, prospective home buyers are spending a lot more time looking at homes virtually rather than in person. This was a trend before COVID-19 reared - Published: 2022-01-21 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/how-many-homes-should-i-look-at-before-i-buy/ - Categories: Home Buying, Housing Market, Mortgage Tips These days, prospective home buyers are spending a lot more time looking at homes virtually rather than in person. This was a trend before COVID-19 reared its ugly head, and one that has only been exacerbated by the pandemic. Ultimately, much of the home buying process can be conducted online, just like anything else these days. However, you probably still want to see the property in person because you’re buying a house, not a burrito. The question is, how many homes should you look at before making an offer? The Typical Home Buyer ‘Views’ Eight Properties First, let’s talk about what the norm is based on some data from the National Association of Realtors. The real estate agent group recently noted that home buyers viewed a median eight homes before purchasing a property last year. This was down from 12 homes between the years 2009 and 2011, when the market was cold, and slightly less than the nine homes viewed during the prior housing boom from 2004 to 2006. Further back in the 80s and 90s, the median was closer to 12 homes as well. While eight might not seem like a lot, it’s actually even less in the real world. By real world, I mean not on your smartphone. Of those eight properties, three were viewed online-only, meaning the buyer didn’t actually check them out in person. They viewed those properties by way of virtual tour or virtual open house. So when it comes down to it, the typical... --- > As the name implies, "prepaid interest" is money you owe to a bank or mortgage lender that is paid in advance of when it is actually due. In terms of why - Published: 2022-01-18 - Modified: 2024-10-14 - URL: https://www.thetruthaboutmortgage.com/what-is-prepaid-interest/ - Categories: Mortgage Tips, Refinance As the name implies, "prepaid interest" is money you owe to a bank or mortgage lender that is paid in advance of when it is actually due. In terms of why it needs to be paid before the due date, there are several reasons, though it mostly boils down to the fact that mortgages are paid in arrears. This means mortgage payments are due after the month ends, because interest must accrue (over time) before it can be paid. This differs from rent, which is paid in advance of the month in which you occupy a rental unit. If buying a home or refinancing an existing mortgage, prepaid interest will often be listed as a line item along with your other closing costs. Let’s learn why. Prepaid Interest on a Home Purchase Mortgages are generally due on the first of the month, though there is also typically a grace period to pay until the 15th. Additionally, mortgage lenders don’t accept partial payments, so an entire month’s payment must be paid each month. When you purchase a home, there’s a good chance you’ll close on a random day of the month, say the 10th or the 15th, or the 24th. This means your mortgage will accrue interest for an odd number of days during that initial month. Instead of asking you to pay that odd amount of interest as your first mortgage payment, you simply take care of it at closing. By take care of it, I mean pay it in... --- > Before you set out to snag the lowest rate on your purchase mortgage or refinance, you’ll need to decide on (or at least narrow down) a mortgage term. - Published: 2022-01-12 - Modified: 2023-09-22 - URL: https://www.thetruthaboutmortgage.com/what-mortgage-term-is-best/ - Categories: Mortgage Tips Mortgage Q&A: “What mortgage term is best? ” Before you set out to snag the lowest rate on your home purchase loan or mortgage refinance, you’ll need to decide on (or at least narrow down) a mortgage term. I'm referring to the amount of time it will take to pay off your home loan in full. The "mortgage term" is essentially the duration of your mortgage, whether you actually keep it for that length of time or not. Let's talk about why it matters and what factors may sway your decision in this department. Choosing an Appropriate Mortgage Term One thing you'll need to decide on when taking out a mortgage is the "loan term" This is the duration of the home loan, which can generally range from 10 to 30 years It's how long it will take to pay off the mortgage in full based on regular monthly principal and interest payments Your choice can greatly impact how much interest is paid to the bank over time First off, your mortgage payments and the amount of interest you pay will be determined, in large part, by the term of your mortgage. For example, a 15-year mortgage is paid off in half the amount of time as a 30-year mortgage, so the monthly mortgage payment will be much higher. It won’t be double the amount of the 30-year because you’ll pay less interest over a shorter period of time, but it’ll be significantly higher. Generally, you're looking at a mortgage... --- > It’s been some time since I’ve done mortgage Q&A, so without further delay, let’s explore the following question: “Do you need 20% down to buy a - Published: 2022-01-10 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/do-you-need-20-down-to-buy-a-house/ - Categories: Home Buying, Housing Market, Mortgage Tips It’s been some time since I’ve done mortgage Q&A, so without further delay, let’s explore the following question: “Do you need 20% down to buy a house? ” If you chat with anyone older than 50 (maybe 60), they’ll probably tell you that you need to (or should) put 20% down if you want to buy a house. For them, it's the normal, or should I say traditional, down payment needed to secure a mortgage. And while it might be conventional wisdom when it comes to home buying, it’s not necessarily the reality anymore. In fact, the median down payment is just 12%, per the National Association of Realtors (NAR) 2021 Home Buyer and Seller Generational Trends report. Despite this, a lot of people still seem to think you need 20% down to purchase a home. You Don't Need a 20% Down Payment... A few years back, the NAR 2017 Aspiring Home Buyers Profile report found that 39% of non-owners believed they needed more than 20% for a mortgage down payment on a home purchase. And 26% assumed they needed to put down 15-20%, while 22% said they needed a down payment of 10-14% in order to buy. None of those answers are true. A 2020 study from NAR also had a whopping 35% of respondents going with the 16% to 20% down payment tier, easily the number one answer. In reality, you may not even need a down payment if you take out a certain type of home loan,... --- > If you own a second home or hold a high balance loan amount, you may want to refinance sooner rather than later. That’s assuming you were thinking of - Published: 2022-01-06 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/new-fees-for-high-balance-loans-and-second-home-loans/ - Categories: Mortgage News, Mortgage Rates If you own a second home or hold a high balance loan amount, you may want to refinance sooner rather than later. That’s assuming you were thinking of refinancing. The same goes for those planning to purchase a second home or take out a mortgage with a high balance, which is a loan amount above the baseline conforming limit. The conforming limit for 2022 is $647,200, so if your loan amount will be north of that, take note. Fannie Mae and Freddie Mac are raising loan-level price adjustments (LLPAs) for both types of transactions come April 1st. Depending on the details of your loan scenario, this could drastically increase your closing costs and/or mortgage rate. Second Home Mortgages and High Balance Loans Going Up in Price In an effort to bolster its support for affordable housing and sustain equitable access to homeownership, the Federal Housing Finance Agency (FHFA) will be raising (LLPAs) for certain transactions. These LLPAs get passed onto consumers in the form of either more expensive closing costs or higher mortgage rates. As noted, they pertain to the financing of second homes, whether a purchase or refinance, and high-balance loans, those which exceed the conforming limit. The idea here is that these types of home loans go toward more affluent individuals. And they also create more risk for Fannie Mae and Freddie Mac, which are backed by taxpayers. After all, large loan amounts and vacation properties are more likely to default and/or create larger losses for the Enterprises.... --- > It's almost mid-December, which means it is time for another round of mortgage and real estate predictions for the upcoming year. I think it's safe to say - Published: 2021-12-09 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2022-real-estate-predictions/ - Categories: Housing Market, Mortgage Tips It's almost mid-December, which means it is time for another round of mortgage and real estate predictions for the upcoming year. I think it's safe to say that 2021 has been another stellar year for both the mortgage industry and the housing market. But it's going to be hard to top or even match what we've experienced this year in terms of mortgage origination volume and home price gains. However, the party might not be over yet, with additional home price gains on the horizon due to similar factors in play. Let's see what 2022 might have in store as we once again look into the crystal ball. 1. Mortgage rates will go up, but only slightly. Experts have been calling this for years to no avail. We have been told year in and year out that the low mortgage rates are leaving the station. But year after year, they remain. In 2022, I do expect them to rise somewhat, but not by a meaningful amount. Sure, your 30-year fixed rate may go from 3% to 3. 5%, but that’s not a huge jump. And any 30-year fixed in the 3s is generally very favorable. It will put pressure on prospective home buyers who also have to grapple with rising home prices and a lack of inventory. And it will certainly dent mortgage refinance demand, as most existing homeowners have already locked in a lower rate. However, as I said in my 2022 mortgage rate predictions post, there will likely... --- > Today we’ll take a good look at a newer veteran-owned mortgage lender by the name of Strong Home Mortgage. As the name implies, they want to put you in a - Published: 2021-12-08 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/strong-home-mortgage-review/ - Categories: Mortgage Tips Today we’ll take a good look at a newer veteran-owned mortgage lender by the name of Strong Home Mortgage. As the name implies, they want to put you in a strong position, whether you’re a first-time home buyer looking to make a good impression with a seller, or an existing homeowner who wants better terms on your mortgage. Despite being a young company, their former-military founders have a combined 36 years of mortgage experience and counting. They also pride themselves on providing mortgage financial literacy to their customers via their many social channels to empower their clients. So far it all seems to be working as they’ve got excellent customer reviews across the internet and recently received a top-10 award from LendingTree. Let’s learn more. Strong Home Mortgage Fast Facts Veteran-owned mortgage lender that offers home purchase and refinance loans Founded in 2017, headquartered in Manassas, Virginia Licensed to do business in 46 states and the District of Columbia Offer a $6,000 On-Time Closing Guarantee for home buyers A Costco mortgage program preferred lender Strong Home Mortgage is a direct-to-consumer mortgage lender with a small handful of physical branches scattered across the country. This means you’ll more than likely work with them remotely to close your home loan. The company was founded by veterans in 2017, who also have a ton of mortgage experience from prior positions. The current CEO is VMI graduate Roger Jones, and the president Mike Peoples, a former U. S. Army Ranger. One notable fact about... --- > Well, just like that it’s December again, which means it’s time for the 2022 mortgage rate predictions. This past year was filled with ups and downs - Published: 2021-12-07 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2022-mortgage-rate-predictions/ - Categories: Mortgage Rates Well, just like that it’s December again, which means it’s time for the 2022 mortgage rate predictions. This past year was filled with ups and downs (literally) when it came to mortgage rates, with plenty of surprises and unexpected turns along the way. I expect 2022 to be no different, seeing that COVID is still very much an unresolved issue. At the same time, the Fed has pumped the brakes on its purchases of mortgage-backed securities, while also signaling an end to its easy money, low rate days. So perhaps 2022 will be an ongoing tug-o-war between the Fed and COVID when it comes to the direction of rates. This could mean periods of low rates and not-as-low rates. MBA 2022 Mortgage Rate Predictions First quarter 2022: 3. 3% Second quarter 2022: 3. 5% Third quarter 2022: 3. 7% Fourth quarter 2022: 4. 0% First up is the Mortgage Bankers Association (MBA) and their monthly Mortgage Finance Forecast from late November. They predict a 30-year fixed mortgage at 3. 3% in the first quarter of 2022, which isn’t far off from today’s levels, depending on the mortgage lender in question. It then rises 20 basis points to 3. 5% in the second quarter of 2022, and another 20 bps to 3. 7% in the third quarter. The shocker is their call for a 4% 30-year fixed mortgage rate by the fourth quarter of 2022. That’s bold, though not out of the realm of possibilities. They see rates going even higher... --- > Today we’ll review a Missouri-based community bank that’s big on home loans, North American Savings Bank, or NASB Home Loans for short. The company got - Published: 2021-12-06 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/nasb-home-loans-review/ - Categories: Mortgage Tips Today we’ll review a Missouri-based community bank that’s big on home loans, North American Savings Bank, or NASB Home Loans for short. The company got started all the way back in 1927, navigated World War II and the Great Depression, and now holds billions in customer assets. They were once known as the North American Savings Association, or NASA for short, but that probably led to some confusion. While NASB offers a wide range of home loan options, they appear to specialize in VA lending and mortgage refinancing. Let’s learn more about them to see if they could be a good choice for your mortgage needs. North American Savings Bank Fast Facts Community bank that offers mortgages and checking/savings accounts Founded in 1927, headquartered in Kansas City, MO Funded $5. 6 billion in home loans last year Specializes in VA loans and mortgage refinances for existing homeowners Most active in the state of California (13% of overall loan volume) Licensed to do business in all 50 states and the District of Columbia A Costco mortgage lender partner As noted, North American Savings Bank is a community bank that takes in deposits (checking/savings accounts) and lends out money (home loans). They operate brick-and-mortar branches in Missouri but also work with their many customers remotely because they’re licensed nationally. Last year, the company funded a whopping $5. 6 billion in home loans, with about $750 million of that coming from the state of California. NASB is also quite active in their home... --- > If you live in New England, or more specifically Massachusetts, there’s a very good chance you’ve heard of Mortgage Network, Inc. They refer to themselves - Published: 2021-12-02 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/mortgage-network-review/ - Categories: Mortgage Tips If you live in New England, or more specifically Massachusetts, there’s a very good chance you’ve heard of Mortgage Network, Inc. They refer to themselves as one the largest independent mortgage lenders on the East Coast, funding billions in home loans annually. And the company does so with shining customer reviews, claiming that more than 98% of customers would refer them to friends or family. Mortgage Network prides itself on raising the bar when it comes to customer service, while also offering its clients the latest “proprietary, award-winning technology. ” Read on to learn more about them to determine if they could be a good choice for your home loan needs. Mortgage Network Inc. Fast Facts Retail direct mortgage lender that offers home purchase loans and refinances Founded in 1988, headquartered in Danvers, Massachusetts Currently licensed in 26 states and the District of Columbia Funded $4 billion in home loans last year Nearly 60% of total volume comes from home state of MA Mortgage Network is a retail, direct-to-consumer mortgage lender located in Danvers, Massachusetts, which is located north of Boston. This means you can work with them over the phone, online, or in-person if you live close to one of their many branches. They have about 40 physical branches located throughout the East Coast from as far north as Portland, Maine to as far south as Ft. Lauderdale, Florida. The company was founded all the way back in 1988 by Robert McInnes and claims to be one of the... --- > Similar to the FHFA, the U.S. Department of Housing and Urban Development (HUD) announces maximum loan limits each year for FHA loans. Today, they - Published: 2021-12-01 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2022-fha-loan-limits/ - Categories: Mortgage News Similar to the FHFA, the U. S. Department of Housing and Urban Development (HUD) announces maximum loan limits each year for FHA loans. Today, they unveiled the 2022 FHA loan limits, which like the 2022 conforming loan limits, will be significantly higher than the limits in effect this year. This is thanks to continued home price appreciation, and the fact that the calculation of the FHA loan limits is driven by the conforming loan limit itself. To come up with the FHA loan limits, HUD uses a percentage of the national conforming limit to set both a floor and a ceiling. In cities like Los Angeles, home buyers can enjoy the higher ceiling loan limit, while many less expensive cities nationwide are set at the floor. There are also limits in between these two thresholds. FHA Low-Cost Area Loan Limits (The Floor) One-unit property: $420,680 Two-unit property: $538,650 Three-unit property: $651,050 Four-unit property: $809,150 To calculate the FHA loan limit floor, HUD uses 65 percent of the national conforming limit, which will be $647,200 for a one-unit property in 2022. That puts it at $420,680, up from $356,362 in 2021. That’s a big 18% increase, and enough to make many more home buyers eligible for FHA financing nationwide. It’ll be even higher for multi-unit properties, such as duplex or triplex. If you put down the minimum 3. 5% on a home purchase, you'll now be able to purchase a property for as much as $435,000. FHA High-Cost Area Loan Limits... --- > This morning, the 2022 conforming loan limits were officially announced by the FHFA, with the baseline limit hitting a whopping $647,200. Prior to this - Published: 2021-11-30 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2022-conforming-loan-limits/ - Categories: Mortgage News This morning, the 2022 conforming loan limits were officially announced by the FHFA, with the baseline limit hitting a whopping $647,200. Prior to this announcement, some mortgage lenders had already upped their maximum loan amounts in anticipation. Both PennyMac and United Wholesale Mortgage increased loan limits to $625,000 back in early October, knowing they'd be safe in doing so due to massive home price gains. This is great news for prospective home buyers (and existing homeowners) who have loan amounts that slightly exceed the current 2021 loan limit. In short, conforming loans backed by Fannie Mae and Freddie Mac tend to price lower than jumbo loans, and can be easier to qualify for. 2022 Conforming Loan Limit Up Nearly $100k From Last Year One-unit property: $647,200 Two-unit property: $828,700 Three-unit property: $1,001,650 Four-unit property: $1,244,850 Thanks to surging property values, it’s now possible to get a conforming loan amount up to $647,200 on a one-unit property. This is a major increase from the 2021 conforming loan limit of $548,250. In fact, it’s an 18% jump, which is a reflection of the red-hot housing market. As a result, a home buyer could purchase a home for $809,000, put 20% down, and avoid the jumbo loan realm. And an existing homeowner looking to refinance a mortgage could save some more money by slipping below the conforming limit. And on multi-unit properties, the loan limits are even higher, from $828,700 up to $1,244,850. This might mean lower mortgage rates for more homeowners, which... --- > Last week, the World Health Organization (WHO) designated Omicron, formally known as B.1.1.529, a variant of concern. This news rocked financial markets - Published: 2021-11-29 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-vs-omicron/ - Categories: Mortgage Matchups, Mortgage Rates Last week, the World Health Organization (WHO) designated Omicron, formally known as B. 1. 1. 529, a variant of concern. This news rocked financial markets nationwide amid concerns of another series of lockdowns, travel restrictions, and so on. In short, there’s renewed fear that we’re not out of the woods on COVID, as some seemed to think prior to this bombshell. Of course, this is all just preliminary information, and researchers in South Africa and elsewhere are conducting studies to determine if it presents additional risks to the world. If you’re in the market to buy a home or refinance your mortgage, you might be wondering what it means for mortgage rates. Let’s discuss. Mortgage Rates Tend to Drop When There Are Unknowns While mortgage rates and COVID don’t have a long-term relationship, given COVID’s recent emergence, one thing is clear. Interest rates often move lower when there is uncertainty in the air, no matter what’s behind it. Prior to this announcement from the WHO, there was a general belief that we had seen the worst of COVID, and thus the economy could get back on its merry upward trajectory. This news has thrown a wrench is that idea, and as such safe havens like Treasuries have rallied. Meanwhile, their yields have plummeted, with the bellwether 10-year bond yield falling about 20 basis points (. 20%) from around 1. 68 to 1. 47, before recovering somewhat. It now stands at about 1. 52, as investors digest this Omicron news and... --- > Today we’ll check out a Southern California-based mortgage broker named “Lendevity,” which has been earning rave reviews lately. Their name is actually a - Published: 2021-11-18 - Modified: 2024-10-16 - URL: https://www.thetruthaboutmortgage.com/lendevity-review/ - Categories: Mortgage Tips Today we’ll check out a Southern California-based mortgage broker named “Lendevity,” which has been earning rave reviews lately. Their name is actually a combination of lend and longevity, their way of saying they’ll be by your side throughout the loan process and beyond. The company says it takes an “advisory approach” to better understand your financing needs and create a custom solution that fits your goals. They do so using the latest technology, charge $0 lender fees, and aim to close loans in three weeks or less. And they’ve got a loyalty program to boot if you come back to them a second time. Let’s learn more. Lendevity Fast Facts Online mortgage broker that offers home purchase and refinance loans Founded in 2018, headquartered in Woodland Hills, CA Licensed to do business in five states (AZ, CA, CO, OR, WA) Charge $0 lender fees on most loans Offer a loyalty program for repeat customers that waives 3rd party fees As noted, Lendevity is a mortgage broker, meaning they connect consumers with their wholesale lender partners. This gives them the ability to shop your loan so you don’t have to in order to find the best price. They may also have access to unique loan programs the bigger banks might not offer. The company is located in Woodland Hills, California and was founded in 2018. Despite being rather young, they’ve got consistently excellent reviews. At the moment, they are licensed to do business in just five states, including Arizona, California, Colorado,... --- > I think I finally know what’s going to cause the next major financial collapse. Crypto. Ignore the fact that the word “cry” is part of the word. For the - Published: 2021-11-17 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/what-will-cause-the-next-housing-crash/ - Categories: Housing Market, Mortgage News I think I finally know what’s going to cause the next major financial collapse. Crypto. Ignore the fact that the word “cry” is part of the word. For the record, I don’t have anything against crypto, I just believe it’s a classic case of something climbing too high, too fast. Don't believe me? Look at silly meme coins like Doge and Shiba Inu coin, which rallied because Elon Musk recently acquired a Shiba Inu puppy. Over time, the crypto industry could resemble something like the Internet, but similar to the Internet, growing pains will accompany its upward trajectory. And because more and more investors are piling into cryptocurrencies, it’s just a matter of time before it all comes crashing down. The question is will it take housing with it? Staples Center Becomes Crypto. com Arena In the latest piece of ominous news, the long-named Staples Center will become known as Crypto. com Arena in a 20-year deal. Apparently, Crypto. com shelled out more than $700 million for the naming rights, which makes it one of the most expensive deals in sports history. The arena’s new logo will debut on Christmas day when the Los Angeles Lakers host the Brooklyn Nets. And all of Staples Center signage is expected to be replaced with the new brand by around June 2022. When I saw the news, it just kind of hit me that this whole crypto thing is getting out of control. Even my wife shared the news, and the tone was... --- > Don’t be fooled by Zillow’s recent iBuying exit. The housing market is alive and well, despite some expected seasonal slowing. Sure, November and December - Published: 2021-11-16 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/cant-find-home-to-buy/ - Categories: Housing Market Don’t be fooled by Zillow’s recent iBuying exit. The housing market is alive and well, despite some expected seasonal slowing. Sure, November and December are traditionally soft months in terms of home buying and selling, and asking prices often trickle lower as well. But it’s typically a short-lived period that springs back to life in the early months of the year, assuming the underlying drivers are there (demand, limited supply, low interest rates, etc. ). Speaking of, 2022 is expected to be another big year for real estate, with one of the latest projections calling for a further 16% rise in home prices. One thing supporting this perhaps lofty estimate is the fact that investors are dominating the housing market like never before. Investor Share of Home Purchases Hits a Record in the Third Quarter As if it wasn’t hard enough to find a home to buy, now you’ve got to compete with investors from all angles. We’re talking mom-and-pop investors, institutional investors (the ones that buy up hundreds or thousands of homes), and even Airbnb folks, who buy properties and turn them into short-term rentals, perhaps for eternity. If you thought they were losing their appetite, think again. Redfin recently noted that investors purchased a record $63. 6 billion worth of homes in the third quarter. This was up from a revised $58. 8 billion in the second quarter and nearly double the $35. 7 billion seen a year earlier. They bought a record 90,215 homes during the past... --- > While refinance applications seem to be slowing, there are still some good reasons to refinance your mortgage, even if interest rates aren’t currently at - Published: 2021-11-09 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/an-fha-to-conventional-refinance-may-allow-you-to-ditch-mip/ - Categories: Mortgage Tips, Refinance While refinance applications seem to be slowing, there are still some good reasons to refinance your mortgage, even if interest rates aren’t currently at their best. First off, let me preface this with the fact that mortgage rates are spectacular. Yes, the 30-year fixed used to be in the mid-2% range, but a rate of around 3% was relatively unheard of until recently (and is still available today). Unfortunately, the recent increase in rates has dented refinance applications as the pool of eligible borrowers (those who stand to benefit) begins to dry up. Last week, the Mortgage Bankers Association (MBA) noted that refis slid another 4%, pushing the refi share of total mortgage activity down to just below 62%. Most industry participants saw this coming, which explains the recent trend of mortgage companies cozying up with real estate agents. But there are still opportunities for homeowners and mortgage lenders to pick up the refi slack. Refinancing Out of the FHA and Into Conventional Mortgage insurance must be paid for life on most FHA loans (unless you put 10% down) This is the case regardless of how much you've paid down your mortgage Often the only way to drop MI completely is to refinance out of the FHA loan program entirely Fortunately this is easy to do and a common reason why homeowners refinance their mortgages Even if rates are a bit higher than they once were, one opportunity that may remain is refinancing an FHA loan into a conventional loan... --- > Lakeview Loan Servicing is the nation's fourth largest loan servicer and also a home loan lender that provides purchase and refinance loans. - Published: 2021-11-08 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/lakeview-mortgage-review/ - Categories: Mortgage Tips Today we’ll explore one of the nation’s largest loan servicers that happens to be a major mortgage lender as well, “Lakeview Loan Servicing. ” As their name implies, they service mortgage loans, meaning they collect monthly payments from customers after the loan funds. These days, a lot of mortgage lenders don’t do that, and instead focus on making new loans and selling them off quickly so they can fund even more. But Lakeview has adopted a strategy some of the largest mortgage lenders in the country have, doing both. This means aside from servicing loans, they also originate billions in mortgages annually. Let’s see if they could be a good fit for a new mortgage. Lakeview Loan Servicing Fast Facts Direct-to-consumer mortgage lender that offers home purchase and refinance loans Founded in 2010, headquartered in Coral Gables, Florida Formerly a top-25 mortgage lender nationally during the boom years The 4th largest loan servicer in the country Licensed to lend in 48 states and the District of Columbia Also operates a wholesale and correspondent lending business As noted, Lakeview Loan Servicing, LLC operates as both a loan servicer and a direct-to-consumer mortgage lender. This is similar to a NewRez or a Rocket Mortgage. They are currently the nation’s fourth largest loan servicer in the country, and help more than 1. 4 million customers manage their home loans annually. The company also recently became the largest servicer of Ginnie Mae mortgages, aka FHA loans and VA loans. To clarify, they own the... --- > In a somewhat strange turn of events, the iBuying unit of Zillow, known as Zillow Offers, is shutting down after an initial suspension late last month. I - Published: 2021-11-02 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/zillow-offers-shuts-down/ - Categories: Housing Market, Mortgage News In a somewhat strange turn of events, the iBuying unit of Zillow, known as Zillow Offers, is shutting down after an initial suspension late last month. I call it strange because it’s happening at a time when the real estate market has never been hotter. You would think that any entity or individual who purchased a boatload of residential real estate over the past year would make out like a bandit. But I guess that’s not the case, at least when it comes to Zillow. The company addressed the move in a lengthy shareholder letter tied to their third quarter financial results. Among the reasons were COVID-19, a supply-demand imbalance, and the sheer inability to accurately forecast future home prices. Why Zillow Offers Is Being Shuttered Zillow is a publicly-traded company, and as such their main motive is turning a profit and rewarding their shareholders. Ultimately, their iBuying unit wasn’t profitable, and I suppose wasn’t looking like it was going to be anytime soon. They also determined that “further scaling up” would be even riskier, and “too volatile” to their earnings/operations. And the only way to make money was by scaling the business. Simply put, not a risk they wanted to take. All of this was exacerbated by COVID-19, which turned the housing market on its head, then created a supply/demand issue with regard to things like skilled labor. Since the company fixes up the homes they buy before flipping them to a new buyer, it’s a problem. Zillow also... --- > In a rather surprising turn, Zillow has suspended new home purchases via its Zillow Offers unit through the end of 2021. It’s actually the second time - Published: 2021-10-20 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/zillow-hits-pause-on-ibuying-for-the-rest-of-2021-should-we-worry/ - Categories: Housing Market, Mortgage News In a rather surprising turn, Zillow has suspended new home purchases via its Zillow Offers unit through the end of 2021. It’s actually the second time they’ve suspended iBuying this year, the first coming back in March due to “market uncertainty” related to COVID-19. This time, it’s for reasons more loosely associated with COVID, namely a backlog in renovation and operational capacity. Similar to many other industries feeling the brunt of supply chain issues, Zillow is apparently having a difficult time finding folks to repair the many homes they buy and flip. Is this no big deal, or a sign of trouble ahead for the hot housing market? Why Is Zillow Completely Pausing Home Buying? In a press release, Zillow chief operating officer Jeremy Wacksman said the company is dealing “within a labor- and supply-constrained economy” during a time when the housing market is ultra-competitive. He added that Zillow hasn’t been exempt from market/capacity issues that others are experiencing in different sectors, and that they’ve now got “an operational backlog for renovations and closings. ” By pausing new home purchase contracts, they’ll be able to focus attention on home sellers who are already under contract with the company, along with existing housing inventory. In other words, they own too many homes and don’t have enough contract labor to fix them up and get them back on the market in a reasonable timeframe. Of course, with the way the housing market is going, what’s the rush to put them on the... --- > Think home prices are expensive today? Well, get ready for an even bigger shock. A new report claims 2022 home prices could be 16% by the end of next - Published: 2021-10-13 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2022-home-prices/ - Categories: Housing Market Think home prices are expensive today? Well, get ready for an even bigger shock. A new report claims 2022 home prices could be 16% by the end of next year. For example, a home listed for $350,000 might be going for $406,000 next year. If you put down 20%, you’ll need $81,200 instead of $70,000. And if mortgage rates stay around 3% for a 30-year fixed, your monthly payment will increase from about $1,180 to $1,370. That’s if mortgage rates don’t rise between now and then, which is certainly questionable at the moment. In other words, if you’re currently shopping for a home, you might want to get even more serious about it. Why Will 2022 Home Prices Go Up Double-Digits? As I wrote last week, the same fundamentals that have been at play for a while now continue to be at play. Namely, a very tight supply of available housing, ultra-low mortgage rates, and lots of prospective home buyers. This hasn’t changed because there is still a massive supply imbalance that home builders have yet to make up. It’s going to take time for builders to catch up, because well, building hundreds of thousands of homes takes time. In the meantime, expect a highly competitive housing market, where bidding wars are the norm. And don’t assume the housing market has topped simply because home prices have risen roughly 20% over the past 12 months. Winter Might Cool Things Down Temporarily Goldman Sachs U. S. Economics analyst Jan Hatzius makes... --- > Mortgage Q&A: “Why are mortgages cheaper than rent?” Today we’ll discuss why mortgages often appear to be less expensive than a monthly rent payment, - Published: 2021-10-11 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-are-mortgages-cheaper-than-rent/ - Categories: Mortgage Tips Mortgage Q&A: “Why are mortgages cheaper than rent? ” Today we’ll discuss why mortgages often appear to be less expensive than a monthly rent payment, despite allowing you to build precious home equity. For example, you might be shopping mortgage rates and see a sample loan amount of $240,000, along with a hypothetical interest rate. Let’s pretend that rate is 3% and the loan program is a 30-year fixed, the most popular option available. This would result in a monthly payment of roughly $1,012. Sounds pretty darn cheap, doesn’t it? Especially with how much rents are these days. But there’s more to the story. The Mortgage Payment Isn’t Everything, Not Even Close Monthly Cost Homeowner Renter Mortgage payment $1,012 $0 Rent $0 $1,843 Property taxes $312. 50 $0 Homeowners insurance $125 $0 Repair/maintenance $200 $0 Utilities (water/trash/etc. ) $250 $0 Total expense $1,900 $1,843 While an advertisement might highlight the monthly mortgage payment, especially when mortgage rates are low, it’s just the tip of the iceberg. I assume a lot of folks could afford a monthly housing payment of $1,012 in most parts of the country these days. That’s well below the U. S. Typical Monthly Rent (Zillow Observed Rent Index) of $1,843 as of July, the latest data reported by Zillow. In fact, it’s nearly half of the typical rent Zillow is reporting, which tells me a mortgage is a screaming bargain, at least on the surface. But the $1,012 mortgage payment isn’t your all-in monthly housing expense. It’s... --- > If you’re a doctor, resident, or even a veterinarian, getting a mortgage can be a little bit easier thanks to so-called "physician mortgages" offered by - Published: 2021-10-07 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/mortgages-for-doctors-expanded-ltvs-and-large-loan-amounts/ - Categories: Mortgage Tips If you’re a doctor, resident, or even a veterinarian, getting a mortgage can be a little bit easier thanks to so-called "physician mortgages" offered by most major lenders. Just about every bank offers a special mortgage program for doctors, including large commercial banks like Bank of America and small local credit unions as well. The names of these programs, along with the guidelines and perks, will vary from bank to bank. They’re typically not heavily advertised, so you may have to do some digging to find all the details. But they all seem to have two things in common; large maximum loan amounts and high loan-to-value ratios (LTVs). My assumption is lenders are keen to offer these loans to future doctors because they’ll be good clients with lots of assets, ideally kept with the bank. In fact, you may need a prior banking relationship to get approved. What Is a Physician Mortgage? A mortgage designed specifically for doctors, residents, fellows, and interns As well as dentists, orthodontists, pharmacists, and veterinarians Offers more flexible underwriting like higher loan amounts and LTVs and no mortgage insurance Applicants can get approved regardless of medical school debt and/or limited employment history In a nutshell, a "doctor mortgage" is a home loan designed specifically for physicians that offers flexible underwriting guidelines and unique features a traditional mortgage loan may not offer. But we’re not just talking medical doctors (MDs). These loan programs are often available to a wide range of disciplines, including dentists, orthodontists, veterinarians,... --- > A Common Mortgage Rate Tale You’ve been shopping mortgage rates and finally found a lender you like. The loan officer asks if you want to lock in your - Published: 2021-09-28 - Modified: 2021-09-28 - URL: https://www.thetruthaboutmortgage.com/dude-wheres-my-low-mortgage-rate/ - Categories: Mortgage Rates, Mortgage Tips A Common Mortgage Rate Tale You’ve been shopping mortgage rates and finally found a lender you like. The loan officer asks if you want to lock in your rate and you say huh? They explain that you can lock in your interest rate today so it won't change, or you can float and take your chances on rates going even lower before you close. You decide you don’t want to lock just yet because rates just seem to be moving lower and lower. Then you wake up to stock rally after stock rally, which puts you in a good mood because your stocks are making you rich, at least on paper. You decide it’s time to lock and call your lender to dial in that 2. 75% rate on the 30-year fixed you were quoted last week. No sense in taking any chances, right? It’s probably best not to get greedy and just go with a rate of 2. 75% you can enjoy until the year 2051! It’s a very low rate and dreams of a sub-2% 30-year fixed-rate mortgage are probably just dreams and nothing more. Here Comes the Not Good Surprise The loan officer picks up the phone and you tell her you want to move ahead with what was quoted last Thursday. Well guess what? Your low rate isn’t so low anymore. Yep. Rates went up since last week and because you chose not to lock, you’re now stuck with a higher rate. No, the lender isn’t... --- > When deciding between renting and buying, individuals often fret about missing out on home equity if they do the former. In other words, for all those - Published: 2021-09-20 - Modified: 2023-10-18 - URL: https://www.thetruthaboutmortgage.com/its-okay-to-rent-until-you-find-a-house-you-really-like/ - Categories: Home Buying, Housing Market, Mortgage Tips When deciding between renting and buying, individuals often fret about missing out on home equity if they do the former. In other words, for all those years they choose to rent instead of own, they’re not gaining any sort of ownership, and their money is simply being thrown out the window. Of course, that rent money is providing shelter and a roof over their head, so it's hard to say it's all for nothing. And while the argument has some truth to it, it’s often blown out of proportion. Or skewed in favor of buying as opposed to renting. Imagine if someone bought a home and prices went down. Would they still be talking about throwing away money on rent? Has the Housing Market Gotten Ahead of Itself? When things start to feel bubbly prospective home buyers seem to get even more desperate This can lead to bad decisions, especially when it comes to a major purchase Make sure you're buying a property for the right reasons and not throwing out your own rules It should never be a rushed decision or one in which you make too many sacrifices Lately, there’s been a lot of talk about bubbles and a potential housing market crash. But home prices have only surged due to a lack of inventory, not because of bad mortgages. The low mortgage rates on offer have also made the housing market hot, perhaps too hot. And after some really stellar home price gains, they've begun to moderate... --- > Nowadays, just about everyone looking to buy or sell real estate begins their search online. And a small handful of websites seem to be dominating the - Published: 2021-09-14 - Modified: 2025-03-10 - URL: https://www.thetruthaboutmortgage.com/what-the-names-zillow-redfin-and-trulia-mean/ - Categories: Mortgage Tips Nowadays, just about everyone looking to buy or sell real estate begins their search online. And a small handful of websites seem to be dominating the home buying space, including oddly-named real estate tech companies. I use these websites all the time when researching real estate, but never actually knew the details behind their names. So here goes. Zillow Is a Play on the Word Zillion The name Zillow is a made up word that is a combination of existing words It relates to the zillions of data points used to come up with their famous Zestimate And also happens to rhyme with the word pillow, which appears to the emotional side of homeownership First up is Seattle, Washington-based Zillow, which got its start by offering free house values using an algorithm. Before they came along, it was hard to know what your home was worth without getting an appraisal done. As for their unique name, it rhymes with popular words like willow and pillow. And while willow trees are certainly homey, the word pillow is actually part of the name. They note that a home is more than just data; it’s also a place to lay one’s head, hence the word pillow. But primarily, Zillow is a play on the zillions of data points the company digests to come up with home values (Zestimates). The company was founded back in 2005, and since then has become a major player in both the real estate realm and the mortgage world.... --- > While it sounds like you're getting something for free with lender-paid mortgage insurance, it's more about how you pay for this coverage. - Published: 2021-09-13 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/what-is-lender-paid-mortgage-insurance/ - Categories: Mortgage Tips Mortgage Q&A: “What is lender-paid mortgage insurance? ” Several years back, a rule went into effect that made mortgage insurance permanent on most FHA loans for the entire life of the loan. Ouch! Before this game-changer, FHA loans were the cat’s meow because of the low mortgage rates offered, coupled with mortgage insurance premiums that were not only more affordable, but removed once the loan amortized to 78% LTV. But in an effort to reduce losses, the FHA ended its so-called easy money policies and clamped down on borrowers taking advantage of a program originally intended for the underserved. As a result, borrowers began giving conventional loans a lot more attention, seeing that private mortgage insurance (PMI) automatically terminates at 78% LTV. Homeowners with these types of loans can also request PMI removal at 80% LTV (based on original amortization schedule) or even sooner if the home appreciates in value. And even better, there's a thing called "lender-paid mortgage insurance" on conventional loans where borrowers don't have to pay for their own coverage! That certainly sounds too good to be true, but there is a catch. Lender-Paid Mortgage Insurance Isn’t Free The phrase "lender-paid" is somewhat deceiving/confusing (it's not free coverage) Your mortgage lender isn't doing you a favor out of the goodness of their heart The borrower still pays for this insurance coverage, just not directly out-of-pocket Instead the lender will pay the premium on your behalf, which should increase your mortgage rate When you see the term lender-paid... --- > A while back, I cautioned readers to avoid swiping the credit card before applying for a mortgage. In short, the more you charge, the higher your - Published: 2021-09-09 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/two-simple-ways-to-boost-your-credit-score-before-applying-for-a-mortgage/ - Categories: Credit Scores, Mortgage Tips A while back, I cautioned readers to avoid swiping the credit card before applying for a mortgage. In short, the more you charge, the higher your outstanding balances. And the higher your balances, the lower your available credit. This can result in lower credit scores since utilization is a big factor for FICO. And it can increase your debt-to-income ratio as well. Simply put, if you're seen as overextended due to maxed out credit cards, your credit scores will suffer. So you can give your credit scores a boost by simply doing nothing, but there are some proactive measures you can take as well. Increase the Credit Limits on Your Credit Cards One quick and easy way to boost your credit scores is to increase your available credit You can do this by raising the credit limits on the credit cards you have open Simply ask your credit card issuers for credit line increases online or by phone Once granted your utilization will go down and your credit scores should improve over time One simple trick to improve your credit scores is via a credit limit increase. This is something that is very easy (and fast) to accomplish thanks to the many credit card management tools now at our fingertips. If you visit just about any credit card issuer’s website, you should be able to find an area to increase your credit limit online. Typically, all you need to do is enter enter your gross annual income and monthly housing/rent... --- > Back in July, the NCAA granted college athletes the opportunity to make money by using their “name, image and likeness” (NIL). This means getting paid to - Published: 2021-09-08 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/michigan-state-athletes-will-soon-be-paid-500-per-month-to-promote-mortgage-brokers/ - Categories: Mortgage News Back in July, the NCAA granted college athletes the opportunity to make money by using their “name, image and likeness” (NIL). This means getting paid to sign autographs, make appearances, or promote products and services, among other things. Importantly, it keeps college sports from turning into pay-for-play schemes, while also providing clarity to student-athletes and their families. These NIL opportunities are beginning to materialize, and we now have what appears to be the first mortgage-related deal. The nation’s second largest mortgage lender, United Wholesale Mortgage, is offering $500 per month to Michigan State University (MSU) athletes. Because UWM is a wholesale mortgage lender, these athletes will essentially be promoting the mortgage broker model. MSU Athletes Can Earn $500 Per Month for the 2021-2022 Season This new partnership involves MSU men’s basketball and football players, of which there are 133 in total. Each one will have the opportunity to earn $500 per month for the 2021-2022 season, which will amount to $6,000 per player. In terms of how they’ll market UWM, it’ll apparently be via social media channels as opposed to a clothing partnership. Per Crain’s Detroit Business, the MSU players won’t “be required to wear UWM logos on their jerseys. ” This differs from UWM’s earlier deal with the Detroit Pistons, in which their logo will feature on the left front strap of official team jerseys for the 2021-22 NBA season. So expect all your favorite MSU student-athletes to pitch mortgage brokers and specifically UWM on Instagram and other social... --- > Over the past year, mortgage rates have been relatively steady near their all-time lows. This has continued to benefit existing homeowners who wish to - Published: 2021-09-08 - Modified: 2024-01-31 - URL: https://www.thetruthaboutmortgage.com/six-ways-to-secure-a-low-mortgage-rate-despite-the-recent-jump/ - Categories: Mortgage Tips Over the past year, mortgage rates have been relatively steady near their all-time lows. This has continued to benefit existing homeowners who wish to refinance their mortgages. And has exacerbated an already too-hot housing market. But there has been increasing talk of rate increases, with the Fed eyeing a possible taper to its bond buying program. If they do announce such a plan, it could lead to an interest rate spike, especially if the economy improves and COVID gets under control. Of course, the jobs report released last Friday was very poor, with blame being tied to the more infectious Delta variant. In short, reopenings and tourism/hospitality have been struggling once again as more folks stay at home. However, if and when that does change, you need to be prepared. I've compiled a list of ways to keep your mortgage rate down if we do see another taper tantrum and mortgage rate fiasco. Just Buy It Down by Paying Points Want an even lower mortgage rate than what's being offered? Simply pay discount points at closing and you'll get one This is a surefire way to get your hands on a discounted rate It'll cost you a little more upfront, but your monthly payment will be lower for the life of the loan One tried and true method to push your mortgage rate lower is to buy down the rate. Simply put, you pay interest upfront in the way of discount points for a lower rate long-term. Yes, your closing... --- > These days, it seems as if you can insure just about anything. Your car, your house, your dog, your phone, and maybe even your hair? At one time, there - Published: 2021-09-01 - Modified: 2022-03-21 - URL: https://www.thetruthaboutmortgage.com/mortgage-insurance-vs-homeowners-insurance/ - Categories: Mortgage Matchups These days, it seems as if you can insure just about anything. Your car, your house, your dog, your phone, and maybe even your hair? At one time, there was a form of home down payment insurance, which at last glance appears to no longer exist. While all these new policy options may be perceived as “great news! ” by overzealous insurance agents, for individual consumers it’s often just more money down the drain. After all, paying for insurance always feels like a chump’s game until you actually need to file a claim, which never seems to happen if you actually have insurance in place. And if you do file a claim, your insurance rates will go up! What a deal! When you purchase a home, your insurance needs will certainly rise, which will put even more strain on your already-strained checkbook. Let’s look at two common forms of insurance tied to homeownership, and explore what each actually provides. Mortgage Insurance Protects the Bank/Lender Mortgage insurance doesn't protect homeowners It protects the mortgage lender from payment default It exists because they're taking a bigger risk by offering you a home loan with very little down The trade-off is you get a mortgage despite having a sizable down payment If you've been shopping for a home (and a home loan) lately, you may have heard about mortgage insurance. At first glance, it might sound like something that protects you in the event you can't pay the thing. But contrary to what... --- > If you’ve driven the 405 freeway lately, you may have seen a billboard from “ChangeFi,” a bank that’s looking to eliminate social and racial inequity in - Published: 2021-08-30 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/change-home-mortgage-review/ - Categories: Mortgage Tips If you’ve driven the 405 freeway lately, you may have seen a billboard from “ChangeFi,” a bank that’s looking to eliminate social and racial inequity in banking/lending. That means growing Black and Latino homeownership, while serving underbanked businesses and individuals. In the process, they hope to empower all Americans to pursue their dreams by working to close the wealth gap. Aside from operating as a bank, ChangeFi is big on home loans, offering a ton of products via their “Change Home Mortgage” brand. Let’s discover more about them to see if they might have a solution others don’t. Change Home Mortgage Fast Facts A Community Development Financial Institution (CDFI) Offers banking, small business loans, and home loans Specializes in lending for non-traditional borrowers (gig workers, immigrants, etc. ) Founded in 1994 (rebranded in 2021), headquartered in Irvine, CA Licensed in 27 states and the District of Columbia Originated more than $7 billion home loans last year Also operate a wholesale lending division called Change Wholesale As noted, ChangeFi operates a residential home lending division known as Change Home Mortgage. They were formerly known as “Commerce Home Mortgage,” and also do business under the name “Change Home Loans. ” The company offers both home purchase financing and refinance loans, with a large variety of loan programs available. They're unique because they operate as a Community Development Financial Institution (CDFI), which allows them to offer mortgages to non-traditional borrowers. Simply put, they enjoy certain regulatory exemptions related to Regulation Z and risk... --- > This appears to be a first – digital mortgage lender Neat Loans will provide applicants with a $500 discount if they’re vaccinated for COVID-19. The - Published: 2021-08-25 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/neat-loans-covid-19-discount/ - Categories: Mortgage News This appears to be a first – digital mortgage lender Neat Loans will provide applicants with a $500 discount if they’re vaccinated for COVID-19. The Boulder, Colorado-based company believes they are the first mortgage lender, and indeed financial services company, to offer a discount for getting the COVID-19 vaccine. At a time when cases are surging again in many parts of the country following a bit of a lull, it appears they’re putting safety first. Of course, this move will probably come with its share of controversy as well, like all things COVID do. As to why they’re doing this, Neat Capital CEO Luke Johnson said, “Mortgage lenders need to have important conversations with their clients about the home-buying process and their vaccine status as it relates to employment. ” Adding that responsible companies have required their employees to get vaccinated to keep workplaces safe, and without a job, it’s tough to get a home loan. Vaccinated Customers Will Receive a $500 Lender Credit from Neat Loans Specifically, Neat Loans will provide a $500 lender credit to borrowers if they provide proof of COVID-19 vaccination. Borrowers may use any digital or electronic picture of a vaccine record to satisfy the requirement. So you can probably take a photo of a paper copy and upload it as well. It doesn’t matter which vaccine manufacturer you went with, such as J&J, Pfizer, or Moderna, or the number of doses received. This offer is available to both those purchasing a home and those... --- > If you’re in need of a VA loan, one mortgage company that deals almost exclusively in them goes by the name “ClearPath Lending.” Roughly 99% of the home - Published: 2021-08-25 - Modified: 2025-04-09 - URL: https://www.thetruthaboutmortgage.com/clearpath-lending-review/ - Categories: Mortgage Tips If you’re in need of a VA loan, one mortgage company that deals almost exclusively in them goes by the name “ClearPath Lending. ” Roughly 99% of the home loans they originated last year were VA loans, and they were pretty much all refinance loans as well. That means there’s a high likelihood ClearPath Lending knows what they’re doing when it comes to funding a VA loan quickly and competently. Let’s learn more about this Southern California-based mortgage lender to see if they could be a good choice for your veteran home loan needs. ClearPath Lending Fast Facts Direct-to-consumer mortgage lender that offers purchase and refinance loans Specializes in VA lending which comprises about 99% of their overall volume Founded in 2012, headquartered in Irvine, California Funded $5. 57 billion in home loans during 2020 Currently licensed to do business in 29 states nationwide Most active in California, Florida, and Texas ClearPath Lending is a direct-to-consumer mortgage lender located in Irvine, California, which is basically the epicenter of the mortgage industry on the West Coast. The operate a call center, but no physical branches, so you’ll be working remotely with their lending team to close your loan. Last year, they originated a whopping $5. 57 billion in home loans, which makes them almost a top-100 mortgage lender nationally. While they originated a large amount of loans in over a dozen different states, they were most active in California, Florida, Texas, Virginia, and Arizona. As noted, most of the loans they... --- > Conventional wisdom would lead us to believe that consumers go with the mortgage lender that offers the lowest interest rate. After all, who can resist a - Published: 2021-08-25 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/borrowers-dont-choose-mortgage-lenders-for-the-best-interest-rate/ - Categories: Mortgage Rates, Mortgage Tips Conventional wisdom would lead us to believe that consumers go with the mortgage lender that offers the lowest interest rate. After all, who can resist a discount? But this appears to not be the case... In fact, it’s the least common reason why a borrower selects a particular home loan lender, which is pretty shocking considering how much money is at stake. I suppose this is the power of marketing, taking a very boring product that is for all intents and purposes a commodity and selling it for more than your competitors. Referrals, Referrals, Referrals... Clever marketing aside (hello Rocket Mortgage and their push button get mortgage tagline), there's also a little thing called referrals. You know, when your real estate agent says they have a mortgage gal or guy they think you should use because they're "the best. " When it comes to home purchase loans, a referral from a real estate agent or builder is the top reason (53%) why a borrower chooses a certain lender, this according to a survey from mortgage advisory firm STRATMOR Group. The survey results are part of its MortgageSAT Borrower Satisfaction Program, which the company claims is the mortgage industry’s only “Borrower Satisfaction measurement tool. ” It's actually a older study, with data for the 12-month period ending June 30th, 2018. But I don't think it has changed much. If anything, this trend has probably gotten even more pronounced with a more competitive housing market. Are You Choosing the Mortgage Lender or... --- > It’s a question a lot of prospective home buyers are asking right now. When will the housing market slow down? When will the bidding wars end and prices - Published: 2021-08-20 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/is-the-housing-market-finally-slowing-down/ - Categories: Housing Market, Mortgage News It’s a question a lot of prospective home buyers are asking right now. When will the housing market slow down? When will the bidding wars end and prices fall back to earth? After an unprecedented year of home price gains, which somehow took place during a global pandemic, would-be buyers are looking for a reprieve. But is it finally here, or is this just another seasonal fakeout? It Has Been Very Much a Seller’s Market in 2021 The median home-sale price increased 17% year-over-year to a record high $361,973 Asking prices of newly listed homes are up 10% from the same time a year ago Half of homes had an accepted offer within the first two weeks of being on the market 52% of homes sold above their list price, up from just 30% a year earlier First, the bad news, assuming you don’t own yet. Home prices continue to be on a tear, with the median home-sale price rising 17% year-over-year for the week ending August 15th, per Redfin. That pushed home prices up to an all-time high of $361,973, and was a much more pronounced climb than what we saw in previous years. Part of that can be attributed to the COVID-inspired home buying frenzy, while the other underlying drivers have been constant for a while now. There continues to be a supply glut, with too many buyers and not enough homes. Home builders have yet to catch up and don’t appear to be close to doing so.... --- > The nation’s second largest mortgage lender, United Wholesale Mortgage, has plans to accept bitcoin for mortgage payments. The Pontiac, Michigan-based - Published: 2021-08-18 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/nations-second-largest-mortgage-lender-to-accept-bitcoin-because-they-want-to-be-first/ - Categories: Mortgage News The nation’s second largest mortgage lender, United Wholesale Mortgage, has plans to accept bitcoin for mortgage payments. The Pontiac, Michigan-based company’s CEO Mat Ishbia told Yahoo that scores of its customers hold crypto, so why not let them use it to pay the mortgage? As to why they’d want to do that, it’s a bit unclear. But he holds nothing back when saying UWM is the “best tech company in the mortgage space by a wide margin. ” And yes, that’s probably a shot at its crosstown rival Rocket Mortgage, which is situated about 25 miles south in downtown Detroit. Almost One Million Homeowners Pay UWM Every Month During the interview, Yahoo’s Julie Hyman brought up the company’s plans to accept bitcoin, and like AMC’s recent announcement, “read it as a way to get headlines. ” Ishbia brushed that off and spoke of the company’s role as a leader, innovator, and tech company (something mortgage companies are big on these days). He added that nearly one million customers pay them each month since they're a loan servicer too, and a lot of them apparently have a good amount of cryptocurrency. “They’d like to be able to transfer it in,” he said, so how do they accomplish that? Well, they accept bitcoin obviously. Again, in terms of motivation to do that, it’s not clear. Maybe the convenience of it, maybe something else? But Ishbia’s motivation appears to be driven by competition, namely from Rocket Mortgage, the nation’s top mortgage lender. If... --- > In a bid to help more renters become homeowners, Fannie Mae has introduced a new “innovation” that will incorporate rental history into its automated - Published: 2021-08-12 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/your-positive-rental-history-will-now-help-you-qualify-for-a-mortgage/ - Categories: Mortgage News In a bid to help more renters become homeowners, Fannie Mae has introduced a new “innovation” that will incorporate rental history into its automated underwriting system. The added feature, which will launch on September 18th, 2021 via Fannie Mae’s Desktop Underwriter (DU), automatically identifies recurring rent payments in an applicant’s bank statement data. This will allow mortgage lenders to “deliver a more inclusive credit assessment,” with the permission of the borrower. Fannie Mae CEO Hugh R. Frater said he believes it’s the first time a large-scale AUS will leverage electronic bank statement data to incorporate positive rental history. The move is expected to even the playing field for homeowners and renters by “correcting the housing inequities of the past. ” And it should lead to more mortgage approvals for those who otherwise may not have qualified for a home loan due to insufficient credit history. How Rental History Can Help You Get Approved for a Mortgage The addition of positive rental history can be used as compensating factor during the underwriting process Beneficial if the borrower has a limited traditional credit history (lack of credit cards, loans, etc. ) Positive rents will automatically be pulled from submitted bank statements and incorporated into the underwriting engine Nearly 20% of denied applicants from a sample study could have been approved with this change in place Prior to this announcement, it was possible to use positive rental history as a compensating factor if you didn’t quite qualify for a mortgage. But it’s a... --- > Time for more mortgage Q&A: “Are mortgage calculators accurate?” Just about anyone looking to buy real estate or apply for a mortgage refinance will - Published: 2021-08-11 - Modified: 2021-08-11 - URL: https://www.thetruthaboutmortgage.com/are-mortgage-calculators-actually-accurate/ - Categories: Mortgage Tips Time for more mortgage Q&A: “Are mortgage calculators accurate? ” Just about anyone looking to buy real estate or apply for a mortgage refinance will rely upon a loan calculator to get a better understanding of what their monthly payment might be. But not all mortgage calculators are created equal – in fact, some totally miss the mark. For that reason, it’s important to understand what you’re actually calculating to ensure you get the numbers right. Or at least close to right... The More Stuff That's Included, the Better... Let’s start with the basics here. Any mortgage calculator worth its salt should let you calculate principal, interest, taxes, insurance, and even include PMI and HOA dues. Why? Because these are all very real costs, and ignoring them means underestimating what you'll owe each month. If it simply shows you principal and interest, you’re missing a pretty decent chunk of the payment, assuming your mortgage has impounds (which many do). Or if you're buying a condo (and will be subject to HOA dues) or put less than 20% down and don’t opt for LPMI. I know many mortgage calculators often ignore some of these costs, or automatically assume they don't apply to your situation. This can be misleading. I conducted a little research on Google by looking up the first few mortgage calculators that came up in their search. Mortgage Calculator Results Definitely May Vary Not all mortgage calculators are created equal In fact, many don't include very important components of... --- > The nation’s largest mortgage lender, Rocket Mortgage, has just rolled out a home loan program exclusively for customers buying homes in Detroit. The goal - Published: 2021-08-09 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/detroit-home-loan-plus-rocket-mortgage/ - Categories: Mortgage News The nation’s largest mortgage lender, Rocket Mortgage, has just rolled out a home loan program exclusively for customers buying homes in Detroit. The goal of the so-called “Detroit Home Loan+” is to help more Detroiters own a home in Detroit, where the company has been headquartered for more than a decade. Rocket Mortgage (formerly Quicken Loans) has been a major player in revitalizing downtown Detroit, which had been one of the hardest cities in the country during and after the Great Recession. This new initiative supports with the company’s mantra of “for-more-than-profit. ” What Is the Detroit Home Loan+? Mortgage program offered exclusively to home buyers purchasing in city of Detroit Comes with up to $2,500 in closing cost credit if buying a primary residence Borrowers can also take advantage of pre-purchase mortgage counseling from the Detroit Housing Network Those who are unbanked and/or credit invisible can work with fintech MoCaFi to improve their finances In a nutshell, Detroit Home Loan+ is a new program offered by Rocket Mortgage that provides $2,500 in closing cost credits for those buying a home in Detroit. It exists because less than 47% of Detroit’s residents own homes, a number that is well below the national average of around 66%, per the Census Bureau. Simply put, the program incentivizes homeownership vs. renting in Motor City (maybe now better known as Mortgage City), which can be a positive for both the individual and the larger community. Aside from the closing cost credit, it also offers... --- > It's time for another mortgage match-up: "Mortgage rates vs. unemployment." When it comes to making (or for our purposes saving) money, everyone probably - Published: 2021-08-09 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-vs-unemployment/ - Categories: Mortgage Matchups, Mortgage Rates It's time for another mortgage match-up: "Mortgage rates vs. unemployment. " When it comes to making (or for our purposes saving) money, everyone probably wishes they could predict the future. After all, if you know what’s coming next, there are plenty of great ways to capitalize. For homeowners, good timing or a penchant for fortunetelling can result in buying a property at market bottom. Or landing a lower mortgage rate, assuming one takes the time to shop around and gather multiple quotes from different lenders. Ultimately, a low mortgage rate can easily eclipse the savings of other tedious money-saving tasks in one fell swoop. Why? Because the savings are realized month after month, and year after year, for potentially decades. The Economy Guides Mortgage Rates Mortgage interest rates are mainly driven by the state of the economy Things like unemployment and new job creation can have a big impact Good news = a growing economy and higher rates Bad news = a stagnant/contracting economy and lower rates While there are plenty of economic indicators that affect the direction of mortgage rates, perhaps the biggest is the monthly “Employment Situation” report, delivered by the Bureau of Labor Statistics (BLS) on the first Friday of each month. It’s affectionately known as the “jobs report” or the “NFP,” which stands for nonfarm payrolls (it excludes farm workers, government employees, and some others). The latest report released a few days ago revealed that nonfarm payroll employment increased by 943,000 jobs in July, well above... --- > An ultra-cheap mortgage might give you a false sense of living below your means, pushing you to spend when you otherwise wouldn't. - Published: 2021-08-04 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/why-a-really-cheap-mortgage-might-actually-be-trouble/ - Categories: Mortgage Rates, Mortgage Tips I know, I know. It sounds ridiculous to complain about or imply that something cheap is a bad thing. Clearly I’m going to have some explaining to do, which I’m prepared to do so bear with me. I’m by no means against cheap mortgages or anything else cheap, but I do see one drawback that can present itself in certain situations. Existing Homeowners Are Enjoying the Lowest Payments in Years Despite record high home prices and appreciation that hasn’t been seen in decades, existing homeowners are enjoying relatively low monthly payments. This is a result of record low mortgage rates coupled with increased wages and perhaps a sprinkling of inflation. Yes, affordability has worsened for renters who have yet to enter the market, due to a whopping 17. 2% rise in home prices from June 2020, per CoreLogic. But for those who were already homeowners, monthly payments are often getting cheaper via a rate and term refinance. These borrowers are turning in their old mortgages for ones with smaller balances and lower interest rates. The combination is an even cheaper mortgage payment, which is great for the household balance sheet, right? Homeowners Might Be Flush with Cash, But What Are They Spending It On? Here’s the problem for some of these folks. If they’ve got super cheap mortgage payments, they might feel wealthier than they really are. After all, we live in a time of 2% mortgage rates, which isn’t usual, though it’s been the new normal for quite a... --- > If you apply for a mortgage when it's super busy, you might not get the lowest interest rate, or the best customer service! - Published: 2021-08-04 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/why-you-may-want-to-apply-for-a-mortgage-when-things-are-slow/ - Categories: Mortgage Tips A working paper from the National Bureau of Economic Research revealed that it might be best to apply for a mortgage when no one else is. The analysis, “The Time-Varying Price of Financial Intermediation in the Mortgage Market” (if you like light reading you should check it out), found that price changes on the secondary mortgage market aren’t fully passed on to consumers if volume is high. In other words, if lenders are busy, they aren't offering their lowest mortgage rates. In a sense, this is somewhat ironic, in an Alanis Morissette kind of way. Savings Aren't Passed Along When Demand Is Strong When demand for a certain product, such as a home loan, is particularly strong There is less (or no) incentive for lenders to pass along even more savings This is similar to how retailers won't lower prices if they've got plenty of buyers Why should they if they're already slammed? The researchers refer to this cost as “intermediation,” which they define as the middleman between the borrower and the purchaser of the loan (the investor), essentially the lender. This intermediary buys the mortgage from the borrower and then sells it to an investor. They provide the principal balance to the borrower and offer a rebate, otherwise known as a lender credit. The rebate can cover closing costs associated with the loan so the borrower doesn’t have to pay them out of pocket. Conversely, the borrower can take less or none of this rebate (or even a negative... --- > If you decide to refinance your mortgage, be sure to factor in your new loan term, which could add thousands of dollars in interest. - Published: 2021-08-03 - Modified: 2025-02-04 - URL: https://www.thetruthaboutmortgage.com/resetting-the-clock-when-refinancing-your-mortgage/ - Categories: Mortgage Tips Mortgage rates are trickling back toward record lows again and refinance applications are on the rise. You can thank our questionable economy, a COVID resurgence, and the Fed’s pledge to continue buying mortgage-backed securities. The recent announcement regarding the end of the Adverse Market Refinance Fee is also undoubtedly helping. My expectation is we'll see a big jump in refinance applications when the Mortgage Bankers Association (MBA) reports the data tomorrow morning. While the rally could be short-lived, it may renew interest for some that were on the fence about refinancing, especially if their current interest rate isn’t all that high compared to current market rates. What Does It Mean to Reset the Mortgage Clock? Mortgage term: 30 years Age of mortgage: 5 years old Time left on mortgage: 25 years When you refinance your mortgage, there are lots of implications. It’s not just about a lower monthly payment, despite that being the chief motivation. There’s also the cost and time involved, the product you choose, the status of your existing mortgage, along with what you plan to do post-refinance. One thing some homeowners might overlook when refinancing is their mortgage term, seeing that most individuals tend to focus on monthly payments above all else. But when you refinance, you wind up with a new loan term and associated amortization schedule. So if you previously had a 30-year mortgage that was five years old, and refinanced into another 30-year mortgage, your term would increase from 25 years back to 30... --- > There are several ways it might be possible to lower your mortgage rate without a refinance. Find out if one of these methods works for you! - Published: 2021-07-27 - Modified: 2024-09-23 - URL: https://www.thetruthaboutmortgage.com/can-i-lower-my-mortgage-interest-rate-without-refinancing/ - Categories: Mortgage Tips, Refinance Here’s an interesting one. Is it possible to obtain a lower mortgage rate without refinancing? While it’s not all that difficult to refinance a home loan, it does take a bit of time and energy, and you generally need to qualify for the thing! Not everyone qualifies for a mortgage for one reason or another, and the same goes for refinancing an existing loan. For example, if your credit score isn’t quite up to snuff, or you don’t have the required income to keep your DTI below key levels, you may not get approved. This means you might be locked out when it comes to obtaining a lower mortgage interest rate in times when rates are favorable. There are also times when it just doesn’t make much sense to refinance because rates are higher or similar to what you’ve already got. So what are you to do if you can’t or simply don’t want to refinance, but still want a lower rate? Well, there are some options to consider. Just Call and Request a Lower Mortgage Rate While perhaps not conventional or all that common, some folks have obtained lower interest rates simply by calling up their mortgage lender and requesting one. This is formally known as a mortgage rate modification and offered with some credit unions and depository banks. You need to indicate that you have no interest in refinancing with them because otherwise they'll just take you down that route. It’s kind of similar to the old credit... --- > Homeowners often complain that mortgages are mostly interest, despite the low rates offered. But is it true, and if so why? Let's find out! - Published: 2021-07-22 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/why-are-mortgage-payments-mostly-interest/ - Categories: Mortgage Rates, Mortgage Tips Mortgage Q&A: “Why are mortgage payments mostly interest? ” Here’s an interesting mortgage question – pun sadly intended because I couldn't help it. Lots of folks are obsessed with how much interest is paid on a mortgage, often citing the total interest paid over 30 years. This counters the argument that mortgages are the cheapest debt you can own, which they basically are. Let's discuss what they're getting at to see what all the fuss is about. Payment Composition Over Time Most homeowners tend to take out fixed-rate mortgages The monthly payments on these types of loans don't change during the full 15- or 30-year terms But while the mortgage payment remains constant throughout the life of the loan The amount that is allocated to principal and interest changes monthly as the loan is paid off The way mortgages are set up here in the United States, each monthly payment is the same amount, assuming it’s a fully amortizing fixed-rate mortgage, which most tend to be. The payment amount after month one is the same as it is during month 360, assuming you take out a 30-year fixed and keep it until maturity. This makes housing payments more affordable (and predictable) because the balance is paid off evenly over a long period of time, such as 30 years. However, even though the payment amount is fixed, the composition of the payment will change monthly until the loan term ends. Just check out the chart above - the light blue interest... --- > The mortgage and real estate industry is no stranger to disruptors, especially over the past few years as scores of companies have tried to change the way - Published: 2021-07-19 - Modified: 2025-05-02 - URL: https://www.thetruthaboutmortgage.com/tomo-mortgage-review/ - Categories: Mortgage Tips The mortgage and real estate industry is no stranger to disruptors, especially over the past few years as scores of companies have tried to change the way we buy, sell, and obtain a home loan. One of the latest examples is “Tomo,” a venture-backed fintech with some big-name founders and investors, including former Zillow employees Greg Schwartz, Carey Armstrong, and Spencer Rascoff. What’s unique about this mortgage lender is they only originate home purchase loans. No refis. That means they’re completely committed to home buyers. Like other lenders, they’re attempting to level the playing field between cash buyers and those who need a mortgage, an especially relevant concern in today’s ultra-competitive housing market. Tomo Mortgage Is a Purchase-Only Lender (No Refis) Direct-to-consumer, purchase loan-only mortgage lender Founded in 2020, headquartered in Stamford, CT Started by former Zillow executives Greg Schwartz and Carey Armstrong Do not charge lender fees and offer both a low rate and closing guarantee Will also pair you with a real estate agent for an additional mortgage rate discount Tomo Exists Because Buying a Home Can Be Terrible Tomo was created because purchasing a property can be a real pain in the neck, and instead of relying on old technologies, they’re going the digital route. This means you can get started right from their website in minutes, whether by desktop computer or smartphone. They’re also streamlining the process, simplifying how you can complete tasks, and throwing in a bunch of guarantees along the way. It all starts... --- > Mongoose vs. Cobra. Coyote vs. Roadrunner. Pirate vs. Ninja? And finally, "fixed-rate mortgage vs. adjustable-rate mortgage."  Yes, we're talking - Published: 2021-07-14 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/30-year-fixed-vs-arm/ - Categories: Mortgage Matchups, Mortgage Tips Mongoose vs. Cobra. Coyote vs. Roadrunner. Pirate vs. Ninja? And finally, "fixed-rate mortgage vs. adjustable-rate mortgage. " Yes, we're talking about the greatest rivalries of all time. Okay, maybe this one isn't as interesting as those others mentioned above, but it can be if you're buying a home or refinancing an existing mortgage. So what's better, the boring old fixed-rate mortgage or the more provocative and often controversial adjustable-rate mortgage (ARM)? Let's discuss both and come up with some conclusions, which can vary based on individual preferences and circumstances. Fixed-Rate Mortgage vs. Adjustable-Rate Mortgage During the housing boom in the early 2000s, homeowners often chose adjustable-rate mortgages as a means to qualify for a home they probably wouldn’t be able to afford with a traditional fixed mortgage. Back then, you could qualify a borrower at the ARM's lower start rate, even though the loan would eventually adjust much higher. Even if they could afford a fixed-rate loan, homeowners were happy to take the lowest interest rate possible, which typically came with the ARM. But times have changed, and adjustable-rate mortgages have now fallen out of fashion with fixed-rate mortgage rates hitting all-time record lows. Rates have since risen quite a bit but the trend is the same. In fact, fixed-rate mortgages account for more than 90% of the purchase money mortgages and refinance loans being originated nowadays. Sure, fixed mortgages are definitely more popular, but that doesn't mean they're any better, or always the right choice. It's just a matter... --- > With the housing market so competitive, and properties often going above asking, getting a mortgage can be a little more stressful. One major component of - Published: 2021-07-13 - Modified: 2025-01-29 - URL: https://www.thetruthaboutmortgage.com/better-appraisal-guarantee/ - Categories: Mortgage News With the housing market so competitive, and properties often going above asking, getting a mortgage can be a little more stressful. One major component of the mortgage approval process is determining the collateral value of the subject property, otherwise known as the appraised value. A bank or lender generally won’t approve you for a home loan without getting an independent appraisal first, at your expense. Simply put, they want to know that the property you’re buying or refinancing is actually worth what you or the seller think it’s worth. Even if you’re a stellar borrower with an excellent credit score and tons of money in the bank, a valuation issue can sink your loan approval. While this typically isn’t a problem, it can muddy the waters if the appraisal happens to come in low. The good news is we’re in a rising real estate market, with home prices experiencing their best annual gains in decades. They’re also at new record highs. This means even a bid over asking could easily come in at value when the appraisal is conducted. But what if it doesn’t? Often, the home buyer would need to make some adjustments to their financing to “make it work. ” The most common tactic is to put more money down to keep the loan-to-value (LTV) ratio at its original level. Unfortunately, this isn’t always an option if a buyer is light on cash, and home sellers (or at least their listing agents) know this. This is why they... --- > If you happen to be an American Express cardholder, or were thinking about becoming one, they’ve got new a limited-time promotion with Rocket Mortgage and - Published: 2021-07-07 - Modified: 2023-09-05 - URL: https://www.thetruthaboutmortgage.com/american-express-mortgage-promotion/ - Categories: Mortgage News If you happen to be an American Express cardholder, or were thinking about becoming one, they’ve got new a limited-time promotion with Rocket Mortgage and Better Mortgage. On top of waiving some origination fees, the card issuer will provide cardholders with up to $6,000 in statement credits if they use one of the mortgage lenders above to purchase a home or refinance an existing home loan. So if you were planning on using either of these lenders, it could actually make sense to become a cardholder first, then apply. Or if you were thinking about using a different lender, you might want to get a quote from these two lenders as well. Then do the math to see if this promotion makes them the cheaper option. How the Amex Mortgage Promotion Works Finance a home purchase or refinance a loan with Better or Rocket Mortgage to receive a statement credit $2,000 statement credit for conforming loan amounts $6,000 statement credit for jumbo loan amounts Both lenders will also waive loan origination fees like processing and underwriting In order to be eligible for this new promotion, you need to be an American Express cardholder. Specifically, you need to be a “basic account holder” of a personal consumer American Express card, such as the pricey American Express Platinum or a free option like their Amex EveryDay credit card. Aside from that, you also need to apply/lock your home loan by a certain date, and close by the cutoff as well. The good... --- > Assuming you want to become a homeowner, it’s probably best to go to college, even if you have to take out costly student loans in the process. You may - Published: 2021-06-21 - Modified: 2024-01-31 - URL: https://www.thetruthaboutmortgage.com/if-you-want-a-mortgage-go-to-college-and-get-a-degree/ - Categories: Mortgage Tips Assuming you want to become a homeowner, it’s probably best to go to college, even if you have to take out costly student loans in the process. You may have read articles over the past several years that talk about snowballing student loan debt and the inability to afford a mortgage as a result. While this might be true in some cases, it turns out you’re still more likely to buy a home if you obtain at least a bachelor’s degree. The Benefits Outweigh the Costs A commentary (since removed) from mortgage financier Fannie Mae revealed that those who go to college are more likely to become homeowners than those who simply graduate from high school. The most probable homeowners are those with a college education and no student loans, with a likelihood of homeownership that is 43% higher than high school graduates without student loans. Meanwhile, student loan holders with bachelor’s degrees are still 27% more likely to become homeowners relative to those debt-free high school graduates. There is a catch though – if you don’t actually complete your bachelor’s degree and simply wind up with student loans, you’re actually worse off than those who simply called it quits after high school. This last group is 32% less likely to own a home than a debt-free high school graduate. They’re also more likely to be behind on student loan payments, which isn’t very surprising. The takeaway here is that it pays to go to college, even if it costs... --- > While a low down payment can make it easier to buy your dream home, it may increase your mortgage payment in three different ways. - Published: 2021-06-17 - Modified: 2021-08-08 - URL: https://www.thetruthaboutmortgage.com/3-ways-a-low-down-payment-can-raise-your-mortgage-payment/ - Categories: Mortgage Tips If you’re in the market to purchase a new home, perhaps because mortgage rates are low and you're an extremely brave individual, you may be thinking low down payment all the way. Heck, for many borrowers these days, a low down payment is the only way to play, with home prices surging to new all-time highs in record fashion. In case you hadn’t heard, zero down mortgages are mostly extinct, other than VA loans and USDA loans. But there are still other low-down payment options, such as the ever-popular FHA loan, which only requires 3. 5% down, along with conventional mortgage options that call for just 3% down. While these low-down payment mortgages can make homeownership more accessible, your mortgage payment will rise, which obviously erodes your affordability. There are actually three ways a low down payment can increase your mortgage payment, which could even put your loan in jeopardy. Let's explore these issues to determine if putting down more money might be the better move. Less Money Down = Larger Loan Amount The most obvious downside to a lower down payment is a larger loan amount The less you put down, the more you'll need to borrow from the bank This means paying more each month in the way of principal and interest Pay extra attention to loan amount if it's close to the conforming limit First and foremost, if you put less money down on your home purchase, you’ll wind up with a larger mortgage. There’s really no... --- > Today we’ll check out Florida-based lender “The Mortgage Firm,” which has been originating home loans since the mid-1990s. That’s a lifetime in today’s - Published: 2021-06-16 - Modified: 2024-08-17 - URL: https://www.thetruthaboutmortgage.com/the-mortgage-firm-review/ - Categories: Mortgage Tips Today we’ll check out Florida-based lender “The Mortgage Firm,” which has been originating home loans since the mid-1990s. That’s a lifetime in today’s world of nascent startups, and shows they’ve been able to weather the ups and downs of the housing market while earning a stellar reputation at the same time. In fact, they were recently named the top mortgage lender by SocialSurvey for customer satisfaction, beating out dozens of other companies in their category. Let’s learn more to see if they could be a good fit for you. The Mortgage Firm Fast Facts Direct-to-consumer retail mortgage lender Offers home purchase financing, refinance loans, and reverse mortgages Founded in 1995, headquartered in Orlando, FL Funded about $3. 5 billion in home loans last year Licensed in 22 states and the District of Columbia Does most of their business in home state of Florida along with Georgia The Mortgage Firm is an independently operated direct-to-consumer retail mortgage lender that offers home purchase financing, mortgage refinance loans, and reverse mortgages. They primarily serve home buyers and existing homeowners in the Southeastern United States, with their home state of Florida providing most of their overall volume. Last year, they funded roughly $3. 5 billion in home loans, making them a large-sized regional lender. About two-thirds of their volume was dedicated to home purchase loans, with the rest mostly comprised of mortgage refinances. At the moment, they’re licensed to do business in 22 states and the District of Columbia. Those states include Alabama, Arizona,... --- > Check out which mortgage lender dominated each state across the nation in 2020. Rocket Mortgage won a whopping 19 states and D.C.! - Published: 2021-06-15 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/top-mortgage-lenders-by-state-2020/ - Categories: Mortgage News Assuming you actually needed to be told, Quicken Loans (aka Rocket Mortgage) was the top residential mortgage lender in the United States last year. The company funded roughly $314 billion in home loans during what was a record year for many mortgage companies thanks to record low mortgage rates and an uptick in home purchases. That handily beat out runner up Wells Fargo ($267 billion), which until recently had been the #1 mortgage lender in the country for many years. Coming in third was United Wholesale Mortgage (UWM), which funded an impressive $183 billion despite only operating on the wholesale level with mortgage broker partners. Rounding out the top five were Chase with $149 billion and Freedom Mortgage Corp. with $122 billion. While interesting, I wanted to know which companies were performing best in each state, or simply who the top mortgage lenders were in say California or Texas or New York. Thanks to 2020 HDMA data parsed and organized by Richey May, I was able to see which states were top in all 50 states and the District of Columbia. Rocket Easily Outpaced Its Competitors on a State-by-State Basis Aside from being the top mortgage lender nationally, Quicken/Rocket was also the leader by total number of states with 19, along with the District of Columbia. That was a truly impressive figure, as no other single lender claimed double-digits. In fact, only one other company came even remotely close, San Francisco-based bank Wells Fargo, with nine total states. It drops... --- > The best day to list your home is Thursday because they go pending faster and are more likely to sell above asking! - Published: 2021-06-07 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/thursday-is-the-best-day-to-list-your-house/ - Categories: Housing Market, Mortgage News Not that it matters much these days, but apparently Thursday is the best day to list your home for sale. This is the latest advice from iBuyer and home valuation company Zillow, which noted that 21% of properties are listed on that particular day of the week. What’s So Great About a Thursday Anyway? Roughly 21% of properties are listed for sale on Thursdays (the most of any other day) The share of homes listed on Thursdays is as high as a third in some markets nationwide (Portland, Seattle) Properties listed on a Thursday typically go pending faster than homes listed on any other day of the week And homes listed on Thursdays are more likely to sell above their asking price I like Thursdays – ever since college it’s been the unofficial start of the weekend, something I didn’t grasp until, well, college. Fridays are generally the lighter work days (or school days), with most of the heavy lifting completed earlier in the week. The other special thing about a Thursday, at least when it comes to real estate, is that open houses and private showings often take place on the weekend, when folks aren’t working. So if a property is listed just a day or two before, there’s a good chance it’ll be seen very shortly after, as opposed to sitting on the market all week before the prospective buyers start showing up. Conversely, if you put your property on the market on say a Sunday, for some... --- > Today we’ll check out “Directors Mortgage,” a Portland, Oregon-based mortgage lender that says it “takes a community-first, people-focused approach” to - Published: 2021-06-07 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/directors-mortgage-review/ - Categories: Mortgage Tips Today we’ll check out “Directors Mortgage,” a Portland, Oregon-based mortgage lender that says it “takes a community-first, people-focused approach” to the home loan business. This means you can actually sit down and speak with a human being about your homeownership goals instead of filling out an online form, assuming you prefer face-to-face interaction. And those human beings are apparently happy because the company is consistently recognized as one of the best companies to work for in Oregon. So hopefully they’ll make you happy too. They are also one of the top philanthropic businesses in the area and involved with many of the local sports teams, including youth teams and pros like the Portland Thorns and Portland Timbers. Let’s learn more about this local mortgage lender to see if they could be a good fit for you. Directors Mortgage Fast Facts Independent retail direct-to-consumer mortgage lender Largest privately owned mortgage company headquartered in Oregon Locally owned and operated in Lake Oswego since 1998 Offer home purchase loans, refinances, construction loans, and reverse mortgages Currently licensed to do business in eight Western states Funded nearly $1. 5 billion in home loans last year Also operate a wholesale lending division called USA Direct Funding Directors Mortgage is a retail direct-to-consumer mortgage lender that was founded back in 1998 by current CEO Mark J. Hanna. They are one of the largest independent mortgage companies located in the Northwest, and say they don’t take a "one-size fits all" approach like some of the bigger banks.... --- > While everyone always seems to focus on mortgage payments adjusting higher, there are a number of reasons why a mortgage payment may decrease. - Published: 2021-06-02 - Modified: 2023-09-05 - URL: https://www.thetruthaboutmortgage.com/do-mortgage-payments-decrease/ - Categories: Mortgage Tips Mortgage Q&A: “Do mortgage payments decrease? ” While everyone always seems to focus on mortgage payments adjusting higher, there are a number of reasons why a mortgage payment may actually decrease over time. No really, there are, so let’s take a look at how this pleasant surprise could happen, shall we... Mortgage Payments Can Decrease on ARMs While perhaps not as common as the payment going up Monthly payments can drop if you have an adjustable-rate mortgage But you'll need the associated mortgage index to decline in the process And your lender may have a built-in floor, so basically don't bank on it If you have an adjustable-rate mortgage, there’s a possibility the interest rate can adjust both up or down over time, though the chances of it going down are typically a lot lower. Still, it is viable to take out an ARM, hold it throughout its initial fixed-rate period, then wind up with a lower rate once it becomes adjustable. You may remember that now infamous interest rate reset chart, the one that showed billions of dollars worth of mortgages resetting from their fixed-rate period into their scary adjustable period. Well, the damage wasn't nearly as bad as it originally appeared because many of the mortgage indexes tied to those loans plummeted to rock-bottom levels and/or all-time lows. As a result, some homeowners who stayed in those seemingly “exploding ARMs” may have actually seen their mortgage payments fall. And the savings could have been significant. For example, say... --- > Today we’ll check out “Supreme Lending,” a mortgage banker out of Dallas, Texas that is all about speed. In fact, their goal is to close and fund every - Published: 2021-06-02 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/supreme-lending-review/ - Categories: Mortgage Tips Today we’ll check out “Supreme Lending,” a mortgage banker out of Dallas, Texas that is all about speed. In fact, their goal is to close and fund every loan that comes in their door in 20 days or less, using the latest technology and more efficient loan processing. This is especially important because they specialize in home purchase lending, which is often more time-sensitive than a standard mortgage refinance. They also believe they can offer lower rates and fees than other lenders thanks to their advanced processing software and automated underwriting systems. Additionally, their “Give Back Program” provides up to $800 in reduced closing costs to veterans, first responders, and cancer survivors, and possible discounted real estate agent fees as well. Supreme Lending Fast Facts A direct-to-consumer retail mortgage banker that offers home purchase and refinance loans Founded in 1999, headquartered in Dallas, Texas (a dba of Everett Financial) Funded $16 billion in home loans last year About a third of their overall volume comes from home state of Texas Licensed to do business nationwide including the District of Columbia Has 300 physical branches and 1,800+ employees across the country Supreme Lending is a direct-to-consumer retail mortgage banker based in Dallas, TX that was founded all the way back in 1999 by Scott Everett. The company is actually a dba of Everett Financial, which gets its namesake from, you guessed it, their founder. They are a home purchase-heavy lender, meaning they probably have good relationships with real estate agents and... --- > The pros and cons of using a mortgage to finance your home purchase, or paying all-cash instead to save on interest. - Published: 2021-05-25 - Modified: 2025-01-10 - URL: https://www.thetruthaboutmortgage.com/mortgage-vs-cash-which-is-the-better-option-when-buying-a-home/ - Categories: Home Buying, Mortgage Matchups It’s been a while since my last mortgage match-up, so let’s give it a whirl again: "Mortgage vs. cash. " Today, the focus will be on taking out a mortgage versus simply using cash when purchasing a home and skipping the lender piece altogether. Of course, it's not that simple for the majority of the population to throw a few hundred thousand dollars (or more) down on a property. So for many, this won't even be an option. But it's worth visiting regardless to see how even the very rich often opt for a home loan when they've got plenty of cash to spare. Buying a Home with Cash Has Its Benefits Cash buyers are more attractive to home sellers The home buying process can be a lot faster without a mortgage Don't need to abide by any mortgage lender's rules No property restrictions or inspections to worry about Don't have to pay interest to the bank for several decades First let’s talk about buying a home with cash. This is almost certainly the favored approach of real estate investors and perhaps the mega-rich, though billionaires like Mark Zuckerberg still take out mortgages. And investing gurus like Warren Buffett think the low mortgage rates are a great deal... especially when you get to lock in a low fixed rate for 30 years. But for a large swath of the population, this either/or question doesn’t even get any consideration because most of us can’t afford to buy a home (or even... --- > Mortgage Q&A: “How many mortgage quotes should I get?” When it comes to getting the best deal on your mortgage, you can never shop too much. Just like - Published: 2021-05-19 - Modified: 2024-03-27 - URL: https://www.thetruthaboutmortgage.com/how-many-mortgage-quotes-should-i-get/ - Categories: Mortgage Tips Mortgage Q&A: “How many mortgage quotes should I get? ” When it comes to getting the best deal on your mortgage, you can never shop too much. Just like any other product you may comparison shop for, the more time you put in, the better deal you’ll probably receive. Sure, it’s a pain in the you know what, but you’re not shopping for a plasma TV. This is your mortgage, most likely one of the largest financial decisions you’ll make in your life. And one that can affect your pocketbook for years and years to come depending on how long you keep it. So not spending a considerable amount of time shopping for one would be very ill advised. Don't be one of the many individuals who obtains just one mortgage quote! Look At Mortgage Rates Online and Track Weekly Averages There's no specific number of quotes needed to score the best deal But the more mortgage quotes you receive the better your odds of finding that low rate A study from Freddie Mac found that even two quotes as opposed to one can save you thousands over the loan term And 5+ quotes from different lenders has the ability to save you even more These days, we’ve got the luxury of using the Internet to comparison shop. Back when, you had to scour the phonebook and make phone call after phone call to check on prices and availability. I remember doing this to buy a pair of high-tops when... --- > Declaring that ARMs are back, United Wholesale Mortgage (UWM) has just rolled out a new line of adjustable-rate mortgages for its mortgage broker - Published: 2021-05-13 - Modified: 2021-09-02 - URL: https://www.thetruthaboutmortgage.com/united-wholesale-mortgage-arms/ - Categories: Mortgage News Declaring that ARMs are back, United Wholesale Mortgage (UWM) has just rolled out a new line of adjustable-rate mortgages for its mortgage broker partners. The new offering from the nation’s largest wholesale mortgage lender includes a 5-, 7-, and 10-year ARM to flank the usual fixed-rate options, such as the very popular 30-year fixed and the shorter-term 15-year fixed. What makes these loans interesting is the fact that they come with significantly better pricing than fixed-rate mortgages currently available with other lenders. And that might be enough to change the ARM argument, which has been decidedly dour for years now thanks to record low fixed mortgage rates. How Long Will You Actually Keep Your Home Loan? Something like 90% of purchase mortgages are 30-year fixed loans And roughly 80% of all mortgages including refinances are 30-year fixed loans Yet less than 10% of borrowers actually keep their home loan for more than seven years This means the bulk of homeowners with a mortgage are overpaying for the perceived safety of a fixed interest rate UWM aptly points out that fewer than 10% of borrowers stay in the same mortgage for more than seven years, yet something like 80% of mortgagors hold 30-year fixed mortgages. In other words, a large majority are paying too much for their home loan, yet never actually receiving the benefit of an interest rate that is fixed for the life of the loan. And because many adjustable-rate mortgages come with a lengthy initial fixed-rate period, many... --- > Today we’ll check out East Coast mortgage lender “Garden State Home Loans,” which says it has some of the lowest mortgage rates and most competitive fees - Published: 2021-05-13 - Modified: 2025-04-09 - URL: https://www.thetruthaboutmortgage.com/garden-state-home-loans-review/ - Categories: Mortgage Tips Today we’ll check out East Coast mortgage lender “Garden State Home Loans,” which says it has some of the lowest mortgage rates and most competitive fees in the industry. They’re able to offer more attractively priced mortgages to their customers because they operate mostly online, meaning low overhead and a streamlined operation. And their thousands of customer reviews appear to back that up, with excellent marks across all the major ratings websites. Let’s learn more about them. Garden State Home Loans Fast Facts Mortgage broker that offers home purchase loans and refinances Founded in 2011, headquartered in Cherry Hill, New Jersey Licensed to do business in six states on the East Coast Has funded more than $4 billion in home loans since inception Aims to close most loans in 30 days or less (21. 3-day average turn time currently) Garden State Home Loans is a mortgage broker located in Cherry Hill, NJ that offers home purchase financing and mortgage refinances. As a broker, they can shop your loan on your behalf with their wholesale lender partners to find the best pricing and most flexible programs available. At the moment, the company is licensed in just six states, including Connecticut, Florida, Maryland, Michigan, New Jersey, and Pennsylvania. Since inception, the company has originated more than $4 billion in home loans and says it’s able to fund loans very quickly, with an average turn time of just 21. 3 days from submission to closing. How to Apply with Garden State Home Loans... --- > In an effort to perhaps streamline its brand and create a little less consumer confusion, Quicken Loans announced today that it is officially changed its - Published: 2021-05-12 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/quicken-loans-changes-name-to-rocket-mortgage/ - Categories: Mortgage News In an effort to perhaps streamline its brand and create a little less consumer confusion, Quicken Loans announced today that it is officially changed its name to “Rocket Mortgage. ” Going forward, you won’t see the old “Rocket Mortgage by Quicken Loans” blurb, and instead will just see Rocket Mortgage, which has clearly become the hot brand in home loans. The nation’s number one mortgage lender said the change will “bring alignment” to the Rocket brand, while making clear to home buyers that technology is the core tenet of Rocket Companies, Inc. From searching for a home to mortgage closing, the Rocket brand will feature, whether it’s sister company Rocket Homes or Amrock Title, or the company’s wholesale lender Rocket Pro TPO. At the same time, the Quicken Loans brand is essentially being retired after about 20 years in existence. In case you’re wondering, the name originally came from Intuit Inc. , the company behind TurboTax and QuickBooks, after Rock Financial founder Dan Gilbert sold to them in 1999. He later bought back the company and kept the name, though I believe they had to pay naming rights to keep it. Rocket Mortgage Quickly Took Over Its Parent Company Founder Dan Gilbert started a regional branch-based mortgage broker in metro Detroit called Rock Financial in 1985 Later changed the name to RockLoans. com in 1999 and sold the company to Intuit, the owner of Quickbooks and TurboTax They changed the company name to Quicken Loans before he eventually bought it... --- > Today we’ll review a Midwest-based depository bank that is big on home loans, “Central Bank,” which also operates an online lending division known as - Published: 2021-05-11 - Modified: 2025-04-09 - URL: https://www.thetruthaboutmortgage.com/central-bank-mortgage-review/ - Categories: Mortgage Tips Today we’ll review a Midwest-based depository bank that is big on home loans, “Central Bank,” which also operates an online lending division known as “Online Central. ” They’re perhaps best described as a neighborhood bank that has embraced the latest mortgage technology to allow for an up-to-date, digital home loan experience. So if you’re looking for a banking institution that has been around for a while, which operates the old-fashioned way with regard to values and personal service, they could be a good option. You’ll also get access to the latest technology too, and perhaps a low rate as well since they say they offer “very competitive” interest rates. Let’s learn more about them. Central Bank Fast Facts Direct-to-consumer retail mortgage lender backed by a depository bank Offers home purchase loans, refinances, and home equity products Founded in 1902, headquartered in Jefferson City, Missouri Backed by Central Bancompany, a $16-billion bank holding company Licensed to do business in all 50 states and the District of Columbia Also operates an online lending division called "Online Central" The Central Bank is a direct-to-consumer retail mortgage lender, meaning they offer home loans both online and in-person via their 140 physical bank branches. You can get a home purchase loan, a mortgage refinance, or a home equity product such as a HELOC. Their parent company Central Bancompany was founded more than 100 years ago, and is headquartered in Jefferson City, Missouri. Those bank branches I mentioned are located throughout the Midwest, from as far... --- > Large Credit Card Purchases Really Can Tank Your Credit Score While missed payments are arguably the worst offense Even racking up a lot of debt can lower - Published: 2021-04-29 - Modified: 2025-02-13 - URL: https://www.thetruthaboutmortgage.com/dont-swipe-your-credit-card-before-you-apply-for-a-mortgage/ - Categories: Mortgage Tips Large Credit Card Purchases Really Can Tank Your Credit Score While missed payments are arguably the worst offense Even racking up a lot of debt can lower your credit score significantly So it's best to put the spending on hold a few months before applying for a home loan That way there won't be any unwelcome surprises when it comes time to pull your credit You’ve probably heard at some point that making large purchases with your credit card(s) before applying for a mortgage is a no-no. In fact, you may have read that on this very site, since I’ve warned about it on numerous occasions in multiple posts because it's such a common problem. You might be aware of this issue, but shrugged it off, thinking what’s a few points, right? You already have excellent credit so it doesn’t matter if you purchase a new $5,000 couch with your AmEx card for the new digs ahead of time. Well, think again. It really does matter, and it can do serious damage to your credit score. I’m not just talking about 5-10 points. I’m talking enough movement to potentially take you out of the running for a mortgage altogether, or at minimum raise your mortgage rate. My Credit Score Got Rocked After Maxing Out a Credit Card I maxed out one of my credit cards a few years ago And my excellent credit score dropped about 50 points seemingly overnight That's enough to raise your mortgage rate depending on how... --- > In an effort to undo some of the damage the Federal Housing Finance Agency (FHFA) basically caused itself, it’s throwing a bone to so-called low-income - Published: 2021-04-28 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/new-fannie-freddie-refinance-option-drops-adverse-market-fee-offers-500-appraisal-credit/ - Categories: Mortgage News, Refinance In an effort to undo some of the damage the Federal Housing Finance Agency (FHFA) basically caused itself, it’s throwing a bone to so-called low-income families to save on their mortgage. It all spurs from the adverse market fee the very same agency implemented back in August 2020 to contend with heightened losses related to COVID-19 forbearance and loss mitigation. The 50-basis point fee, which went into effect on September 1st, 2020, applies to all new refinance loans backed by Fannie Mae and Freddie Mac. While it’s not a . 50% increase in mortgage rate, the fee does get passed along to consumers in the form of either higher closing costs or a slightly higher mortgage rate, perhaps an . 125% increase all told. Either way, it wasn’t well received at the time, and still isn’t today, and this announcement is a somewhat bittersweet one, as it only applies to a certain subset of the population. Still, the FHFA believes families who are eligible for this new refinance initiative could see monthly savings between $100 and $250 on average. Who Is Eligible for Fannie Mae RefiNow and Freddie Mac Refi Possible? Homeowners with incomes at or below 100% of the area median income Must result in a lower monthly mortgage payment, and at least a 50-basis point reduction in interest rate Must currently hold an agency-backed mortgage (Fannie Mae or Freddie Mac) Loan must be seasoned for at least 12 months Property must be a 1-unit principal residence Borrower must... --- > It’s no secret the housing market is hot at the moment, so much so that just about everyone is wondering when the next housing crash will take place. The - Published: 2021-04-23 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/dont-be-a-desperate-home-buyer/ - Categories: Housing Market, Mortgage Tips It’s no secret the housing market is hot at the moment, so much so that just about everyone is wondering when the next housing crash will take place. The few homes that are out there are flying off the shelves, and bidding wars are becoming more and more common, if not a foregone conclusion. Instead of home sellers delivering price reductions to prospective buyers, as they did just a couple years ago, properties are going way above asking. While some are quick to scream “Another housing crisis! ,” for me it just reinforces the housing market dynamic we've seen over the past year and change. One driven by limited housing supply, low mortgage rates, and rising salaries for prospective buyers, all of which increase both home prices and purchasing power. At the moment, it's clear the home sellers have all the leverage, but that doesn't mean you still can't negotiate or get a better deal. Sure, the past few years have been crazy – but you shouldn’t have to write a letter to the seller begging them to accept your offer. And while it’s still easy to get caught up in all the excitement, don't forget that you have power too as the home buyer, no matter the market conditions. Simply put, don’t be a desperate home buyer. Or a desperate buyer of anything. If you are, you’ll likely get ripped off, or at the least pay more than you need to. Here are some things to consider to avoid... --- > Real estate Q&A: "Why Is the Housing Market So Expensive Right Now?" If you asked me this same question a few years ago, I would have had the same - Published: 2021-04-22 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/why-is-the-housing-market-so-hot/ - Categories: Housing Market, Mortgage News Real estate Q&A: "Why Is the Housing Market So Expensive Right Now? " If you asked me this same question a few years ago, I would have had the same basic answer I’m about to explain. And since that time, home prices have surged much, much higher, which basically tells me the same fundamentals have been at play for quite a while now. Additionally, they may continue for more years to come. Similar to a market downturn, when things are hot, they remain hot for years, which is why it can pay to hold on, just like those who didn’t sell their bitcoin at first-profit. Reason #1: There Is Very Limited Inventory and Lots of Buyers Housing supply is at record low levels meaning few homes are available to buyers And 45 million Americans are hitting the median first-time home buyer age over the next decade While home building has increased lately it's still stubbornly low and insufficient This has allowed a seller’s market to persist for nearly a decade simply because demand outweighs supply The top reason why the housing market is so high right now has to do with limited inventory, or supply. It’s one of those fundamental concepts even a child can comprehend. When you have a small or finite amount of something, and people want it, its value goes up. This is basically what’s been going on with real estate since the market bottomed in 2012. In reality, supply has been tight ever since the market... --- > In your endless search to find the lowest mortgage rates on the planet, you may be wondering which route will lead to the biggest savings. Should you go - Published: 2021-04-19 - Modified: 2021-08-22 - URL: https://www.thetruthaboutmortgage.com/do-mortgage-brokers-offer-better-rates-than-the-competition/ - Categories: Mortgage Rates, Mortgage Tips In your endless search to find the lowest mortgage rates on the planet, you may be wondering which route will lead to the biggest savings. Should you go to your local bank, try your luck with an online mortgage lender, visit a credit union, or consult with an independent mortgage broker/banker? You've Got a Lot of Options When It Comes to a Mortgage There are many avenues you can take to obtain a home loan Including local brick-and-mortar banks and credit unions you may already know and work with Or direct mortgage lenders (both online and offline) you may have never heard of that promise low rates Lastly don't forget to consider an independent mortgage broker as well You may have heard that mortgage brokers offer the lowest interest rates thanks to their wholesale partners. And as we all know (or should know), wholesale prices tend to be cheaper than retail prices, the latter of which rise as operating costs are passed along. So does this mean brokers will automatically offer better rates than the competition? To be blunt, there’s no easy answer here. Actually, there is, but it’s not without its legwork. I’d argue to call/visit all of the above to see who offers the best interest rate and closing cost combination. Yes, I know it’s a pain, but if you don’t do it, you’ll never really know what could have been. And consider the return on your investment for those few extra hours you put in. Of course,... --- > File this one under bizarre, for several different reasons. Mad Money host Jim Cramer disclosed yesterday that “he recently paid off a mortgage using - Published: 2021-04-15 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/jim-cramer-just-paid-off-his-mortgage-with-bitcoin-gains/ - Categories: Mortgage News File this one under bizarre, for several different reasons. Mad Money host Jim Cramer disclosed yesterday that “he recently paid off a mortgage using profits from his investment in bitcoin. ” He apparently purchased a significant amount of the cryptocurrency back when it was trading at around $12,000, which was actually as recently as last October. The price of a single bitcoin has launched since then, hitting a record high of around $64,000 this week. For Cramer, that’s an investment return of about 433%, something he then moved into his mortgage account, which was probably earning a return of say 2-4%, which is the mortgage rate. He said it was “great to pay off a mortgage,” likening it to using “phony money” to pay for “real money. ” But why would he pay off a home loan that was priced at 2-4%, which is essentially its annual rate of return? Surely a big-wig investment guru like Jim Cramer could do better than a measly 2-4% in this market, or any market for that matter. What Is Cramer’s Rush to Be Free and Clear? Mortgage debt is typically the cheapest debt you can own, especially today Yet homeowners are often in a huge rush to pay off their home loans While this could make sense from an emotional or psychological point of view It’s a bit of a head-scratcher coming from an investment guru like Jim Cramer Now I understand it’s a common goal for homeowners to pay off their home... --- > I’ve noticed a trend lately. Everyone’s a real estate expert. It seems the most recent crisis and recovery has turned just about every single person into - Published: 2021-04-15 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/when-will-the-next-housing-market-crash-take-place/ - Categories: Housing Market, Mortgage Tips I’ve noticed a trend lately. Everyone’s a real estate expert. It seems the most recent crisis and recovery has turned just about every single person into a guru on all things to do with home buying and selling. I suppose part of it has to do with the fact that the massive housing bubble that formed a decade ago swept the nation and was front page news. It also directly affected millions of Americans, many who serially refinanced their mortgages, then found themselves underwater, then eventually short sold, were foreclosed upon, or held on for the ride back up to new heights. And now with home prices surging and real estate so expensive, it might be conjuring up not-so-distant memories for some that we could be in for another rude awakening. A New Housing Bubble Mentality Real estate is red-hot again thanks to limited supply and intense demand It can feel like an ominous sign that we're headed down a dark road again But that alone isn't reason enough for the housing market to crash again There have to be clear catalysts and financial stress for another major downturn It’s a common conversation piece these days to talk about your local housing market. Thanks to greater access to information, folks are scouring Redfin and Zillow and coming up with theories about what that home should sell for, or what they should have listed it for. Neighbors are getting upset when nearby listings are not to their liking for one reason... --- > Most properties require some amount work to get into their desired shape, even newer ones. And just about everyone knows that home renovation projects - Published: 2021-04-12 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/how-to-pay-for-home-renovations-pros-and-cons-to-different-methods/ - Categories: Mortgage Tips Most properties require some amount work to get into their desired shape, even newer ones. And just about everyone knows that home renovation projects aren’t cheap. This is generally the case regardless of whether the job is a small one or a large one, or a matter of preference versus a mandatory fix. It’s going to cost you some real money, especially if you’ve got plans to update a kitchen or bathroom, replace a leaky roof, and so on. And at the moment, it seems everyone is addressing these issues at the same time, which has made it more difficult to hire a pro, and probably more expensive too. Let’s talk about the many ways you can pay for it all, and which might be best depending on the situation. Options to Pay for Home Improvements Various Ways to Pay for Renovations Method Cost Pros Cons Credit Card Zero if you use a 0% APR credit card Potentially very cheap, easy to apply and use Hard to pay contractors, costly if you don’t pay on time Project Loan Interest rates in mid to high single-digits, e. g. 7. 99% APR Relatively low APR, fixed monthly payments, flexible use of funds May be stuck working with one company HELOC Interest rate around 5% depending on prime rate and lender Pretty cheap, can draw if/when needed, tax deductible Need to apply for a loan, uses your home equity, rate is adjustable Home Equity Loan Interest rate slightly higher than HELOC in most... --- > There are a lot of good reasons to buy a house, and probably a lot of bad ones too. But all too often, folks seem to get fixated on the investment side of - Published: 2021-04-08 - Modified: 2023-02-11 - URL: https://www.thetruthaboutmortgage.com/10-reasons-to-buy-a-house-other-than-for-the-investment/ - Categories: Housing Market, Mortgage Tips There are a lot of good reasons to buy a house, and probably a lot of bad ones too. But all too often, folks seem to get fixated on the investment side of things above all else, as if they’re playing the stock market. This is especially true at the moment, with home prices up substantially since the housing crisis that look place about a decade ago. Simply put, people don't want to overpay or buy a home at the top of the market, especially with bidding wars all too common again. And that's a fair concern. The thing is, a house isn’t just an investment, if it’s even an investment at all. It’s shelter if you plan on residing in it. A roof over your head to keep the rain and the cold out. It's a safe place where you can put down roots and create a foundation, maybe start a family. So when you consider that pros and cons of buying a house list, you need to think outside the box as well. You shouldn’t simply consider current home prices, or attempt to time the market to determine that right time to buy. Homeownership is much more than that, though I do recognize everyone wants to get a good deal, whether buying a new pair of shoes or real estate. That being said, let's look at some reasons why buying a home can be about much more than the investment. 1. Stay as long as you pay For... --- > These days, home equity is booming thanks to rapidly appreciating property values. At last glance, total equity on mortgaged properties exceeded $10 - Published: 2021-03-31 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/10-ways-to-build-home-equity/ - Categories: Housing Market, Mortgage Tips These days, home equity is booming thanks to rapidly appreciating property values. At last glance, total equity on mortgaged properties exceeded $10 trillion, with more than $6. 5 trillion of it tappable, per recent figures from Black Knight. Yes, that's a "T" not a "B. " But you would of never guessed it less than a decade ago after the housing bubble burst and put millions in underwater positions. In the early 2000s, it was all about tapping into your home equity with a line of credit or a cash-out refinance, often at absurdly high loan-to-value ratios (such as 100%). The whole using your house as an ATM thing to make lavish purchases or even just pay the bills each month became the norm. As a result of all that excess, the narrative quickly changed to overpriced homes, declining equity, negative equity, underwater mortgages, loan modification programs, foreclosures, and so on. Funny how that works... This reversal of literal fortune was caused by crashing home prices and zero down mortgages, many of which weren't properly underwritten to begin with. Most of those who got into trouble purchased homes at the height of the market at unsustainable prices, while at the same time relying on 100% financing to get the deal done. This caused lots of homeowners to leave or think about walking away, as home price deprecation was found to be the leading driver of default. But many of those who stuck around and rode it out are actually in... --- > With the weather warming up, I thought it’d be prudent to check out “Spring EQ,” a lender that specializes in getting cash out of your home. By that, I - Published: 2021-03-30 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/spring-eq-review/ - Categories: Mortgage Tips With the weather warming up, I thought it’d be prudent to check out “Spring EQ,” a lender that specializes in getting cash out of your home. By that, I mean they offer cash out refinances and second mortgages, including both home equity loans and lines of credit (HELOCs). They also partner with other lenders to provide secondary financing, so if you get a combo loan, you might find that they’re your lender on the second mortgage. Aside from allowing you to tap your home equity, they also offer home purchase financing too, so they’re a full-service lender. Let’s learn more about them to determine if they could be a good option for your first or second mortgage, or even both. Spring EQ Is All About Second Mortgages Direct-to-consumer nonbank lender that offers first and second mortgages Including home equity loans and home equity lines of credit Founded in 2016, headquartered in Philadelphia, Pennsylvania Currently licensed to do business in 39 states and D. C. Also operates a wholesale lending division for its mortgage broker partners Acquired by Cerberus Capital Management in December 2023 Spring EQ is a direct-to-consumer mortgage lender based out of Philadelphia, Pennsylvania that got its start in 2016. Originally, they sought to transform the home equity lending business model from “a long, drawn-out paperwork based process into a 21st century digital experience. ” This mirrors the efforts currently being made by mortgage lenders that focus on first mortgages, moving from a clumsy, slow process into a digital... --- > A look at some of the most common refinance roadblocks and what you can do to overcome them now. - Published: 2021-03-29 - Modified: 2023-01-19 - URL: https://www.thetruthaboutmortgage.com/7-reasons-why-you-cant-refinance-your-mortgage/ - Categories: Mortgage Tips, Refinance With mortgage rates so low, just about everyone and their mother has at least inquired about refinancing their mortgage lately, whether it's to obtain a lower interest rate and/or tap into their newfound equity. There are actually many reasons to refinance a mortgage, some you may have never considered, so it's important to ensure you're always eligible if the need comes up. Unfortunately, a lot of existing homeowners are finding that they don’t qualify for a refinance for one reason or another. What may have been a slam dunk a few years ago is now not even close to a sure thing. Let’s explore some common reasons why you may be denied that precious mortgage refinance. And don't fret, I'll also offer solutions to get around some of these common roadblocks. Lack of Equity/ LTV Restraints It can be difficult to refinance if you lack home equity due to a low down payment and/or falling home prices Lenders typically want your LTV to be below 100% to ensure you've got skin in the game However, there are some loan programs that address high-LTV and underwater mortgages Including streamline refinances that don't require a home appraisal Perhaps the most typical reason for a denied refinance is a lack home equity, which translates to a loan-to-value ratio well above what’s acceptable. For example, a great number of homeowners took out interest-only home loans and option-arms during the housing boom because home prices were only going in one direction. Up. But once things... --- > Wondering why you didn’t receive the low mortgage rate you saw advertised on TV or the Internet? Well, there are a ton of reasons why the quote you - Published: 2021-03-24 - Modified: 2024-01-31 - URL: https://www.thetruthaboutmortgage.com/21-things-that-can-drive-your-mortgage-rate-higher/ - Categories: Mortgage Rates, Mortgage Tips Wondering why you didn’t receive the low mortgage rate you saw advertised on TV or the Internet? Well, there are a ton of reasons why the quote you obtained was higher than anticipated. Let’s explore a lot of them so you can actually get your paws on that low rate. 1. Low credit score This is a biggie, if not the biggest reason. Most lenders assume (for the sake of their super low advertised rates) that you have stellar credit. So if you take the time to read the fine print, it might say something to the effect of “minimum 740 FICO score. ” That means your interest rate will be higher if you don’t have a credit score that high. Fortunately, the fix is easy... work on all three of your credit scores ahead of time to ensure they’re where they should be and you won’t be hit with any unnecessary pricing adjustments. In fact, you could even get a pricing break in the process if your scores are really good! Just keep in mind that it could take time to see a boost in your scores, so take action early. 2. You don’t occupy the property Mortgage lenders also tend to advertise rates on the basis that you’ll occupy the subject property. If it’s not going to be your primary residence, expect the mortgage rate to be significantly higher. Simply put, second homes, also known as vacation homes, and investment properties create more risk for lenders, and they... --- > Marriage or Mortgage? The premise of the new Netflix show "Marriage or Mortgage" is simple. It pits a wedding planner against a real estate agent. The - Published: 2021-03-24 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/marriage-and-mortgage/ - Categories: Mortgage Tips Marriage or Mortgage? The premise of the new Netflix show "Marriage or Mortgage" is simple. It pits a wedding planner against a real estate agent. The prize, if you want to call it that, is getting the spouses-to-be to go in one direction over the other. In this case, an over-the-top wedding versus a dream house. Because they can't possibly have both, at least not on their budget. While this might make for great reality television, it is a serious issue many young couples face, especially with home prices a lot higher than they've been. At the same time, the pressure to throw an incredible wedding has never been greater, perhaps thanks to Instagram and social media. It's like a weird competition no one really wins. It's Okay to Rent and Be Married, Honest There's nothing wrong with renting at any time in your life You don't need to own a home just because you're married or engaged But if you do plan on starting a family in the near future it might be smart to put down roots somewhere This will provide added stability and perhaps more space for additional occupants So you're planning on getting married this summer, and you just have to find a perfect house to call your own before that magical day. Or very soon thereafter. There's no possible way you could continue to live in an apartment and rent once you're married! That just won't do. Married people are supposed to be homeowners, right?... --- > The Importance of Knowing How to Calculate a Mortgage While there are plenty of mortgage calculators out there that do all the heavy lifting for you It - Published: 2021-03-19 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/demystifying-how-mortgages-are-calculated/ - Categories: Mortgage Tips The Importance of Knowing How to Calculate a Mortgage While there are plenty of mortgage calculators out there that do all the heavy lifting for you It can actually be helpful to know the math behind it You'll probably better understand the implications of paying extra/early or the impact of a lower interest rate And if nothing else you can impress your friends and family Mortgages can be complicated business – fortunately there are a ton of great calculators out there that take the legwork out of all the tricky math. But as your teachers probably told you in school time and time again, it’s good to actually know how things work too. That's why they asked you to show your work! And hey, it’s never smart to rely too heavily on technology in case something goes wrong. Oh, and you can impress your friends too. Well, probably not, but let's move on. That brings us to how mortgage interest works. Ready to do some light algebra? Neither am I, but let’s try it anyway. The Interest Part Is Easy to Calculate It's very easy to calculate monthly mortgage interest A standard calculator will do the job if you need to run a quick calculation Simply multiply your loan amount by your interest rate and divide by 12 That will give you the monthly interest due based on the outstanding principal balance Let’s say you’ve got a 30-year fixed mortgage with a loan amount of $200,000 and your mortgage rate... --- > It’s been a while since I’ve done a matchup, so let’s talk about an important one if you’re in the market to buy real estate. Today, we’ll breakdown the - Published: 2021-03-14 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/condo-vs-townhouse-why-it-matters/ - Categories: Housing Market, Mortgage Matchups, Mortgage Tips It’s been a while since I’ve done a matchup, so let’s talk about an important one if you’re in the market to buy real estate. Today, we’ll breakdown the similarities and differences of a condo vs. townhouse. First things first, let’s define what a condo is, then we can do the same for a townhouse, and finally we can compare the two and talk about how they affect mortgage financing. What Is a Condo? A Form of Ownership A condo, short for condominium, is actually a Latin word that basically means joint ownership (con+dominium). It’s technically a type of ownership, though it is commonly used to refer to a building style, whether correct or not. Practically speaking, it’s best defined as a structure that is divided into individual living units, with common areas throughout that are owned by all members of the association. If we’re just talking about the aesthetic, condos are basically no different than apartment buildings. The distinction is ownership versus renting, with condos being something you own, and apartments being something you rent, assuming you’re not the owner of the entire building. For example, a friend may have told you that they're renting a condo, which is basically a misnomer and likely uttered to make it sound more appealing. I think there's a more positive (valuable) connotation with the word condo than there is with apartment, as if condos are nicer or more luxurious than apartments. However, this can certainly vary by region of the United States... --- > Today we’ll check out a large-scale mortgage broker by the name of Sunnyhill Financial that’s looking to start a “Doc Less Revolution.” By that, they mean - Published: 2021-03-12 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/sunnyhill-financial-review/ - Categories: Mortgage Tips Today we’ll check out a large-scale mortgage broker by the name of Sunnyhill Financial that’s looking to start a “Doc Less Revolution. ” By that, they mean make it easier for folks to apply for a home loan without having to track down lots of paperwork, scan/upload it, fax it, etc. Yes, all those things are still verified to ensure you’re a creditworthy borrower (it's not 2006! ). But it’s done so in a more efficient manner (using the latest technology) so you can spend less time getting a mortgage, and more time enjoying that new low rate. Sunnyhill Financial Fast Facts Independent mortgage brokerage Offers home purchase loans and refinances via it wholesale partners Founded in 2018, headquartered in San Francisco, California Currently licensed to do business in 10 states nationwide Provides a digital home loan experience to their customers Sunnyhill Financial is an independent mortgage broker, which means they connect consumers to wholesale mortgage lender partners. This gives them the advantage of shopping your loan scenario on your behalf so you don’t have to. For those who don’t like to comparison shop, or simply don’t have the time, a broker can accomplish the shopping piece for you by checking out rates from their partners, then presenting you with the best offer. Aside from saving you time, it could also save you money if they match you with a lender that offers lower mortgage rates and reduced lender fees. The San Francisco, California-based company seems to be pretty young,... --- > Loyalty? Not in the mortgage business. That is, if you actually want to save money on your home loan. A few years back, an HSBC survey revealed that 52% - Published: 2021-03-11 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/more-than-half-of-consumers-switch-mortgage-companies/ - Categories: Mortgage Rates, Mortgage Tips, Refinance Loyalty? Not in the mortgage business. That is, if you actually want to save money on your home loan. A few years back, an HSBC survey revealed that 52% of U. S. homeowners “switched providers” (sorry, they’re British) when obtaining subsequent mortgages. This was mainly driven (53%) by the desire to get a better deal, aka a lower mortgage rate with fewer closing costs. That survey also found that 46% of consumers investigated a mortgage switcheroo, again either to save money or to lock in a new low rate due to rising interest rates. Other reasons homeowners decided to go with another mortgage company were because they moved and purchased a new property. Or due to their current mortgage deal was expiring. I think they mean an adjustable-rate mortgage resetting. Is It Bad to Switch Mortgage Lenders? A new report from Black Knight claims that loan servicers retained just 18% of the estimated 2. 8 million homeowners who refinanced a mortgage in the fourth quarter of 2020, the lowest share on record. Interestingly, those who refinanced to improve their rate and/or term were retained at a higher rate (23%) versus those pulling cash out as part of the transaction (11%). This could be due to cash out refinances being harder to come by lately, and thus offered by fewer lenders. Or it just feeling more complex to the homeowner. But here's the biggie - among higher-credit quality rate and term refinances, borrowers who switched mortgage lenders received more than an... --- > The loan-to-value ratio (LTV) is your mortgage loan amount divided by the current appraised value or sales price. - Published: 2021-03-08 - Modified: 2024-02-01 - URL: https://www.thetruthaboutmortgage.com/what-is-loan-to-value/ - Categories: Mortgage Tips Let's talk mortgage basics: “What is the loan-to-value ratio? ” If you're currently shopping for a home or already going through the mortgage loan process, chances are you've heard the phrase loan-to-value ratio get thrown around on more than one occasion. You may have also encountered the acronym "LTV" while perusing mortgage advertisements or playing around on mortgage rate comparison websites. Regardless of what's going on in the housing market, you should know all about this very important term when applying for a home loan. Why? Because it can greatly affect mortgage rate pricing, refinance options, and overall loan eligibility. How to Calculate the Loan-to-Value Ratio (LTV) It's actually one of the easiest calculations you can make Simply divide the loan amount by the appraised value or purchase price And you'll wind up with a percentage known as your LTV The tricky part might be agreeing on a sales price and getting the home to appraise at value Simply put, the loan-to-value ratio, or “LTV ratio” as it's more commonly known in the industry, is the mortgage loan amount divided by the lower of the purchase price or appraised value of the property. If we're talking existing mortgages (in the case of refinance loans), it's the outstanding loan balance divided by the appraised value. When calculating it, you will wind up with a percentage. That number is your LTV. And the lower the better here folks! It's actually very easy to calculate (no algebra required) and takes just one step.... --- > People constantly ask me if a particular lender is good, bad, or should be avoided at all costs. They also ask who the best mortgage lender is, often - Published: 2021-03-04 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/why-every-mortgage-lender-will-disappoint-you/ - Categories: Mortgage Tips People constantly ask me if a particular lender is good, bad, or should be avoided at all costs. They also ask who the best mortgage lender is, often citing some customer satisfaction survey or what not. Or whether they should use a mortgage broker or a bank. And my answer is pretty much always the same – it depends on how your particular loan goes. You might end up hating the company or loving them, all based on how things go when it’s your turn. So yes, two individuals can wind up with completely different opinions, even when working with the same company, and perhaps even the same exact employees. The problem with the mortgage industry is that it’s very regulated, dynamic, and complex, and as such, it’s very difficult to please everyone all of the time, even with the best of intentions. In other industries, such as the credit card industry for example, customer service reps can “make things right” if something goes wrong, usually just by pushing a button. You didn't like our service? Okay, how about a $25 statement credit? The same goes for your cable company, who you have to call each month to ask for a billing adjustment after they attempt to gouge you. With home loans, it's a little different. Aligning Expectations with Reality in the Mortgage Biz Thanks to the widespread "the customer is always right" policy Consumers are almost guaranteed to be dissatisfied with the home loan experience Because it doesn't work... --- > It’s time for another mortgage review, this time we’ll take hard look at Summit Funding Inc., which bills itself as “The Home Loan Experts.” There might - Published: 2021-03-04 - Modified: 2024-10-16 - URL: https://www.thetruthaboutmortgage.com/summit-funding-review/ - Categories: Mortgage Tips It’s time for another mortgage review, this time we’ll take hard look at Summit Funding Inc. , which bills itself as “The Home Loan Experts. ” There might be some truth to that because the direct lender has been around since 1995, almost as long as the duration of a 30-year fixed mortgage. The company started off small with just a few employees, known then as Sacramento Residential Mortgage, but has rapidly expanded into a national mortgage lender. Today, they fund billions in home loans annually and are working to become one of the top lenders in the nation and a household name. Summit Funding Fast Facts Direct-to-consumer retail mortgage lender that offers home purchase and refinance loans Founded in 1995, headquartered in Sacramento, California Licensed to do business in 45 states and the District of Columbia Funded more than $4 billion in home loans last year (a top-100 lender nationally) About two-thirds of their business consisted of home purchase lending More than half of their loan volume came from home state of California Summit Funding, Inc. is a direct mortgage lender and loan servicer that was founded by current CEO Todd Scrima in the mid-1990s. Since then, they have grown to be a top-100 mortgage lender nationally based on loan volume, and may even be close to cracking the top-50 today. Last year, they originated roughly $4 billion in home loans, with about two-thirds of it driven by home purchase loans. That means real estate agents trust working with... --- > There are many reasons to refinance your mortgage, some obvious and some a bit more obscure and/or different. I figured I’d compile a list of the many - Published: 2021-03-03 - Modified: 2023-09-22 - URL: https://www.thetruthaboutmortgage.com/18-reasons-to-refinance-your-mortgage/ - Categories: Mortgage Tips, Refinance There are many reasons to refinance your mortgage, some obvious and some a bit more obscure and/or different. I figured I’d compile a list of the many reasons I can think of to refinance. Some of the situations are complete opposites of one another and will depend on your unique financial goals and/or risk appetite. But most will be appealing at times when interest rates are low, as they are now. 1. To get a lower interest rate This one is the no-brainer that everyone will agree on. If you want a lower interest rate then refinancing your mortgage is the way to go, assuming mortgage rates are lower now than when you took out your original mortgage. The classic rate and term refinance allows homeowners to reduce their interest rate so they can enjoy a lower monthly payment. The potential downside to this is resetting the clock on your mortgage, though you can also go with a shorter term at the same time to avoid that. 2. Because your borrower profile has improved Another reason to refinance has to do with your unique borrower profile. Say you improved your FICO scores over the past year and cleaned up some other negative stuff. Or perhaps your home value increased enough to push your LTV into a lower tier. It's also possible that your new loan amount could fall below the conforming loan limit, thereby opening up new loan programs and potentially providing even greater savings. In short, if your borrowing... --- > Today we’ll check out “Own Up,” a new technology company that wants to be your mortgage co-pilot. By that, they mean help you comparison shop for a home - Published: 2021-03-02 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/own-up-review/ - Categories: Mortgage Tips Today we’ll check out “Own Up,” a new technology company that wants to be your mortgage co-pilot. By that, they mean help you comparison shop for a home loan without having to jump through hoops or get badgered by salespeople. And stick with you every step of the way. Aside from making the process faster and easier, they can apparently save you some serious dough too – to the tune of $27,102 in interest over the life of the loan (on average). How Own Up Works Complete an online profile on the Own Up website in about five minutes Schedule a call with a dedicated home advisor to discuss your mortgage goals Compare rates and fees from partner lenders on their platform and select the one you like best Fill out the lender’s application and they’ll process, underwrite, and fund your loan Instead of going to a bank or calling a lender to get a mortgage, you begin by creating a profile on the Own Up website. While they refer to themselves as a tech company, they’re technically a mortgage broker, just on a larger scale, as opposed to a mom and pop shop. They seem to be similar to Credible, the Fox-owned brokerage that operates a comparable mortgage marketplace for homeowners. What this means for you is that Own Up acts as an intermediary between borrowers and mortgage lenders. After you complete your anonymous online profile, you’ll be assigned a dedicated home advisor who will discuss your needs/goals, along... --- > Zillow appears to be putting its money where its mouth is by offering to buy properties at their Zestimate price. No longer is the Zestimate just a number - Published: 2021-02-25 - Modified: 2021-08-20 - URL: https://www.thetruthaboutmortgage.com/zillow-will-now-buy-your-home-for-its-zestimate-price/ - Categories: Housing Market, Mortgage News Zillow appears to be putting its money where its mouth is by offering to buy properties at their Zestimate price. No longer is the Zestimate just a number you can fantasize about, assuming your home qualifies for the company’s iBuying program known as Zillow Offers. The Zestimate Turns 15 Years Old Zillow introduced the Zestimate all the way back in 2006 They claim it was the first time homeowners had instant access to free estimated home values Zestimates are published for nearly 100 million homes nationwide with a median error rate for on-market homes of just 1. 9% Today’s algorithm uses public records, feeds from MLSs, artificial intelligence, computer vision, and a deep-learning neural network that even factors in photographs Zillow’s new initiative coincides with the 15th anniversary of their popular home valuation tool known as the Zestimate. The free quasi-appraisal tool was launched in 2006 and essentially put Zillow on the map by providing homeowners and prospective home buyers with a quick tool to see what a home was worth. Today, their complex algorithm goes beyond public data and MLS feeds and uses things like artificial intelligence and computer vision that allows it to incorporate data from photographs. In other words, if images are uploaded that show a new kitchen or bathroom, or even just new paint or more expensive fixtures, your Zestimate might get a boost. They claim all these improvements to the always-evolving Zestimate give it a median error rate of just 1. 9% for on-market homes.... --- > While it might look and sound counterintuitive at first glance, it could actually make perfect sense. Instead of assuming that home loan financing is just - Published: 2021-02-23 - Modified: 2021-08-20 - URL: https://www.thetruthaboutmortgage.com/look-for-a-mortgage-before-you-search-for-a-home/ - Categories: Housing Market, Mortgage Tips While it might look and sound counterintuitive at first glance, it could actually make perfect sense. Instead of assuming that home loan financing is just a cumbersome, yet mostly guaranteed step toward the American Dream, understand that it will dictate the home shopping process itself. After all, without a mortgage, there’s a good chance you won’t be getting a home unless you're one of the few individuals out there able to finance the transaction with cash. Don’t Assume You’re Good to Go on the Mortgage Front Close the real estate apps and dig into your financials Take the time to ensure you actually qualify for a mortgage Only then should you start searching for a suitable property to buy And try to do this before you speak to a real estate agent or lender to keep things as objective as possible There’s a reason I’ve written so many articles in the past about what to do and not to do before applying for a mortgage. I’ve recommended renting before applying for a mortgage, avoiding credit card use, knowing which type of mortgage you want before speaking to a lender, paying down debts, and more. I brought up all these important points because they are often overlooked, and aren’t something one can resolve in a matter of days or weeks during crunch time. And so focusing on these potential pitfalls early is key to actually getting the house you want, especially when it's a seller's market (as it is now! ).... --- > You may have come across one of those articles lately that talks about how a couple paid off their mortgage in five years. Or some other absurdly-fast - Published: 2021-02-22 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/why-does-everyone-want-us-to-pay-down-our-mortgages/ - Categories: Mortgage Rates, Mortgage Tips You may have come across one of those articles lately that talks about how a couple paid off their mortgage in five years. Or some other absurdly-fast timeline. While it also sounds super enticing and perhaps inspiring, it's often just a feel-good story that may not actually make a lot of sense financially. At least for your particular situation. And with mortgage rates close to levels never seen before, one should question whether it makes sense to target the mortgage as a bad debt. Mortgage Debt Has Hit Record Highs The New York Federal Reserve Bank recently reported that household debt, largely comprised of home loans, hit a record $14. 56 trillion in the fourth quarter of 2020. It was driven "by a steep increase in mortgage originations," which the NY Fed estimated to be a staggering $1. 2 trillion in the fourth quarter of 2020. That was also a record which surpassed the massive volumes seen during the historic refinance boom back in the third quarter of 2003 (at least in nominal terms). At first glance, this makes it appear as if Americans are going down that dark debt path once again. But in reality, it's more illustrative of surging property values, not so much overflowing debt balances. Many homeowners these days actually owe very little relative to what their homes are worth, which puts them in a much better position than where we were at a decade ago. Back then, scores of homeowners applied for cash out refinances... --- > If you already have a mortgage, there’s a good chance you receive junk mail on a regular basis urging you to refinance. You may receive solicitations from - Published: 2021-02-18 - Modified: 2025-02-10 - URL: https://www.thetruthaboutmortgage.com/why-do-mortgage-companies-want-you-to-refinance-so-badly/ - Categories: Mortgage Tips, Refinance If you already have a mortgage, there’s a good chance you receive junk mail on a regular basis urging you to refinance. You may receive solicitations from both your current bank/loan servicer and from a competing lender or mortgage broker looking to acquire your business. But why do they want you to refinance your mortgage so badly? What’s in it for them, especially if they already originated your mortgage and get paid interest each month? Wouldn’t it be in their best interest (seriously, no pun intended) to hold onto your mortgage and continue to earn a decent rate of return, rather than give you a new low rate. Why Would They Offer You a Lower Rate? Why would a mortgage lender offer you a lower interest rate than you currently have That would ostensibly earn them less money each month? Because they often sell the loans off to investors to make a profit Or they never owned your mortgage to begin with, so they earn a commission and proceeds from a sale This might be easier to grasp if we look at it the other way around. Imagine you have a savings account that earns an APY of 0. 95%. Your same bank wouldn’t come to you and say hey, let’s get you into an account with a rate of 1. 25% instead, you deserve more! If they did, there would be a huge catch, such as locking up your money for five years at a fixed rate of return... --- > Sometimes I tend to skip past the seemingly basic mortgage questions, assuming everyone already knows the simple stuff. Unfortunately, that’s not the - Published: 2021-02-17 - Modified: 2024-03-16 - URL: https://www.thetruthaboutmortgage.com/do-i-qualify-for-a-mortgage/ - Categories: Mortgage Tips Sometimes I tend to skip past the seemingly basic mortgage questions, assuming everyone already knows the simple stuff. Unfortunately, that’s not the case, and what may appear basic isn’t really all that straightforward. So let’s talk about qualifying for a mortgage. As you might suspect, it’s a pretty complex process. After all, you're asking a bank to loan you a ton of money for a long period of time. They'll want to know you can actually pay it all back. Jump to mortgage qualification topics: - The Mortgage Qualification Process - The Home Loan Submission Process - Keys to Qualifying for a Mortgage - Use Common Sense and Think Like the Lender - What You Need to Qualify for a Mortgage Mortgage Qualification Varies by Lender and Loan Type There is no one-size-fits-all approach Some mortgage lenders may say no while others says yes It depends on their risk appetite and available loan programs But your goal should be a smooth loan approval no matter where you apply The first thing I’ll say on this topic is that qualification for a mortgage can vary greatly from bank to bank, and also by loan type. For example, one lender may allow FICO credit scores as low as 550 for FHA loans, while another may require a minimum credit score of 620. So right there you could be approved by one company and denied by another, simply because of their unique credit scoring thresholds. Not every lender necessarily offers the same product... --- > New Home vs. Old Home It’s time for another match-up, this time we’ll compare buying a new home versus purchasing an old one. For the record, some home - Published: 2021-02-15 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/should-you-buy-a-new-home-or-an-old-home/ - Categories: Housing Market, Mortgage Matchups, Mortgage Tips New Home vs. Old Home It’s time for another match-up, this time we’ll compare buying a new home versus purchasing an old one. For the record, some home builders refer to existing homes as “used,” which sounds kind of silly considering we're talking about a house and not a car. Ultimately, it's a marketing gimmick to sway you toward buying new as opposed to old, but let’s continue on to determine the pros and cons. Millennials and Gen X Are Big on New Homes A recent report from the National Association of Home Builders found that interest in newly-built homes has surged. They noted that during the fourth quarter of 2020, 41% of prospective buyers were searching for a newly-built home, double the 19% share a year earlier. At the same time, the share interested in an existing home fell from 40% to 30%. It's even more pronounced when we break it down by generation, with 50% of Millennial and 48% of Gen X buyers looking to buy a new home. Meanwhile, just 13% of Boomers indicated that they were looking for a new home vs. existing. Interestingly, Gen Z is a little more into existing homes than Boomers with a 38% share, but still below that of Millennials and Gen X. New Homes Are Untouched and Clean The number one reason to buy a new home is probably the fact that it's never been lived in Some people may not like the idea of living somewhere that was previously... --- > Some good news for homeowners struggling to make ends meet thanks to COVID-19, which as the name implies has been going on for a while now. The Federal - Published: 2021-02-10 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/covid-mortgage-forbearance-15-months/ - Categories: Foreclosure, Mortgage News Some good news for homeowners struggling to make ends meet thanks to COVID-19, which as the name implies has been going on for a while now. The Federal Housing Finance Agency (FHFA), which oversees Fannie Mae and Freddie Mac, has just announced an extension to the COVID forbearance period, which was previously capped at 360 days. Now borrowers who requested mortgage forbearance back in March or April of 2020 will be able to get another few months to keep monthly payments on hold. COVID-Related Mortgage Forbearance Extended Another Six Months Homeowners with a Fannie/Freddie-backed mortgage can now request an additional six months of forbearance Originally allowed for an initial 180 days of payment relief (and an additional 180 days if the borrower needed more time) Now borrowers can get a full 18 months of mortgage payment relief if in a COVID-19 forbearance plan Applies to those who are in a COVID-19 forbearance plan as of February 28th, 2021 The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) originally allowed homeowners with a federally-backed residential home loan to request forbearance for up to 180 days, or roughly six months. It also included a 180-day extension if they were still struggling to make mortgage payments at the end of the original 180-day term. Now the FHFA has gone a step further by allowing an additional six months of relief, for a grand total of 18 months of suspended mortgage payments. In other words, a homeowner who is unable to pay their... --- > The co-founder and CEO of a so-called “tech-enabled residential mortgage servicer” named Valon (formerly Peach Street) has warned we could be on the brink - Published: 2021-02-02 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/valon-loan-servicer-cusp-of-another-foreclosure-crisis/ - Categories: Foreclosure, Housing Market, Mortgage News The co-founder and CEO of a so-called “tech-enabled residential mortgage servicer” named Valon (formerly Peach Street) has warned we could be on the brink of another foreclosure crisis. While real estate is flying high at the moment, it’s appears that two very different stories are unfolding at the same exact time. On the one hand, the housing market has never been hotter, with supply at record lows and dwindling, while demand from prospective buyers skyrockets. Meanwhile, home builders are playing catch-up, which has pushed property values to all-time highs, with a further 10% increase expected in 2021. Then there’s the other story, which got some press early last spring when the pandemic took hold, but has since been somewhat ignored. Nearly 3 Million Homeowners Have Their Mortgage Payments on Hold Currently 2. 7 million borrowers are taking part in COVID-19 mortgage forbearance These programs essentially put payments on hold for up to 360 days But once the forbearance ends the borrower must at least resume regular payments This could lead to another wave of short sales and foreclosures if the economy doesn’t get back on track There are 2. 7 million U. S. homeowners in mortgage forbearance plans at the moment, which represents 5. 38% of loan servicers’ portfolio volume, per the latest weekly report from the MBA. These borrowers essentially have their payments on hold for up to 360 days due to a COVID-19-related issue, such as unemployment or reduced earnings. It’s even worse for government-backed loans like FHA... --- > Today we’ll check out “Sage Home Loans,” a digital mortgage lender startup backed by Red Ventures, which refers to itself as a portfolio of internet - Published: 2021-01-25 - Modified: 2025-07-04 - URL: https://www.thetruthaboutmortgage.com/sage-mortgage-review/ - Categories: Mortgage Tips Today we’ll check out “Sage Home Loans,” a digital mortgage lender startup backed by Red Ventures, which refers to itself as a portfolio of internet brands and digital platforms. You may have heard of some of their companies, such as the popular credit card blog The Points Guy, along with Healthline, NextAdvisor, and Bankrate. Well, now it appears they’re trying their hand at mortgage lending themselves, as opposed to merely offering advertising on behalf of third-party lenders. Let’s find out more about them to see if they could be a good choice for your home loan needs. Sage Home Loans Fast Facts A direct-to-consumer mortgage broker Headquartered in Fort Mill, South Carolina Offer both home purchase loans and mortgage refinances Acquired by Red Ventures in 2020 Say they offer a 100% digital mortgage experience Licensed to do business in 49 states and D. C. (not licensed in NY) Sage Home Loans is a dba of Forward Mortgage Lending, Inc. , which was acquired by media company Red Ventures. They were founded in 2020, and actually operate as a mortgage broker, but on a larger scale than your mom-and-pop variety. This means they connect borrowers with wholesale mortgage lenders they work with to help them find competitive interest rates. After initially only offering mortgage refinancing, they expanded to offer home purchase loans as well. So if you’re a prospective home buyer or a current homeowner looking for a lower mortgage rate and/or cash out, they could be of good use. They... --- > Today we’ll check out “Carrington Mortgage,” a top-50 mortgage lender nationally that is based in Anaheim, California. They recently launched “Vylla - Published: 2021-01-22 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/carrington-mortgage-review/ - Categories: Mortgage Tips Today we’ll check out “Carrington Mortgage,” a top-50 mortgage lender nationally that is based in Anaheim, California. They recently launched “Vylla Home,” which is their take on a modern all-in-one experience for home buyers and mortgage seekers. It’s a single brand that encompasses everything from mortgage lending and loan servicing to a real estate brokerage, title, escrow, and settlement services – all under one roof. Let’s learn more about this full-service real estate and mortgage company. Carrington Mortgage Fast Facts Retail direct-to-consumer mortgage lender A top-50 mortgage lender nationally Founded in 2007, headquartered in Anaheim, CA Offers home purchase loans and mortgage refinances Funded more than $7 billion in home loans last year About two-thirds of their total loan volume consisted of mortgage refinances They also operate wholesale and correspondent lending divisions and are a loan servicer Currently licensed in 48 states and the District of Columbia Carrington Mortgage Services is one of the largest mortgage lenders in the country, and also a major loan servicer as well. Aside from running a billion-dollar retail direct-to-consumer channel, they operate wholesale and correspondent lending divisions. This means you might be resold a Carrington Mortgage at a credit union or via one of their mortgage broker partners. The company got its start back in 2007 in Anaheim, California (home to Disneyland), and since then has increased its footprint to 48 states and D. C. , with North Dakota and Massachusetts the two exceptions. While they mostly operate online, there are six physical locations,... --- > Mortgage Q&A: “Does a refinance require an appraisal?” A reader recently asked if they needed an appraisal to refinance their existing mortgage, - Published: 2021-01-21 - Modified: 2024-10-28 - URL: https://www.thetruthaboutmortgage.com/does-a-refinance-require-an-appraisal/ - Categories: Mortgage Tips, Refinance Mortgage Q&A: “Does a refinance require an appraisal? ” A reader recently asked if they needed an appraisal to refinance their existing mortgage, knowing they can often add weeks to the refinance process. As with anything in the mortgage realm, the answer is it depends. Mainly, it depends on the type of loan you plan to refinance. Additionally, the type of refinance (rate and term vs. cash out) you're applying for can also come into play, as can the property type. Nowadays, there are both appraisal waivers and a number of different home loan programs that do not require an appraisal to refinance, known as streamline refinances. Let's learn more about if and when an appraisal might be required, and how you might be able to avoid one. Introducing the Appraisal Waiver Fannie Mae and Freddie Mac can both waive the appraisal requirement in some cases This applies to both home purchase loans and refinance transactions But you must meet maximum LTV limits (or minimum down payment requirements) They are not an option on 2-4 properties, manufactured homes, and properties valued over $1 million In recent years, Fannie Mae and Freddie Mac introduced a novel concept known as an "appraisal waiver. " As the name implies, it allows you to waive the appraisal requirement typically needed to get to the finish line. Initially, this was an option for certain types of refinance transactions, but now it's good for some home purchases as well. (Note that this isn't possible for purchase... --- > To say residential real estate is on fire would be a huge understatement. In fact, it’s so popular that we’re literally running out of homes. Simply put, - Published: 2021-01-19 - Modified: 2021-08-20 - URL: https://www.thetruthaboutmortgage.com/the-2021-housing-market-is-kind-of-like-the-toilet-paper-shortage/ - Categories: Housing Market, Mortgage News To say residential real estate is on fire would be a huge understatement. In fact, it’s so popular that we’re literally running out of homes. Simply put, there are too many home buyers and not enough properties for sale, nor is the supply being replenished fast enough. In a way, it reminds me of the toilet paper crisis that marked the beginning of the COVID-19 pandemic in spring of 2020. While you might hesitate to call the latest housing boom akin to panic buying, there is some bubbly sentiment in the air that is reminiscent of the early 2000s. Back then, folks were purchasing homes sight-unseen in faraway states because mortgage financing was cheap and loan underwriting non-existent. Today, mortgage financing is even cheaper, with mortgage rates not far off their all-time record lows. However, mortgage underwriting isn’t what it was once, and is in fact a lot better, thankfully. If it weren’t, I’d hate to see what today’s housing market would like look. Where Are All the Homes? Total housing supply (1. 28 million homes) is at an all-time low, per NAR The current sales pace (2. 3 months) is also at its lowest point in history Homes on the market are selling nearly twice as fast as they were a year ago And there are very few distressed sales with foreclosures and short sales accounting for less than 1% of the total The National Association of Realtors recently noted that despite a monthly 2. 5% decline in existing-home... --- > You’ve got to pretty confident to say you’re #1 in both price and customer service, but that’s exactly how “Optimum First Mortgage” describes itself. The - Published: 2021-01-19 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/optimum-first-mortgage-review/ - Categories: Mortgage Tips You’ve got to pretty confident to say you’re #1 in both price and customer service, but that’s exactly how “Optimum First Mortgage” describes itself. The Southern California-based mortgage lender isn’t afraid to say it has the lowest rates in the industry, or the best customer service. It’s a bold claim (or two), but based on their stellar reviews from past customers, they might be on to something. Let’s discover more about them. Optimum First Mortgage Fast Facts Direct-to-consumer mortgage lender Founded in 2008, headquartered in Fountain Valley, CA Offers home purchase loans and mortgage refinances Also able to broker out loans via its wholesale lending partners Claims to offer the lowest rates in the industry and top customer service Employs roughly three dozen loan officers Licensed to lend in 14 states nationwide Optimum First Mortgage is a direct-to-consumer mortgage lender based in Fountain Valley, California, which is situated pretty close to Huntington Beach. As noted, they claim to be #1 when it comes to mortgage rates and customer service, which they claim is possible because of their high volume of business. In short, because they originate more home loans, they’re happy to earn less per loan and make up for it by simply closing more loans. They also have the advantage of brokering out loans via their wholesale lender partners, and say they’ve got about 30 different rate sheets at their fingertips to find the right home for your mortgage. So unlike a retail bank that might just have one... --- > If you simply want a lower interest rate on your existing home loan, look into a “streamline refinance” that requires limited paperwork. - Published: 2021-01-13 - Modified: 2024-03-12 - URL: https://www.thetruthaboutmortgage.com/what-is-a-streamline-refinance/ - Categories: Mortgage Tips, Refinance Mortgage Q&A: “What is a streamline refinance? ” While qualifying for a mortgage refinance is generally a lot harder than it has been in the past (now that lenders actually care how your home loan performs), there are less cumbersome options available. In fact, many lenders offer “streamlined” alternatives to existing homeowners to lower costs and make refinancing more accessible, knowing that borrowers simply want payment relief. When you think about it, a mortgage with a lower interest rate should also be lower-risk, as the monthly payment will be reduced, putting less burden on the homeowner. It is for this reason that “streamline refinance” programs are available with just about every bank and lender out there. They come with looser credit scoring requirements, easier income and asset verification, and limited paperwork. And in some cases, you don’t even need to order a home appraisal since collateral isn't really an issue if you're just swapping your mortgage for one with a lower rate. Simply put, a streamline refinance takes a lot of the legwork (and time) out of the process, and may increase your chances of approval. However, streamline refinances also come with their own list of requirements, namely that the refinance has a “net tangible benefit. ” In other words, it should help the homeowner, not just put money in the pocket of the loan originator (yes, they benefit too when you refinance by earning a commission). This generally means that the mortgage rate should drop by an amount that... --- > Mortgage Q&A: “How to get a wholesale mortgage rate?” Wholesale mortgage rates tend to be considerably cheaper than their retail counterparts, though - Published: 2021-01-12 - Modified: 2021-01-12 - URL: https://www.thetruthaboutmortgage.com/how-to-get-a-wholesale-mortgage-rate/ - Categories: Mortgage Rates, Mortgage Tips Mortgage Q&A: “How to get a wholesale mortgage rate? ” Wholesale mortgage rates tend to be considerably cheaper than their retail counterparts, though it's never a guarantee with so many lenders out there these days. To get your hands on one, you need to shop for your home loan with a mortgage broker, who has access to wholesale mortgage rates via their lender partners. What Is a Wholesale Mortgage Rate? It's an interest rate offered by a mortgage broker to a homeowner Via a wholesale lender partner (B2B lending channel) They differ from retail mortgage rates that are obtained by consumers directly from a bank/lender Can be higher, lower, or the same depending on the lenders in question Mortgage brokers work as middlemen (and women) between homeowners and mortgage lenders. That means they're both client-facing (with you) and directly in contact with wholesale lenders. They receive pricing from Account Executives, who are basically like loan officers, except they only deal with brokers, not the public. In other words, you can only get your wholesale rate by working with a broker, who acts as an intermediary between you and the Account Executive (AE). Typically, brokers have a handful of wholesale banks they work with directly, all with different rate sheets and loan programs. And perhaps most importantly, pricing! Once you begin working with a broker, they can compare rates among these lenders and ideally provide you with the lowest rate (and closing costs) available. Instead of shopping with a single retail... --- > While tech has taken center stage in the mortgage world, Nations Lending still strives to make home loans human. That’s their motto, and it means looking - Published: 2021-01-06 - Modified: 2024-10-16 - URL: https://www.thetruthaboutmortgage.com/nations-lending-review/ - Categories: Mortgage Tips While tech has taken center stage in the mortgage world, Nations Lending still strives to make home loans human. That’s their motto, and it means looking beyond the numbers and at the individual themselves to determine their needs. They believe the key to a successful mortgage starts with a good conversation, which should ultimately ensure you wind up with the right home loan. So far, their approach seems to be paying off, with excellent customer reviews fueling a rapidly growing business. Nations Lending is also pretty ambitious - their goal is to become a top-10 independent mortgage banker in the next five years. Let’s discover more about them. Nations Lending Fast Facts Retail direct-to-consumer mortgage lender founded in 2003 Offers home purchase loans and refinance loans Headquartered in Independence, Ohio (suburb of Cleveland) Employs more than 1,300 people, with 120+ branches across the United States Licensed to do business in all 50 states and the District of Columbia Funded more than $4. 6 billion in home loans last year Nations Lending is a retail direct-to-consumer mortgage lender that offers home purchase financing and refinance loans. This means you can call them up on the phone or visit a branch to apply for a mortgage. They were founded in 2003, but since that time have grown from a small local lender to a billion-dollar national originator with aspirations to become a household name. The company mustered more than $4. 6 billion in loan origination volume last year, with nearly $700 million... --- > There’s nothing inherently wrong with living with your parents, other than EVERYTHING! So let’s talk about how to GET OUT! To be clear, I’m going to - Published: 2021-01-06 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/how-to-move-out-of-your-parents-house/ - Categories: Housing Market, Mortgage Tips There’s nothing inherently wrong with living with your parents, other than EVERYTHING! So let’s talk about how to GET OUT! To be clear, I’m going to discuss moving out and buying a place of your own, not moving out and renting, seeing that the latter is fairly self-explanatory. The desire to move out now might be especially strong right given we just went through a pandemic and everyone was home, all of the time. But don't just make a home purchase on a whim, really take the time to think it through, especially since home prices aren't very cheap anymore. The pandemic housing boom, fueled by record low mortgage rates, led to a surge in property values as everyone and their mother snapped up anything and everything. So the landscape has changed quite a bit with today's home buyers now facing mortgage rates in the 6-7% range instead of the low 3% range. Living with Your Parents Is a Great Launchpad Live rent-free and save up money for a home purchase Establish steady and reliable employment history (2+ years is generally good) Pay off other non-housing debt like student loans, credit cards, etc. Work on your credit scores and bolster your credit history (aim for a 780 FICO) Study how real estate and mortgages work and peruse listings to get a feel Determine if and where you want to buy a property (and why! ) While it might not be cool now or ever, living with your parents is actually... --- > One of the more unique mortgage originators out there is First Republic Bank, due to both their large volume of jumbo home loans and adjustable-rate - Published: 2021-01-04 - Modified: 2024-08-01 - URL: https://www.thetruthaboutmortgage.com/first-republic-bank-mortgage-review/ - Categories: Mortgage Tips One of the more unique mortgage originators out there is First Republic Bank, due to both their large volume of jumbo home loans and adjustable-rate mortgages. Unlike most mortgage bankers that stick to fixed-rate conforming loans and home loans backed by the government, they mostly make jumbos that don’t adhere to the guidelines of those agencies. In fact, they don’t even bother with FHA loans, USDA loans, or VA loans. As such, they tend to cater to high-net worth individuals who are also relatively low-risk borrowers relative to the rest of the population, including billionaires like Mark Zuckerberg. Let’s learn more about this premium mortgage lender, which may be a good fit if you need a very large home loan. First Republic Bank Fast Facts Headquartered in San Francisco, CA, founded in 1985 Publicly traded depository bank valued at more than $25B+ Offer home loans, construction loans, and HELOCs Funded more than $14. 5B in mortgages in 2019 Most of loan volume came from states of CA, MA, and NY Specialize in jumbo home loans for high-net worth individuals First Republic Bank was founded by its current CEO Jim Herbert back in 1985 in the city of San Francisco. Today, the company is publicly traded on the NYSE and valued at more than $25 billion. Based on their numbers through the first nine months of 2020, they likely originated more than $20 billion in home loans last year, which would be quite a jump from 2019. Most of their loan... --- > Today we’ll take a deep dive into a major credit union that's also a sizable mortgage lender, Pentagon Federal Credit Union, or PenFed for short. While - Published: 2020-12-29 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/penfed-mortgage-review/ - Categories: Mortgage Tips Today we’ll take a deep dive into a major credit union that's also a sizable mortgage lender, Pentagon Federal Credit Union, or PenFed for short. While originally intended to serve the U. S. military, veterans, and various defense department government employees, today anyone can join PenFed, whether part of those groups or not. For example, if you have no military affiliation whatsoever, it’s possible to join if your employer is eligible or if you make a small donation to an organization. PenFed has been around since 1935, and today serves more than two million members worldwide with a whopping $25 billion in assets. They lend in all 50 states and the District of Columbia, as well as in Guam, Puerto Rico, and Okinawa. Let's learn more. PenFed Mortgage Fast Facts Members-only credit union federally insured by NCUA Founded in 1935, headquartered in Alexandria, Virginia Anyone free to join regardless of lack of military background Offer checking and savings accounts, credit cards, mortgages, and HELOCs Licensed to lend in all 50 states, D. C. , Guam, Puerto Rico, and Okinawa Funded $18. 9 billion in home loans last year Did about a fifth of total loan volume in home state or Virginia Also operate a wholly-owned title insurance company called PenFed Title, LLC and real estate brokerage called PenFed Realty As noted, anyone can join PenFed, though they are a members-only credit union. So once you become a member, you can take advantage of their many product offerings, including home mortgages.... --- > If you live in Indiana, there’s a very good chance you either got your home loan from Ruoff Mortgage, or at least considered them if you’re a homeowner. - Published: 2020-12-29 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/ruoff-mortgage-review/ - Categories: Mortgage Tips If you live in Indiana, there’s a very good chance you either got your home loan from Ruoff Mortgage, or at least considered them if you’re a homeowner. After all, the company managed to originate nearly $3 billion in home loans last year, with roughly $2 billion coming from the Hoosier State alone. They’ve even got an IndyCar with Ruoff Mortgage plastered along the front and sides of the vehicle, and the naming rights to the Ruoff Music Center, the largest outdoor music venue in Indianapolis. So it’s clear they’re laser-focused on a certain region of the country, as opposed to trying to tackle the nation as a whole. This has proven to be a successful model as they are now one of the top mortgage lenders in the nation, and #1 in Indiana. You may also want to check out First Internet Bank of Indiana if you live in the Hoosier State. Ruoff Mortgage Fast Facts Independent direct-to-consumer mortgage lender Founded in 1984, headquartered in Fort Wayne, Indiana Employ nearly 1,000 workers across 70+ branches Ranked the #1 mortgage lender in Indiana Now the "Official Mortgage Partner of NASCAR" If you’re wondering where they got their name from, they were originally known as the Dave Ruoff Mortgage Co. , after founder David Ruoff. They later changed the company name to Ruoff Mortgage, and today employ around 1,000 employees across some 70 branches. As noted, they are highly-concentrated in the Midwest, with another $500 million in volume coming from nearby... --- > Welp, it’ll be nice to close out 2020 and look ahead to a brand-new year that hopefully features a lot less drama and much more good news. While the - Published: 2020-12-16 - Modified: 2024-01-31 - URL: https://www.thetruthaboutmortgage.com/2021-mortgage-and-housing-market-predictions/ - Categories: Housing Market, Mortgage News Welp, it’ll be nice to close out 2020 and look ahead to a brand-new year that hopefully features a lot less drama and much more good news. While the housing market actually absorbed both the COVID-19 pandemic and the presidential election surprisingly well, we can probably thank the record low mortgage rates for that. And the continued lack of inventory. That has been the silver lining for existing homeowners, but it’s created an even wider divide between the haves and the have-nots, otherwise known as homeowners and renters. So what does 2021 look like when it comes to mortgages and the housing market? Let’s dust off the old crystal ball and make some predictions. 1. Mortgage rates will hit new record lows As of this writing, mortgage rates hit 14 new all-time lows in 2020. And there’s a decent chance they’ll hit a 15th before the year is complete. This has many pundits calling for an end to the low rates. Sound familiar? It does because every single year they call for higher rates, only to be proven wrong over and over. I expect mortgage rates to hit new all-time lows in 2021, though the caveat is that they may not remain there. In other words, we could see 30-year fixed mortgage rates reach levels never seen before in the first half of the year, before they rise back above lows seen this year. The good news is rates should remain low throughout the year if the 2021 mortgage rate... --- > While searching for a home loan, you may have come across “Paramount Residential Mortgage Group,” or PRMG for short, along the way. It’s also possible - Published: 2020-12-15 - Modified: 2024-07-19 - URL: https://www.thetruthaboutmortgage.com/paramount-residential-mortgage-group-review/ - Categories: Mortgage Tips While searching for a home loan, you may have come across “Paramount Residential Mortgage Group,” or PRMG for short, along the way. It’s also possible that your real estate agent referred you to the company since they do quite a bit of home purchase loan volume. In fact, more than 75% of their overall business last year was derived from home purchase financing, with the remainder split between refinance loans. The Southern California-based company is a top-50 mortgage lender nationally, having closed more than $7 billion in home loans last year. Let’s discover more about them. Paramount Residential Mortgage Group Fast Facts Direct-to-consumer retail mortgage lender Corporate headquarters located in Corona, CA Founded in 2001 by mortgage veteran Paul Rozo Now employ over 2,000 with 180 retail locations nationwide (and growing) Licensed to do business in 48 states and D. C. Funded more than $7 billion in home loans last year Also operate wholesale and correspondent lending programs Paramount Residential Mortgage Group got its start back in 2001, founded by Paul Rozo and a couple friends. Today, the company employs more than 2,000 workers across more than 180 retail locations nationally, and just cracked the top-50 for total home loan volume among all banks and lenders out there. That means they’re a very large mortgage company, and because they’re licensed in 48 states and the District of Columbia, they should be an option for most of us. Aside from running a retail direct-to-consumer mortgage business, they also operate sizable wholesale... --- > Yet another year is about to come to an end, and that means it's time to look ahead to what next year has in store. I think just about everyone wants to - Published: 2020-12-14 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2021-mortgage-rate-predictions/ - Categories: Mortgage News, Mortgage Rates Yet another year is about to come to an end, and that means it's time to look ahead to what next year has in store. I think just about everyone wants to see the back of 2020, though it wasn't all bad news. The housing market actually held up surprisingly well, and mortgage lenders enjoyed record mortgage originations. Anyway, without further ado, here are the “2021 mortgage rate predictions” from a number of major mortgage and real estate groups, along with my own outlook. MBA 2021 Mortgage Rate Prediction First quarter 2021: 3. 1% Second quarter 2021: 3. 1% Third quarter 2021: 3. 2% Fourth quarter 2021: 3. 3% Like in past years, we’ll begin with a prediction from the Mortgage Bankers Association (MBA). They publish a monthly Mortgage Finance Forecast that includes predictions for 30-year fixed mortgage rates on a quarterly and annual basis, with rates all the way to 2023. We’ll focus on the 2021 numbers and throw in 2022 for good measure. As you can see, the MBA expects the 30-year fixed to remain relatively flat in the first half of 2021, before rising ever so slightly in the second half. Their quarterly average for the 30-year fixed is 3% flat for the fourth quarter of 2020, so the 3. 1% average would also represent a slight increase. They expect mortgage rates to rise to 3. 6% in 2022, which is a more significant increase that homeowners would actually notice and likely disapprove of. For the record,... --- > The Department of Veterans Affairs (VA) has proposed a new loss mitigation method to help homeowners with VA loans in COVID-19 related forbearance get - Published: 2020-12-10 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/partial-claim-va-loan-covid-19-forbearance/ - Categories: Foreclosure, Mortgage News The Department of Veterans Affairs (VA) has proposed a new loss mitigation method to help homeowners with VA loans in COVID-19 related forbearance get back on track. The new program, known as the COVID-19 Veterans Assistance Partial Claim Payment program, or COVID-VAPCP for kind of shorter, somewhat mirrors existing programs offered by the FHA and USDA to pay forbearance back. It would allow veteran borrowers to defer the repayment of missed mortgage payments for up to 60 months. And the full repayment of any forborne payments wouldn’t be due in full for 120 months, or 10 years to provide veterans with a "soft landing. " However, there would be interest charged, though at a very nominal 1% rate, which differs from the interest-free offerings at the FHA/USDA. Additionally, the FHA/USDA both don’t require repayment until the loan is refinanced or otherwise paid-in-full. While perhaps not as attractive, it has to do with the VA's smaller guaranty percentage versus those other loan types. Still, when compared to a standard loan modification, a veteran homeowner could stand to save thousands in interest and stay on track with respect to paying off their loan in full. It should be noted that loan servicers would only consider this proposed partial claim option after evaluating “all loss-mitigation options for feasibility. ” How the COVID-VAPCP Works Any missed mortgage payments from CARES Act forbearance are set aside Monthly payments on this amount are deferred for up to 60 months (five years) The repayment period begins in... --- > The leading wholesale mortgage lender in the nation has brought the heat once again, this time offering 30-year fixed mortgage rates below 2% on FHA - Published: 2020-12-03 - Modified: 2020-12-03 - URL: https://www.thetruthaboutmortgage.com/uwm-fha-loans-mortgage-rates-below-2/ - Categories: Mortgage News, Mortgage Rates The leading wholesale mortgage lender in the nation has brought the heat once again, this time offering 30-year fixed mortgage rates below 2% on FHA loans. United Wholesale Mortgage announced that borrowers can now lock in interest rates as low as 1. 99% on FHA-backed loans via its popular Conquest program. The new Conquest for FHA offering matches the low 1. 99% rate they’ve been offering on conventional loans backed by Fannie Mae and Freddie Mac. This means borrowers can choose between FHA loans and conventional loans and still secure some of the lowest mortgage rates around. UWM is also offering these same low rates for VA loans as well, so all borrowers are covered, even those with high-balance conforming loans. Conquest for FHA Details Mortgage rates start at 1. 999% Can be a purchase loan or rate and term refinance Primary residences only Also permits FHA streamline refinances on both primary and secondary homes Loan must not have closed with UWM in the last 18 months Minimum FICO score of 640 required No debt-to-income (DTI) maximum Can lock rates for anywhere from 8-22 days This exciting new loan program allows both new home buyers and current homeowners to take part, assuming it’s your primary residence. You can take out a home purchase loan or a rate and term refinance if you’re looking to save money on your existing mortgage. Additionally, those who apply or an FHA streamline refinance can qualify if the property is a primary residence or a... --- > American Financial Network Inc. bills itself as one of the fastest growing mortgage bankers in the United States, and is indeed ranked in the top 50 - Published: 2020-12-03 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/american-financial-network-mortgage-review/ - Categories: Mortgage Tips American Financial Network Inc. bills itself as one of the fastest growing mortgage bankers in the United States, and is indeed ranked in the top 50 nationally. But they’re not satisfied with that, and believe they have what it takes to land in the top-10 one day. Of course, the competition is pretty fierce at the very top of the pile. Aside from being a high-growth company, they are also a highly-rated one, finding themselves among the top three lenders on LendingTree based on customer reviews. That's pretty impressive given the fact that there are more than 800 mortgage lenders listed there. Let’s dig into the details to learn more about this SoCal mortgage lender. American Financial Network Quick Facts Retail direct-to-consumer mortgage banker founded in 2001 Headquartered in Brea, CA – licensed in all 50 states and D. C Offers home purchase loans and refinance loans A top-50 mortgage lender nationally by loan volume Funded more than $7 billion in home loans last year 185+ physical locations and 700+ loan officers nationwide One of the top-rated mortgage lenders on LendingTree based on customer reviews American Financial Network Inc. was founded in Chino Hills, California by mortgage industry veteran Jack Sherman back in 2001. The company later relocated to nearby Brea, CA before growing rapidly and hitting its first billion-dollar funding year in 2012. Today, it’s one of the nation’s largest mortgage lenders (top-50), having funded over $7 billion last year alone. In 2019, they signed on New York and... --- > Today we’ll check out another one of the newcomers in the mortgage industry that is all about technology and low rates, aptly named "Lower Mortgage." - Published: 2020-12-02 - Modified: 2025-05-14 - URL: https://www.thetruthaboutmortgage.com/lower-mortgage-review/ - Categories: Mortgage Tips Today we’ll check out another one of the newcomers in the mortgage industry that is all about technology and low rates, aptly named "Lower Mortgage. " Similar to Better Mortgage, which is also a one-word-named mortgage company, they like to keep things simple and make it easy to apply for a home loan. That means you can get started right on their website, or even begin your home loan process with a text message. They’re also all about things being lower, whether it’s mortgage rates, lender fees, monthly payments, or the amount of hassle it takes to get a mortgage. They even take a subtle jab at Quicken Loans on their website, saying “No rocketry. Just the important stuff—like lower rates. ” Let’s find out more about this low-loving, techy mortgage lender. Lower Mortgage Quick Facts Direct-to-consumer mortgage lender that offers home purchase loans and refinances Launched in 2018, headquartered in New Albany, Ohio (just outside Columbus) Originated roughly $5 billion in home loans last year Licensed in 45 states and the District of Columbia A top-rated lender on LendingTree that has won several customer satisfaction awards They have a sister company called Homeside Financial (founded in 2013) Exclusive mortgage provider for Opendoor Acquired real estate portal Movoto in May 2025 Lower, which actually refers to itself as a technology company, was launched in December 2018. The main goal of the company is to improve the online mortgage and refinance experience, knowing that the majority of applicants start the process... --- > If you live in Colorado, you may have heard a radio ad for "American Financing," a direct-to-consumer mortgage lender based in Aurora. You may also know - Published: 2020-12-01 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/american-financing-mortgage-review/ - Categories: Mortgage Tips If you live in Colorado, you may have heard a radio ad for "American Financing," a direct-to-consumer mortgage lender based in Aurora. You may also know that ex-Denver Broncos quarterback Peyton Manning is a fan of the company, and serves as an endorser, along with dozens of other celebrities including Rush Limbaugh, Glenn Beck, Nephew Tommy, and Bobby Bones. So it’s clear they’ve got a lot of prominent individuals pitching their brand, similar to Dave Ramsey’s endorsement of Churchill Mortgage. Let’s dig into the details of American Financing. American Financing Fast Facts Direct-to-consumer mortgage banker headquartered in Aurora, Colorado Founded in 1999 by Damian and Gabie Maldonado Offer home purchase financing and refinance loans Licensed to do business in all 50 states and the District of Columbia Funded more than $4 billion in home loans last year 80% of total origination volume came from their home state of Colorado Also operate an affiliated real estate brokerage called American Home Agents American Financing got their start at the turn of the century, originally operating out of the Maldonado household before getting incorporated in June of 2001 and growing rapidly thereafter. Today, they employ hundreds at their Aurora, Colorado headquarters and are licensed to do business in all 50 states and the District of Columbia. Last year, the mortgage banker funded a whopping $4 billion in home loans, with more than $3. 2 billion of that coming from their home state of Colorado. Aside from offering home loans to new and existing... --- > Thanks to another year of stellar home price appreciation, the 2021 conforming loan limit will increase to $548,250, per the Federal Housing Finance - Published: 2020-11-30 - Modified: 2021-03-13 - URL: https://www.thetruthaboutmortgage.com/2021-conforming-loan-limits/ - Categories: Mortgage News Thanks to another year of stellar home price appreciation, the 2021 conforming loan limit will increase to $548,250, per the Federal Housing Finance Agency (FHFA). This is the maximum loan amount for mortgages that can be acquired by Fannie Mae or Freddie Mac, known as conforming mortgages. The figure is up from $510,400 for mortgages closed in 2020, and represents the 7. 42% rise in home prices over the past four quarters. The FHFA determines the conforming loan limit each year by looking at the FHFA House Price Index (FHFA HPI) report. The seasonally adjusted, expanded-data FHFA HPI rose 7. 42%, on average, between the third quarters of 2019 and 2020. That pushed the baseline maximum conforming loan limit up by the same amount, from $510,400 to $548,250, which becomes effective on January 1st, 2021. Individual banks and mortgage lenders may accept the new, higher loan limits almost immediately as it takes a month or longer for a mortgage to actually fund. While there were certainly times where it looked like the conforming loan limit could have remained at its 2020 level, thanks to the COVID-19 pandemic, real estate took off after a brief slowdown in spring. Fun fact – conforming loan limits do not decrease, even if home values have declined. Instead, loan limits remain the same as the prior year, not that this has been an issue for nearly a decade. In summary, this is more good news for existing homeowners wanting to refi and those looking to... --- > What I’ve seen and heard through the years is certain lenders not being so forthcoming with existing customers wanting to refinance their mortgage. For - Published: 2020-11-20 - Modified: 2020-11-20 - URL: https://www.thetruthaboutmortgage.com/dont-let-your-current-lender-talk-you-out-of-a-refinance/ - Categories: Mortgage Tips, Refinance What I’ve seen and heard through the years is certain lenders not being so forthcoming with existing customers wanting to refinance their mortgage. For example, when a homeowner goes to inquire about the “awesome low rates,” their first instinct may be to pick up the phone and call the lender who gave them their current home loan. Or perhaps they make contact with their loan servicer, the company that collects their mortgage payments each month. The problem is some lenders may respond with, “you’ve got a killer rate already. ” Or, “why would you refinance, your mortgage rate is already the lowest in history! ” They’ll say this in their most convincing tone, though it’ll be pretty clear they’re lying through their teeth, assuming your rate is much higher than today's going rates. So why are they throwing up roadblocks, as opposed to quoting you a new low rate and getting your loan application started? Well, it could be that it's not in their best interest, regardless of the fact that it may benefit you. Your Mortgage Rate Could Be Substantially Lower Mortgage rates have hit 13 record lows so far this year And they might not be done going down yet! You need to keep an eye on rates to see if a refinance could be beneficial, even if you recently refinanced Always take the time to look beyond your current lender/loan servicer for pricing At last glance, mortgage rates have hit 13 new all-time record lows this year,... --- > If you live in the USA and need a mortgage, perhaps you’ve thought about applying at "USA Mortgage." Makes sense, right? It just so happens that USA - Published: 2020-11-17 - Modified: 2024-06-22 - URL: https://www.thetruthaboutmortgage.com/usa-mortgage-review/ - Categories: Mortgage Tips If you live in the USA and need a mortgage, perhaps you’ve thought about applying at "USA Mortgage. " Makes sense, right? It just so happens that USA Mortgage is located right smack in the middle of our fine country, in St. Louis, Missouri to be exact. Well, that’s pretty darn close to the midpoint... Anyway, geography aside, they’ve been around for about 20 years now and actually operate under the name DAS Acquisition Company, LLC, which purchased the lender when it was a distressed company. Today, it’s one of the largest privately held mortgage bankers in the state of Missouri and employs more than 750 licensed loan officers and operations personnel. Technically, USA Mortgage is a full-service mortgage broker, meaning they can offer loan programs from various lender partners at wholesale prices. USA Mortgage Is a Top Lender in St. Louis Employee-owned direct-to-consumer mortgage lender located in St. Louis, MO Founded in 2001 by current president and CEO Doug Schukar Originally acquired as a distressed asset by DAS Acquisition Company, LLC Was the #1 mortgage lender in metro St. Louis for about a decade Funded nearly $800 million in home loans during 2023 40% of total loan volume came from their home state of Missouri Currently licensed to do business in 41 states and D. C. If you live in Missouri, there’s a good chance you’ve heard of USA Mortgage. They did nearly half their business in The Show-Me State last year. The company is also one of the... --- > You’d think presumably wealthy politicians like Joe Biden and Kamala Harris would own their homes free and clear. But that’s not the case, per their 2019 - Published: 2020-11-11 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/why-joe-biden-and-kamala-harris-havent-paid-off-their-mortgages/ - Categories: Mortgage Tips You’d think presumably wealthy politicians like Joe Biden and Kamala Harris would own their homes free and clear. But that’s not the case, per their 2019 tax returns. Both individuals disclosed their returns on the JoeBiden. com website, and each paid tens of thousands of dollars in mortgage interest last year. But why would they pay interest if they had the means to simply pay off the loans, a luxury most other Americans can’t afford to do? The reason is simple. Mortgage Debt Is the Cheapest Debt Out There Joe and Jill Biden paid $15,796 in home mortgage interest in 2019 Kamala Harris and Douglas Emhoff paid $32,041 in home mortgage interest in 2019 There’s a good chance both parties could have paid off their mortgages in full But why bother if you can earn a higher rate of return for your money elsewhere? Why Biden and Harris and so many other rich homeowners choose to carry mortgages as opposed to paying them off has to do with how cheap they are relative to virtually everything else. Ultimately, it doesn’t get much better than home loan debt, especially with mortgage rates in the 1-2% range at the moment. What other type of loan offers such cheap financing? This is why I refer to mortgages as good debt, especially since you have the opportunity to write off the interest in many cases. On top of that, the low rate of interest makes it easy for savvy homeowners to beat the rate... --- > A lot of homeowners are looking to refinance their mortgages at the moment. That’s abundantly clear based on the record volume of refis expected this - Published: 2020-11-09 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/if-a-mortgage-lender-reaches-out-to-you-reach-out-to-other-lenders/ - Categories: Mortgage Tips, Refinance A lot of homeowners are looking to refinance their mortgages at the moment. That’s abundantly clear based on the record volume of refis expected this year, per the MBA. And while mortgage rates are in record low territory, thus making the decision to refinance an easy one for most, it still pays to shop around. I think we all have a tendency to care less about prices when something is on sale, but there’s no reason you shouldn’t strive for even better, regardless of how cheap something is. Look Beyond Your Current Mortgage Lender New technology is making it easier for lenders to improve borrower retention rates This means using the same lender for life even if their interest rates aren’t the lowest But like most things loyalty often doesn’t pay when it comes to a home loan So take the time to shop around and negotiate like you would anything else Thanks to emerging technology, it has become easier for mortgage lenders, mortgage brokers, and loan officers to improve their customer retention. This means if and when a past customer looks to refinance their home loan or purchase a new home, they might be notified if they pay for such services. There are companies that can keep an eye on your data over time to see if you’ve applied for a home loan elsewhere, if your home equity has increased, or if your debt load has gone up. The same goes for your credit score, which if it’s improved... --- > Today we’ll take a look at FBC Mortgage, which is a Florida-based mortgage lender that does a ton of business in its home state. In fact, they originated - Published: 2020-11-09 - Modified: 2025-04-09 - URL: https://www.thetruthaboutmortgage.com/fbc-mortgage-review/ - Categories: Mortgage Tips Today we’ll take a look at FBC Mortgage, which is a Florida-based mortgage lender that does a ton of business in its home state. In fact, they originated nearly $2 billion in home loans in the Sunshine State last year, which accounted for roughly 60% of their overall loan volume. They also recently struck a deal with the University of Central Florida (UCF) to be the field sponsor at the “Bounce House. ” So it’s safe to say that if you live in Florida, there’s a good chance you’ve heard of FBC Mortgage. Either way, read on to learn more. FBC Mortgage Fast Facts Direct-to-consumer retail mortgage lender Founded in 2005 in Orlando, Florida Licensed in 48 states nationwide (excluding Hawaii and New York) Funded over $3 billion in home loans during 2019 Refer to themselves as a top-20 national mortgage lender Also operate correspondent and wholesale lending divisions FBC Mortgage is somewhat middle-aged for a mortgage company, having been around for about 15 years. The name is related to their past affiliation with the Florida Bank of Commerce, hence the initials FBC. During their relatively short time in existence, the company changed hands twice but came full circle. First, it was sold to privately-owned investment bank Sterne Agee Group, Inc. in 2012, then three years later it reacquired itself. That excitement aside, today the independent nonbank lender has roughly 1,000 employees nationwide and funds billions in home loans annually. Last year, nearly 80% of their total loan volume consisted... --- > If and when you take out a mortgage, you’ll be faced with an important choice. To pay or not pay mortgage points. In short, those who pay points should - Published: 2020-11-05 - Modified: 2022-01-18 - URL: https://www.thetruthaboutmortgage.com/alternative-to-paying-mortgage-points/ - Categories: Mortgage Rates, Mortgage Tips, Refinance If and when you take out a mortgage, you’ll be faced with an important choice. To pay or not pay mortgage points. In short, those who pay points should hypothetically secure a lower interest rate than those who do not pay points, all else being equal. That’s because mortgage points, at least the ones that are bona fide discount points, are just a form of prepaid interest. So you’re essentially paying a portion of the interest on the underlying loan upfront, as opposed to monthly over the life of the loan term. The caveat is that it is possible for a home buyer or refinancer to obtain a lower mortgage rate than another borrower without paying any points, assuming they shop around and use a mortgage lender with lower rates. Now back to whether you should pay points or not, especially at a time when mortgage rates continue to hit new all-time lows. Mortgage Rates Have Hit Record Lows 12 Times This Year In an environment where mortgage rates are declining over a long period of time, paying mortgage points can be a mug’s game. After all, you paid money upfront for a lower mortgage rate, only to find yourself back at the refinancing table. No bueno. Indeed, many homeowners these days are asking the question, how soon can I refinance again? Those who went the no cost refinance route have basically nothing to lose, other than maybe resetting the mortgage clock. While those who paid several thousand dollars in... --- > Mortgage rates keep on marching lower and lower, with new records broken seemingly every week. But with all the fervor surrounding mortgage rates, some - Published: 2020-11-04 - Modified: 2022-01-18 - URL: https://www.thetruthaboutmortgage.com/watch-out-for-low-mortgage-rates-you-have-to-pay-for/ - Categories: Mortgage Rates, Mortgage Tips, Refinance Mortgage rates keep on marching lower and lower, with new records broken seemingly every week. But with all the fervor surrounding mortgage rates, some lenders are playing the “how low can we appear to go” game. For example, mortgage lenders may be talking about their lowest rates (with multiple points required), as opposed to offering their par rates, the latter coming at no extra cost to the consumer. So instead of being presented with a mortgage rate of say 2. 75% on a 30-year fixed, you may see a rate as low as 1. 99%. Or even a 15-year fixed at 1. 75%! Here's the problem; with mortgage rates breaking record lows time and time again, 10+ times so far in 2020, many homeowners are finding the need to refinance the mortgage twice. Or even three times. And those who chose to pay points at closing, only to refinance within months or a year, essentially left money on the table. Or they decide not to refinance to an even lower rate, knowing they'll lose that upfront cost that's already been paid, which is also a tough situation. Mortgage Rates Aren’t as Low as They Appear In order to advertise lower mortgage rates lower than the competition Lenders will often tack on discount points to their publicized rates Meaning you'll have to pay a certain amount upfront to obtain the low rate in question Make sure you're actually comparing apples to apple when mortgage rate shopping Guess what? That absurdly low... --- > A mortgage refinance can result in big savings, but it's not always the right move. Learn when to refinance your mortgage to maximize your benefit and when you may want to pump the brakes. - Published: 2020-10-28 - Modified: 2025-02-04 - URL: https://www.thetruthaboutmortgage.com/when-to-refinance-a-mortgage/ - Categories: Mortgage Tips, Refinance Mortgage Q&A: “When to refinance a home mortgage. ” With mortgage rates at or near record lows, you may be wondering if now is a good time to refinance. Heck, your neighbors just did and now they're bragging about their shiny new low rate. The popular 30-year fixed-rate mortgage slipped to 2. 80% last week, per Freddie Mac, well below the 3. 75% average seen a year ago, and much better than the 4-6% range seen years earlier. Historically, mortgage interest rates have never been lower, making a mortgage refinance a veritable no-brainer for many homeowners out there. In other words, there's a good chance you won't be holding off from refinancing because interest rates are too high (unless you just recently refinanced). But even if you did, there's a possibility it could make sense to refinance a second time. Should I Refinance My Mortgage Now? Consider your current interest rate relative to today's available rates Along with required closing costs and how long it will take to break even Think about how long you plan to keep the mortgage/property And any other factors like removing mortgage insurance or shortening your loan term Well, the answer to that question depends on a number of factors that will be unique to you and only you. First, what is the interest rate on your existing mortgage(s)? Is it higher or lower than current mortgage rates? If it's higher, how much higher? If it's lower, is your current loan adjustable? Or do you... --- > If customer satisfaction is your thing, and you happen to need a home loan, you might want to check out Royal United Mortgage. The company recently topped - Published: 2020-10-27 - Modified: 2024-12-09 - URL: https://www.thetruthaboutmortgage.com/royal-united-mortgage-review/ - Categories: Mortgage Tips If customer satisfaction is your thing, and you happen to need a home loan, you might want to check out Royal United Mortgage. The company recently topped LendingTree’s customer satisfaction rankings for four consecutive quarters, and have consistently ranked in the top-10 for the past six years. Another thing that makes them unique is the fact that they offer home equity lines of credit (HELOCs), and a lot of them at that, based on their HMDA data. Let’s learn more. Royal United Mortgage Fast Facts Privately-held, employee-owned retail mortgage lender licensed in 32 states Founded in 2008, headquartered in Indianapolis, Indiana Funded roughly $1 billion in home loans during 2019 via consumer direct channel Ranked a top-10 mortgage lender by LendingTree since 2014 Began 2020 as LendingTree’s #1 lender in customer satisfaction for 4th quarter in a row Most of their business comes from the states of Florida, Indiana, and Texas Royal United Mortgage is a relatively young company, around since 2008, which is right around the time the mortgage crisis and Great Recession took place. But they’ve made it through some tough times and mustered over a billion in home loan volume last year. They’re a privately-held, employee-owned direct-to-consumer mortgage lender, meaning they operate remotely without branches. At the moment, they seem to be licensed to do business in 32 states, including Alabama, Arizona, Arkansas, California, Colorado, Florida, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, Missouri, New Jersey, New Mexico, New York, North Carolina, Ohio,... --- > While mortgage rates are projected to be slightly higher next year, home purchase activity should hit a new record high, per the latest forecast from the - Published: 2020-10-26 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/record-home-purchase-activity-expected-in-2021-despite-higher-mortgage-rates/ - Categories: Housing Market, Mortgage News While mortgage rates are projected to be slightly higher next year, home purchase activity should hit a new record high, per the latest forecast from the Mortgage Bankers Association (MBA). The group said it expects purchase loan origination volume to increase a further 8. 5% to a record high $1. 54 trillion in 2021. That $1. 54 trillion would better the previous all-time high of $1. 51 trillion in purchase loan volume set back in 2005, just a year or so before the housing bubble burst. Interestingly, they’re forecasting an even better 2022, with purchase volume of $1. 57 trillion. Similar to 2005, 2022 could be one of the last big years in the housing market before things take a turn, though there’s no guarantee of history repeating itself. It’s just that it sounds awfully familiar... Higher Mortgage Rates in 2021? The MBA is once again calling for higher mortgage rates next year They expect the popular 30-year fixed to rise from 3. 00% to 3. 30% in 2021 Then they see rates rising to 3. 6% in 2022 and 3. 9% in 2023 I’m not convinced mortgage rates will rise next year – they could in fact fall further And now for the bad news, at least for mortgage lenders. The MBA sees mortgage refinance originations plummeting 46. 3% to $946 billion next year. Of course, that’s not horrible, it’s just that 2020 has been so good for the refinance market that it’ll be tough to follow it up... --- > Today, we’ll take a look at Synergy One Lending, a company whose mission is to create a modern mortgage experience for its clients. To achieve this goal, - Published: 2020-10-26 - Modified: 2024-09-30 - URL: https://www.thetruthaboutmortgage.com/synergy-one-lending-review/ - Categories: Mortgage Tips Today, we’ll take a look at Synergy One Lending, a company whose mission is to create a modern mortgage experience for its clients. To achieve this goal, the direct-to-consumer mortgage lender plans to focus on fintech for the next generation of home buyers who expect speed and convenience. This means being able to apply for a home loan from anywhere, without the usual red tape and headaches we’re all accustomed to when taking out a mortgage. However, they haven’t forgotten about the power of human touch, which is why Synergy One Lending says it offers the right combination of people and technology. Synergy One Lending Fast Facts Retail consumer-direct mortgage lender based in San Diego, CA, founded in 2013 Currently licensed in 33 states and the District of Columbia Funded more than $1. 5 billion in home loans during 2023 A top-100 retail mortgage lender nationwide About a third of their total loan volume came from home state of California In 2013, Synergy One Lending began as an independent mortgage lender before being acquired by a bigger fish, Mutual of Omaha Bank, just five years later in 2018. But just two years after that, a management-led asset purchase ("MBO") of the company's distributed retail channel took place in mid-2020, so they’re back to being on their own. During their brief spell under Mutual of Omaha Bank ownership, they acquired certain assets of BBMC Mortgage, a mortgage company that was based in Lombard, Illinois. At the moment, Synergy One Lending appears... --- > One mortgage lender that’s been around a while, but is beginning to shake things up is Loan Simple. As the name suggests, they’re all about simplicity, - Published: 2020-10-21 - Modified: 2025-04-09 - URL: https://www.thetruthaboutmortgage.com/loan-simple-mortgage-review/ - Categories: Mortgage Tips One mortgage lender that’s been around a while, but is beginning to shake things up is Loan Simple. As the name suggests, they’re all about simplicity, whether it’s simple talk or a simple loan process. They consider themselves a boutique mortgage lender, striving for relationships and quality customer service over sheer volume. However, they still managed to fund half a billion in home loans in 2019 via the retail channel, with even more slated for 2020 and beyond. One thing I like about Loan Simple is their effort to increase mortgage literacy by offering free classes powered by EverFi. So they actually want you to know more about mortgages before/when you apply, which is a rarity in this industry or any other for that matter. Additionally, they donate to charities they care about each time a loan funds, including Feeding America, Water. org, and the World Wildlife Fund. Loan Simple Quick Facts Direct mortgage lender located in Englewood, Colorado Founded by Roland Dozois more than 20 years ago (son Jason is current CEO) Licensed to lend in 30 states nationwide Launched a wholesale lending division in late 2020 Donate to charities for each loan funded Also a licensed loan servicer Loan Simple did about half a billion in loan volume last year, which makes them one of the smaller fish, but a growing one. They did more than half their total loan volume in their home state of Colorado, so if you’re from the Centennial State, you’ve likely heard of... --- > It’s been a while since I last posted a mortgage match-up, so without further ado, here’s the latest installment: "Prepay the mortgage or invest instead?" - Published: 2020-10-19 - Modified: 2024-03-19 - URL: https://www.thetruthaboutmortgage.com/prepay-the-mortgage-or-invest-instead/ - Categories: Mortgage Matchups, Mortgage Tips It’s been a while since I last posted a mortgage match-up, so without further ado, here’s the latest installment: "Prepay the mortgage or invest instead? " There are likely thousands of articles that deal with this very subject, all with plenty of differing opinions, but we are in unprecedented times. Mortgage rates have never been lower than they’ve been over the past year, and that changes the argument quite a bit, especially since stocks continue to generate massive returns in the face of a global pandemic. Simply put, it makes holding a low-rate mortgage for a long time more attractive than it has ever been, assuming you can earn a better return elsewhere. The good news is with mortgage rates in the 1-2% range, it shouldn't take much to earn a better return. Can You Earn a Better Return Than Your Mortgage Rate? Your mortgage interest rate is essentially your rate of return It may be possible to beat it by investing elsewhere like the stock market Prepaying the mortgage might not always be the best move if you can put your money someplace that earns a higher yield This could sway your decision to pay the mortgage early or dictate a refinance decision As I noted in a prior post, the 30-year fixed averaged 5. 72% over the past decade, and 6. 52% over the past 20 years. The average jumps to 7. 45% over the past 30 years. Today, the average interest rate on a 30-year fixed mortgage... --- > As everyone knows, we have a very important U.S. presidential election just around the corner. In fact, it’s now less than three weeks away. It could be - Published: 2020-10-14 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/will-mortgage-rates-go-up-or-down-if-trump-biden-wins-the-election/ - Categories: Mortgage News, Mortgage Rates As everyone knows, we have a very important U. S. presidential election just around the corner. In fact, it’s now less than three weeks away. It could be the biggest in U. S. history, at least in terms of drama and friction, and possibly an unknown or disputed outcome come November 3rd. Unfortunately, not everyone takes the time to vote for one reason or another, and it appears that those behind on the mortgage are even less likely to vote. Those Behind on the Mortgage Are Less Likely to Vote A new survey from Apartment List revealed that 87% of homeowners who began the month without any unpaid mortgage bills will “definitely” vote next month. This compares to just 60% of those who had unpaid bills to begin the month. Now it’s unclear if these borrowers are actually late, given the fact that mortgage lenders often provide a grace period to pay the mortgage until the 15th of the month. But we can at least glean some patterns and trends that emerge over time. You can also see that voter turnout is even worse for renters, whether they pay on time or not. Only 68% of on-time renters plan to vote, whereas just 48% of those behind on rent expect to make it out to the polls. As to why renters are generally less likely to vote than homeowners, Apartment List noted that homeowners are often motivated by policies and propositions that could affect local property values. There are also... --- > With mortgage rates at or near record lows, a lot of existing homeowners are probably asking themselves, “Is refinancing worth it?” The problem is there’s - Published: 2020-10-13 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/is-refinancing-worth-it/ - Categories: Mortgage Rates, Mortgage Tips, Refinance With mortgage rates at or near record lows, a lot of existing homeowners are probably asking themselves, “Is refinancing worth it? ” The problem is there’s no absolute right or wrong answer to this question, though with interest rates a lot lower than they were a year or two ago, the answer to this question will often be YES. Simply put, if there’s a larger spread between your existing mortgage rate and current refinance rates, it’s that much easier to save money. Conversely, if rates haven’t budged much since you last obtained a home loan, you’re going to have to get knee-deep in the math to ensure it makes sense financially. This Is the #1 Reason Homeowners Don’t Refinance If you’re questioning whether a refinance is worth it you’re not alone It’s actually the top reason why homeowners don’t bother refinancing 34% said so in a new survey from YouGov for Forbes Advisor But instead of wondering, take action and determine if a refinance can save you money As noted, lots of homeowners are probably mulling over a mortgage refinance, even those who just refinanced last year, or perhaps even earlier this year. The top reason they haven’t yet is because they’re not sure it’s worth it, followed by a good chunk saying they just recently refinanced (how soon can I refinance? ). Others are concerned about fees, rightfully so. A mortgage requires work – it isn’t a set it and forget it situation. Since mortgage rates can change tremendously... --- > Mortgage Q&A: “What mortgage rate can I expect?” The thing with mortgage rates is that they can vary greatly depending on a number of market forces - Published: 2020-10-12 - Modified: 2023-11-17 - URL: https://www.thetruthaboutmortgage.com/what-mortgage-rate-can-i-expect/ - Categories: Mortgage Rates, Mortgage Tips Mortgage Q&A: “What mortgage rate can I expect? ” The thing with mortgage rates is that they can vary greatly depending on a number of market forces and borrower-specific factors. That's why it's impossible to just throw a random interest rate out there such as 5. 99% or 6. 99%. Sure, a handful of borrowers may qualify for a mortgage rate like that. But there will be many others who qualify at a higher rate, assuming they even get approved to begin with. To get a better idea, answer some questions about yourself and the subject property. Your Default Risk Determines Your Mortgage Rate First you need to know what type of borrower you are (excellent credit, bad credit, etc. ) And what type of property you're buying or refinancing with what down payment Once you know the level of risk you present to the lender you can get a better idea of mortgage rate expectations Those who are deemed lower risk with be able to obtain the lowest market rates available This is one of the most common mortgage questions I get. Everyone wants to know what their mortgage rate will be. As noted, it's hard to pinpoint, but we can arrive at some good estimates by learning more about the loan scenario. In fact, this is exactly how a mortgage lender or mortgage broker approaches it. They generate your loan scenario by asking basic questions. Once they know your credit score, occupancy/property type, and transaction type, they'll have... --- > Costco, the well-known mega wholesaler that runs a chain of membership warehouses internationally, rolled out it’s so-called “Mortgage Services” program - Published: 2020-10-10 - Modified: 2025-03-15 - URL: https://www.thetruthaboutmortgage.com/costco-mortgage-review-what-dont-they-do/ - Categories: Mortgage News Costco, the well-known mega wholesaler that runs a chain of membership warehouses internationally, rolled out it’s so-called “Mortgage Services” program back in 2011. Now known as "The Mortgage Program," their lending partners have funded nearly 200,000 mortgages worth more than $51 billion. Costco already offers all types of insurance, a co-branded credit card, RV and boat loans, food and drink, jewelry, electronics, not to mention gigantic tubs of mayonnaise. So what’s the deal here? Why did Costco get into mortgages? Could it really be that profitable? Update: On May 1st, 2022, Costco shuttered the service, which just so happened to coincide with mortgage rates doubling! It's unclear if they'll ever bring it back. Costco Is Marketing Mortgages, Not Actually Making Them Just to be clear here, there is no Costco Mortgage Nor is Costco actually originating mortgages on their own (they are NOT a lender) They are simply marketing home loans via their lending partners Because they have a massive stable of customers who are or want to become homeowners Let me start by saying there is no "Costco Mortgage. " It does not exist. What Costco’s really doing is marketing a mortgage product on behalf of another company, formerly First Choice Loan Services Inc. , and now CrossCountry Mortgage. CrossCountry actually oversees a group of preferred lenders, including national depository banks and mortgage bankers, such as NASB Home Loans and Consumer Direct Mortgage. Apparently, Costco doesn't get paid for the loans that close or receive any sort of loan... --- > While 2020 continues to surprise us, somehow, someway, home sales are expected to hit their highest point since 2006 this year. This, despite an ongoing - Published: 2020-10-08 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/redfin-2020-home-sales-will-be-highest-since-2006/ - Categories: Housing Market, Mortgage News While 2020 continues to surprise us, somehow, someway, home sales are expected to hit their highest point since 2006 this year. This, despite an ongoing worldwide pandemic and a contentious U. S. presidential election that’s less than a month away. You’d think those types of events would give prospective home buyers pause, but they could actually be accelerating peoples’ plans. 6. 2 Million Home Sales Expected for 2020 The total includes both newly-built homes and existing home sales Would be the highest total since 2006, around the time home prices peaked Their low-end estimate is 6. 08 million home sales, still 1% above last year Their high-end estimate is 6. 4 million home sales, 6% above last year While the year 2020 certainly got off to a rocky start, and resulted in obvious disruptions during the traditional spring home buying season, we appear to be back on track. In fact, some 6. 2 million homes are expected be sold by the end of 2020, per Redfin’s model forecast, a 3% increase from 2019. That’d make 2020 the best year for home buying since 2006, back when real estate was flying high, and only years before it all came crashing down and ushered in the Great Recession. This doesn’t mean we’re doomed once again – things were a lot different back then, namely mortgage underwriting guidelines. In 2006, you could buy a house with zero down, stated income, and a subprime credit score. In fact, you could by a 4-unit investment... --- > I was reading through the latest quarterly home price report from the National Association of Realtors yesterday and stumbled upon an interesting nugget. - Published: 2020-10-07 - Modified: 2024-03-12 - URL: https://www.thetruthaboutmortgage.com/you-can-buy-more-house-if-you-put-more-money-down/ - Categories: Housing Market, Mortgage Tips I was reading through the latest quarterly home price report from the National Association of Realtors yesterday and stumbled upon an interesting nugget. It might seem obvious, but it’s worth pointing out to prospective home buyers who might be lacking in the income department. Simply put, if you are able to come to the table with more money for a down payment, you’ll be able to buy more house. Allow me to explain, using the NAR’s latest Metropolitan Median Area Prices and Affordability and Housing Affordability Index release (Q2 2020). National Median Home Price Rises to $291,300 Expect home prices to keep rising throughout the year and next This should continue to hurt purchasing power despite low mortgage rates But if you're able to come in with a larger down payment You can keep your loan amount at a reasonable level and boost affordability In the report, they noted that the national median existing single-family home price rose to $291,300 in the second quarter of 2020, up 4. 2% from a year earlier ($279,560). For the record, the pace slowed a bit as the median price in the first quarter of 2020 was 7. 7% higher than it was during the first quarter of 2019. Still, we continue to see healthy (maybe too healthy) home price growth and it’s probably going to keep rising, which should make it more difficult for some would-be buyers to purchase homes due to DTI restrictions. Yes, mortgage lenders limit what you can afford based... --- > While it’s still possible to request mortgage forbearance via the CARES Act if you’re having trouble making monthly payments, this option will eventually - Published: 2020-10-07 - Modified: 2024-05-23 - URL: https://www.thetruthaboutmortgage.com/cares-act-forbearance-option-end-date/ - Categories: Foreclosure, Mortgage News While it’s still possible to request mortgage forbearance via the CARES Act if you’re having trouble making monthly payments, this option will eventually come to an end. In fact, you might only have about two months left to contact your loan servicer for relief. So if you think you'll need help, act sooner rather than later to avoid missing out. This cutoff date depends on the type of mortgage you have, e. g. an FHA loan or a conventional loan. What's the Last Day to Apply for Mortgage Forbearance? Fannie and Freddie loans - when the "national emergency" ends FHA loans - June 30th, 2021 USDA loans - June 30th, 2021 VA loans - June 30th, 2021 Oddly, it’s not even known when that date is, at least when it comes to mortgages backed by Fannie Mae and Freddie Mac. That’s because the GSEs currently have the end date for relief set to the end of the national emergency. So it might be a moving target given COVID-19 seems to just be getting started. Seeing that the other agencies have extended into the first six months of 2021, the hope is Fannie/Freddie will also do at least that. The FHA had set a deadline of October 30th, 2020 (which was extended to December 31st , 2020, then Feb. 28th, 2021, then to March 31st, 2021, and now to June 30th). Similarly, the USDA had announced a deadline of December 31st, 2020 for approving forbearance requests, then aligned it with the... --- > You may have seen commercials lately for “Experian Boost,” a program that says it can increase your credit scores instantly. Their latest ad spot features - Published: 2020-10-06 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/should-you-use-experian-boost-before-applying-for-a-mortgage/ - Categories: Credit Scores, Mortgage Tips You may have seen commercials lately for “Experian Boost,” a program that says it can increase your credit scores instantly. Their latest ad spot features wrestler John Cena riding around on a horse, giving people with no hope of getting approved for a loan, well, hope. Even better, it’s free to use. So if you’re on the cusp of average, good, or even excellent credit, perhaps a boost could improve your approval odds and save you money. Well, that’s the idea at least. In practice, it might not actually work that way, especially if we’re talking about a home loan. What Is Experian Boost? A free service from credit bureau Experian that may increase your credit score instantly Works by adding positive payment history to your credit report for things like phone bills or even Netflix payments These recurring utilities and other monthly payments often aren’t factored into your credit history By connecting your bank accounts, Experian can factor in these payments and give your credit score a boost Average Experian Boost users see their Experian-based FICO Score 8 rise by 13 points As the name suggests, it’s a credit score boosting program from credit reporting company Experian, which together with Equifax and TransUnion, makes up the three major credit bureaus. How it works is fairly simple – you sign up for Experian Boost, then connect your bank account(s) to your profile. This essentially provides read-only access to your bank account history, allowing Experian to quickly scan and find qualifying... --- > If you’ve watched a Cleveland Guardians baseball game lately, you may have noticed a big sign for “Union Home Mortgage” out in center field. That’s - Published: 2020-10-06 - Modified: 2025-03-04 - URL: https://www.thetruthaboutmortgage.com/union-home-mortgage-review/ - Categories: Mortgage Tips If you’ve watched a Cleveland Guardians baseball game lately, you may have noticed a big sign for “Union Home Mortgage” out in center field. That’s because UHM is the official mortgage partner of the Guardians, along with the Professional Bull Riders (PBR) organization. They also recently partnered with former Cleveland Browns quarterback Bernie Kosar for some commercials, and are now the title sponsor of the Cleveland Marathon. So it’s clear they’re big sports fans and proud to call Northeast Ohio home. The company’s headquarters also aren’t too far away from two other major players in the mortgage industry, Quicken Loans and United Wholesale Mortgage. Like those two heavy-hitters, Union Home calls itself a “high-growth” company and has plans to keep building out its campus and expanding. Let’s learn more about them. Union Home Mortgage Fast Facts A retail mortgage lender based out of Strongsville, Ohio Founded in 1970, led by former MBA chairman Bill Cosgrove Licensed in 48 states and the District of Columbia More than 155 branch locations and nearly 1,400 Partners nationwide 18% of total loan volume comes from the state of Ohio Funded more than $5 billion in home loans during 2023 (latest data available) Union Home Mortgage, or UHM for short, is a direct-to-consumer retail lender based in Strongsville, Ohio. That means you can call them up, visit a branch, or simply surf over to their website to get started. They are an approved direct lender for Fannie Mae, Freddie Mac, the FHA, USDA, and VA,... --- > Once left for dead, the mortgage broker is alive and well. And in fact, thriving. There are now more than 100,000 mortgage brokers in business, per the - Published: 2020-10-06 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/the-mortgage-broker-comeback/ - Categories: Mortgage News Once left for dead, the mortgage broker is alive and well. And in fact, thriving. There are now more than 100,000 mortgage brokers in business, per the latest jobs report from the U. S. Bureau of Labor Statistics, an increase of 20% from a year ago. And it only appears to be getting better for the mortgage broker, as large shops continue to embrace them as either a complement or alternative to retail. That’s a stark contrast to the trend seen less than a decade ago, after the prior housing boom quickly turned mortgage bust, with brokers the first to be blamed. Mortgage Broker Redux The mortgage broker share hit nearly 35% back in 2008 It then fell sharply to around 7% in 2011 as the housing crisis worsened They have since regained market share with it climbing back to around 16% in 2019 Brokers may see market share rise to/above 20% in 2020 and beyond if the trend continues Back in the early 2000s, mortgage brokers were all the rage, accounting for a large chunk of the overall mortgage market. Pretty much every major depository bank and large mortgage banker had a wholesale lending division. And if they didn’t, they quickly created one. There was such a strong appetite for mortgage backed securities on Wall Street that it was a virtual no-brainer for a mortgage firm to rapidly boost loan volume by enlisting third-party brokers. This led to a near-35% mortgage broker share back in 2008, at least with... --- > United Wholesale Mortgage continues to bring the heat, this time shaving 50 basis points off streamline VA loans from now until Veterans Day on November - Published: 2020-10-01 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/uwm-offering-50-basis-point-discount-on-va-streamline-loans-through-veterans-day/ - Categories: Mortgage News, Mortgage Rates United Wholesale Mortgage continues to bring the heat, this time shaving 50 basis points off streamline VA loans from now until Veterans Day on November 11th. The move will make it even cheaper for veteran homeowners to refinance their existing mortgages to take advantage of today’s near record low mortgage rates. What’s the Deal? UWM is offering 50-basis point discount on VA IRRRLS Offer good on rate locks now through Veterans Day (November 11th) Can also be combined with VA Conquest program Rates start as low as 2. 25% on the 30-year fixed To celebrate and better yet, appreciate our active duty military and veterans, UWM is offering a special pricing incentive on VA Interest Rate Reduction Refinancing Loans, or IRRRL for short. This means existing veteran and active duty homeowners in the market for a mortgage refinance can save even more through Veterans Day. At the moment, mortgage rates are already basically rock bottom, hovering near all-time lows achieved just a couple weeks ago. When combined with UWM’s already low VA Conquest program, which has interest rates starting at 2. 25% for a 30-year fixed, a borrower might be able to snag an exceptional deal over the next month and change. And if we see mortgage rates creep down even lower prior to the election, thanks to the election and COVID-19, homeowners might get their hands on a deal of a lifetime. The VA IRRRL is a streamlined refinance program that doesn’t require an appraisal and allows for an... --- > If you live in Texas or the Southeast, you’ve likely heard of Regions Mortgage. In fact, you might already be a banking customer with parent company - Published: 2020-10-01 - Modified: 2025-03-07 - URL: https://www.thetruthaboutmortgage.com/regions-mortgage-review/ - Categories: Mortgage Tips If you live in Texas or the Southeast, you’ve likely heard of Regions Mortgage. In fact, you might already be a banking customer with parent company Regions Financial. The company is a banking leader in the states of Alabama and Tennessee, so if you’re the type that likes to do all your business in one place, Regions Mortgage might be for you. Aside from their strong presence in the Southeast, they also provide banking and home loan services in Indiana, Illinois, and Missouri. Their basic pitch is that you should get your mortgage from a lender you can trust, namely a massive billion-dollar bank with a near 50-year history. Let’s learn more to see if Regions Mortgage could be a good fit for your home financing needs. Regions Mortgage Quick Facts Publicly traded commercial bank serving customers in the Midwest, South, and Texas Founded in 1971, headquartered in Birmingham, Alabama One of the largest banks in the United States (top 40) A top-30 mortgage lender nationally by volume Funded nearly $9 billion in homes loans via retail channel in 2023 Florida accounted for 21% of total home loan volume Also a major mortgage lender in the states of Alabama, Georgia, and Tennessee Regions Mortgage is the retail mortgage banking arm of Regions Financial, a full-scale depository bank. The company, which is one of the largest banks in the United States, was founded in 1971 and is headquartered in Birmingham, Alabama. Last year, they funded almost $9 billion in home loans,... --- > Primary Residential Mortgage, Inc., or PRMI for short, is a direct mortgage lender based out of Salt Lake City, Utah that has been around since 1998. - Published: 2020-09-29 - Modified: 2025-04-09 - URL: https://www.thetruthaboutmortgage.com/primary-residential-mortgage-review-prmi/ - Categories: Mortgage Tips Primary Residential Mortgage, Inc. , or PRMI for short, is a direct mortgage lender based out of Salt Lake City, Utah that has been around since 1998. Since that time, they have grown into a multi-billion-dollar mortgage originator with over 250 branches and more than 1,800 employees nationwide. At the moment, they are licensed to lend in 49 states (New York being the exception), and while they originate lots of home loans in many states, their highest volume comes from Florida and Maryland. They do mostly home purchase loans (~70% share) thanks to their many relationships with real estate agents, but also a good deal of refinance loans as well. Additionally, they offer a $5,000 Loan Closing Guarantee, whereby they’ll pay you $2,500 and the seller $2,500 if they issue a mortgage pre-approval and don’t close on time. Let’s learn more about what PRMI offers and if they’re the right mortgage lender for you. Primary Residential Mortgage Fast Facts Direct-to-consumer mortgage lender located in Salt Lake City, Utah Founded in 1998 by Dave Zitting, Jeff Zitting, and Steve Chapman Licensed to originate mortgages in 49 states Over 250 branches and more than 1,800 employees Funded $6+ billion in home loans during 2019 (top-50 lender nationally) Florida and Maryland are their top two states by loan volume Also operate a wholesale lending division for mortgage broker partners Getting a Home Loan with Primary Residential Mortgage You can apply for a home loan directly from their website in minutes Their digital mortgage... --- > In early 2019, a new mortgage lender called Beeline Loans, or Beeline for short, was launched. Their mission: to completely transform the home loan - Published: 2020-09-25 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/beeline-loans-mortgage-review/ - Categories: Mortgage Tips In early 2019, a new mortgage lender called Beeline Loans, or Beeline for short, was launched. Their mission: to completely transform the home loan experience. No small task, but they’ve already made meaningful changes that should make it both more fun and cheaper to take out a mortgage. They say they’ve “removed pointless steps,” while automating others. And they don’t charge a pricey loan origination fee, nor do they pay out commissions to middlemen. This is similar to Better Mortgage, which also doesn't charge lender fees. Let’s learn more about this up-and-coming mortgage lender that’s looking to shake things up. Beeline Loans Fast Facts Direct-to-consumer mortgage lender (operates exclusively online) Offers home purchase loans and mortgage refinancing Founded in 2019, located in Providence, Rhode Island Currently licensed to do business in 28 states and D. C. Charge a flat origination fee of $1,049 for conforming purchase & refinance loans And $1,999 for non-conforming loans (DSCR/jumbo/bank statement, etc. ) Beeline Loans is a direct-to-consumer mortgage lender that was founded in 2019. They offer both home purchase loans and mortgage refinances. The company is located in Providence, Rhode Island and are currently licensed to do business in 28 states and the District of Columbia. Those states include Alabama, Arizona, Arkansas, California, Colorado, Delaware, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Massachusetts, Michigan, Mississippi, North Carolina, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Virginia, and Wisconsin. They operate exclusively online, meaning there are no physical branches you can walk... --- > Despite the ongoing pandemic, it’s turning out to be a very good time for companies to go public, especially mortgage lenders, which are seeing record - Published: 2020-09-24 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/united-wholesale-mortgage-going-public/ - Categories: Mortgage News Despite the ongoing pandemic, it’s turning out to be a very good time for companies to go public, especially mortgage lenders, which are seeing record volumes thanks to über-low mortgage rates. The latest announcement comes from United Wholesale Mortgage, the largest wholesale mortgage lender in the country that works exclusively with mortgage brokers. While they don’t offer home loans directly to the public, they still managed to crack the top-3 in terms of overall loan volume thanks to their legion of broker partners, who are client-facing. United Wholesale Mortgage IPO Going public via a special purpose acquisition company (SPAC) transaction Will merge with Gores Holdings IV, sponsored by The Gores Group Combined company expected to have equity value worth $16. 1 billion at closing Deal expected to close at some point in the fourth quarter of 2020 As opposed to a traditional initial public offering (IPO), the Pontiac, Michigan-based company is becoming a public company via a special purpose acquisition company (SPAC) transaction. It will merge with already-public blank check company Gores Holdings IV, Inc. , which is an affiliate of The Gores Group. The deal is expected to close sometime in the fourth quarter of 2020, which is kind of fast-tracked to take advantage of the buzz in the mortgage space at the moment. It’s the largest SPAC in history with a value of $16. 1 billion, which is nearly 10x the company's estimated 2021 adjusted net income of roughly $1. 7 billion. Like Rocket Companies Inc. , parent... --- > Zillow has officially launched a real estate brokerage, known as “Zillow Homes.” The move is intended to “simplify and streamline” the company’s Zillow - Published: 2020-09-23 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/zillow-homes-zillow-launches-a-real-estate-brokerage/ - Categories: Housing Market, Mortgage News Zillow has officially launched a real estate brokerage, known as “Zillow Homes. ” The move is intended to “simplify and streamline” the company’s Zillow Offers platform, which up until now relied upon outside real estate brokerages to manage its iBuying transactions. While it sounds like unwelcome news for real estate agents, the company said it doesn’t intend to compete with other brokerages or recruit agents. Rather, the company will have existing Zillow Offers employees become licensed real estate agents, and they’ll only work on Zillow Offers deals. What Is Zillow Homes? A new licensed real estate brokerage launched by Zillow Will be used for Zillow Offers transactions beginning in 2021 All Zillow-owned homes will be listed on the multiple listing service (MLS) Real estate commissions will be paid to agents representing home buyers In 2018, the company’s iBuying program known as Zillow Offers was launched. Today, it’s operational in 25 markets across the United States. At the moment, it functions with the use of outside real estate brokerages, who work with home sellers and Zillow concurrently to quickly offload properties. In a video message, Zillow chief industry development officer Errol Samuelson noted that this back and forth from outside brokerage to Zillow, while generally problem-free, has created confusion for customers. So going forward, the entire transaction from start to finish will be conducted using only Zillow employees. The Zillow employees will work for Zillow Homes, a brokerage entity focused solely on Zillow Offers transactions. And Zillow Homes will be the... --- > A recent op-ed said buying a home during a pandemic was a terrible idea. The author, Teresa Ghilarducci, noted that both home prices and uncertainty are - Published: 2020-09-15 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/is-it-a-bad-idea-to-buy-a-home-during-a-pandemic/ - Categories: Housing Market, Mortgage Tips A recent op-ed said buying a home during a pandemic was a terrible idea. The author, Teresa Ghilarducci, noted that both home prices and uncertainty are high. Her basic message - we’re maybe acting irrationally due to the COVID-19 pandemic, and that it could be smart to hunker down until the dust settles. While I totally get the author’s point of view, I never agree with blanket rules, especially when it comes to real estate and/or mortgages. Ultimately, we are all different people in unique situations, and what benefits one individual may not work for another, and vice versa. Simply put, it could be a great time to buy a home right now, and also a very bad one. It just depends... Do You Have a Solid Home Purchase Plan? Don’t buy a house just because everyone else is Don’t buy a house because you don’t want to miss out Don’t buy a house due solely to speculation Don’t buy a house sight unseen or on a whim Don’t buy a house without knowing your exit strategy No matter what’s going on in the world, you should have a clearly thought out plan when venturing into the world of real estate. Purchasing a home is a big commitment, and a costly one at that. Even if you get cold feet and decide to sell shortly after, there are lots of closing costs on both ends of the transaction. You might be able to break even if home prices continue to... --- > One of the “most senior lenders in the industry,” in their own words, is Charlotte, North Carolina-based Cardinal Financial. The retail mortgage lender - Published: 2020-09-15 - Modified: 2024-08-10 - URL: https://www.thetruthaboutmortgage.com/cardinal-financial-mortgage-review/ - Categories: Mortgage Tips One of the “most senior lenders in the industry,” in their own words, is Charlotte, North Carolina-based Cardinal Financial. The retail mortgage lender has been around since 1987, truly making them one of the veterans in the mortgage space. After all, a lot of newcomers, while perhaps large and growing, only formed around the time of the mortgage crisis in 2006. Cardinal Financial, on the other hand, has some 30+ years under their belt, but that hasn’t stopped them from innovating and adopting new technologies. In fact, they even have an Alexa skill (search for Cardinal Financial) that provides hands-free answers to dozens of everyday mortgage questions. Credit to them for helping their potential customers get smarter. Cardinal Financial Fast Facts Direct-to-consumer mortgage lender based in Charlotte, NC Founded in 1987, 118 branch locations nationwide Licensed in all 50 states and the District of Columbia Funded nearly $8 billion in home loans during 2019 On their way to being a top-25 mortgage lender nationally Also operate a wholesale lending division for mortgage brokers Cardinal Financial is a direct-to-consumer mortgage lender with 118 branches nationwide. They are licensed in all 50 states and the District of Columbia, which is a somewhat rare feat unless we’re talking about the largest mortgage lenders in the nation. As it stands, they’re a top-40 mortgage lender with aspirations to perhaps land in the top-25 at some point. While they do a lot of business all across the nation, their biggest state based on volume in... --- > It makes sense that the mortgage industry would see its best quarter in history during a global pandemic. Okay, it doesn’t make sense, but that’s what - Published: 2020-09-09 - Modified: 2024-01-31 - URL: https://www.thetruthaboutmortgage.com/mortgage-lending-volume-hits-highest-level-on-record-despite-covid-19/ - Categories: Housing Market, Mortgage News, Refinance It makes sense that the mortgage industry would see its best quarter in history during a global pandemic. Okay, it doesn’t make sense, but that’s what happened anyway, per the latest Mortgage Monitor report from Black Knight. Mortgage Lenders Originated $1. 1 Trillion in Home Loans During the Second Quarter Mortgage lenders experienced best quarter in history during Q2 2020 Driven most by refinance loans thanks to record low mortgage rates Refinancing was up 60% from first quarter and 200% from a year earlier Purchase lending was only down 8% from a year earlier despite pandemic The data analytics firm said about $1. 1 trillion (yes, trillion) in first-lien mortgages were originated during the second quarter of 2020, the best three months on record since reporting began in January 2000. The record numbers were mostly fueled by mortgage refinance transactions, which have surged due to continued record low mortgage rates, helped in part by the COVID-19 pandemic. They said refinance lending was up more than 60% from the first quarter alone, and more than 200% higher than the same time last year. Such home loans accounted for almost 70% of all first-lien mortgage originations in terms of dollar value, compared to just 39% in the second quarter of 2019. Meanwhile, home purchase lending was down about eight percent from a year earlier, which is surprisingly strong given the economic uncertainty surrounding the coronavirus. Some $351 billion in home purchase loans were originated during the quarter, thanks again to low mortgage... --- > If you reside in Arizona, there’s a really good chance you’ve driven by a billboard advertising NOVA Home Loans. I don’t even live in Arizona but always - Published: 2020-09-09 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/nova-home-loans-review/ - Categories: Mortgage Tips If you reside in Arizona, there’s a really good chance you’ve driven by a billboard advertising NOVA Home Loans. I don’t even live in Arizona but always see their advertisements when visiting. The direct-to-consumer mortgage lender has a huge presence in the Copper State, and actually generated about 65% of its business there last year. They are a top Arizona mortgage lender. While they also have brick-and-mortar locations in nearby states like California, Colorado, Nevada, and Texas, the lion’s share of mortgages are on properties located in Arizona. And that’s a big deal because the company originated nearly $8 billion in home loans in 2020, meaning everyone in Arizona has probably heard of them, and lots have a NOVA Home Loans mortgage. Their second biggest state is Colorado, where they do about a quarter of total volume, so it’s clear that much of their mortgage lending happens between these two states. NOVA Home Loans Fast Facts Independent nonbank retail mortgage lender based in Tucson, Arizona A top-100 mortgage lender nationally founded in 1980 Originated nearly $8 billion in home loans during 2020 About two-thirds of its volume came from Arizona, and a quarter from Colorado Licensed in 14 states including Arizona, California, Colorado, Florida, Illinois, Indiana, Kentucky, Nevada, New Mexico, Oregon, Pennsylvania, Texas, Utah, and Washington Also offers financing on commercial and multi-family properties via NOVA Commercial Loans Sponsors the annual NOVA Home Loans Arizona Bowl Applying for a Mortgage with NOVA Home Loans The company prides itself on efficiency... --- > There are all sorts of gimmicks, tips, and tricks out there to pay down the mortgage a little (or a lot) quicker. And one that sounds relatively painless - Published: 2020-09-03 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/rounding-up-your-mortgage-payment-does-it-actually-work/ - Categories: Mortgage Tips There are all sorts of gimmicks, tips, and tricks out there to pay down the mortgage a little (or a lot) quicker. And one that sounds relatively painless is the simple rounding up of one’s mortgage payment. So if you owe $1,550 each month, paying $1,600 instead could make a sizable dent in your mortgage over the years, thereby reducing the loan term and saving you lots of money in interest. But just how effective is rounding up your mortgage payment? Well, it depends. Let’s take a look at a couple of potential scenarios to find out. It Depends How Much You’re Actually Rounding Up The biggest factor is your actual monthly mortgage payment Which will determine how much extra you pay each month Assuming you round up your payments to the nearest whole number It can be quite different depending on that original payment amount First off, you need to take a look at your actual monthly mortgage payment. If it’s $1,599 a month, rounding it up to $1,600 will do virtually nothing to save you money on your mortgage. If anything, you might just confuse your loan servicer when sending in what appears to be the wrong payment amount. Conversely, if your monthly home loan payment is $1,501, bumping it up to $1,600 will lead to considerable savings. Of course, if you have to increase your payment by nearly $100 a month, it’s no easy task, especially if you have other expenses to worry about, or high-interest debt... --- > You may have heard there’s a “new mortgage fee.” And you might have been told to hurry up and refinance NOW to avoid said fee. While there is some truth - Published: 2020-09-01 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/new-mortgage-fee-refinance/ - Categories: Mortgage News, Mortgage Rates, Refinance You may have heard there’s a “new mortgage fee. ” And you might have been told to hurry up and refinance NOW to avoid said fee. While there is some truth to that, it is by no means a reason to panic, nor is it even applicable to all homeowners. Additionally, it’s possible it may not save you money to refinance now versus a couple months from today, depending on what direction mortgage rates go. So before we all get in a tizzy and give in to what some are clearly utilizing as a scare tactic, let’s set the record straight. What the New Mortgage Fee Is and Is Not A 50-basis point cost known as the Adverse Market Refinance Fee intended to offset COVID-19 related losses It’s not a . 50% higher mortgage rate It’s an additional . 50% of the loan amount via closing costs Only applies to mortgage refinance loans backed by Fannie Mae or Freddie Mac Home purchase loans are NOT affected by the new fee Nor does it apply to FHA loans, USDA loans, or VA loans Over the past week, I’ve been bombarded by articles warning of the new mortgage fee – most feature something to the effect of “refinance now” and “act fast! ” But in reality, you might not need to do anything different, nor hurry. Sure, it’s an amazing time to refinance a mortgage, what with mortgage rates hovering at or record all-time lows. No one can argue that. Still, it... --- > A little bit of mortgage Q&A: “When do mortgage payments start?” New homeowners (and those refinancing a mortgage) often wonder when mortgage payments - Published: 2020-08-26 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/when-do-mortgage-payments-start/ - Categories: Mortgage Tips A little bit of mortgage Q&A: “When do mortgage payments start? ” New homeowners (and those refinancing a mortgage) often wonder when mortgage payments start, as there’s sometimes a considerable gap between loan closing and the due date of the first monthly payment. For example, you may have been told by your real estate agent or mortgage broker that payments won’t start for 45 days or longer and express some intense optimism as a result. But you might be skeptical as well, and for good reason. Why would it take so long to start paying your mortgage lender back? Let's find out! Mortgages Are Paid in Arrears Unlike rental payments that are paid a month in advance Mortgage payments are paid after the fact (arrears) Because interest must actually accrue before it becomes due So once the month is over you pay interest for that time period This loan was closed in early August, but the first payment isn't due until October. This phenomenon occurs because mortgages are paid in arrears, not in advance, meaning payment is made at the end of a certain period, such as one month. Because interest is accrued on a mortgage balance each month, it cannot be paid until after the fact. Simply put, your mortgage payment made on the first of the month will cover last month’s interest, along with taxes and insurance, and principal (if applicable). This differs from monthly rental payments, which are paid in advance for the month they cover; if... --- > CMG Financial isn’t new to the mortgage industry, having been around since 1993. That makes them a veritable veteran in the home loan space, as many of - Published: 2020-08-26 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/cmg-financial-mortgage-review/ - Categories: Mortgage Tips CMG Financial isn’t new to the mortgage industry, having been around since 1993. That makes them a veritable veteran in the home loan space, as many of today’s top mortgage lenders have only been around since the 2000s. Of course, age isn’t everything, so let’s talk about what sets apart this top-30 lender, with aspirations to crack the top-25 and beyond. CMG Financial Quick Facts Privately held retail mortgage lender founded in 1993 Located in San Ramon, California Operates in all 50 states and the District of Columbia Funded roughly $7 billion in home loans via retail channel during 2019 Top states based on loan volume include California, Tennessee, and Texas Also runs correspondent and wholesale lending divisions As noted, the company got its start all the way back in the early 1990s, when Christopher M. George established CMG Mortgage, Inc. in Pleasanton, California. If you’re wondering what CMG stands for, well, now you know. Or at least I hope you know! The company later began doing business as CMG Financial to better reflect its philosophy of making sure borrowers found the right solution for their broader financial goals, not just the mortgage. They might be most famous for their Home Ownership Accelerator, now known as the “All In One Loan,” which received a U. S. patent in 2009. It’s a loan that functions as a checking account to help homeowners save on mortgage interest. Last year, the company did roughly $7 billion in home loan origination volume via the... --- > While there are thousands of mortgage companies nationwide, only a select few land in the top 10. Today, we’ll examine U.S. Bank Mortgage, which ranked - Published: 2020-08-24 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/us-bank-mortgage-review/ - Categories: Mortgage Tips While there are thousands of mortgage companies nationwide, only a select few land in the top 10. Today, we’ll examine U. S. Bank Mortgage, which ranked 9th in 2019 for total home loan origination volume. Being a very large depository institution, they’ve got advantages that other, smaller competitors don’t have. Namely, lots of liquidity and the ability to keep loans on their books, instead of having to sell them off and rely on short-term financing. This means they can offer mortgage products that the other guys can’t, and potentially lower mortgage rates too. Let’s learn more about U. S. Bank’s mortgage division. U. S. Bank Mortgage Fast Facts 9th largest mortgage lender in 2019 based in Minneapolis, Minnesota Operates both a retail direct-to-consumer and correspondent lending business Funded $32 billion in home loans last year A third of total loan volume took place in California Nearly half of their volume consisted of jumbo loans Originate a large share of adjustable-rate mortgages Available in all 50 states and D. C. , branches located in 40 states How to Apply for a Mortgage with U. S. Bank You can apply online or by phone via digital mortgage application powered by Blend A faster pre-qualification or loan estimate is also available if simply shopping around Can request a call from a loan officer or visit a retail branch if located near you Once approved you can track loan progress via the U. S. Bank Loan Portal Those who want to apply for a... --- > Way to rain on our parade, Fannie Mae and Freddie Mac. Just when mortgage rates were hitting record lows, the pair decided to add a new fee to mortgage - Published: 2020-08-13 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/fannie-mae-and-freddie-mac-mortgage-refinances-just-got-more-expensive/ - Categories: Mortgage News, Refinance Way to rain on our parade, Fannie Mae and Freddie Mac. Just when mortgage rates were hitting record lows, the pair decided to add a new fee to mortgage refinances in light of the ongoing pandemic. Simply put, they expect more losses related to a higher rate of loan defaults, and are adjusting their pricing accordingly. And refinance rates are higher to begin with so it's a double-whammy. Remember, they don’t lend directly, but rather purchase and securitize many of the mortgages that are funded by banks and mortgage lenders. As such, this new cost will be passed along to you, the consumer. Introducing the Adverse Market Refinance Fee Fannie Mae and Freddie are charging a new fee to account for higher risk related to COVID-19 It applies to all mortgage refinance transactions, including those without cash-out Only exception is certain single-close construction-to-permanent loans The new fee will apply to mortgages with settlement dates on or after September 1st, 2020 On August 12th, both Fannie Mae and Freddie Mac released lender letters discussing a new fee that they’re going to tack onto ALL mortgage refinance loans. Known as the “Adverse Market Refinance Fee,” it is designed to cover higher costs associated with increased risk thanks to COVID-19. Instead of absorbing that cost themselves, they’re passing it onto homeowners, even if you don’t actually pose any additional risk to Fannie and Freddie, collectively known as the government-sponsored enterprises (GSEs). Fannie Mae said the new fee is being charged as a result... --- > It seems that lately we reach a new all-time low for mortgage rates just about every week, which begs the question, how low can they go? Indeed, mortgage - Published: 2020-08-12 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/how-low-will-mortgage-rates-go/ - Categories: Mortgage Rates, Mortgage Tips It seems that lately we reach a new all-time low for mortgage rates just about every week, which begs the question, how low can they go? Indeed, mortgage rates have hit record lows eight times so far in 2020, and it is only mid-August. If you had to bet, you’d probably guess that we’d see at least two more record lows this year, given the recent trend of lower and lower. I assume that too would break some sort of record for most record lows in a calendar year, but that’s unclear. What is clear is that we continue to see old records get broken with relative ease, and at this point even lower rates feel like a given. The 2020 mortgage rate predictions are now totally laughable, with a 30-year fixed around 3. 75% the most common response. Can Mortgage Rates Get Even Better from Here? Fixed mortgage rates are already at all-time record lows There have been eight record lows this year, including three record lows in three weeks recently Is it possible that mortgage rates could move even lower in the second half of 2020? The trend certainly seems to point to even lower rates, especially with wide spreads relative to Treasuries As noted, mortgage rates are hitting record lows so often it’s becoming a bit of a non-event. Heck, I don’t even write about it anymore. And it’s hard to know if homeowners are even excited about it at this point. When something happens on a... --- > Prosperity Home Mortgage based out of Chantilly, Virginia originally got started in the Carolinas back in 2006. While that was probably the last good year - Published: 2020-08-10 - Modified: 2025-04-09 - URL: https://www.thetruthaboutmortgage.com/prosperity-home-mortgage-review/ - Categories: Mortgage Tips Prosperity Home Mortgage based out of Chantilly, Virginia originally got started in the Carolinas back in 2006. While that was probably the last good year for the mortgage industry before the Great Recession, the independent mortgage banker was able to weather the storm and come out bigger and stronger. Today, they are one of the largest mortgage lenders in the United States, having originated roughly $6 billion in home loans in 2019. They operate exclusively via the retail direct-to-consumer channel in 44 states (and D. C. ) with 700 branch locations nationwide. Interestingly, they are a wholly owned subsidiary of The Long & Foster Companies, which is a part of HomeServices of America, a Berkshire Hathaway affiliate, so they appear to have a strong connection to the real estate industry. Let’s learn more about why Prosperity Home Mortgage could be a good choice for your next mortgage. Prosperity Home Mortgage Quick Facts Formed in 2006 in the Carolinas, currently based out of Chantilly, Virginia More than 700 brick-and-mortar branch locations nationwide and 350+ loan consultants 11 regional offices that process, underwrite, and close loans Closed roughly $6 billion in home loans during 2019 via retail channel Also operate a family of local brands including Edina Realty Mortgage, FM Lending Services, DFW Texas Mortgage, and Long Mortgage Part of the HomeServices family of mortgage companies, a Berkshire Hathaway Affiliate As noted, Prosperity Home Mortgage is a relatively young mortgage company, having been formed in 2006. However, they’ve already managed to fund... --- > Mortgage Q&A: “Do mortgage inquiries affect credit score?” When preparing to take out a mortgage, you may have concerns about your credit report being - Published: 2020-08-10 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/do-mortgage-inquiries-affect-credit-score/ - Categories: Credit Scores, Mortgage Tips Mortgage Q&A: “Do mortgage inquiries affect credit score? ” When preparing to take out a mortgage, you may have concerns about your credit report being pulled numerous times within a short period of time. This can occur while shopping for that perfect mortgage with multiple mortgage lenders or mortgage brokers over the span of a few weeks or even months. But while mortgage inquiries can certainly add up, they won’t necessarily lower your credit score or affect your ability to obtain home loan financing. It's Totally Fine to Shop Around for a Mortgage! You should definitely shop around for your home loan This ensures you explore all options and obtain the lowest rate possible Fortunately FICO has an algorithm designed specifically for mortgage inquiries Doesn't penalize mortgage shopping in a specified window of time The developers of the FICO score know how mortgage shopping works and have adjusted their super secret algorithm accordingly. First off, FICO ignores any mortgage inquiries made in the 30-day window prior to scoring, meaning those recent credit pulls shouldn't adversely affect your credit scores. For example, if mortgage lender A pulls your credit, then you decide to get quotes and/or pre-approved with mortgage lenders B and C in the same week, they wouldn't count against you. This allows to you shop without worry of your credit scores going down each time you do. Additionally, FICO counts multiple mortgage inquiries in a certain time span as a single inquiry. The FICO Mortgage Shopping Period If your... --- > Sometimes you need a little push to get things going, especially when it’s a big something like purchasing a home. Well, it turns out a pandemic can be - Published: 2020-08-06 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/covid-19-is-pushing-home-buyers-to-move-sooner/ - Categories: Housing Market, Mortgage News Sometimes you need a little push to get things going, especially when it’s a big something like purchasing a home. Well, it turns out a pandemic can be that driving force, as evidenced by a new survey from real estate brokerage company Redfin. The company said 25% of the 1,000 home buyers it polled are moving (or moving sooner than planned) due to COVID-19. COVID-19 Induced Low Mortgage Rates Are Getting Buyers Off the Fence In terms of what’s getting people moving, literally, it’s the record low mortgage rates currently on offer. Thanks in part to COVID-19, mortgage rates have hit new record lows eight different times this year (so far and it's only August), as economic uncertainty often has a positive effect on interest rates. Some 55% of respondents cited the “low mortgage rates” as reason to change or speed up their plans. The second biggest factor (52%) was “spending more time at home,” something I think we’ve all done a lot of lately. When you’re home all the time, you have more time to think, and more time to complain about your surroundings too. Third was the work from home angle (40%), which is changing living preferences for prospective home buyers. It tends to mean buying more house so a home office can be designated in one of the bedrooms. It also means moving out of the city to the more spacious and affordable suburbs. Home Buyer Preferences Aren’t What They Used to Be While 25% of respondents... --- > The mortgage industry can be a little bit old school. Similar to how the stock market used to operate in sixteenths, and later eighths, mortgage rates are - Published: 2020-07-30 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/uwms-exact-rate-lets-borrowers-choose-exact-mortgage-rates/ - Categories: Mortgage News, Mortgage Rates The mortgage industry can be a little bit old school. Similar to how the stock market used to operate in sixteenths, and later eighths, mortgage rates are mostly offered in eighths. Before 2001, the stock market only allowed price movements as small as one-sixteenths, an archaic method that gave way to the introduction of decimals. The issue was that big traders were losing out when trading millions of shares, because as we all know, those little fractions can add up. The rest of the world was also using decimals, so it was time to evolve. Today, you can buy and sell stocks for prices like $73. 805 as opposed to just $73 3/4. That matters if we’re talking about a large purchase or a massive sell order. Now it’s probably not going to be as impactful with a mortgage, but in this day and age, every little bit seems to matter. Do You Want a Really Specific Mortgage Rate? UWM Exact Rate allows custom rates to the thousandth decimal point Mortgage brokers can “create the unshoppable loan” Pricing better matches closing costs on the loan and can be used to avoid principal reductions Even a fractional improvement may be enough to win a borrower’s business Typically, you’ll see that your mortgage rate is either a whole number, such as 3%, or an eighth of a number, such as 3. 125%. Some lenders and credit unions also offer promotional rates below key thresholds, such as 2. 99%, to make their offer... --- > One of the problems with refinancing a home loan right now is that mortgage rates keep falling. As such, you might find the need to refinance again - Published: 2020-07-29 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/is-a-2-25-30-year-fixed-mortgage-rate-in-the-cards/ - Categories: Mortgage Rates, Mortgage Tips, Refinance One of the problems with refinancing a home loan right now is that mortgage rates keep falling. As such, you might find the need to refinance again shortly after refinancing. Aside from being inconvenient, it’s also not very cost-effective. Yes, it costs money to refinance, whether you pay for it out-of-pocket or via a higher interest rate, the latter being a no cost refinance. So in a sense, mortgage rates moving even lower can be seen as a bit of a double-edged sword – sure, lower is better, but does it make your prior refinance worthless in the process? Are More Record Lows on the Way? Mortgage rates hit record lows for three weeks in a row Then pulled back slightly in the latest week, per Freddie Mac data The popular 30-year fixed currently averages about 3% flat Could we see 2. 75%, 2. 5%, and eventually 2. 25% at some point soon? At the moment, mortgage rates are essentially at record lows, give or take a few basis points. The 30-year fixed is hovering around 3%, which is basically its lowest point on record. Some borrowers are obtaining rates even lower than rate, say at 2. 875%. Over the past year, mortgage rates have defied expectations by marching lower and lower. This has led to a surge in mortgage refinance activity for the past 12 months or longer. But it’s also led to questions like, “How soon can I refinance again? ” You see, while homeowners are locking in... --- > Today we’ll learn more about "Homespire Mortgage," which has made the Inc. 5000’s List of America’s Fastest-Growing Private Companies for the past four - Published: 2020-07-29 - Modified: 2024-12-04 - URL: https://www.thetruthaboutmortgage.com/homespire-mortgage-review/ - Categories: Mortgage Tips Today we’ll learn more about "Homespire Mortgage," which has made the Inc. 5000’s List of America’s Fastest-Growing Private Companies for the past four years in a row. Aside from being a rapidly expanding mortgage company, they're also consistently recognized as a top mortgage employer. Happy employees should increase your odds of being a happy borrower. They pride themselves on breaking the mold, fusing innovative mortgage technology with the power of the human spirit to create a winning mortgage experience. The company was founded in 2006 by Michael Rappaport (no, not the actor), who also currently serves as their president. Let's discover more about a lender borrowers trust, and real estate agents recommend. Homespire Mortgage Fast Facts Direct-to-consumer retail mortgage lender Offers home purchase and mortgage refinance loans Also an approved Fannie Mae and Freddie Mac seller and loan servicer. Founded in 2006, based out of Gaithersburg, Maryland Currently operates in 41 states and the District of Columbia Funded roughly $2. 4 billion in home loans during 2020 About half of total lending volume was in the state of Maryland Homespire Mortgage is a direct-to-consumer retail mortgage lender that operates 32 branches in 17 states. They are currently licensed to do business in 41 states nationwide, with Alaska, Hawaii, Missouri, Nebraska, Nevada, New York, South Dakota, Utah, and Wyoming the exceptions. In 2020, roughly 70% of their loan origination volume consisted of purchase loans, with the remainder refinance loans. In other words, real estate agents trust them to get the job... --- > The latest weekly Forbearance and Call Volume Survey from the Mortgage Bankers Association (MBA) revealed that 7.80% of outstanding home loans were in - Published: 2020-07-28 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/homeowners-in-forbearance-plans-have-lower-credit-scores-higher-dti-ratios/ - Categories: Mortgage News The latest weekly Forbearance and Call Volume Survey from the Mortgage Bankers Association (MBA) revealed that 7. 80% of outstanding home loans were in forbearance. That number was up slightly from 7. 74% a week earlier, putting roughly 3. 9 million homeowners in forbearance plans. Much of these are COVID-19-related, thanks in part to a very liberal CARES Act that allows just about anyone to apply for relief with no documentation. Ginnie Mae Loans Continue to Perform the Worst More than 10% of FHA/USDA/VA loans are in forbearance plans This compares to roughly 5. 5% of Fannie Mae and Freddie Mac loans While the forbearance numbers have leveled off in recent weeks There’s a good chance the numbers may spike again if COVID worsens and the economy slows In the latest week, the share of Ginnie Mae loans in forbearance increased from 10. 26% to 10. 27%, while the share of Fannie Mae and Freddie Mac loans in forbearance fell from 5. 64% to 5. 49%. Mortgages backed by Ginnie Mae include FHA loans, USDA loans, and VA loans, all of which have relatively easy qualifying criteria relative to conforming loans backed by Fannie/Freddie. While the numbers seemed to have leveled off lately across all loan types, things could get worse if the COVID-19 flare ups across the country continue. And who knows what the fall and winter hold. In the meantime, we’ve got some data that sheds light on what types of homeowners are entering into mortgage forbearance plans,... --- > One of the biggest hurdles to homeownership is down payment. Most people can afford a monthly mortgage payment, especially with interest rates so low, - Published: 2020-07-22 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-is-a-gift-of-equity/ - Categories: Mortgage Tips One of the biggest hurdles to homeownership is down payment. Most people can afford a monthly mortgage payment, especially with interest rates so low, because it’s often not too different than a rent payment. But coming up with 20% of the purchase price is a different story. Heck, most Americans don’t even have a couple month’s reserves in their bank account. And while there are several zero down mortgage options like USDA loans and VA loans, and low down payment mortgage programs like FHA loans and Fannie Mae HomeReady, you pay more when you put less down. Simply put, the more risk you present to the lender, the more you pay, whether it’s through mortgage insurance or a higher mortgage rate. To alleviate this concern, you could look into a “gift of equity,” which as the name implies, is a contribution of equity from the seller to the buyer that can be used toward down payment on a home purchase. How a Gift of Equity Works A relative agrees to sell their home at below-market value The difference between appraised value and loan amount is the gift Can be used for down payment and closing costs Allows buyer to avoid PMI and obtain a cheaper mortgage via lower interest rate In short, it’s a “gift” provided by the home seller to the property buyer that works like a credit, which can be used toward the down payment and closing costs. Instead of selling the property at market price, the seller... --- > You may have heard that mortgage is a “good debt,” in that it’s okay to carry a multi-hundred-thousand-dollar loan for decades on end. While that may - Published: 2020-07-20 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/is-mortgage-a-good-debt-or-a-bad-debt/ - Categories: Mortgage Tips You may have heard that mortgage is a “good debt,” in that it’s okay to carry a multi-hundred-thousand-dollar loan for decades on end. While that may sound counterintuitive to the many anti-debt folks out there, such as Suze Orman or Dave Ramsey, there is actually some real truth to it. Why Mortgage Is a Good Debt Home loans are typically essential debt because most people can’t buy homes with cash They feature some of the lowest interest rates relative to all other types of loans The underlying asset typically rises in value over time as the debt is paid off The property provides shelter and/or investment value to the holder of the debt As noted, financial experts tend to agree that mortgage is a good debt. They say this because the underlying property is deemed an “asset,” as opposed to a liability. For example, a big screen TV that will become obsolete by the time your 36 months of financing comes to an end is a liability. It doesn’t rise in value during the loan term, and if anything becomes worthless by the time it’s actually paid off. Conversely, a piece of real estate should rise in value over time if history is any indication. Sure, there might be some hiccups along the way, but home prices do increase as time goes on. A good example being the homes that were underwater in the wake of the Great Recession, many of which are now worth significantly more than they were... --- > One of the trickiest aspects of homeownership is unloading an existing property while acquiring a replacement. Aside from being stressful, it can also be - Published: 2020-07-16 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/knock-home-swap-buy-sell-a-get-a-mortgage-with-just-one-company/ - Categories: Mortgage News One of the trickiest aspects of homeownership is unloading an existing property while acquiring a replacement. Aside from being stressful, it can also be difficult it not impossible thanks to financing constraints and unwanted contingencies, which a home seller likely won’t accept in a hot market. Unfortunately for those in this predicament, real estate is red hot at the moment, thanks to a lack of inventory and record low mortgage rates. This means contingent offers, where you must sell before you commit to buy, aren’t likely to be accepted. And worse yet, even an offer that requires a mortgage could be denied in favor of an all-cash offer. Enter “Knock Home Swap,” which as the name implies, looks to solve this common conundrum by giving the concurrent home buyer/seller some helpful tools to compete. How Knock Home Swap Works First you get pre-approved for a mortgage with Knock Lending LLC This allows you to make offers on a replacement home with down payment assistance included Once you find the right home you can move in and make just the new mortgage payment In the meantime, your old home will be prepped, listed, and sold while they cover monthly mortgage payments We’ve heard of home swapping before, with it being a common feature with popular iBuyers. For example, Opendoor, HomeLight, Reali, and Offerpad all offer trade-in programs where you can sell them your home and buy one from them at the same time. But unlike an iBuyer, Knock doesn’t purchase your... --- > Thanks to a newly released SEC Form S-1 associated with their upcoming initial public offering (IPO), we now know a lot more about closely held Quicken - Published: 2020-07-08 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/a-look-inside-the-books-of-rocket-companies-inc/ - Categories: Mortgage News Thanks to a newly released SEC Form S-1 associated with their upcoming initial public offering (IPO), we now know a lot more about closely held Quicken Loans, aka Rocket Mortgage, aka “Rocket Companies, Inc. ” The company, which bills itself as the nation’s largest mortgage lender, plans to trade on the New York Stock Exchange (NYSE) under the ticker symbol “RKT. ” Moving Toward the Rocket Mortgage Brand, Away from Quicken? The first takeaway here is that they seem to be embracing the Rocket Mortgage brand over the Quicken Loans brand, with the latter still paying royalties to Intuit for the use of that name, per the S-1. As you can see from the graphic provided in the S-1, they’ve got quite a few affiliated companies under the Rocket Companies umbrella that cover virtually all aspects of the home buying and mortgage lending process. Their Rocket Homes unit refers home buyers who have been pre-qualified for a mortgage by Quicken Loans to a network of third-party partner real estate agents. And their Amrock unit offers title insurance, property valuations (home appraisals), and settlement services. Consider them a one-stop shop, like others in the business are trying to achieve (see Redfin Mortgage and Zillow Offers). Quicken Loans Mortgage Services Is Huge In case you weren’t aware, the company has a major wholesale lending operation as well via Quicken Loans Mortgage Services (QLMS), which accounted for about 36% of total production in 2019. That was a big jump from 2018 and earlier... --- > While the housing market has been coming up roses lately, even in the face of COVID-19, it might turn out to be a short-lived affair as widespread - Published: 2020-07-07 - Modified: 2021-08-20 - URL: https://www.thetruthaboutmortgage.com/now-home-prices-are-expected-to-fall-by-2021-thanks-to-covid-19/ - Categories: Housing Market, Mortgage News While the housing market has been coming up roses lately, even in the face of COVID-19, it might turn out to be a short-lived affair as widespread unemployment takes hold. A new report from CoreLogic today revealed that despite a strong showing in May compared to a year earlier, home prices are actually slated to fall by 2021. This would mark the first national decline in nearly a decade, which could signal a top in home prices after many years of stellar gains. First Annual Home Price Decrease in Over 9 Years While home prices rose 4. 8% year-over-year in May They are expected to fall 6. 6% from May 2020 to May 2021 Would be the first annual decrease in more than nine years Could signal the end of a very long recovery for home prices Nationally, home prices were up 4. 8% year-over-year in May, per the latest CoreLogic Home Price Index (HPI) Report. For perspective, the May 2020 HPI gain from May 2019 was only 3. 6%, so home price growth accelerated and defied many expectations that anticipated the opposite. We’ve certainly had a good run, with the HPI increasing every month since February 2012 on a year-over-year basis, chalking a massive 68. 3% gain after bottoming in March 2011. However, when you look at the increase in real terms adjusted for inflation, home prices are still 6. 7% below their 2006 peak in May. As you can see from the image above, home prices haven’t truly... --- > If you’re curious which mortgage lender closed the most home loans in 2019, I’ve got your answer. You probably already guessed that the top mortgage - Published: 2020-06-30 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/the-top-25-mortgage-lenders-of-2019/ - Categories: Mortgage News If you’re curious which mortgage lender closed the most home loans in 2019, I’ve got your answer. You probably already guessed that the top mortgage lender was Detroit, Michigan-based Quicken Loans, which also led on total dollar amount in recent quarters. But if you didn’t, now you know. The direct mortgage lender, which doubles as fintech company Rocket Mortgage, closed 541,000 mortgages last year, per HMDA data recently released by the CFPB. That’s about 1,500 closed loans a day if you break it down over 365 days, which tells you the scale of that institution, one that might be planning an IPO at this very moment. Of that total, 134,000 were home purchase loans. Their mortgage refinance share was around 70%, which is fairly high. Coming in second place was their neighbor United Shore Financial, also known as United Wholesale Mortgage (UWM), based out of Pontiac, Michigan. The wholesale mortgage lender that works exclusively with mortgage brokers closed a whopping 339,000 home loans last year, of which 152,000 were purchases. They seem to have their sights set on Quicken, with their Conquest loan program offerings rates as low as 2. 5% (and 2. 25% for VA loans). That put their refinance share closer to 50%, which is a solid mix and shows they aren’t overly dependent on the record low mortgage rates around at the moment. Rounding out the top three was San Francisco-based Wells Fargo, which closed 232,000 home mortgages in 2019. They'll probably still be #1 based on... --- > It seems mortgage rates keep moving lower and lower, and now some veterans and active duty military might be able to snag a 30-year fixed as low as 2.25%! - Published: 2020-06-24 - Modified: 2021-08-06 - URL: https://www.thetruthaboutmortgage.com/veterans-can-now-get-rates-as-low-as-2-25-on-a-30-year-fixed-mortgage/ - Categories: Mortgage News, Mortgage Rates It seems mortgage rates keep moving lower and lower, and now some veterans and active duty military might be able to snag a 30-year fixed as low as 2. 25%! That’s pretty unheard of. While it sounds too good to be true, it appears to be a reality thanks to United Wholesale Mortgage’s push to dominate the mortgage market. The rapidly growing wholesale lender based out of Pontiac, Michigan announced the new offering today via their website, calling it “Conquest for VA. ” Who Is Eligible for Conquest for VA? Active duty military and veterans who otherwise qualify for VA loans Those looking for a VA purchase loan or VA IRRRL (streamline refinance) Primary residence only for purchases Primary and second homes for VA IRRRLs Minimum FICO score of 640 Must obtain financing via a mortgage broker approved to work with UWM Homeowner must not have closed a refinance through UWM in past 18 months Mortgage rates start from 2. 25% to 2. 375% on the 30-year fixed Now let’s talk about who’s eligible for this seemingly fantastic loan program, which UWM says is being offered to honor our nation’s veterans. As the name suggests, Conquest for VA is reserved for veterans and active duty military, and anyone else generally eligible for a VA home loan. So if you don’t qualify for a VA loan, you’ll have to look into their general Conquest loan program instead. Additionally, these low rates are only applicable to new home purchase loans and streamline... --- > We’re starting to get a better picture of how COVID-19 affected the housing market, with the National Association of Realtors’ existing-home sales report - Published: 2020-06-22 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/covid-19-may-have-just-been-a-speed-bump-for-surging-housing-market/ - Categories: Housing Market, Mortgage Tips We’re starting to get a better picture of how COVID-19 affected the housing market, with the National Association of Realtors’ existing-home sales report showing a big drop in May. It’s based on completed transactions, including both single-family homes and condos/townhomes, meaning these were likely under contract during the full lockdown seen a month or so ago. Home Sales Hit Hard by COVID-19 Existing home sales fell 9. 7% in May from a month earlier per NAR Off a sizable 26. 6% from April 2019 as traditional home buying period disrupted by virus Housing supply increased but likely only due to artificially slower sales pace Home prices were down slightly month-to-month but still registered 99th straight YoY increase As expected, existing home sales were off 9. 7% from April, falling to a seasonally-adjusted annual rate of 3. 91 million in May. That’s a whopping 26. 6% below the 5. 33 million sales pace seen in May 2019, though there are some pretty serious extenuating circumstances at play here. NAR chief economist Lawrence Yun noted that the sales completed last month “reflect contract signings in March and April. ” The true test on the existing home sale front will be a month or two from now, assuming the country remains open post the worst of COVID-19. The lack of home sales also seemed to boost unsold inventory, which rose to a 4. 8-month supply based on the current sales pace, up from 4. 0 months in April and 4. 3-months in May... --- > Some very big news in the mortgage world – Quicken Loans is reportedly going public, with an IPO currently being worked on by Credit Suisse, Goldman - Published: 2020-06-12 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/quicken-loans-ipo-going-public/ - Categories: Mortgage News Some very big news in the mortgage world – Quicken Loans is reportedly going public, with an IPO currently being worked on by Credit Suisse, Goldman Sachs, JPMorgan, and Morgan Stanley. It's now confirmed. Quicken has officially filed its IPO, under the name “Rocket Companies Inc. ” It will trade under the symbol RKT on the New York Stock Exchange. Rocket Companies Inc. consists of many consumer brands, including Rocket Mortgage, Rocket Homes, Rocket Loans, Rocket Auto, Rock Central, Core Digital Media, Rock Connections, Lendesk and Edison Financial. It doesn’t appear that the Cleveland Cavaliers basketball team or Rocket Mortgage FieldHouse are part of the deal, but that's unclear. The size of the deal and number of shares have not been disclosed and it’s subject to market conditions, which we all know are questionable at the moment. It is being led by Morgan Stanley, Credit Suisse, JP Morgan, Goldman Sachs, and others. The Detroit-based company, which recently became the bona fide largest mortgage lender in the nation across all channels, has been private since 2002. There was a period of time when the lender was publicly-traded before eventually being sold to TurboTax and QuickBooks maker Intuit in 1999. A few years later, founder Dan Gilbert bought Quicken Loans back from Intuit and took it private again. Fast forward to 2020 and it appears they’re ready to test the market on Wall Street once again, this time being the #1 mortgage lender in the country. The story resembles the path Countrywide... --- > Newrez is one of the fastest growing mortgage lenders in the nation, currently offering a $1,000 closing cost credit to home buyers. - Published: 2020-06-12 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/newrez-mortgage-review/ - Categories: Mortgage Tips One mortgage lender making a big splash of late is Newrez, short for New Residential Investment Corp. They've grown mightily thanks to their 2019 acquisition of Shellpoint Partners LLC, which was the parent company of New Penn Financial. As a result, the company has a robust loan origination platform to flank their expansive loan servicing business. Newrez is also a publicly-traded company worth billions of dollars that has quickly become a top-10 mortgage lender nationwide. Read on to learn more about their history, loan offerings, interest rates, and more. Newrez Fast Facts Founded in 2008, originally known as New Penn Financial A direct-to-consumer mortgage lender based in Fort Washington, PA Parent company is publicly-traded Rithm Capital (NYSE: RITM) Also operates a correspondent lending and wholesale division Licensed to lend in 49 states and DC (pending approval in NY state) Funded nearly $40 billion in 2022 (a top-10 lender nationwide) 2,600+ employees and 616,000+ customers served Acquired Caliber Home Loans in summer of 2021 Newrez was founded in 2008 and is headquartered in Fort Washington, Pennsylvania. Their NMLS ID is 3013. It is part of the Rithm Capital family of companies, which includes loan servicer Shellpoint Mortgage Servicing. Their acquisition of Shellpoint in 2019 allowed them to grow their retail loan origination business thanks to its subsidiary New Penn Financial, which was an established mortgage player. In August 2021, Newrez got even bigger after acquiring Caliber Home Loans, which was already a household name in the mortgage space. This propelled them... --- > Planet Home Lending is a mortgage lender and loan servicer that was recently named one of the fairest lenders based on HMDA data. - Published: 2020-06-10 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/planet-home-lending-review/ - Categories: Mortgage Tips Today we’ll take a good look at Planet Home Lending, a rising star in the mortgage world that’s beginning to make inroads and become a household name. Founded less than 20 years ago, they were able to muster about $25 billion in residential loan origination volume in 2023, per a company release. It was split between conventional loans, FHA loans, and VA loans, with a handful of jumbo loans and USDA loans thrown into the mix as well. They seem to do the most business in California, Florida, and Texas, despite being headquartered in Connecticut. True to their name, Planet Home Lending has also partnered with the National Forest Foundation, pledging to plant three trees for every closed loan, up to 30,000 trees in 2020. Planet Home Lending Quick Facts Direct mortgage lender founded in 2007, headquartered in Meriden, Connecticut Operates both a retail and correspondent lending business Originated about $25 billion in home loans during 2023 Services more than 250,000 active loans for borrowers Does majority of business in California, Colorado, Florida, Texas, and Virginia Licensed in 48 states, D. C. , Puerto Rico, and the Virgin Islands Not licensed to originate loans in Hawaii or Massachusetts 3rd largest correspondent lender and 2nd largest government loan correspondent lender nationally Despite 2023 being a challenging year for most mortgage lenders, Planet Home managed to originate $25 billion in mortgage loans. They also managed to become #2 government correspondent lender and the #3 correspondent lender overall as of the end of... --- > If you’re a homeowner, or just became one during the pandemic, you’ve likely heard of mortgage forbearance. Not to be confused with mortgage forgiveness, - Published: 2020-06-09 - Modified: 2021-09-01 - URL: https://www.thetruthaboutmortgage.com/5-things-to-know-if-considering-mortgage-forbearance/ - Categories: Mortgage Tips If you’re a homeowner, or just became one during the pandemic, you’ve likely heard of mortgage forbearance. Not to be confused with mortgage forgiveness, it allows borrowers to suspend mortgage payments for a period of time if experiencing a hardship related to COVID-19. Eventually those missed payments need to be repaid, likely via a payment deferral where they're set aside and paid off via refinance or home sale. Some 8. 46% of mortgages are now in forbearance, per the latest Forbearance and Call Volume Survey from the Mortgage Bankers Association (MBA). The most widely used forbearance program is offered via the CARES Act because it covers a wide swath of the mortgage market, including loans backed by Fannie Mae and Freddie Mac, along with FHA loans, USDA loans, and VA loans. Recently, the Consumer Financial Protection Bureau (CFPB) and Conference of State Bank Supervisors (CSBS) released additional guidance regarding mortgage forbearance to ensure it’s being implemented correctly. While it’s geared toward mortgage lenders and loan servicers to ensure they’re in compliance of the CARES Act and not causing consumer harm, it could serve as a consumer guide as well. No Documentation Is Required for Mortgage Forbearance While you must attest to having a COVID-19-related hardship in order to qualify for mortgage forbearance, no other documentation is required. Sure, you can provide your lender or loan servicer with a forbearance request letter to satisfy that attestation, but they can’t ask for proof that you’re unable to make your mortgage payment(s). That... --- > The latest Mortgage Monitor report from Black Knight reveals that many homeowners in forbearance plans are sitting on a healthy amount of home equity, - Published: 2020-06-08 - Modified: 2021-09-01 - URL: https://www.thetruthaboutmortgage.com/home-equity-could-prevent-flood-of-forbearance-related-foreclosures/ - Categories: Foreclosure, Housing Market, Mortgage News The latest Mortgage Monitor report from Black Knight reveals that many homeowners in forbearance plans are sitting on a healthy amount of home equity, meaning if they're forced to sell banks may not lose out. Per the data analytics company, fewer than one in 10 homeowners (9%) in forbearance have 10% or less home equity in their property, which the company believes is “typically enough to cover the costs of selling the property. ” Additionally, just one percent of homeowners in forbearance are currently underwater on their mortgages, surely a bad sign if they stop making monthly payments too. Overall, 80% of the 4. 76 million homeowners in active forbearance plans have 20% or more equity in their homes, meaning they’ve got options and loan servicers do too. This should reduce the number of foreclosures that hit the housing market and also keep default-related losses in check, a good sign for the housing market and the borrowers at risk of losing their homes. Home Equity the Difference This Time Around 4. 76 million homeowners in active forbearance as of May 26th 46% of homeowners in forbearance made their April mortgage payment as of April 30th 22% of those in forbearance have made their May payments as of May 26th Forbearance volume declined for the first time since the COVID-19 pandemic began The last mortgage crisis was marked by toxic mortgages and a lack of home equity, a one-two punch that sent to the housing market to its knees. Or whatever’s... --- > The Federal Housing Administration (FHA) finally announced a new policy, which is temporary, to endorse mortgages where the borrower has requested or - Published: 2020-06-05 - Modified: 2021-09-01 - URL: https://www.thetruthaboutmortgage.com/fha-will-buy-mortgages-in-forbearance-with-a-catch/ - Categories: Foreclosure, Mortgage News The Federal Housing Administration (FHA) finally announced a new policy, which is temporary, to endorse mortgages where the borrower has requested or obtained COVID-19 forbearance. Mortgagee Letter 2020-16 temporarily reverses the FHA’s existing policy that doesn’t permit FHA insurance for mortgages in forbearance. The agency said the policy ensures “the safeguards of the FHA program continue to work for new homeowners facing a financial hardship due to COVID-19. ” Now before mortgage lenders get too excited about this, there is a major hitch. They must sign an indemnification agreement with the FHA that leaves them on the hook for 20% of the original loan amount if it goes bad. What Are the Requirements for Insuring FHA Loans in Forbearance? Borrower must be experiencing a financial hardship due directly or indirectly to COVID-19 Mortgage must have been current at time of request for forbearance Mortgage must satisfy all requirements for FHA insurance at time of closing Mortgagee must execute a two-year partial indemnification agreement Aside from that pretty significant piece about lenders being liable for 20% of the original loan amount, there are also some general requirements that must be met. First off, the borrower must be experiencing a financial hardship directly or indirectly related to COVID-19 and in a forbearance plan. Additionally, they must have been current on the mortgage at the time they requested the forbearance. In the letter, the FHA says “forbearance provided to borrowers experiencing a financial hardship due, directly or indirectly, to COVID-19 is not considered... --- > Today we’ll take a good look at On Q Financial, a direct mortgage lender based in Tempe, Arizona that wants to make getting a mortgage simple. In fact, - Published: 2020-05-28 - Modified: 2024-09-07 - URL: https://www.thetruthaboutmortgage.com/on-q-financial-mortgage-review/ - Categories: Mortgage Tips Today we’ll take a good look at On Q Financial, a direct mortgage lender based in Tempe, Arizona that wants to make getting a mortgage simple. In fact, their slogan is, “Mortgages Simplified,” so my guess is their loan process is pretty straightforward and possibly easier than the other guys. That could have something to do with their digital mortgage offering that promises a faster and easier experience, complete with a smartphone app that can do most of the heavy lifting. While they’ve only been around since 2005, they’re growing rapidly and making a name for themselves in the industry. They weren't in the top 100 based on 2018 HMDA data, but now refer to themselves as a top-50 lender. On Q Financial Quick Facts Direct mortgage lender headquartered in Tempe, Arizona Founded in 2005 by former mortgage loan officer John Bergman A top-50 mortgage lender with more than 550 employees and 70 locations Offers a digital mortgage experience that allows you to apply via smartphone app Specialize in home purchase loans but also offer refinancing Licensed in 47 states and DC (not available in Hawaii, New Jersey, or New York) Helped over 10,000 families purchase a home in 2019 On Q Financial Digital Mortgage Process On Q Financial prides itself on making the often-agonizing home loan process fast and easy, so you should expect a better experience than what you may have heard or are used to. Their “Mortgages Simplified” digital mortgage solution allows you to submit income, asset,... --- > One of the fastest growing and largest mortgage lenders in the country goes by the name PennyMac, not to be confused with Freddie Mac. If you're wondering - Published: 2020-05-27 - Modified: 2025-06-25 - URL: https://www.thetruthaboutmortgage.com/pennymac-mortgage-review/ - Categories: Mortgage Tips One of the fastest growing and largest mortgage lenders in the country goes by the name PennyMac, not to be confused with Freddie Mac. If you're wondering what the rather odd name means, it stands for Private National Mortgage Acceptance Co. While the company started as a buyer of distressed mortgage assets after the mortgage crisis in the early 2000s, it wasn’t long before they were originating their own home loans. Today, they refer to themselves as a “top 3 lender in the U. S. ,” which is likely driven by their strong correspondent lending business. They purchase home loans from small and mid-sized banks, along with credit unions and other smaller mortgage lenders. But they’re also becoming a major retail mortgage lender as well (top-15 at last glance), serving consumers directly and beginning to make a household name for themselves. In fact, in October 2019 they broke their one-month record by lending more than $1 billion directly to consumers. If you’re looking to purchase a home or refinance an existing mortgage, PennyMac might be a lender worth looking into. PennyMac Mortgage Quick Facts Publicly-traded mortgage company launched in 2008 Former Countrywide Financial CFO is their founder A top-3 mortgage lender licensed everywhere but NY Nearly 4,000 employees, headquartered in Westlake Village, CA Funded $21. 5B in home loans during 2024 (14th largest lender nationally) Services more than $680B in home loans for its customers First a little history on PennyMac, which only stretches back to 2008. But they’ve been... --- > Update: Eagle Home Mortgage is now known as Lennar Mortgage. If you’re thinking about buying a home or refinancing an existing mortgage, you may have come - Published: 2020-05-26 - Modified: 2024-06-22 - URL: https://www.thetruthaboutmortgage.com/eagle-home-mortgage-review/ - Categories: Mortgage Tips Update: Eagle Home Mortgage is now known as Lennar Mortgage. If you’re thinking about buying a home or refinancing an existing mortgage, you may have come across Eagle Home Mortgage on your journey. They’re more likely to come up if purchasing a home since they are a direct mortgage lender owned by Lennar, which is now the nation’s largest homebuilder thanks to its acquisition of CalAtlantic in April 2018. In short, Eagle Home Mortgage acts as the home builder’s financing department, though if you buy a home from Lennar you don’t have to use them. It’s just that borrowers often use the builder’s finance department as opposed to an outside mortgage lender seeing that it’s the easiest and most obvious choice, and usually the path of least resistance. There may also be some synergies to using affiliated companies, whether it’s a special incentive or just a faster loan process, knowing a home purchase with their builder is on the line. In 2019, they provided home loan financing to more than 34,000 families looking to purchase a home. Let’s discover more about Eagle Home Mortgage. Eagle Home Mortgage Is Lennar's Captive Lender Retail consumer-direct mortgage lender founded in 1981 Subsidiary of Lennar Corp. , nation’s largest homebuilder Company headquarters located in Miami, Florida Closed more than 34,000 home purchase loans in 2019 More than 1,500 employees nationwide A top-30 mortgage lender overall that specializes in new home purchase financing Does most of their business in Florida and Texas Where Is Eagle... --- > Another interesting trend has emerged from the latest mortgage forbearance data, this time courtesy of a new report from data analytics company Black - Published: 2020-05-22 - Modified: 2021-08-20 - URL: https://www.thetruthaboutmortgage.com/46-of-homeowners-in-forbearance-plans-still-made-their-mortgage-payments/ - Categories: Housing Market, Mortgage News Another interesting trend has emerged from the latest mortgage forbearance data, this time courtesy of a new report from data analytics company Black Knight. Nearly 5 Million Now in Mortgage Forbearance Plans 4. 75 million borrowers in active forbearance plans (9% of all mortgages) FHA/VA forbearance rate rises to 12. 6% as of May 19th Fannie/Freddie forbearance rate climbs to 7. 1% Other loan type forbearance rate (portfolio loans and private-label) up to 9. 5% First things first, some 4. 75 million homeowners, or about 9. 0% of all mortgages, are now in COVID-19 mortgage forbearance plans, per the company’s McDash Flash Forbearance Tracker. That represents more than $1 trillion in unpaid principal balances, just to give you an idea of what loan servicers and the GSEs could be on the hook for. Both FHA loans and VA loans continue to exhibit the worst levels of forbearance, at 12. 6% of all loans, versus just 7. 1% for GSE-backed loans (Fannie Mae and Freddie Mac). Other types of loans, such as portfolio loans and private-label securities, have a forbearance rate of 9. 5%. While things have settled down lately, Black Knight said the pace of forbearance has risen “slightly in recent days,” with the number of active forbearances climbing by about 93,000 over the past week. However, that’s still a ~70% decline from the 325,000 jump during the first week of May, and 93% below the first week of April when active forbearance plans surged by almost 1. 4 million... --- > One of the largest mortgage lenders in the country you may not have heard of is Fairway Independent Mortgage Corp., based out of Madison, Wisconsin. They - Published: 2020-05-21 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/fairway-independent-mortgage-review/ - Categories: Mortgage Tips One of the largest mortgage lenders in the country you may not have heard of is Fairway Independent Mortgage Corp. , based out of Madison, Wisconsin. They were the 9th largest residential mortgage lender in 2022, per HMDA data, just below Caliber Home Loans and Amerihome Mortgage. That’s pretty impressive, considering the few others ahead of them include the likes of UWM, Chase, Bank of America, Wells Fargo, and Quicken Loans. Despite that, they're only the 5th largest lender in Wisconsin, which is somewhat strange as it's their home state. But it illustrates the fact that their business is a national one that extends across the entire United States. Fairway Independent Mortgage Fast Facts Direct-to-consumer retail mortgage lender licensed in all 50 states Founded in 1996 by Steve Jacobson and Randy Cross Headquartered in Madison, WI and Carrrollton, TX Top-10 lender that funded $41 billion in home loans during 2022 Heavily focused on home purchase financing as opposed to refinance Used to operate a wholesale channel known as Fairway Wholesale Lending Fairway Independent Mortgage got started back in 1996 and has funded more than $200 billion in home loans since that time, with $41 billion originated in 2022 alone. The Madison, Wisconsin-based direct lender employs over 7,000 people across 500 branches nationwide, and counts roughly 3,000 team members as loan originators. They are licensed in all 50 states. Their focus is to provide unparalleled customer service to help Americans achieve their dream of homeownership. Speaking of, the vast majority of... --- > While lots of lenders have recently cut back on offerings that aren’t backed explicitly by the government, some are rolling out new loan programs to help - Published: 2020-05-20 - Modified: 2020-05-20 - URL: https://www.thetruthaboutmortgage.com/despite-covid-19-you-can-still-get-a-jumbo-home-loan/ - Categories: Mortgage News, Refinance While lots of lenders have recently cut back on offerings that aren’t backed explicitly by the government, some are rolling out new loan programs to help homeowners get the financing they need. We’ve already seen non-QM lending basically dry up as the COVID-19 pandemic hit, though some lenders in the space are still hanging on with reduced menus. And I’ve reported that numerous large, depository banks have also eliminated their higher-risk programs, including Chase upping credit score requirements and no longer offering HELOCS. Similarly, Wells Fargo tightened its mortgage guidelines and even implemented a rule requiring $250,000 in one of their bank accounts in order to get a jumbo loan. Clearly that won’t work for a lot of folks, so if you’re in need of a jumbo home loan, it might be a lot harder than it used to be. Sprout Mortgage Launches Premier Jumbo Program Loan amounts as high as $3 million for purchase or refinance Up to 90% loan-to-value (LTV) with a 700 FICO score and no PMI Up to 43% DTI ratio (40% DTI for LTV>85%) 1-4 unit primary, second homes, and investment properties (condos included) One mortgage lender has just launched a new proprietary jumbo loan program that allows loan amounts up to $3 million on a 30-year fixed, which is available to approved mortgage brokers and correspondents. Sprout Mortgage based in East Meadow, New York unveiled its so-called “Premier Jumbo” today to meet the demand of home buyers and homeowners left behind by larger banks... --- > Just five percent of homeowners who recently got approved for mortgage forbearance actually needed it, according to a shocking survey from home loan - Published: 2020-05-20 - Modified: 2020-05-22 - URL: https://www.thetruthaboutmortgage.com/only-five-percent-who-requested-mortgage-forbearance-needed-it/ - Categories: Mortgage News, Mortgage Tips Just five percent of homeowners who recently got approved for mortgage forbearance actually needed it, according to a shocking survey from home loan comparison company LendingTree. The company said 70% of those in forbearance plans could have made mortgage payments, but “wanted a break. ” While 26. 2% said they would have had to “skip other essential bills,” which is interesting because borrowers historically pay the mortgage first. The trend was even more apparent among younger generations, with 71% of Millennial and Gen X respondents saying “they could’ve made their payment but just wanted a pause. ” And only 4. 3% of these two groups on average indicated that they wouldn’t have been able to pay the mortgage without forbearance. Meanwhile, 20% of baby boomers said they actually needed forbearance to avoid missing their mortgage payment, despite being less likely to apply for assistance. The Moral Hazard of Mortgage Forbearance CARES Act offers mortgage forbearance to homeowners with no proof of hardship Allows borrowers to voluntarily accept assistance even if not necessary Just 5% wouldn’t have been able to pay their mortgage without forbearance 72% who received forbearance feel “at least a little guilty about it” While you would expect that most people who asked for mortgage forbearance to actually need it, turns out it’s just not the case. This might explain why a large number of those who successfully received it feel some level of guilt. A staggering 40. 7% of Gen X respondents said “a lot” when asked... --- > We’ve finally got some clarity regarding what happens after mortgage forbearance in terms of obtaining a subsequent home loan. The Federal Housing Finance - Published: 2020-05-19 - Modified: 2021-09-01 - URL: https://www.thetruthaboutmortgage.com/mortgage-forbearance-waiting-period/ - Categories: Mortgage News, Mortgage Tips, Refinance We’ve finally got some clarity regarding what happens after mortgage forbearance in terms of obtaining a subsequent home loan. The Federal Housing Finance Agency (FHFA), which oversees Fannie Mae and Freddie Mac, announced temporary guidance regarding the matter today. Waiting Period After Mortgage Forbearance for Fannie and Freddie No wait to buy a home or refinance if you’re in a forbearance plan but continued making payments 3-month waiting period if you didn’t make payments while in a forbearance plan Those who paused payments must make 3 consecutive monthly mortgage payments after forbearance ends to be eligible for a new home loan Only applies to mortgages backed by Fannie Mae or Freddie Mac While it’s not 100% clear, thanks to ambiguous wording from the FHFA, it appears there will be a three-month waiting period to get a mortgage after forbearance ends, assuming you didn’t make payments during that time. The key to eligibility is to ensure that you have made three consecutive payments after forbearance comes to an end, via a repayment plan, the payment deferral option, or loan modification if applicable. Those who just go back to making regular payments via the payment deferral option should only need to make three regular payments to restore eligibility for a mortgage refinance or new home purchase loan. The semi-confusing part is the release also says borrowers in forbearance plans are eligible to refinance or buy a home, presumably right away, if they are current on their mortgage. For example, if a homeowner... --- > Maybe there’s some good news out there, or maybe it’s just the calm before another storm. The mortgage forbearance rate barely budged during the week - Published: 2020-05-18 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/mortgage-forbearance-rate-only-rises-3-from-a-week-ago-but-second-wave-could-be-coming/ - Categories: Foreclosure, Mortgage News Maybe there’s some good news out there, or maybe it’s just the calm before another storm. The mortgage forbearance rate barely budged during the week ending May 10th, per the latest installment of the Forbearance and Call Volume Survey from the Mortgage Bankers Association (MBA). The group said the total number of loans in forbearance increased to 8. 16% of loan servicers' portfolio volume from 7. 91%, a mere three percent increase from a week prior. It could represent a flattening in the forbearance rate after a massive surge from basically zero in March, or it could be a pause before another breakout, possibly mirroring COVID-19. Mortgage Forbearance Rate Hits 8. 16% Total loans in forbearance up to 8. 16% from 7. 91% Ginnie Mae forbearance rate up to 11. 26% from 10. 96% Fannie Mae and Freddie Mac forbearance rate up to 6. 25% from 6. 08% Private-label and portfolio loan forbearance up to 9. 26% from 8. 88% While the forbearance rate obviously increased again, as everyone expected, the 25 basis point weekly increase was the smallest gain since the week ending March 16th. It was also pretty consistent across all loan types, with both Fannie/Freddie loans and Ginnie loans (FHA/USDA/VA) seeing very minor increases from a week earlier. Additionally, loan servicer call volume, hold times, call lengths, and abandonment rates all dropped from a week prior. As noted last week, it is somewhat early in the month, as you can generally pay the mortgage until the 15th... --- > The Federal Housing Finance Agency (FHFA) announced today that Fannie Mae and Freddie Mac have launched a new payment deferral option in light of the - Published: 2020-05-14 - Modified: 2021-08-06 - URL: https://www.thetruthaboutmortgage.com/covid-19-payment-deferral/ - Categories: Mortgage News The Federal Housing Finance Agency (FHFA) announced today that Fannie Mae and Freddie Mac have launched a new payment deferral option in light of the unprecedented disruption caused by the coronavirus. The new workout option, known as “COVID-19 payment deferral,” was specifically designed by Fannie Mae and Freddie Mac to help those affected by a temporary hardship related to COVID-19. The goal is to help borrowers in a simple and straightforward manner achieve current loan status after up to 12 months of missed mortgage payments. How COVID-19 Payment Deferral Works The delinquent amount is moved into a non-interest bearing balance No payments are made toward this balance and mortgage remains otherwise changed It is due at maturity or earlier if mortgage is refinanced or home sold No trial period is necessary and runs through automated process to expedite The way payment deferral works is pretty simple, which is the entire point of offering it. Say a borrower missed 12 mortgage payments that were $2,000 each. That $24,000 would be set aside in a non-interest bearing account. It would not need to be paid down or touched at all until the homeowner either refinanced their mortgage, sold their home, or otherwise reached maturity based on the original loan term. The borrower’s original mortgage would remain unchanged otherwise, meaning they’d resume making the $2,000 monthly payment they were accustomed to making before COVID-19 disrupted their income. This would make getting back on track very straightforward, and hopefully doable for most homeowners, assuming... --- > Well that didn’t take long – demand to buy a home is now back above its so-called 
“pre-coronavirus levels,” per a new analysis from real estate brokerage - Published: 2020-05-14 - Modified: 2021-08-20 - URL: https://www.thetruthaboutmortgage.com/home-buyer-demand-bounces-back-small-towns-become-hot/ - Categories: Housing Market, Mortgage News Well that didn’t take long – demand to buy a home is now back above its so-called “pre-coronavirus levels,” per a new analysis from real estate brokerage Redfin. The company said demand was a seasonally-adjusted 5. 5% higher during the week ending May 10th than it was prior to the COVID-19 pandemic. Of course, it would probably have been a lot higher if not for the complete dislocation of the economy, but it’s still a good sign. A V-Shaped or a W-Shaped Recovery? Redfin sees a V-shaped recovery because home buyer demand has totally bounced back But prospective buyers might not be looking at the same properties post-pandemic Realtor. com sees a W-shaped recovery in 2020 thanks to coronavirus second wave Expects sales to drop 15% as sellers de-list their properties and buyer demand see-saws There are two camps when it comes to real estate in 2020. There is Redfin, which is already calling a V-shaped recovery, or complete return to pre-pandemic levels. And there is Realtor. com, which expects a W-shaped recovery, brought on “as secondary waves of coronavirus infections pop up throughout the U. S. ” Redfin says the V-shaped recovery is being driven by record low mortgage rates and the loosening of shelter-at-home orders in certain states. They believe after a two-month wait, prospective buyers who are still gainfully employed and perhaps even confident about their financials are jumping back in. Meanwhile, the Realtors expect home sales to rebound as virus-related concerns dip, but anticipate a decline... --- > Here's a good sign mortgage rates might be moving even lower than they already are. Pontiac, Michigan-based United Wholesale Mortgage (UWM), which refers - Published: 2020-05-13 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/its-now-possible-to-get-a-2-5-mortgage-rate-on-a-30-year-fixed/ - Categories: Mortgage News, Mortgage Rates Here's a good sign mortgage rates might be moving even lower than they already are. Pontiac, Michigan-based United Wholesale Mortgage (UWM), which refers to itself as the #1 wholesale lender in the nation, has launched an exclusive new program that offers mortgage rates as low as 1. 99% on the 30-year fixed. That’s basically the lowest rate in history on the popular loan program, and a direct jab at local competitor Quicken Loans, whose CEO recently said 30-year fixed mortgage rates wouldn’t fall below 3%. UWM CEO Mat Ishbia announced the new loan program, known as “Conquest,” in a Facebook Live post this morning. Let’s learn more about it. Conquest: What’s in a Name? Exclusive program designed to help mortgage brokers win new business Offers “significantly better pricing” than UWM’s other offerings Mortgage rates range from 1. 999% to 2. 875% on the 30-year fixed Rates may be even lower (or higher) based on mortgage market conditions First off, UWM is a wholesale-only lender, meaning they don’t work directly with the public. Instead, they work with mortgage brokers, who are consumer-facing liaisons. So if you want a loan with UWM, you’d need to hook up with a broker who is approved to work with UWM. Anyway, the new Conquest program was basically launched to grab more market share as UWM goes head-to-head with Quicken Loans for nation’s largest lender. While Quicken is #1 thanks to a recent stellar first quarter, UWM hasn’t been far behind lately. And Ishbia didn’t mince... --- > Since the CARES Act rolled out in early April, more than four million Americans have reportedly put their mortgage payments on hold for up to 12 months. - Published: 2020-05-13 - Modified: 2020-05-19 - URL: https://www.thetruthaboutmortgage.com/will-forbearance-prevent-you-from-getting-a-mortgage-in-the-future/ - Categories: Mortgage News, Mortgage Tips, Refinance Since the CARES Act rolled out in early April, more than four million Americans have reportedly put their mortgage payments on hold for up to 12 months. The massive numbers taking part can be attributed to the widespread fallout from the coronavirus epidemic (COVID-19), and also the ease at which a homeowner can request assistance, with not much more than a letter or simple request to their loan servicer without proof. It’s expected that many more borrowers will request mortgage forbearance in the month of May and beyond, as evidenced by a recent survey from Bankrate. Update: There Will Be a 3-Month Waiting Period to Get a Mortgage After Forbearance Need Help, But Not Yet Asking for It Apparently, many Americans are concerned about making mortgage payments in light of possible job losses or income curtailments, but most haven’t reached out for help yet. Some 70% of Millennials said they were concerned about their ability to make mortgage payments over the next three months, but only 60% said they have contacted their lender. Meanwhile, 56% of Gen Xers are concerned, but a mere 29% have reached out to their lender or loan servicer. It’s even worse for Baby Boomers, with 43% concerned, and only 17% asking for help. As to why, some said they didn’t know it was an option, or simply haven’t gotten around to it, or are waiting for lenders to reach out to them (good luck! ) Others cited unspecified reasons or said they came up with... --- > The mortgage forbearance rate increased again last week, rising to 7.91% from 7.54% a week earlier, per the Mortgage Bankers Association (MBA). That - Published: 2020-05-11 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/mortgage-forbearance-rate-up-near-8-housing-assistance-fund-proposed/ - Categories: Foreclosure, Mortgage News The mortgage forbearance rate increased again last week, rising to 7. 91% from 7. 54% a week earlier, per the Mortgage Bankers Association (MBA). That marked the smallest weekly increase (4. 91%) since the newly-created Forbearance and Call Volume Survey was launched, but it’s important to remember it was only 0. 25% back in March. Additionally, the weekly gains just aren’t going to be headlines anymore because it’s hard to move the needle once millions are already in forbearance plans. Still, it’s pretty clear we’re heading to 10% sooner or later, which is pretty remarkable and sure to stress a lot of loan servicers. It's also time to start thinking about more than just the next 12 months. Forbearance Rate Close to 11% for Ginnie Mae Loans 10. 96% of FHA/USDA/VA loans in forbearance 6. 08% of Fannie/Freddie loans in forbearance 8. 88% of private-label and portfolio loans in forbearance Depositories (8. 75%) faring worse than independent nonbanks (7. 54%) Once again, home loans backed by Ginnie Mae exhibited the worst forbearance rate at 10. 96%, up from 10. 45% a week prior. Meanwhile, Fannie Mae- and Freddie Mac-backed mortgages saw forbearance creep up to 6. 08% from 5. 85%. Private-label securities and portfolio loans fell in between those levels with a forbearance rate of 8. 88%, up from 8. 30%. And depositories continue to fare worse than independent mortgage bank (IMB) servicers, otherwise known as nonbanks, which is relatively good news because the former have money on hand. Keep... --- > It’s time to take a look at how COVID-19 could impact home prices given the massive disruption to the local, state, national, and global economy. On the - Published: 2020-05-07 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/home-prices-vs-covid-19-will-they-go-up-or-down/ - Categories: Housing Market, Mortgage Tips It’s time to take a look at how COVID-19 could impact home prices given the massive disruption to the local, state, national, and global economy. On the one hand, inflation is expected due to all the government spending, which could lead to a price increase since real estate often acts as an inflation hedge. Conversely, if tons of borrowers lose their homes due to unemployment, we could see properties flood the market. And when combined with fewer eligible buyers, it could lead to a supply glut. Consider the Lack of Housing Supply and Mortgage Quality The housing market has three great things working in its favor right now Housing supply is low enough even if buyer demand wavers during this uncertain time The quality of today’s mortgages is excellent any many homeowners have lots of equity Mortgage rates are at record lows, which further increases home buyer appetite First, let’s compare today’s housing market to the one in 2006. They really couldn’t be any different, both from an inventory standpoint and from a mortgage perspective. Simply put, back then there were way too many homes being built, and not enough demand to meet that supply. At the same time, banks and lenders were doling out home loans to anyone with a pulse, knowing they could quickly bundle the underlying mortgages and sell them to Wall Street shortly after origination. Taken together, it was a recipe for disaster. Homeowners had massive mortgages they couldn’t truly afford that were often set to... --- > The mortgage forbearance rate worsened yet again compared to last week, though as expected the increase has slowed as the pool of borrowers grows larger. - Published: 2020-05-05 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/nearly-4-million-homeowners-now-in-mortgage-forbearance-plans-servicers-may-get-500-payments/ - Categories: Mortgage News The mortgage forbearance rate worsened yet again compared to last week, though as expected the increase has slowed as the pool of borrowers grows larger. As of April 26th, some 3. 8 million homeowners were in forbearance plans, per the Mortgage Bankers Association's (MBA’s) most recent Forbearance and Call Volume Survey. The forbearance rate increased from 6. 99% to 7. 54%, a mere eight percent rise from a week earlier, but still more bad news for loan servicers. And I should note that we’re about to begin a new month, so those on the fence last month could request forbearance this week, creating a new surge. Forbearance Rate Tops 10% for FHA/VA Loans Ginnie-backed loans have a forbearance rate of 10. 45% Fannie/Freddie loans have forbearance rate of 5. 85% Private-label securities and portfolio loans have rate of 8. 30% Depository banks have rate of 8. 41%, independent mortgage bank (IMB) servicers have rate of 7. 13% In terms of loan type, government-backed home loans continue to fare worst, with Ginnie Mae mortgages (FHA loans and VA loans) seeing forbearance rates climb to 10. 45% from 9. 73%. Meanwhile, the Fannie Mae and Freddie Mac forbearance rate rose from 5. 46% to 5. 85%. Other mortgages, such as private-label securities and portfolio loans, which can include jumbo loans, increased from 7. 52% to 8. 30%. With regard to institution type, depository banks saw their forbearance rate go up from 7. 87% to 8. 41%, and independent mortgage bank (IMB) servicers... --- > While some have complained that the mortgage forbearance program under the CARES Act is far too liberal, a new report claims some loan servicers aren’t - Published: 2020-04-30 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/loan-servicers-accused-of-providing-unclear-and-dated-mortgage-forbearance-information/ - Categories: Mortgage News While some have complained that the mortgage forbearance program under the CARES Act is far too liberal, a new report claims some loan servicers aren’t being very transparent about the assistance available to homeowners. A new report from the U. S. Department of Housing and Urban Development (HUD) Office of Inspector General (OIG) found that some loan servicers’ websites are displaying loan forbearance information that is “incomplete, inconsistent, dated, and unclear. ” Are Loan Servicers Trying to Discourage Forbearance? The CARES Act requires loan servicers to provide mortgage forbearance for up to 360 days on federally-backed loans That includes an initial 180 days and an additional 180-day extension if needed Borrowers are not required to pay it all back in one lump sum But there’s a lot of misinformation out there, even on loan servicers’ websites The CARES Act allows homeowners to request forbearance for 180 days, followed by an additional 180 days if need be. Effectively, borrowers can put 12 mortgage payments on hold while they deal with financial disruptions directly or indirectly related to the coronavirus epidemic (COVID-19). Additionally, not much is needed from the homeowner other than a request for forbearance via a letter or perhaps a phone call, with no proof of hardship actually required. This has led to an outcry from some pundits who believe it’s too easy to get mortgage assistance, even if you really haven’t experienced a decline in income at all. But the HUD OIG’s report claims some loan servicers aren’t doing... --- > Today we’ll review NewDay USA, a mortgage lender that is geared specifically toward veterans and active duty military. Like other mortgage companies, they - Published: 2020-04-29 - Modified: 2024-07-24 - URL: https://www.thetruthaboutmortgage.com/newday-usa-mortgage-review-a-mortgage-company-designed-for-veterans/ - Categories: Refinance Today we’ll review NewDay USA, a mortgage lender that is geared specifically toward veterans and active duty military. Like other mortgage companies, they offer both home purchase loans and refinance loans, but only those backed by the United States Department of Veterans Affairs (VA) and the Federal Housing Administration (FHA). Let’s discover more about this company, whose goal is to become one of the largest VA lenders in the country. NewDay USA Quick Facts Top-10 VA mortgage lender headquartered in Fulton, Maryland Founded in 1998 by current CEO Rob Posner Direct-to-consumer company offering VA loans and FHA loans A Ginnie Mae (GNMA) approved issuer/servicer Licensed to lend in 43 states and the District of Columbia Originated around $2. 5 billion in 2019 How to Apply with NewDay USA NewDay USA is a direct-to-consumer mortgage lender. This means you work directly with a loan officer at their company to obtain your mortgage. To get started, you fill out what amounts to a lead form and then a loan officer will contact you to go over your options and eligibility. You enter basic information including the type of loan you’re looking for, property type, estimated home value, property address, name, and contact info. It’s also possible to call the company directly or fill out a much shorter contact form if you’re interested in getting a loan. Unfortunately, they don’t seem to offer the ability to apply for a home loan directly on their website. So you will need to speak with a... --- > Here we go again – the latest Forbearance and Call Volume Survey from the Mortgage Bankers Association's (MBA) revealed that the total number of loans in - Published: 2020-04-28 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/mortgage-forbearance-rate-hits-7-fannie-freddie-may-offer-partial-claim-to-repay/ - Categories: Mortgage News Here we go again – the latest Forbearance and Call Volume Survey from the Mortgage Bankers Association's (MBA) revealed that the total number of loans in forbearance increased from 5. 95% to 6. 99% as of April 19th, 2020. That means roughly 3. 5 million homeowners have now asked for their mortgage payments to be put on hold due to the coronavirus epidemic (COVID-19). It’s a 17. 48% increase from a week earlier, nowhere near the first couple weekly surges, but consider that just 0. 25% of all loans were in forbearance during the week of March 2nd. As I mentioned a week ago, the percentage gains won’t sound as devastating going forward, but the number of Americans in forbearance plans keeps rising, putting a lot of stress on themselves and loan servicers. Share of FHA and VA Loans in Forbearance Nears 10% Ginnie Mae forbearance rate up to 9. 73% from 8. 26% Fannie/Freddie forbearance rate climbs to 5. 46% from 4. 64% Other loans (private-label securities & portfolio loans) forbearance rate up to 7. 52% from 6. 43% Forbearance rate 6. 52% for independent nonbanks, 7. 87% for depositories When broken down, FHA loans and VA loans continue to exhibit the worst forbearance rates relative to other home loan types. Again, this might be attributable to their lower credit score requirements, and higher loan-to-value ratios (LTVs), with the VA requiring no down payment whatsoever. These Ginnie Mae-backed mortgages had a forbearance rate of 9. 73% this week, up... --- > It’s Monday and I’ve got some good news for homeowners regarding mortgage forbearance. This morning, the Federal Housing Finance Agency (FHFA) announced, - Published: 2020-04-27 - Modified: 2020-04-27 - URL: https://www.thetruthaboutmortgage.com/fhfa-says-no-lump-sum-due-once-mortgage-forbearance-ends/ - Categories: Mortgage News It’s Monday and I’ve got some good news for homeowners regarding mortgage forbearance. This morning, the Federal Housing Finance Agency (FHFA) announced, or rather reiterated, that homeowners currently in forbearance with a Fannie Mae- or Freddie Mac-backed mortgage are not required to pay back all the missed payments in one lump sum. Rather, they’ll be given more practical options to get back on track, such as a repayment plan or a loan modification to ensure it’s affordable once the country reopens again. Why the Lump Sum Repayment Fears? Lenders often require mortgage forbearance to be paid back in one lump sum So if you miss six payments all six are due once the forbearance period ends There had been early reports of banks/lenders telling borrowers this Obviously it’s not practical for many homeowners who are out of work because of COVID-19 In normal times, banks and mortgage lenders offer mortgage forbearance to homeowners as one of their many loss mitigation tools. However, this solution is usually only good for a month or two while the homeowner either sorts out their financial issues or the loan moves into default then foreclosure. This isn’t a normal time. There are literally millions of homeowners either out of work or laid off because of the coronavirus, through no fault of their own. At last glance, about six percent of mortgages were in a forbearance plan, and more than eight percent of homeowners with an FHA loan or VA loan were in a similar boat.... --- > While it’s becoming easier to compare the housing bust that sparked the Great Recession with today’s uncertain climate, the two just aren’t the same. - Published: 2020-04-27 - Modified: 2021-08-20 - URL: https://www.thetruthaboutmortgage.com/12-reasons-todays-housing-market-is-not-the-great-recession-all-over-again/ - Categories: Housing Market, Mortgage Tips While it’s becoming easier to compare the housing bust that sparked the Great Recession with today’s uncertain climate, the two just aren’t the same. You’re probably going to see lots of articles warning of the next housing crash, claiming homeowners will be unable to pay their mortgages and forced to sell due to COVID-19. But those opinions may ignore a lot of real statistics that paint an entirely different picture. I used actual numbers from the latest Black Knight Mortgage Monitor report for February 2020 to illustrate. Greater Share of Homeowners with 10% or More in Equity First off, today’s homeowners are flush with home equity. In 2007, 14. 5% of homeowners had 10% or less in equity. Today, just 6. 6% have less than 10% equity. This is due to several years of strong appreciation coupled with deleveraging. In other words, not tapping equity via a HELOC or a cash out refinance, while also paying down debt via regular principal and interest payments. During the early 2000s, homeowners were serially refinancing their homes while also making interest-only payments. This meant they were overleveraging themselves and often getting into loans they couldn’t actually afford due to lax underwriting standards. Loan-to-Value Ratios (LTVs) Are Lower Today To that same point, today’s loan-to-value ratios (LTVs) are a lot lower than they were a decade or so ago thanks to more prudent underwriting guidelines. The total market combined LTV (CLTV), which includes second mortgages, was 57. 4% in 2007, and just 52. 3%... --- > Back in early 2018, Quicken Loans proclaimed it was the largest mortgage lender in the country, thanks to a solid fourth quarter in 2017. It managed to - Published: 2020-04-24 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/quicken-loans-officially-the-biggest-mortgage-lender-in-the-country/ - Categories: Mortgage News Back in early 2018, Quicken Loans proclaimed it was the largest mortgage lender in the country, thanks to a solid fourth quarter in 2017. It managed to originate $25 billion in home loans, beating out its long-time rival Wells Fargo by about $2 billion. However, there was a caveat: it only counted retail loan origination volume. Wells Fargo does a ton of correspondent mortgage lending as well, whereby its product is resold by other banks. When taken together, the San Francisco-based bank was still the king, and by quite a large margin. But that has finally changed. Quicken Funded Nearly $52 Billion in the First Quarter Detroit-based Quicken Loans originated $51. 7B in home loans during Q1 Company increased their lending slightly from the fourth quarter San Francisco-based Wells Fargo only managed $48B over same period A near-20% decline from the fourth quarter of 2019 In the first quarter, Quicken Loans reported $51. 7 billion in home loan originations, pushing it to the top of the rankings of the first time ever, per new figures from Inside Mortgage Finance. While the Detroit-based nonbank lender has been referring to itself as “America’s Largest Mortgage Lender” since overtaking Wells on retail originations, it is now truly the #1 mortgage lender across all lending channels. Quicken Loans only saw “a modest increase in first-lien mortgage production” from quarter to quarter, but it was more than enough to finally give them the out-and-out crown. That’s because Wells Fargo saw originations slip 20% from the... --- > While the first quarter was booming for many mortgage lenders (see Quicken's record month), the second quarter and beyond might be a different story as - Published: 2020-04-23 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/its-going-to-be-harder-to-get-a-mortgage-thanks-to-covid-19/ - Categories: Mortgage News, Mortgage Rates While the first quarter was booming for many mortgage lenders (see Quicken's record month), the second quarter and beyond might be a different story as COVID-19 becomes a harsher reality. Over just the past five weeks, some 26. 4 million Americans have filed for unemployment. And that number is likely to grow, forcing more and more loans into forbearance. Yesterday, the Federal Housing Finance Agency (FHFA) that oversees Fannie Mae and Freddie Mac said it would allow the pair to buy mortgages in forbearance, but with a big catch. They are tacking on loan level pricing adjustments (LLPAs) of anywhere from 5% to 7%, which is a huge cost for lenders that unload their loans on the secondary market. Ultimately, this new bone thrown out to loan servicers isn’t as good as expected, and for some probably totally worthless. The exorbitant cost essentially makes it a lifeline to stay afloat, but not a practical option to keep pumping out new loans that immediately go into forbearance. How Will Lenders Deal with New Mortgages That Sour Quickly? Most lenders sell off their home loans on the secondary market quickly after origination It's a profitable business model as many loans stay current and investor appetite is strong But they may need to increase mortgage rates to absorb some of the risk of near-term forbearance And/or implement even harsher underwriting standards to improve credit quality to mitigate risk We’ve already seen some big depository banks roll out tougher mortgage underwriting guidelines. For example,... --- > While the CARES Act has allowed millions of homeowners nationwide to put their mortgage payments on hold, doing so has left lots of questions for mortgage - Published: 2020-04-22 - Modified: 2020-04-22 - URL: https://www.thetruthaboutmortgage.com/fannie-mae-and-freddie-mac-agree-to-buy-mortgages-in-forbearance/ - Categories: Foreclosure, Mortgage News, Refinance While the CARES Act has allowed millions of homeowners nationwide to put their mortgage payments on hold, doing so has left lots of questions for mortgage lenders. One being how they’d continue to pay investors while the loans they service were in forbearance. The FHFA clarified that piece yesterday by agreeing to only hold servicers to the first four missed payments. But how do they originate new loans if borrowers turn around and stop paying right away? Will lenders be punished, even if they had no idea these homeowners would immediately request forbearance? Fannie and Freddie Will Temporarily Buy/Securitize Loans in Forbearance Lenders can now sell or securitize their new mortgages even if in forbearance This is a temporary policy aimed at keeping the mortgage market liquid Loans must still meet the general requirements of Fannie Mae and Freddie Mac Eligible loans will be priced to mitigate the heightened risk of loss to the GSEs To alleviate some of that concern, both Fannie Mae and Freddie Mac (the GSEs) have announced a temporary policy to purchase mortgages actively in forbearance plans, counter to their long-held position. Typically, mortgage loans that are either delinquent or in forbearance are ineligible for delivery under Fannie/Freddie requirements. However, things are far from typical at the moment thanks to the coronavirus (COVID-19). In short, some borrowers have sought mortgage forbearance just after closing on their loan, before the lender could actually deliver it to the GSEs. This put lenders in a bad spot if they... --- > With each week that goes by, the mortgage forbearance rate climbs to new highs thanks to the coronavirus (COVID-19). The more or less complete shutdown of - Published: 2020-04-21 - Modified: 2020-04-21 - URL: https://www.thetruthaboutmortgage.com/nearly-6-of-mortgages-in-forbearance-as-fhfa-provides-relief-to-loan-servicers/ - Categories: Foreclosure, Mortgage Rates With each week that goes by, the mortgage forbearance rate climbs to new highs thanks to the coronavirus (COVID-19). The more or less complete shutdown of the world economy has led to skyrocketing unemployment and the inability for many to make ends meet, including the monthly rent or mortgage payment. While it’s unclear how bad it will get, the trajectory is very much on the up and up, and it could get a lot worse once May hits and those on the fence turn to their loan servicers as well. Mortgage Forbearance Rate Increased Nearly 60% From a Week Ago Home loans in forbearance increased to 5. 95% from 3. 74% 8. 26% of Ginnie Mae mortgages (FHA/USDA/VA) in forbearance 4. 64% of Fannie/Freddie mortgages in forbearance Upside is hold times and call abandonment rates have both gone down considerably The mortgage forbearance rate rose 59. 1% during the week ending April 12th, from 3. 74% to 5. 95%, per the latest MBA weekly survey. While the percentage gains will understandably drop as more enter forbearance plans, it’s still a pretty nasty spike. So even if the forbearance rate only climbs 30% next week, it would still mean nearly eight percent of all mortgages would effectively be on pause. In other words, look at the total percentage of loans in forbearance, and pay less attention to the weekly gains as time goes on. Like prior weeks, Ginnie Mae-backed home loans continue to fare worst, with FHA loans, USDA loans, and... --- > Necessity is the mother of innovation, and with that comes the so-called “Livestream Open House,” which has just been launched by Realtor.com in the face - Published: 2020-04-20 - Modified: 2021-08-20 - URL: https://www.thetruthaboutmortgage.com/introducing-the-livestream-open-house/ - Categories: Housing Market, Mortgage News Necessity is the mother of innovation, and with that comes the so-called “Livestream Open House,” which has just been launched by Realtor. com in the face of COVID-19. To combat the ill effects of the coronavirus on the housing market, companies have been stepping up efforts to introduce new tech that allows consumers to continue pursuing the American Dream. A few weeks back, Clear Capital announced the release of OwnerInsight, a new tool that lets homeowners take interior pictures of their home like an appraiser normally would. This allows for social distancing to be adhered to, even while the home buying and selling process goes on. What Is a Livestream Open House? An open house that is broadcasted online in real-time via a video platform Allows listing agents to show multiple home shoppers around the property Buyers can ask the agent questions and request to see specific home features up-close It is scheduled in advance just like a normal open house Now we’ve got the Livestream Open House, which as the name denotes, allows real estate agents to continue showing property listings while maintaining proper distance. There had been reports of open houses still going on in some areas of the country, but with social distancing measures in place and probably a lot of nervous people in masks. Redfin CEO Glenn Kelman wrote about one in Hoboken, New Jersey, where six groups of potential home buyers were being staggered like a Disneyland ride. But in today’s day and age, that’s... --- > We’re now getting more information on just how many Americans might be receiving mortgage relief due to the crippling effects of coronavirus. It’s only - Published: 2020-04-17 - Modified: 2020-04-24 - URL: https://www.thetruthaboutmortgage.com/nearly-3-million-homeowners-already-receiving-mortgage-forbearance/ - Categories: Foreclosure, Mortgage News We’re now getting more information on just how many Americans might be receiving mortgage relief due to the crippling effects of coronavirus. It’s only been a couple weeks since mortgage forbearance programs were officially launched, including the relief that’s part of the CARES Act, which allows homeowners to pause six to 12 mortgage payments. And so far, it appears a lot of homeowners are reaching out to their loan servicers to get assistance. Part of that might have to do with the fact that you only need so much as a mortgage forbearance letter to take part. 2. 9+ Million Borrowers in Mortgage Forbearance Plans 5. 5% of outstanding mortgages are in a forbearance plan This is well above FHFA director’s predictions earlier this month If numbers keep rising it could be devastating for loan servicers Higher percentage of FHA/VA loans affected than Fannie/Freddie loans Data analytics company Black Knight has launched its own mortgage forbearance data report known as the “McDash Flash Forbearance Report” in light of the unprecedented crisis. As of April 16th, more than 2. 9 million homeowners “have entered into COVID-19 mortgage forbearance plans,” which represents 5. 5% of all outstanding mortgages. This is a lot higher than what FHFA director Mark Calabria predicted back in early April, when he said there’d only be 700,000 missed payments for the overall market in April. We are already at over four times that if the extrapolated data from Black Knight’s sample set of loans is accurate. And it’s... --- > The current solution for those struggling to make mortgage payments due to COVID-19 is mortgage forbearance. It allows homeowners to “pause” mortgage - Published: 2020-04-16 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/could-a-cash-out-refinance-be-a-better-solution-than-mortgage-forbearance/ - Categories: Foreclosure, Mortgage News, Refinance The current solution for those struggling to make mortgage payments due to COVID-19 is mortgage forbearance. It allows homeowners to “pause” mortgage payments for anywhere from six to 12 months while their income is reduced or completely nonexistent. Once it comes to an end, the homeowner must repay the missed payments, either by making a lump sum payment or getting on some kind of repayment plan. But what about instead of forbearance, the borrower simply executed a cash out refinance and used the proceeds to cover expenses until they got back on track? This is an interesting idea floated by Urban Institute VP Laurie Goodman and Brookings fellow Aaron Klein. While taking on more debt doesn’t sound like the most sensible plan when you already can’t make ends meet, homeowners are currently sitting on a mountain of home equity. During the previous housing crisis, a streamlined refinance program called the Home Affordable Refinance Program (HARP) was implemented to lower monthly mortgage payments for roughly 3. 4 million Americans. It allowed homeowners to refinance even if they didn’t have sufficient equity in their home, or in most cases, negative equity. And they could do so with limited documentation and no home appraisal. The argument was that it didn’t increase risk to Fannie Mae and Freddie Mac because these homeowners wound up with lower monthly payments, even if they didn’t traditionally qualify for a mortgage refinance. Homeowners Don’t Have Cash, But They’ve Got Equity Today, we face a different challenge – homeowners... --- > The so-called “coronavirus checks” have begun to hit Americans’ bank accounts this week, providing relief to those whose income has been curtailed or - Published: 2020-04-15 - Modified: 2020-04-15 - URL: https://www.thetruthaboutmortgage.com/stimulus-checks-barely-make-dent-in-mortgage/ - Categories: Mortgage News The so-called “coronavirus checks” have begun to hit Americans’ bank accounts this week, providing relief to those whose income has been curtailed or completely cut. It might be especially helpful to those who need to pay rent or make a monthly mortgage payment, the latter of which can be pushed back as late as the 15th of the month in most cases. But just how far can the stimulus check go toward covering a rent or mortgage payment? Well, that totally depends on where you live. Those with an adjusted gross income of up to $75,000 get the full $1,200 offered by the government. It’s even higher ($2,400) for married couples making $150,000 or less, and potentially much higher for married couples or heads of household with young dependents. Stimulus Checks Go Further on Rent than the Mortgage 77% of American renters could cover a month’s housing expenses with $1,200 check 47% of homeowners could pay their mortgage with the same check Share of homeowners who could make housing payment significantly higher in Indy (66%) Check would do very little to pay mortgage for most San Jose, CA homeowners (6%) First off, 77% of renters could cover one month’s worth of housing expenses with a $1,200 check, versus just 47% of homeowners, per a new analysis by real estate brokerage Redfin. The median monthly rent in the U. S. is $1,058 – it’s as low as $804 in Cleveland, Ohio, and as high as $2,283 in San Jose, California. As... --- > The nation’s top retail mortgage lender just knocked it out of the park, despite the ongoing coronavirus pandemic. Quicken Loans CEO Jay Farner was on - Published: 2020-04-15 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/quicken-loans-just-had-its-biggest-month-in-history/ - Categories: Mortgage News, Refinance The nation’s top retail mortgage lender just knocked it out of the park, despite the ongoing coronavirus pandemic. Quicken Loans CEO Jay Farner was on CNBC’s “Squawk Box” this morning to discuss the state of the industry, along with how his company is faring so far. And it appears they’re doing just fine, based on the massive numbers he threw out. March Was Quicken’s Best Month Ever Company funded nearly $21B in mortgages in March A new record for the direct-to-consumer mortgage lender Funded close to $53B in the first quarter Estimated near-$75B in mortgage applications for second quarter Let me preface this with the fact that there is a time lag for mortgage fundings, since they typically take 30-45 days from application to close. In other words, March’s numbers are based on mortgage applications that came in the door in late January or February, before our country shutdown due to COVID-19. That being said, Farner said Quicken Loans nearly funded a record $21 billion in home loans in March, its best month ever. And for the first quarter, did close to $53 billion in mortgage volume, which puts it on pace for a record year. It could also be enough to surpass Wells Fargo on total home loan volume, if you consider the San Francisco-based bank’s sizable correspondent lending business that is included in the overall numbers. The fact that Wells is pulling back on correspondent business while Quicken seems to be growing could be very good news for... --- > Well, another week has gone by, and with that a new wave of mortgage forbearance requests. The total number of home loans now in forbearance is 3.74%, up - Published: 2020-04-14 - Modified: 2021-08-07 - URL: https://www.thetruthaboutmortgage.com/mortgage-forbearance-rate-worsens-but-most-probably-wont-lose-their-homes/ - Categories: Foreclosure, Mortgage News Well, another week has gone by, and with that a new wave of mortgage forbearance requests. The total number of home loans now in forbearance is 3. 74%, up from 2. 73% a week earlier, per the latest Mortgage Bankers Association's (MBA) Forbearance and Call Volume Survey. That’s a 37% increase week to week, which while not as massive as the initial report, is still quite grim. To remind you, the total number of mortgages in forbearance had been just 0. 25% during the week of March 2nd. All told, we’re looking at a 1,396% increase in the total number of loans in forbearance, which is pretty staggering. It tells you that mortgage loan servicers are going to be under immense pressure without a liquidity backstop in place to protect them. FHA and VA Loans Continue to Post Highest Forbearance Rates Ginnie Mae forbearance rate rises to 5. 89% from 4. 31% Fannie/Freddie forbearance rate up to 2. 44% from 1. 69% Phone hold times with loan servicers decreased to 10. 3 minutes from 13 minutes Abandonment rates (hang-ups) declined to 17% from 21% Just like last week, Ginnie Mae backed home loans fared worst, which includes FHA loans, VA loans, and USDA home loans. The forbearance rate for such loans increased to 4. 31% to 5. 89%, meaning nearly six percent of homeowners with those types of mortgages now have their monthly mortgage payments frozen. The silver lining is Ginnie Mae took action and made changes to its existing... --- > Following in the footsteps of many other mortgage lenders of late, JP Morgan Chase has upped its minimum requirements to get a home loan. Once again, it - Published: 2020-04-13 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/chase-now-requires-a-700-fico-and-20-down-to-get-a-new-mortgage/ - Categories: Mortgage News, Refinance Following in the footsteps of many other mortgage lenders of late, JP Morgan Chase has upped its minimum requirements to get a home loan. Once again, it has to do with COVID-19, which has led to a flood of unemployment filings and a general fear that many homeowners will begin to default on their mortgages. This has forced many big banks and mortgage lenders to tighten their belts, focusing on extending new loans to only those they see as the most creditworthy. In case you missed it, last week Wells Fargo said it now required $250,000 in a Wells bank account to get approved for a jumbo home loan. Chase’s New Mortgage Guidelines New customers will need to come with at least 20% down when purchasing a home Will also need a minimum FICO score of 700 to get approved Move is designed to limit exposure related to COVID-19 pandemic Also allows Chase to focus on its refinance customers Beginning this Tuesday, those who apply for a “new mortgage” will be required to make at least a 20% down payment and have a 700+ FICO score, per Reuters. While it’s somewhat unclear what a “new mortgage” is, the down payment piece points to a home purchase application, as opposed to a mortgage refinance, which comes with a minimum loan-to-value ratio. The “new” part refers to those who aren’t already Chase customers, such as a home buyer who doesn’t already have a Chase mortgage. It might also include an existing homeowner... --- > Today we’ll take a hard look at Citizens Bank Mortgage, which is operated by one of the oldest and largest banks in the United States (Citizens Financial - Published: 2020-04-09 - Modified: 2025-06-02 - URL: https://www.thetruthaboutmortgage.com/citizens-bank-mortgage-review/ - Categories: Mortgage Tips Today we’ll take a hard look at Citizens Bank Mortgage, which is operated by one of the oldest and largest banks in the United States (Citizens Financial Group). As of the second quarter of 2024, they were ranked the 20th largest retail bank in the U. S. , with $220 billion in assets. They also happen to run a robust mortgage operation, with a better-than-average variety of home loan options. This includes fixed-rate programs, adjustable-rate programs, construction loans, and a home equity line of credit product. Citizens Bank Mortgage Fast Facts Headquartered in Providence, Rhode Island 20th largest retail bank in the U. S. with 1,100 branches nationwide Owns Franklin American Mortgage Company which provides correspondent and wholesale mortgage lending Typically a top-25 mortgage lender nationally Much of their home loan lending takes place in East Coast states like New York and Rhode Island They originate a high percentage of home purchase loans and ARMs They have roughly 1,100 physical branches across 14 states in New England, the Mid-Atlantic region, and the Midwest. Outside of the bank’s 14-state branch footprint, they refer to themselves as "Citizens One Home Loans. " The company also counts Franklin American Mortgage Company as one of its businesses, which offers both correspondent lending and a wholesale division to serve mortgage brokers. In 2018, Franklin American Mortgage Company did roughly $3. 2 billion in total loan volume, with much of it via home purchase financing. The majority of the lending was concentrated in the states of... --- > While it’s hard to compare the current possible housing crisis to the very real one experienced about a decade ago, there are fears of negative market - Published: 2020-04-08 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/which-housing-markets-are-most-at-risk-from-covid-19/ - Categories: Foreclosure, Housing Market, Mortgage News While it’s hard to compare the current possible housing crisis to the very real one experienced about a decade ago, there are fears of negative market impact due to COVID-19. We’ve already seen listing prices fall, along with a big jump in delistings, where home sellers pull their properties off the market. And home purchase mortgage applications continue to plummet, especially in large metros like LA, NY, and Seattle, per the MBA. Meanwhile, real estate brokerage Redfin revealed via an SEC filing that it was laying off 7% of its workforce, which could result in roughly 236 job losses. Then we have Wells Fargo curtailing its mortgage menu, and ARMs pricing higher than fixed-rate mortgages. The number of mortgages in forbearance has also surged 1000%, and is likely to get a lot worse the longer this goes on. The real estate and mortgage industry certainly isn't operating as usual, and it's even reminiscent of times back in the early 2000s. Temporary Inability to Pay the Mortgage? The housing crisis a decade ago was driven by shoddy financing Such as stated income, option ARMs, interest-only loans, and so on This potential crisis is being driven mostly just by loss of income due to COVID-19 As long as it's temporary it shouldn't create too many problems for the housing market This time around, the number one issue is inability to make mortgage payments due to loss of income or unemployment as a result of coronavirus. Either companies have laid off staff due... --- > At this point, most homeowners have probably heard of the CARES Act and its massive 12-month forbearance option for those with federally-backed mortgages. - Published: 2020-04-07 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/how-is-mortgage-forbearance-paid-back/ - Categories: Foreclosure At this point, most homeowners have probably heard of the CARES Act and its massive 12-month forbearance option for those with federally-backed mortgages. It sounds pretty sweet – you can request six mortgage-free months, followed by an additional six months if you need it, with little paperwork or evidence of hardship from COVID-19. Apparently, all you need is a mortgage forbearance letter and you should be good to go, assuming loan servicers don’t revolt and balk at the sheer number of requests that flood through the door. Does Mortgage Forbearance Need to Be Repaid? Yes, homeowners are expected to repay the missed mortgage payments Loan servicers are NOT waiving payments, they are offering to delay them The big question is how and when are homeowners supposed to catch up Especially if the homeowner loses their job permanently or severely depletes their assets along the way The million-dollar question is how will the skipped mortgage payments be paid back. Remember, these aren’t waived mortgage payments, they are delayed mortgage payments. You are getting a brief moratorium on payments while furloughed or out of work, after which time you must make good on those missed payments, assuming you do get back to work. Everything is working on the assumption that this is a temporary situation, unlike the mortgage crisis a decade ago that was driven by fundamental issues, like sketchy mortgage financing and overpriced homes. Most homeowners could afford to make their mortgage payments in the normal, pre-COVID-19 world, so once this... --- > While estimates have ranged from two million to 12.5 million, we’re now getting our first clues as to just how many homeowners will request mortgage - Published: 2020-04-07 - Modified: 2020-04-07 - URL: https://www.thetruthaboutmortgage.com/number-of-mortgages-in-forbearance-jumps-by-nearly-1000/ - Categories: Foreclosure, Mortgage News While estimates have ranged from two million to 12. 5 million, we’re now getting our first clues as to just how many homeowners will request mortgage forbearance from their loan servicer due to COVID-19. And so far, it doesn’t look too good, which might be a result of the many mortgage relief programs being offered, along with the ease at which one can qualify under programs like the CARES Act. Early Forbearance Numbers Look Pretty Grim Total number of home loans in forbearance up to 2. 66% from 0. 25% Mortgages backed by Ginnie Mae up to 4. 25% from 0. 19% FHA, USDA, and VA loans faring the worst so far Independent mortgage bank (IMB) servicers have largest share of loans in forbearance at 3. 45% A new survey from the Mortgage Bankers Association known as the “Forbearance and Call Volume Survey” paints a grim picture for the mortgage market in the face of COVID-19. From March 2nd to April 1, 2020, the total number of home loans in forbearance increased from just 0. 25% to 2. 66%, or 964%. The MBA's survey data covers roughly 22. 4 million serviced loans, which accounts for nearly half (45%) of the first-lien mortgage servicing market. So it should give us a pretty good idea of what’s happening out there. By investor type, Ginnie Mae loans have fared the worst so far, with the forbearance rate climbing from 0. 19% to 4. 25%. FHFA boss Mark Calabria actually called this one when... --- > In yet another sign that the mortgage market is completely volatile and far from liquid, top mortgage lender Wells Fargo has severely tightened its jumbo - Published: 2020-04-06 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/wells-fargo-will-only-give-you-a-jumbo-loan-if-you-have-250k-in-their-bank/ - Categories: Mortgage News, Refinance In yet another sign that the mortgage market is completely volatile and far from liquid, top mortgage lender Wells Fargo has severely tightened its jumbo loan guidelines. Going forward, the San Francisco-based bank now requires customers to have $250,000 in liquid assets in a Wells account in order to get approved for a jumbo home loan, per the WSJ. Before this immediate market-driven change, I don’t believe there was any such rule in place, other than asking that the customer meet typical reserve requirements. At the same time, Wells stopped buying jumbo loans from other banks by eliminating the product from their correspondent lending menu. This means banks that resell Wells Fargo’s jumbo loan can no longer do so until told otherwise. The bank has also reportedly stop offering cash out refinances, and has placed restrictions on HELOCs. Update: You now apparently need $1 million in new deposits at Wells Fargo to get a jumbo refinance loan with the bank if you're a new customer. Additionally, they've lowered max LTVs across the board by 5% on all products. The move is intended to reduce risk and slow business since they're already overwhelmed. However, existing Wells Fargo customers will no longer need to jump through these hoops, so it's a trade-off. Why So Strict on the Jumbos? Wells won't give you a jumbo loan unless you have $250k in one of their bank accounts New rule only applies to refinance loans, not purchase home loans Reflects the lack of liquidity in... --- > Quick mortgage tip: “How do I know if Fannie Mae or Freddie Mac owns my mortgage?” One of the key requirements to getting approved under the CARES Act to - Published: 2020-04-03 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/how-do-i-know-if-fannie-mae-or-freddie-mac-owns-my-mortgage/ - Categories: Mortgage Tips Quick mortgage tip: “How do I know if Fannie Mae or Freddie Mac owns my mortgage? ” One of the key requirements to getting approved under the CARES Act to receive mortgage forbearance is ensuring that your loan is indeed owned or guaranteed by Fannie Mae or Freddie Mac. If it isn't, you might still be eligible for mortgage relief as long as your loan is backed by the FHA, USDA, or VA. For those explicit government loans, it's a little more straightforward. Knowing who owns your loan can also be helpful to determine if you're eligible for a particular loan modification, or if you can pursue certain foreclosure prevention options via each agency. Fortunately, the pair has made it very simple to find out if your mortgage is owned or backed by either. Fill Out the Short Form To find out if Fannie Mae or Freddie Mac own your mortgage All you have to do is fill out a short form on their website You will be notified immediately if they do or do not own it If they do you'll be directed to options for assistance All you have to do is fill out a short form with your name, last four of your social, and property address, and they'll let you know immediately if they own your home loan. You will receive one of two status messages. Either that no matches were found, or that a match was indeed found. If it's the latter, you may be... --- > You may (or may not) have heard that the CARES Act is allowing a huge chunk of homeowners to request forbearance for six to 12 months of mortgage - Published: 2020-04-02 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/generate-a-mortgage-forbearance-request-letter-with-this-free-tool/ - Categories: Foreclosure, Mortgage News You may (or may not) have heard that the CARES Act is allowing a huge chunk of homeowners to request forbearance for six to 12 months of mortgage payments. If you haven’t heard, you can review the details here, but the takeaway is that anyone with a federally-backed mortgage who has been economically affected by COVID-19 is eligible. And like other mortgage relief programs that have been rolled out by various private banks and state governors, the forbearance won’t hurt your credit score/history, nor will you pay penalties or fees. It’s still somewhat unclear what happens after the forbearance period ends, but the CARES Act did stipulate that you can’t be charged interest beyond what would have been due had you remained current on your loan. For me, that means the missed mortgage payments get added to the end of the loan term, effectively putting the mortgage on hold. But that’s just my opinion, and the whole thing is still a bit fluid and confusing. Even the experts are trying to make sense of it all. Another key point is that you don’t need to provide any documentation of hardship to receive the forbearance. You simply need to attest to your loan servicer that you’re experiencing a financial hardship due to the COVID-19, and request relief. Hello Lender Generates Free Mortgage Forbearance Request Letters Free tool generates a letter to send your loan servicer for mortgage assistance Simply answer a handful of questions and it does the rest You will... --- > Housing supply was bad before the coronavirus epidemic reared its ugly head, and now it has gotten even worse, per new data from real estate brokerage - Published: 2020-04-02 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/home-delistings-increase-148-from-a-year-ago-as-covid-19-impact-grows/ - Categories: Housing Market, Mortgage News Housing supply was bad before the coronavirus epidemic reared its ugly head, and now it has gotten even worse, per new data from real estate brokerage Redfin. Homes Flying Off the Market 28,140 homes were taken off the market before selling in the past week That represents a 148% year-over-year increase in delistings Even worse in cities of Chicago, Los Angeles, and Philadelphia Some cities not yet impacted as stay at home orders finally go into effect this Friday The company noted that home delistings, where home sellers pull their properties off the market, increased 148% during the week of March 29th, compared to a year earlier. And during that seven-day period, nearly 4% of active listings were taken off the market, which is roughly twice the typical rate. It was even worse in the cities of Chicago, Los Angeles, and Philadelphia, where 6% of listings were pulled. All of those hard-hit cities have a shelter in place mandate, so it’s clearly not the best time to sell a home. Conversely, Atlanta only saw 2% of active homes delisted, which might be related to their lack of stay at home orders until this Friday. Once implemented, the delisting trend will likely catch up to homes in Georgia as well. New Real Estate Listings Have Also Declined Just 58,366 new for-sale listings nationwide last week Down 33% from the same week in 2019 Comes as traditional spring home buying season kicks into gear Detroit and Philadelphia saw worst of it with... --- > So I received an unmarked piece of mail the other day, and whenever that happens, I know it’s going to contain some kind of nonsense. Upon opening the - Published: 2020-04-01 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/ive-been-offered-the-opportunity-to-skip-two-mortgage-payments/ - Categories: Mortgage Tips So I received an unmarked piece of mail the other day, and whenever that happens, I know it’s going to contain some kind of nonsense. Upon opening the letter, which I could have easily just thrown away, I discovered that it was a mortgage solicitation. Fun! More specifically, it was a refinance offer from a random mortgage company I'd never heard of. It began by informing me that their “loan restructuring team” had reviewed my home loan and determined that I might be able to refinance my mortgage to a new low rate. Sweet! Although I think they’d have a lot of trouble getting my mortgage interest rate any lower. Even better, they mentioned that as an added “bonus,” I might get the opportunity to skip one or even two mortgage payments. Wow! That’s amazing! However, they cautioned that they receive high call volume, so to leave a message if I don’t get a live rep on the phone... Skip a Mortgage Payment or Skip Writing a Check? Ever heard of skipping a mortgage payment? It's a common sales pitch used by mortgage brokers and loan officers to excite homeowners Often listed as one of the many benefits of refinancing But do you really skip a mortgage payment or simply delay it? Here’s the thing with skipping mortgage payments. It’s kind of a misnomer because you don’t really skip a payment, you skip writing a check to your lender, or sending a monthly payment electronically. In reality, you still pay... --- > It’s the first of the month, and with that comes fear and uncertainty that both homeowners and renters won’t be able to make payments due to loss of - Published: 2020-04-01 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/how-many-homeowners-are-expected-to-miss-mortgage-payments-due-to-coronavirus/ - Categories: Foreclosure, Housing Market, Mortgage News It’s the first of the month, and with that comes fear and uncertainty that both homeowners and renters won’t be able to make payments due to loss of income related to the coronavirus. While it’s not clear how bad things will get just yet, CNBC interviewed FHFA director Mark Calabria to get some preliminary numbers, which he himself called “very rough” and subject to change quickly. Two Million Missed Mortgage Payments by May 300,000 missed payments for Fannie/Freddie owned loans in April 700,000 missed payments for overall market in April Jumps up to 1M and 2M respectively by May Expected to be worse for government loans backed by FHA/VA He currently estimates that roughly 300,000 home loans backed by Fannie Mae and Freddie Mac could go delinquent in April, which is just over 1% of their book. For the overall mortgage market, he said that translates to roughly 700,000 delinquent home loans. By May, those numbers jump up to one million and a little more than two million missed payments, respectively. He sees more stress in FHA/VA loans due to their lower credit score requirements, higher DTI ratios, and so on. While it sounds pretty dire, Calabria was quick to point out that it only represents somewhere between 3-5% of the market, and that he’s "not seeing worst-case scenarios. " This is counter to a comment made by MBA chief economist Mike Franantoni, who warned that if a quarter of U. S. homeowners (~12. 5 million households) sought six months... --- > To further complicate the complicated mortgage relief picture surrounding the coronavirus outbreak, Fannie Mae and Freddie Mac have released their new - Published: 2020-03-26 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/fannie-mae-and-freddie-mac-roll-out-new-payment-deferral-option/ - Categories: Foreclosure, Mortgage News To further complicate the complicated mortgage relief picture surrounding the coronavirus outbreak, Fannie Mae and Freddie Mac have released their new “payment deferral” option early. Originally slated to roll out on January 1st, 2021, the pair are encouraging loan servicers to begin evaluating eligible borrowers on or after July 1st, 2020. Note that this relief option isn't directly related to COVID-19, but can be a practical solution. What Is Fannie/Freddie’s Payment Deferral Option? A loss mitigation option that sets aside 1-2 missed mortgage payments Missed payments are placed in a non-interest bearing unpaid balance (UPB) The UPB is paid back once the loan reaches maturity, or if mortgage refinanced/home sold before then You have to be delinquent but back to making regular mortgage payments to take part In short, it’s a new loss mitigation solution that Fannie Mae and Freddie Mac can offer to borrowers who missed one or two mortgage payments, but are now able to pay their mortgage each month. If utilized, the past-due principal and interest (P&I) payments are set aside as a non-interest bearing unpaid balance (UPB). So imagine your monthly mortgage payment is $2,000 per month and you missed two payments due to unemployment related to the coronavirus epidemic. That $4,000 would be deferred and would only be due at the end of the mortgage term, or earlier if you sold your home or refinanced your mortgage. Importantly, you’d have to already be delinquent in order to receive this type of relief, which is obviously... --- > As reported earlier this week, some important pieces of the home loan process have been disrupted by the ongoing and seemingly intensifying coronavirus - Published: 2020-03-26 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/clear-capitals-new-ownerinsight-tool-lets-homeowners-fill-in-appraisal-gaps/ - Categories: Mortgage News As reported earlier this week, some important pieces of the home loan process have been disrupted by the ongoing and seemingly intensifying coronavirus epidemic. One issue has been home appraisals, which are required for most mortgages and often require a human being to enter the subject property to take photos and inspect the condition of the home. Due to social distancing measures and shelter in place mandates in many cities and states nationwide, this has become increasingly difficult in certain areas the country. Even if business is permitted, it might make either party uncomfortable, rightfully so. And while the FHFA has already directed Fannie Mae and Freddie Mac to make temporary alternatives available, such as desktop appraisals and exterior-only appraisals, Clear Capital has gone a step further. Clear Capital's OwnerInsight Asks Homeowners to Be the Photographers The company, which is focused on appraisal modernization, has released a new product called OwnerInsight (being offered for free in response to COVID-19) that puts homeowners in the driving seat. Instead of someone entering your home, or the property you wish to purchase, the existing homeowner takes the interior photos and answers related questions using an easy-to-follow guide. This ensures appraisers have the information required to complete accurate appraisals, while also giving homeowners and appraisers space that allows them to comply with social distancing guidelines. OwnerInsight doesn’t require the user to download an app, and it works seamlessly on camera-enabled mobile devices, such as our everyday smartphones. Additionally, the photo metadata (time/location/etc. ) is... --- > California Governor Gavin Newsom has announced a “major financial relief package” that gives homeowners in the Golden State a three-month mortgage - Published: 2020-03-25 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/california-homeowners-now-eligible-for-90-day-mortgage-payment-relief/ - Categories: Foreclosure, Mortgage News California Governor Gavin Newsom has announced a “major financial relief package” that gives homeowners in the Golden State a three-month mortgage reprieve. Those who have been (or will be) economically impacted by the coronavirus (COVID-19) are eligible to receive a 90-day grace period on their mortgage payments. This is similar to what some individual mortgage lenders have already offered, and much like the universal mortgage relief program that has been proposed. “Millions of California families will be able to take a sigh of relief,” said Newsom in the press release. “These new financial protections will provide relief to California families and serve as a model for the rest of the nation. I thank each of the financial institutions that will provide this relief to millions of Californians who have been hurt financially from COVID-19. ” How the California Coronavirus Mortgage Relief Will Work Mortgage payments are waived for 90 days with additional relief beyond that also a possibility No negative information reported to the credit bureaus (will not impact your credit scores) Lenders will not initiate foreclosure sales or evictions for at least 60 days Any mortgage-related fees will either be waived or refunded for at least 90 days These measures go into effect as of March 25th, 2020 Participating financial institutions will provide homeowners with a streamlined process to request mortgage payment forbearance for COVID-19-related reasons. As noted, affected homeowners may receive a 90-day grace period to make their mortgage payments. These banks will also provide borrowers with the... --- > A group of mortgage industry heavyweights have sent a letter to the Federal Reserve, HUD, FHFA, CFPB, Treasury Department, and the White House advocating - Published: 2020-03-24 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/streamlined-mortgage-relief-program-could-suspend-payments-for-12-months/ - Categories: Foreclosure, Mortgage News A group of mortgage industry heavyweights have sent a letter to the Federal Reserve, HUD, FHFA, CFPB, Treasury Department, and the White House advocating for a uniform, streamlined mortgage relief program in the wake of the coronavirus outbreak. It could result in waived mortgage payments for up to 12 months for millions of Americans, without the need for much paperwork if any. However, they did stress that “those who can pay their mortgage, should pay their mortgage. ” How a Uniform Mortgage Relief Program Could Work Same assistance across all government agencies and the GSEs Limited documentation requirements Available to owner-occupants and investors Payment forbearance for 90 days initially Payment relief can be extended up to 12 months if necessary Followed by either a loan modification or the resumption of regular mortgage payments No credit hit, fees, penalties, etc. Nationwide foreclosure and eviction moratorium The mortgage relief proposal would allow all homeowners with a mortgage to receive an initial forbearance of 90 days, in which monthly payments would not be due. This would apply to those with conventional loans backed by Fannie Mae or Freddie Mac, along with those who hold a government loan, such as an FHA loan, USDA loan, or VA loan. Importantly, it would provide universal relief regardless of loan type, without the stringent documentation typically required. If we learned anything from HAMP and HARP, the last thing the industry needs is paperwork delays and bureaucratic procedures, especially with social distancing and lockdowns in place. Anyway, the... --- > The real estate market carnage continues with all the major iBuyers pausing home purchases thanks to the coronavirus. Zillow Offers Pauses Purchases This - Published: 2020-03-23 - Modified: 2021-08-20 - URL: https://www.thetruthaboutmortgage.com/top-ibuyers-stop-buying-homes-zillow-redfin-opendoor-all-on-hold/ - Categories: Housing Market, Mortgage News The real estate market carnage continues with all the major iBuyers pausing home purchases thanks to the coronavirus. Zillow Offers Pauses Purchases This morning, Zillow announced that it had stopped home buying via Zillow Offers amid the “market uncertainty” related to COVID-19. While it’s unclear if it was mandated, they did note that the move was “in response to local public health orders related to COVID-19,”and also to ensure the protection and safety of its staff, customers, and partners. Specifically, some states like California have implemented emergency orders requiring individuals to stay at home and cease all non-essential business, which includes some real estate activities. The company said it would continue to market and sell homes through Zillow Offers, despite halting open houses for its homes last week. Zillow said it ended 2019 with 2,707 homes in its inventory, and as of March 19th, had reduced it to approximately 1,860 homes. All 24 markets where Zillow Offers currently operates are affected by the move. Opendoor Cash Offers Suspended Meanwhile, Opendoor is putting cash offers on hold as a result of COVID-19. In a statement posted on their website, the iBuyer said, “If you’re currently in our offer process, be on the lookout for communication from us. If you’re not, here’s how we can still help with your home sale. ” In terms of that help, they are still allowing third parties to make a cash offer for your property, as opposed to Opendoor itself. If you take them up on... --- > Quicken Loans told customers certain parts of the loan process “can’t proceed” in areas of the country affected by shelter-in-place orders. Specifically, - Published: 2020-03-23 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/quicken-loans-warns-some-parts-of-loan-process-may-not-proceed-due-to-shelter-in-place/ - Categories: Mortgage News Quicken Loans told customers certain parts of the loan process “can’t proceed” in areas of the country affected by shelter-in-place orders. Specifically, they said home appraisals can’t be conducted while homeowners are sheltering in place, nor can rate lock requests be made. They have updated their statement saying, "Even though shelter-in-place orders are in effect in many areas of the country, the mortgage process can still continue. " Apparently, appraisers and closing agents may enter your home while under the shelter-in-place order. But if not, they say they've got alternative ways to complete these tasks. As to why you can’t lock a rate, which isn’t an in-person activity, presumably they don’t want to make commitments if the loan isn’t going to move further, especially with the current dislocations and volatility in the secondary market. They have since clarified that there's been "a slight adjustment" to their rate lock process where they can’t offer long rate locks because of the rapidly changing environment. Normally they'd lock a loan before underwriting, but to accommodate shelter-in-place orders, you’ll need to lock your rate closer to closing day in affected areas. This will likely affect both Quicken Loans and Rocket Mortgage customers. For appraisers that are still working, Quicken has taken protective measures to ensure folks don’t get sick. This includes making sure appraisers and signing agents aren’t working while showing signs of symptoms or based on recent travel and interactions. And ensuring “team members and partners understand and follow all CDC guidelines and... --- > Here comes the mortgage assistance! I honestly thought I wouldn’t be writing about this sort of stuff anytime soon, but here we are. It feels like 2009 - Published: 2020-03-20 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/bank-of-america-ally-home-offer-to-defer-mortgage-payments-due-to-coronavirus/ - Categories: Foreclosure, Mortgage News Here comes the mortgage assistance! I honestly thought I wouldn’t be writing about this sort of stuff anytime soon, but here we are. It feels like 2009 all over again. As previously blogged about, all the major housing agencies have pledged to help homeowners affected by the coronavirus, including Fannie Mae, Freddie Mac, HUD, USDA, and the VA. Now individual banks and mortgage lenders are stepping up to the plate to put a hold on mortgage payments. Good on them. Bank of America Offers Mortgage Deferment for Those Affected by Coronavirus Bank of America will defer mortgage payments for an unknown period of time Company is doing so on a case-by-case basis, may need to prove hardship Deferred payments will be added to the end of the loan Unclear if interest will be charged during deferment period First up, Bank of America is offering deferment on basically all loans and credit cards, including mortgages and home equity loans/lines. The caveat is that the mortgage or home equity loan/line must be held on the bank’s books. So if you make mortgage payments to Bank of America each month, as opposed to some other loan servicer, you might be eligible for assistance directly from them. Additionally, you need to make the request, they aren’t just freezing mortgage payments for all customers in advance. This appears to be on a case-by-case situation as well, which they said is how they’ve approached things in the past during other natural disasters or the semi-recent government... --- > CARES Act permits 6-12 month forbearance for mortgage payments on federally-backed home loans HUD has announced a foreclosure and eviction moratorium for - Published: 2020-03-19 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/mortgage-lenders-may-provide-payment-relief-due-to-coronavirus/ - Categories: Foreclosure, Mortgage News, Mortgage Rates, Refinance CARES Act permits 6-12 month forbearance for mortgage payments on federally-backed home loans HUD has announced a foreclosure and eviction moratorium for single family homeowners with FHA-insured mortgages for the next 60 days Fannie Mae has suspended foreclosure sales and borrower evictions until at least December 31st, 2020 Freddie Mac has announced the suspension of foreclosure sales and evictions until at least December 31st, 2020 VA has also announced a moratorium for borrowers affected by COVID-19 USDA Rural Development has granted authority to its lenders to help borrowers stay in their homes if they are having trouble making payments. NYS (New York State) loan servicers told mortgage payments to be WAIVED for 90 days based on financial hardship (no late fees or credit score hit) California homeowners eligible to receive a 90-day grace period on their mortgage payments Connecticut Governor has reached a deal with 50+ banks/credit unions to suspend mortgage payments for 90 days Nevada governor says vast majority of lending institutions offering homeowners 90-day grace period on mortgage payments New Jersey homeowners eligible for mortgage payment forbearance of up to 90 days Bank of America and Ally Home offer deferred mortgage payments A streamlined mortgage relief program has been proposed that would allow 12 months of mortgage forbearance Wells Fargo mortgage customers are being offering a "90-day payment suspension" Check out big list from American Bankers Association of all banks providing mortgage relief to homeowners How is mortgage forbearance paid back? COVID-19 Payment Deferral Mortgage forbearance waiting periods... --- > There’s been lots of chatter around Wall Street that this could be an unprecedented time to buy stocks on the cheap, given the market carnage related to - Published: 2020-03-18 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/is-now-the-time-to-pull-cash-out-of-your-home-and-buy-stocks/ - Categories: Mortgage Tips, Refinance There’s been lots of chatter around Wall Street that this could be an unprecedented time to buy stocks on the cheap, given the market carnage related to the coronavirus. One asset manager, Ricky Sandler of Eminence Capital, has even gone as far as to recommend that you refinance your mortgage and use the proceeds to purchase stocks. Is this a good idea, a bad idea, or a reckless idea? Well, that depends. The Dow Is Now Sub-20K A month ago, the Dow was looking like it was about hit 30,000, which would have been cause for celebration, and the unveiling of new baseball caps with “Dow 30,000” emblazoned on the front. Instead, we’re now below 20,000 as of the time of this writing, thanks to another massive drop this morning. Does anyone have those old hats lying around? For reference, the Dow first surpassed 20,000 in January 2017, so we’ve basically just erased three years of gains in the matter of a month. For the contrarians, this is an exciting development. An opportunity to buy equities at 2017 prices. But who knows what the future has in store. Are stocks going to crumble even more in the short-term? While some are calling the selloff overdone, we are living in extraordinary times. When was the last time you remember the world effectively shutting down? The last time nations across the globe closed their borders? The last time the NBA, NHL, MLB, world soccer, and virtually all movies, concerts, and restaurants came... --- > We're now getting our first indication of how the coronavirus may affect the once booming housing market, thanks to a blog post from Redfin boss Glenn - Published: 2020-03-18 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/redfinnow-temporarily-halts-offers-as-housing-market-takes-turn-for-the-worse/ - Categories: Housing Market, Mortgage News We're now getting our first indication of how the coronavirus may affect the once booming housing market, thanks to a blog post from Redfin boss Glenn Kelman. It’s not good news, as indicated by the title of this post. RedfinNow Hits the Brakes The real estate brokerage is no longer buying homes for cash Unclear how long they will pause their iBuyer business Doesn't bode well for housing market sentiment But understandable given the uncertainty surrounding coronavirus First and foremost, the company’s iBuyer unit RedfinNow is halting offers it makes on homes, per a separate 8-K filing. On the surface, the company isn’t interested in buying your home for cash anymore, at least not at the moment. This doesn’t necessarily mean they think the housing market is going to tank, but it does seem to signal some uncertainty on their part. So that’s a little bit unsettling, though perfectly understandable for a large, publicly-traded business to disclose that material event. By the way, Redfin stock has fallen from around $33 per share a month ago to just over $10 today. It fell nearly 25% on Wednesday as the coronavirus continues to ravage the economy. The company did not indicate when they’d relaunch RedfinNow, but for now, it appears to be on hold. Home Buying Demand Has Taken a Hit from Coronavirus Home buying demand was up roughly 27% in both January and February compared to last year Last week year-over-year growth fell to just 1% And in the past few... --- > There are tons of mortgage lenders out there, certainly too many to count, but Landed Home Loans is a little more unique than the rest. You see, their - Published: 2020-03-17 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/landed-review/ - Categories: Mortgage Tips There are tons of mortgage lenders out there, certainly too many to count, but Landed Home Loans is a little more unique than the rest. You see, their goal isn’t just to help Americans get a home loan. Their mission is to “help educators buy homes in expensive areas. ” And more importantly, to give these individuals “financial security near the communities they serve. ” This is a growing problem as popular cities become increasingly expensive, yet still require workers who are traditionally low-paid. Landed started with educators, but expects to roll out to healthcare workers and first responders, such as police and firefighters, at some point in the future. How Landed’s Shared Equity Down Payment Program Works Provides a portion of down payment in exchange for future home price appreciation No monthly payment is required, it is not a loan Each 1% contributed gives Landed 2. 5% of the appreciation (or depreciation) in the home They are paid back once you sell your property Unlike traditional mortgage lenders, they offer a shared equity down payment program to increase affordability and eliminate the traditional roadblock of needing a large lump sum of cash upfront. This is similar to EquityKey and the Unison HomeBuyer program. It allows home buyers to come in with a 20% down payment, which in turn eliminates the need for private mortgage insurance, and keeps the monthly payment within reach. Having a larger down payment may also make offers more successful in competitive markets where bidding wars... --- > At least not yet… As you probably know, the Fed slashed the federal funds rate to near-zero yesterday afternoon to prop up the economy as it contends with - Published: 2020-03-16 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/no-you-arent-getting-a-0-mortgage-rate/ - Categories: Mortgage News, Mortgage Rates At least not yet... As you probably know, the Fed slashed the federal funds rate to near-zero yesterday afternoon to prop up the economy as it contends with the growing coronavirus pandemic. If you read the headlines, you might falsely assume the Fed just slashed mortgage rates by a full percentage point. Combined with the half-point cut two weeks ago, you might be led to believe that mortgage rates are now truly rock bottom. But in reality, those actions had nothing to do with consumer mortgage rates. Those rate cuts were intended to help banks borrow from one another to ensure they maintain minimum reserve requirements. When that key rate is lowered, the money supply rises and lending to businesses and consumers increases, thereby spurring economic activity. That's the whole point. Didn’t the Fed Just Lower Mortgage Rates? The Fed rate cuts have no direct impact on mortgage rates They can serve as a guide for long-term rates, but the federal funds rate isn't your mortgage rate Your mortgage rate didn't just drop by 1% But the MBS buying program known as QE4 should lead to lower mortgage rates for consumers over time Ok, great, so how does this affect mortgage rates? Well, the Fed also announced the purchase of at least $200 billion in agency mortgage-backed securities (QE4), which is intended to bring down mortgage rates. However, and this is a biggie, long-term fixed mortgage rates weren’t anywhere close to zero when they announced the news. They actually hit... --- > In light of the ongoing coronavirus outbreak, which were the Federal Reserve’s very own words, the Committee took bold action to lower the target range - Published: 2020-03-15 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/the-federal-reserve-has-swooped-in-to-save-mortgage-rates/ - Categories: Mortgage News, Mortgage Rates In light of the ongoing coronavirus outbreak, which were the Federal Reserve’s very own words, the Committee took bold action to lower the target range for the federal funds rate to 0% to 0. 25%. That’s a full percentage point lower than the 1% to 1. 25% it had been previously. And comes on top of the half-point cut executed just over two weeks ago. As such, the prime rate has fallen from 4. 75% to 3. 25%. The prime rate directly affects consumers via things like credit card interest rates and home equity lines of credit (HELOC)s because they’re typically tied to that index. For homeowners with HELOCs, their interest rates will adjust down 1. 50%, which will provide meaningful monthly payment relief. But what about first-lien mortgage rates, which hit record lows a couple weeks ago, then shot back higher once the market was flooded with mortgage-backed securities (MBS). Well, the Fed also addressed that issue by effectively starting a new round of quantitative easing, which will probably be known as “QE4. ” Fed Pledges to Buy Agency MBS to Lower Mortgage Rates (QE4) Fed said coronavirus outbreak has hurt communities and disrupted economic activity in the United States To promote maximum employment and price stability it has lowered federal funds rate to 0% to 0. 25% range Also announced it will increase its holdings of Treasury securities by at least $500 billion and holdings of agency mortgage-backed securities by at least $200 billion This will lead to... --- > Today we’ll do an in-depth review of CrossCountry Mortgage, which as the name implies, is a nationally-licensed mortgage lender that offers its home loan - Published: 2020-03-12 - Modified: 2024-11-01 - URL: https://www.thetruthaboutmortgage.com/crosscountry-mortgage-review/ - Categories: Mortgage Tips Today we’ll do an in-depth review of CrossCountry Mortgage, which as the name implies, is a nationally-licensed mortgage lender that offers its home loan services in all 50 states and the District of Columbia. Given their name, it’s a good thing they do. The consumer direct mortgage lender is based out of Brecksville, Ohio and has been around since 2003. Perhaps their biggest claim to fame is the fact that they were the main lender partner of Costco Mortgage. So if you're a Costco customer, you may have come across them. Now that the Costco mortgage program has wound down, they're flying solo, but still expected to originate billions in home loans annually. Read on to learn more about this direct mortgage lender and their many offerings. CrossCountry Mortgage Fast Facts Founded in 2003 by CEO Ronald J. Leonhardt, Jr Headquarters in Brecksville, Ohio Nationally licensed direct lender in all 50 states More than 7,000 employees at over 800 branches Fannie Mae, Freddie Mac, and Ginnie Mae Approved Seller/Servicer since 2012 Funded $29 billion in home loans in 2022, 13th largest overall Also own a loan servicing portfolio worth around $2. 5B The main mortgage lender partner for Costco (program has since closed) Interestingly, CrossCountry Mortgage began as a mortgage broker before transforming into a full-scale mortgage lender themselves. Today, they claim to be a top-3 retail mortgage lender, with aspirations to go even higher over time. In 2022, they funded roughly $29 billion in home loans, with a high... --- > Today we’ll take a look at Southern California-based Lenox Financial Mortgage Corp., which also does business as WesLend Financial. First things first, be - Published: 2020-03-11 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/lenox-financial-weslend-mortgage-review/ - Categories: Mortgage Tips Today we’ll take a look at Southern California-based Lenox Financial Mortgage Corp. , which also does business as WesLend Financial. First things first, be sure not to confuse them with Atlanta, GA-based Lenox Financial, whose famous radio pitch is/was, “the biggest no-brainer in the history of earth. ” To further muddy the situation, Lenox/WesLend has a very similar slogan, a slightly slimmed down, “home of the biggest no brainer” tagline. And it appears their flagship product is also the no cost refinance. So the first step here might be differentiating the two companies and their DBA WesLend Financial. Let’s learn more about them to determine if they could be a good choice for your home loan needs. Lenox Financial/WesLend History Company founded in 1999 Headquarters are in Santa Ana, CA CEO and founder is Wesley Hoaglund Direct mortgage lender with roughly 25 loan officers Also operates a wholesale lending division and loan servicing department WesLend Financial Corp. , which is a DBA of Lenox Financial Mortgage Corporation, is a direct mortgage lender licensed in 42 states nationwide. They don’t appear to do business in Alaska, Delaware, Montana, Nebraska, Nevada, North Dakota, Wisconsin, Wyoming, or the District of Columbia at the moment. The company is a full-service mortgage banker that offers a wide variety of loan programs via both the retail and wholesale channels. They are a direct seller/servicer with Fannie Mae and Freddie Mac, and also offer all types of government home loans, including FHA, USDA, and VA loans. Lenox/WesLend... --- > Call him a party pooper, but the CEO of top retail mortgage lender Quicken Loans doesn’t expect mortgage rates to decline any further from their new - Published: 2020-03-06 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/quicken-loans-ceo-doesnt-see-the-30-year-fixed-falling-below-3/ - Categories: Mortgage News, Mortgage Rates Call him a party pooper, but the CEO of top retail mortgage lender Quicken Loans doesn’t expect mortgage rates to decline any further from their new all-time lows. If anything, Jay Farner believes they will rise over the next few weeks, per a new interview with Marketwatch. Yesterday, the 30-year fixed fell to 3. 29%, according to Freddie Mac, its lowest level on record since hitting 3. 31% in late 2012. Some lenders were already offering rates below 3% this week, namely at 2. 875%. Whether you had to pay points to get those rates was another question. Why the Pessimism on Mortgage Rates? Quicken CEO points to an otherwise very strong economy The stock market had reached all-time highs before the coronavirus outbreak So if and when good news, or even not-so-bad news arrives Mortgage rates could return to higher levels seen a couple months ago In a nutshell, Farner sees the underlying fundamentals of the economy as “very, very strong,” so much so that if anything positive surfaces, we might see a big reversal. Basically, there’s so much negativity baked into the market right now that if anything good were to happen, we could see a stock market rally and a corresponding increase in mortgage rates. “Even if they come out and say maybe the coronavirus will be a little bit worse than we thought that would bring certainty,” he told Marketwatch. At some point, there will be certainty – whether it’s enough to stop the 10-year bond... --- > If you’ve heard of Dave Ramsey, you might have come across Churchill Mortgage, which happens to be his mortgage lender of choice. Why? Because like Dave, - Published: 2020-03-03 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/churchill-mortgage-review/ - Categories: Mortgage Tips If you’ve heard of Dave Ramsey, you might have come across Churchill Mortgage, which happens to be his mortgage lender of choice. Why? Because like Dave, they believe that the real American Dream is debt-free homeownership, not a massive mortgage hanging over your head through retirement. To that end, they do things a little differently than the rest of the industry. Let’s learn more about what makes them unique. The History of Churchill Mortgage Direct-to-consumer mortgage lender founded in 1992 by Mike Hardwick Headquarters are located in Brentwood, Tennessee Employs more than 400 people with branches in dozens of states Does business in 46 states nationwide Funded more than $2 billion in home loans last year Did the most business in Tennessee, Texas, and California Their main product pitch is the money-saving 15-year fixed mortgage Churchill Mortgage is a privately-owned company that was founded in 1992, meaning it has been around for nearly 30 years. In the mortgage industry, that makes it one of the older companies still standing and/or independent, given many were lost during the Great Recession. It was founded by Lawson H. (Mike) Hardwick, III in Brentwood, Tennessee. He was previously one of the principal founders of Franklin National Bank until it was acquired by Fifth Third Bank. Today, his company has more than 400 employees across a nationwide branch network in 46 states. They don’t appear to do business in Delaware, Hawaii, Nevada, or New York. In 2019, the company originated more than $2. 2 billion... --- > In 2019, one out of every 100 homes were purchased by an iBuyer, short for instant buyer, per a new report from real estate brokerage Redfin. While it - Published: 2020-03-02 - Modified: 2021-08-20 - URL: https://www.thetruthaboutmortgage.com/just-how-popular-has-ibuying-become/ - Categories: Housing Market, Mortgage News In 2019, one out of every 100 homes were purchased by an iBuyer, short for instant buyer, per a new report from real estate brokerage Redfin. While it doesn’t sound like iBuying is catching on, consider the fact that the number is up nearly double from 0. 6% in 2018. And about 10 times higher than it was back in 2016, when virtually nobody sold their home via an iBuyer service. Also recognize that iBuying at scale is a very novel concept, and a business that big household names have just recently got involved in. Some of the larger names in the space include Offerpad, Opendoor, RedfinNow, and Zillow Offers. Simply put, an iBuyer will purchase your home for a fee somewhat similar to what a real estate agent would charge, only to rehab it and list it weeks or months later to a new buyer. The advantage is you don’t need to find an agent, list it, stage it, hold open houses, and deal with uncertainty from prospective buyers. In essence, you can consider these iBuyers institutional home flippers. If they streamline their operations enough to lower costs, they might grow even more popular and eventually displace thousands of real estate agents. iBuying Most Common in Raleigh While iBuyers still account for a tiny piece of the overall pie, they snagged a whopping 7. 3% share of home sales in Raleigh, North Carolina last year. That was nearly double the 3. 9% share reported in 2018, a testament to... --- > Today we’ll take a hard look at AmeriHome Mortgage Company, LLC, which is a direct mortgage lender based out of Southern California. Their current company - Published: 2020-03-02 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/amerihome-mortgage-review/ - Categories: Mortgage Tips Today we’ll take a hard look at AmeriHome Mortgage Company, LLC, which is a direct mortgage lender based out of Southern California. Their current company headquarters are in Thousand Oaks, CA, just north of Los Angeles. You might recognize the name from Designing Spaces on Lifetime TV, where they are featured. They have an A+ rating with the Better Business Bureau and a 4. 2/5 score with Trustpilot. But first a little background. AmeriHome History Launched in 1988 as a Michigan-based corporation Later acquired by Impac Mortgage Holdings in 2010 Sold to Aris Mortgage Holding Company LLC in 2014 Now led by CEO Jim Farush, an ex-Countrywide and PennyMac executive Acquired by Western Alliance Bancorporation in early 2021 for $1 billion The company was started way back in 1988 as a Michigan-based corporation, but has changed hands several times since then. It was later sold by Impac Mortgage Holdings in 2014 to Aris Mortgage Holding Company LLC, after becoming a redundant mortgage platform for the company. AmeriHome is now led by Jim Farush, who is also the current CEO of the company. His experience includes working as CEO for Countrywide Bank, which was the banking business that backed former #1 mortgage lender Countrywide Financial. He also helped launch PennyMac, which began as a purchaser of distressed mortgage assets, and later become a full-scale lender. Clearly he’s got a strong mortgage pedigree, so we’ll assume AmeriHome has ambitions to be one of the top mortgage lenders in the country. Now let’s... --- > An in-depth look at the difference between the mortgage interest rate and APR, including the limitations of each. - Published: 2020-02-27 - Modified: 2023-10-18 - URL: https://www.thetruthaboutmortgage.com/mortgage-rate-vs-apr/ - Categories: Mortgage Matchups, Mortgage Rates It's time for another mortgage match-up: "Mortgage rate vs. APR. " If you're shopping for real estate or looking to refinance, and you've seen a certain mortgage rate advertised, you may have noticed a second, similar percentage adjacent to or below that interest rate, possibly in smaller, fine print. But why? Well, one is the mortgage rate, which is the interest rate you'll pay every month on your home loan, which dictates what your monthly payments will be. And the other is the Annual Percentage Rate, or APR, which is the interest rate factoring in certain loan costs, such as processing, underwriting, loan origination fees, mortgage points, broker fees, and so on. Third-party loan fees, including title insurance and appraisal fees, which are provided by vendors other than the lender, typically aren't included in this figure. Understanding the difference between these two figures is very important, and they will undoubtedly come up a lot as you compare mortgage loans from different lenders. That's assuming you actually take the time to gather more than just one quote, which you absolutely should if your goal is to save money. Mortgage Rate vs. APR The APR is calculated to determine the cost of the loan It factors in lender fees and other closing costs The interest rate simply dictates how much interest you'll pay monthly, annually, and over the life of the loan And is used to calculate with what your monthly payment will be In short, the APR is a calculation used... --- > A new tech company called LemonBrew has launched its so-called “custom matching platform” to link up home buyers (and sellers) with local, expert real - Published: 2020-02-26 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/lemonbrew-launches-real-estate-agent-match-and-rebate/ - Categories: Mortgage News A new tech company called LemonBrew has launched its so-called “custom matching platform” to link up home buyers (and sellers) with local, expert real estate agents. The team behind the operation consists of “experienced entrepreneurs and operators” who work in the real estate and mortgage industry. Their goal is to create a frictionless home buying process and improve efficiencies in what is often a daunting and stressful endeavor. Initially rolled out via pilot in local markets across North Carolina and Florida last fall, LemonBrew plans to launch nationwide throughout 2020. It appears they are currently live in 15 states. The platform has a “couple thousand” Partner Agents in its database, but expects that number to climb above 50,000 by the end of the year. How LemonBrew’s Matchmaker Service Works Answer basic questions to get matched up with local real estate agents Questions include property type, budget, number of bedrooms and bathrooms If you already have a home picked out or are still looking, when you want to buy, etc. Then get top 3 matches in your area to choose from It can be difficult to choose a real estate agent. Do you go with someone a friend or family used, someone you saw in an ad, or do you respond to a flyer or freebie you received in the mail? All of those methods are pretty old school, yet still effective for agents for the time being. But are they the best approach for home buyers and home sellers? Possibly... --- > I wrote a while back that more than half of consumers switched mortgage companies when obtaining a subsequent home loan. The message was pretty clear – - Published: 2020-02-25 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/the-next-big-thing-in-mortgage-is-keeping-in-touch/ - Categories: Mortgage News I wrote a while back that more than half of consumers switched mortgage companies when obtaining a subsequent home loan. The message was pretty clear – there’s not much loyalty in the mortgage business. Ultimately, it’s hard to be loyal if there’s a better deal to be had elsewhere, or if someone else is offering to treat you better. In an effort to combat that, and improve customer retention in the homes loans business, lenders are beginning to take things a lot more seriously. Homebot Engages Past Customers with Real Data For example, last year Guild Mortgage partnered with Homebot to deliver regular, customized home financing digests to its existing customers. Their automated marketing platform allows loan officers to present past customers with relevant data, economic insights, and other market intelligence. Most importantly, it helps them stay connected with homeowners long after the mortgage has funded. As part of that agreement, Guild Mortgage’s 1,100+ loan officers have access to Homebot’s “Lender Base” software to serve its ongoing customer retention initiative. Many other mortgage lenders have also partnered up, including Planet Home Lending, Citywide Home Loans, and Cherry Creek Mortgage. HouseCanary’s ComeHome Wants Your Customers to Come Back In late 2019, HouseCanary launched ComeHome, a proprietary platform used to attract, retain and even convert customers. It creates an ongoing relationship with the homeowner that focuses on what’s probably their largest asset. The ComeHome solution allows lenders to inform homeowners of “opportunities,” such as the ability to refinance, or tap home equity... --- > Mortgage rates can be pretty volatile. Just like stocks, they can change daily depending on what’s happening in the economy. Beyond that, mortgage rates - Published: 2020-02-24 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-vs-the-coronavirus/ - Categories: Mortgage Matchups, Mortgage News, Mortgage Rates Mortgage rates can be pretty volatile. Just like stocks, they can change daily depending on what’s happening in the economy. Beyond that, mortgage rates can move based on news that doesn’t involve a report on the economic calendar, such as a jobs report, GDP, housing starts, inflation, etc. Even if there isn’t a direct financial implication to a news story, mortgage rates can go up or down. Just consider the recent conflict with Iran, which may have pushed mortgage rates down a little lower, even though it was unclear what the outcome would be. It turned out to be a short-lived situation, despite any obvious conclusion or resolution, but that’s just one of many recent examples. How the Coronavirus Could Affect Mortgage Rates Fear of a global economic slowdown has hit financial markets Dow Jones off nearly 1,000 points, Nasdaq down 350 points Investors fleeing market for safety of alternatives like bonds This has pushed the 10-year bond yield down near its all-time low Now we’re dealing with what could be seen as a global pandemic in the spread of Novel Coronavirus (COVID-19). It may or may not have originated in Wuhan, China, but it has rapidly made its way across the globe, with Italy just confirming a fifth death from the virus. The World Health Organization (WHO) hasn’t yet declared the coronavirus outbreak a pandemic, but did say it has “pandemic potential. ” In other words, there’s a lot to fear due to the unknown and the very real... --- > What a difference a decade makes, at least when it comes to paying the mortgage on time. A new report from Black Knight revealed that mortgage - Published: 2020-02-20 - Modified: 2024-01-31 - URL: https://www.thetruthaboutmortgage.com/mortgage-delinquencies-have-fallen-to-the-lowest-level-on-record/ - Categories: Foreclosure, Mortgage News What a difference a decade makes, at least when it comes to paying the mortgage on time. A new report from Black Knight revealed that mortgage delinquencies fell more than 5% in January to reach their lowest point since 2000, which appears to be as far back as the data goes. Overall, the U. S. home loan delinquency rate, which counts mortgages 30 or more days past due, but not those in foreclosure, was just 3. 22%. That was down 5. 37% from December and 14. 17% from January 2019. You can thank rising home prices, super low mortgage rates, and an improved economy for that, along with properly underwritten mortgages. Fewer Than Two Million Americans Past Due or in Foreclosure Thanks to the continuing improvement in mortgage payment behavior, there are now less than two million homeowners behind on the mortgage or in foreclosure, the lowest total since March 2005. While that’s also positive news, there was an uptick in foreclosure starts in January, perhaps related to a holiday moratorium the preceding month. Starts rose 8. 35% from December, but were still down 14. 74% from a year earlier. Meanwhile, the number of loans in active foreclosure were mostly flat month-to-month (+1,000 properties in foreclosure), and down a big 19,000 from a year ago. That left the national foreclosure rate unchanged. In total, 1,951,000 properties are either 30 or more days past due or in the process of foreclosure. Mississippi Worst When It Comes to Non-Current Mortgages While we... --- > Quontic Bank, which bills itself as an “adaptive digital bank,” has launched what they refer to as a “first of its kind” no doc home loan with loan - Published: 2020-02-19 - Modified: 2020-02-19 - URL: https://www.thetruthaboutmortgage.com/quontic-bank-launches-no-doc-streamline-mortgage-refinance/ - Categories: Mortgage News, Refinance Quontic Bank, which bills itself as an “adaptive digital bank,” has launched what they refer to as a “first of its kind” no doc home loan with loan amounts as high as $3 million. The non-Qualified Mortgage (non-QM), which is available nationwide, doesn’t require income or asset verification, similar to the loans offered during the lead up to the mortgage crisis over a decade ago. Quontic Streamline Refinance Highlights No income or asset verification Minimum credit score of 660 Must have clean 24-month mortgage payment history Max LTV of 80% Loan amounts up to $3 million Mortgage rates start at 4. 875% Closing costs may be rolled into loan Can close in less than 30 days All that is required is a 660+ FICO score and a clean 24-month mortgage payment history. The bank doesn’t ask for tax returns, W2s, bank statements, or any other documents typically required to qualify for a home loan. Additionally, a home appraisal may not be required if the loan amount is $400,000 or less. In terms of interest rates, Quontic says they start at 4. 875%. While well above current market rates for a 30-year fixed, they may be much lower than what these homeowners would otherwise qualify for. They note a borrower with a $400,000 loan amount and a 7% mortgage rate could save over $500 per month if refinancing to a rate of 4. 875%. The loan can be closed in less than 30 days thanks to the reduced documentation requirements, and... --- > If you recently took out a mortgage, or have been thinking about purchasing real estate, you may be wondering when your mortgage payments will be due each - Published: 2020-02-18 - Modified: 2024-10-07 - URL: https://www.thetruthaboutmortgage.com/mortgage-due-dates-101/ - Categories: Mortgage Tips If you recently took out a mortgage, or have been thinking about purchasing real estate, you may be wondering when your mortgage payments will be due each month, among other things (like how late Ikea is open). Well, mortgage payments are generally due on the first of the month, every month, until the loan reaches maturity, or until you sell the property. So it doesn’t actually matter when your mortgage funds – if you close on the 5th of the month or the 15th, the pesky mortgage is still due on the first. The only difference is when the first mortgage payment is due, which I’ve explained in my when mortgage payments start post. Mortgage Due on the 1st, Late on the 16th? Mortgages are typically due on the first of the month But mortgage lenders generally provide a grace period Of up to 15 days to pay without any fee or penalty Meaning it's only late if paid after the 15th of the month Most people probably know that mortgage payments are due on the 1st of the month, but many loan servicers (those who collect your payments) will allow you to pay 15 days “late” each month. So even though your mortgage payments are technically due on the first each month, you can pay as late as the 15th every month without any kind of penalty. No late fees, no credit report dings, no issues whatsoever. This is known as the “mortgage grace period,” similar to other grace... --- > One Reverse Mortgage, a Quicken Loans company, is reportedly pausing operations, according to a statement delivered to Reverse Mortgage Daily. While it’s - Published: 2020-02-18 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/quicken-loans-one-reverse-mortgage-to-pause-operations/ - Categories: Mortgage News One Reverse Mortgage, a Quicken Loans company, is reportedly pausing operations, according to a statement delivered to Reverse Mortgage Daily. While it’s unclear what the word “pause” means at this time, RMD also noted that the lender doesn’t expect to originate any more reverse mortgages. However, they will continue to process loans already in the pipeline to ensure existing customers aren’t disrupted by the news. Quicken Focused on Rocket Mortgage Brand Per a Quicken Loans company spokesperson who communicated with RMD, the move relates to the company’s goal of focusing on its burgeoning Rocket Mortgage brand. While Rocket Mortgage is a technology developed by Quicken Loans, it has perhaps become bigger than Quicken itself, at least as a household name for consumers. To that end, employees of One Reverse Mortgage will apparently be transitioned to roles within Quicken Loans that focus on forward, conventional home loan lending. The spokesperson noted that they “see demand shifting from the reverse mortgage market” while at the same time the Rocket Mortgage brand “continues to grow. ” The fact that they’re moving employees sounds like it could be the end for One Reverse Mortgage, though that hasn’t been clearly communicated just yet. But the spokesperson did add that the ORM employees would be used to meet the “growing needs of Rocket Mortgage. ” In other words, it sounds like they care more about making Rocket Mortgage bigger than they do originating reverse mortgages, which are a specialty mortgage product for seniors 62 and older.... --- > I guess homeownership isn’t for everyone, at least if you consider a new study from LendingTree. When respondents were asked if they would “ever go back - Published: 2020-02-13 - Modified: 2024-01-31 - URL: https://www.thetruthaboutmortgage.com/more-than-a-quarter-of-millennial-homeowners-want-to-go-back-to-renting/ - Categories: Housing Market, Mortgage News I guess homeownership isn’t for everyone, at least if you consider a new study from LendingTree. When respondents were asked if they would “ever go back to renting,” some 28% of Millennials said yes. Even worse, 10% said they’d go back to renting this year, while 14% said they’d ditch the mortgage for rent in the next 2-5 years. Another 4% said they’d be renting within 6-10 years, and the numbers are similarly high relative to other generational cohorts in the 10+ year category as well. Millennials the Least in Love with Homeownership LendingTree uses the following age ranges: Millennials: ages 23-38 Generation X: ages 39-53 Baby boomers: ages 54-73 While the numbers aren’t overwhelmingly high, if you look at other age groups, such as Gen Xers and Baby Boomers, Millennials are clearly the least in love with homeownership. Just over half of Millennials would never consider going back to renting, which sounds pretty good until you consider that 65% of Gen Xers and 68% of Baby Boomers wouldn’t. As to why Millennials are the most likely to kiss homeownership goodbye to rent again, there was no explanation. But if you look at the chart above, there seems to be a correlation with age and satisfaction with homeownership. The older a respondent gets, the less likely they are to go back to renting, which could be a sign of either being more comfortable as a homeowner, or better realizing the positive aspects over time. Because the Great Recession is only... --- > One of the largest nonbank mortgage lenders in the country is loanDepot, typically landing on the top-10 list overall year after year. In fact, they’ve - Published: 2020-02-13 - Modified: 2025-02-12 - URL: https://www.thetruthaboutmortgage.com/loandepot-mortgage-review/ - Categories: Mortgage Tips One of the largest nonbank mortgage lenders in the country is loanDepot, typically landing on the top-10 list overall year after year. In fact, they’ve even cracked the top five in some years as well, so they’re certainly a big time player in the mortgage world. At one time, they were even the subject of speculation that they’d be acquired by mega retailer Amazon in its effort to enter the mortgage business. And in early 2021, they became the Official Mortgage Provider of Major League Baseball (MLB). So expect to see their name and brand around a lot more this year. Let’s get some history on loanDepot and determine if they’re a good fit for your home loan needs. Table of Contents - loanDepot Fast Facts - How to Apply at loanDepot - mello smartloan technology - What Loan Types Do They Offer? - loanDepot Lifetime Guarantee - loanDepot Mortgage Rates - loanDepot Reviews - loanDepot Pros and Cons - loanDepot vs. Rocket Mortgage loanDepot Launched in 2010 Direct mortgage lender that offers home purchase and refinance loans Founded in 2010, headquartered in Foothill Ranch, CA Offers industry’s first end-to-end digital mortgage Ranked 2nd largest nonbank lender and a top-10 retail mortgage lender Also the 8th largest VA lender in the country Over 200 retail branches nationwide and growing Went public in early 2021 under ticker symbol NYSE:LDI Despite being a very young company, Foothill Ranch, CA-based direct lender loanDepot has funded more than $300 billion in consumer loans since... --- > An in-depth look at Atlanta, GA-based direct lender AmeriSave Mortgage Corp., which claims to have launched digital origination. - Published: 2020-02-12 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/amerisave-mortgage-review/ - Categories: Refinance While perhaps not a major household name yet, there’s a good chance you’ll stumble upon AmeriSave if actively shopping your home loan. They have quite a presence online and are a top-rated mortgage lender with LendingTree, despite a lack of physical branches and national advertising campaigns. In August 2021, the company inked its first partnership with a professional sports organization, the Miami Dolphins. They will receive prominent branding at Hard Rock Stadium, along with marketing spots on radio broadcasts and team content. Let’s get some more background on AmeriSave to see if they could be a good choice for you. Table of Contents - Who Is AmeriSave? - What Does AmeriSave Mortgage Offer? - AmeriSave Rate Match Guarantee - $500 Application Fee - AmeriSave Mortgage Rates - AmeriSave Reviews - AmeriSave Pros and Cons - AmeriSave vs. loanDepot Who Is AmeriSave Mortgage Corp. ?  Direct-to-consumer mortgage lender that offers home purchase and refinance loans Founded in 2002, based in Atlanta, Georgia Has originated over $55 billion in home loans on over 230,000 properties Claims to have pioneered digital loan origination process Licensed in 49 states and D. C. (not available in NY) AmeriSave Mortgage Corp. is a direct-to-consumer mortgage lender lender based in Atlanta, Georgia that has been around since early 2002. They refer to themselves as a fintech company responsible for “pioneering the first truly digital mortgage experience,” a claim Rocket Mortgage might disagree with. Regardless, they are a mortgage lender that lives online, which hopefully means they can... --- > These days, all the mortgage advertisements I see promote speed. Get your loan fast. Get it with the push of a button. Get approved in minutes, close in a - Published: 2020-02-11 - Modified: 2020-02-11 - URL: https://www.thetruthaboutmortgage.com/a-fast-mortgage-isnt-necessarily-the-best-mortgage/ - Categories: Mortgage Tips These days, all the mortgage advertisements I see promote speed. Get your loan fast. Get it with the push of a button. Get approved in minutes, close in a week! Hello Figure and Rocket Mortgage, and basically every other fintech newcomer in the space. But how much does speed actually matter? And is it really beneficial in most cases? Let’s explore. We Are an Impatient Species We’ve become an impatient society. Well, to be honest, we’ve been an impatient society. But perhaps ironically, thanks to new technology designed to make our lives easier, such as the internet and smartphones, we’ve grown less patient. When I fire up the Uber or Lyft app to hail a ride, I get upset if it doesn’t match me up with a driver in seconds. A decade ago, I remember having to call a taxi cab company and deal with their central command, who would tell me someone would be on their way shortly, maybe. Hopefully. Today, I practically lose it if someone isn’t en route within moments of making a ride request. The same goes for just about anything else, whether it’s a food order on Grubhub or Uber Eats, or a package delivery from Amazon. What’s taking so long! A Mortgage Requires Some Thoughtfulness Here’s the thing though – a mortgage isn’t a ride across town, nor is it a burrito. It’s something that sticks with you for a very long time, and has the potential to significantly shape your financial situation. In... --- > Real estate agent matchmaker HomeLight has launched two new programs for homeowners in California (and now Texas) that make it easier to buy and sell by - Published: 2020-02-10 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/homelight-cash-close-review/ - Categories: Mortgage News Real estate agent matchmaker HomeLight has launched two new programs for homeowners in California (and now Texas) that make it easier to buy and sell by leveraging the power of cash. The new initiative, known as “HomeLight's Cash Close program,” includes HomeLight Trade-In and HomeLight Cash Offer. They can be utilized by both first-time home buyers and existing homeowners who may be looking to buy before they sell in a competitive market. The new offerings flank HomeLight’s iBuyer service known as Simple Sale, which generates all-cash offers in 48 hours or less. How the HomeLight Cash Offer Program Works Get pre-approved to determine home purchasing power Tour properties with a real estate agent and make your offer HomeLight will either guarantee you are clear to close or purchase the home on your behalf Cash offers can be 3X more likely to win and 5% cheaper vs. financed offers Just about everyone knows that cash is king, and it’s no different in the real estate game. A home seller is much more likely to go with a cash buyer versus someone who must get approved for a mortgage, given the uncertainty with the latter. With HomeLight Cash Offer, you can make an all-cash offer using funds from HomeLight, then secure your financing after the fact. Here’s how it works. First, their subsidiary HomeLight Home Loans verifies your income and assets to determine your purchasing power, similar to a mortgage pre-approval. Then you tour homes with your agent (or one recommended by... --- > New American Funding is a direct mortgage lender based in Tustin, CA that refers to itself as the #1 Hispanic mortgage lender in the United States. - Published: 2020-02-06 - Modified: 2025-03-07 - URL: https://www.thetruthaboutmortgage.com/new-american-funding-review/ - Categories: Mortgage Tips It’s time for another mortgage review, this time we’ll take a hard look at "New American Funding" to see if they should be included in your home loan search. They call themselves a family-owned business dedicated to helping other families improve their quality of life. That sounds like they have your best intentions in mind, especially when navigating what is arguably one of the biggest life decisions, buying a home. New American also refers to themselves as the "largest Hispanic-owned mortgage company in the United States. " And their mission is to increase lending to underserved communities, including Black and Latino borrowers. Let's find out more about them. New American Funding Fast Facts Retail direct-to-consumer mortgage company with 180 branches nationwide Launched in 2003, headquartered in Tustin, California (Orange County) Started by husband and wife team Rick and Patty Arvielo Originally a 40-employee call center, workforce now close to 5,000 Offers home purchase financing and refinance loans Licensed to do business in all states except Hawaii Funded nearly $10 billion in home loans during 2023 (nearly a top-25 lender nationally) Services more than 200,000 loans worth approximately $54 billion Ranked #1 loan servicer by J. D. Power in the 2022 study New American Funding got started back in 2003, which was around the time the housing market was booming. Just a few short years later, the subprime mortgage crisis hit, and hundreds of lenders didn’t survive. So I suppose that’s a testament to the resolve of New American Funding, which... --- > For some reason, folks always want to know if you can do X, Y, and Z with bad credit. Which begs the question, why not improve your credit first! Okay, I - Published: 2020-02-04 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/refinance-a-mortgage-with-bad-credit/ - Categories: Mortgage Tips, Refinance For some reason, folks always want to know if you can do X, Y, and Z with bad credit. Which begs the question, why not improve your credit first! Okay, I get it, time is sometimes of the essence, especially if you have bad credit, so it’s not always an option to get things back on track before seeking out financing. There’s also that pesky thing known as patience, which seems to be lacking in the world today. The good news is it’s entirely possible to secure new credit, including a new mortgage, even if you have what’s known as “bad credit. ” So if you've got your eye on those record low mortgage rates, but aren't sure if you qualify, read on. First Off, What’s Bad Credit? Fannie and Freddie require a credit score of 620 or better to get a home loan VA loans and USDA loans don’t have minimum scores, but most mortgage lenders still require 620+ FHA can go as low as 500 if you have 10% equity in your home Otherwise you need at least a 580 FICO score for max financing While opinions may vary, bad credit is typically defined as a sub-620 FICO score in the eyes of mortgage lenders, though even scores a bit higher might be viewed with some disdain. But ultimately, 620 is the hard line in the sand, and the minimum score accepted by both Fannie Mae and Freddie Mac, which back or buy the majority of home loans... --- > A company called Point wants to give you “early access to your home equity” without ever having to make monthly payments, similar to how a reverse - Published: 2020-02-04 - Modified: 2024-07-10 - URL: https://www.thetruthaboutmortgage.com/point-home-equity-review/ - Categories: Mortgage Tips A company called Point wants to give you “early access to your home equity” without ever having to make monthly payments, similar to how a reverse mortgage works. While at first glance it sounds pretty good, you’ve got to dig into the details to see what you’re actually getting. Ultimately, you’re sharing your future home price appreciation with the company in exchange for a piece of the action today. Let’s learn more about how it all works to determine if it might be a better alternative to a traditional home equity loan or HELOC. How Point Works to Tap Home Equity Point makes an investment in your home in exchange for cash today No monthly payments are made during the 30-year loan term You pay back their investment at any time via sale, refinance, etc. Buyback cost includes amount originally received plus portion of your home’s appreciation Instead of taking out a loan to access your home equity, Point “invests” in your property via a Home Equity Investment (HEI) and gives you cash today for some of that sweet, sweet home appreciation tomorrow. Like a traditional first or second mortgage, you need to answer the usual questions like how much you make, what your home is worth, and what your credit scores are. They say you can pre-qualify for Point in less than two minutes, then you’ll be presented with a pre-offer to see how much you can borrow. Funds can be received in as little as 15 days. Their... --- > I received a letter in the mail the other day from a fintech company called “Figure” that claims it can approve me for a home equity line of credit - Published: 2020-01-31 - Modified: 2024-11-21 - URL: https://www.thetruthaboutmortgage.com/figure-review-home-equity/ - Categories: Refinance I received a letter in the mail the other day from a fintech company called “Figure” that claims it can approve me for a home equity line of credit (HELOC) online in five minutes. Better yet, they can fund the thing in as little as five days, assuming I’m able to use their remote online notary and that five-day period doesn’t include a weekend or holiday. You can thank their 100% digital application for that, along with their proprietary blockchain solution known as “Provenance,” which is also being used by Caliber Home Loans, an unaffiliated lender. It all sounds lightning fast, so let’s learn more about Figure to determine if they could be a good solution for those looking to tap their home equity. Figure Calls It the Fastest HELOC on the Planet One of Figure’s taglines is “Fastest HELOC on the Planet,” which sounds pretty darn quick. We know they promise to get you approved and funded fast, which is great if you need cash ASAP for say, pressing home renovations, but speed isn’t everything. The underlying product also has to provide good value relative to similar offerings in the marketplace. It also has to make sense to take one out in the first place. Most homeowners are aware of home equity products, with the most common and popular probably the home equity line of credit, or HELOC for short. The Figure Home Equity Line is kind of a hybrid of two products, the HELOC and the home equity... --- > There are lots of different ways to get a mortgage these days – you can walk into a physical bank branch, call a mortgage broker, or even start a loan - Published: 2020-01-28 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/credible-mortgage-review/ - Categories: Mortgage Tips There are lots of different ways to get a mortgage these days – you can walk into a physical bank branch, call a mortgage broker, or even start a loan application on your smartphone. While the mortgage broker model isn’t new by any means, a company called "Credible" is shaking things up on that front, promising real-time mortgage rates from multiple mortgage lenders without the “annoying calls or emails. ” They also let you compare rates and close your loan all in one place. Let’s learn why this company is different and if they make sense for your mortgage needs. Credible Launched Back in 2012 Company founded by former investment banker in 2012 Initially focused on student loan refinancing Has since delved into personal loans, credit cards, and mortgages Lets you compare personalized loan offers from multiple lender partners anonymously Acquired by Fox Corp. in late 2019 The company is relatively new, having been founded less than a decade ago in San Francisco. But that didn't stop it from being acquired by none other than Fox Corp. , better known for TV shows like The Simpsons rather than finances. Originally a student loan marketplace, the company has since expanded to personal loans, mortgages, and credit cards. Our focus will be the mortgage piece of the pie, this being a mortgage blog and all. In late 2018, Credible announced a “first-of-its-kind mortgage marketplace” that offers actual rates to consumers in just two or three minutes, all without affecting the applicant’s credit... --- > Take a closer look at their Smart Rate ARMs and Low Cost mortgages that require just $295 out-of-pocket at closing. - Published: 2020-01-23 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/third-federal-mortgage-review/ - Categories: Mortgage Tips If you’re like me, you’ve received lots of mailers from a bank called “Third Federal Savings & Loan,” promising a low rate mortgage with very few fees. After maybe the 10th piece of mail from them came through my mailbox, I decided it was finally time to write a review. So here we go. Third Federal Has Been Around Since 1938 Began during Great Depression in Cleveland, Ohio Initially served immigrants from Poland and other Eastern European countries Now operates in 25 states and DC, with branches in Florida and Ohio They are a direct mortgage lender that offers purchase loans, refinances, and home equity products First off, let’s talk a little history. Third Federal isn’t a newcomer like Better Mortgage or Rocket Mortgage. They’ve been around since 1938, which if you’re counting, is nearly a century. That gives them some credibility, and if you ask, they’ll tell you that staying power can be attributed to conservative lending. In other words, avoiding fads and questionable product choices like subprime or Alt-A in exchange for lasting relationships and more stability. The company was started by Ben S. and Gerome Stefanski in Cleveland, Ohio during the Great Depression, using $50,000 in capital provided by members of the Slavic Village neighborhood. It began by serving struggling immigrant families from Poland and other Eastern Europe nations who had settled in the area. Over time, the business grew and thrived, and today they do business in 25 states, and run a branch network in the... --- > I came across a new partnership between ticket marketplace Stubhub and fintech company Affirm that lets you pay for purchases over time. They launched the - Published: 2020-01-23 - Modified: 2020-01-23 - URL: https://www.thetruthaboutmortgage.com/dont-take-out-a-mortgage-to-buy-super-bowl-tickets/ - Categories: Mortgage News I came across a new partnership between ticket marketplace Stubhub and fintech company Affirm that lets you pay for purchases over time. They launched the new payment option “just in time for the Super Bowl,” per a company press release regarding the announcement. Affirm already works with brands you probably recognize, such as that ubiquitous mattress company Casper, iRobot, and that other company with the really well-liked commercials, what’s their name again, oh yeah, Peloton. Anyway, the idea is that you can get the things “you love” now and worry about paying them off later. Sweet. Everyone knows Super Bowl tickets are notoriously expensive, and so the partnership made perfect sense, especially since their survey found that cost was the leading reason why most people didn’t attend. How Affirm Works In short, you select Affirm instead of say a credit card or PayPal at checkout, then answer “five simple pieces of information” to see if you qualify for financing. That includes your name, mobile number, email address, date of birth, and the last four digits of their social. From there, your credit will be run and they’ll let you know if you’re approved to go to the Super Bowl... They say your credit score won’t be affected when checking eligibility, despite the credit check. But if you actually buy with Affirm, your loan and corresponding payments may affect your credit score. Obviously, you’ll have a new account on your credit report, new debt, payment history, etc. With regard to the... --- > It’s a new year, and with that comes old questions, like will mortgage rates go up or down in 2020? And will home prices rise or fall? Well, a few months - Published: 2020-01-22 - Modified: 2021-08-20 - URL: https://www.thetruthaboutmortgage.com/are-home-prices-going-to-surge-in-2020/ - Categories: Housing Market, Mortgage News It’s a new year, and with that comes old questions, like will mortgage rates go up or down in 2020? And will home prices rise or fall? Well, a few months ago, you would have probably thought the answer to the home price question was a no-brainer. After so many years of seemingly unsustainable appreciation, there’d just be no way home prices could eek out more gains, let along big ones. But that logic has just been turned on its head thanks to a new report from Zillow, which claims we’re running out of homes again. For-Sale Inventory Hits Lowest Point Since 2013 Uptick in housing inventory appears to have been short-lived Lowest number of for-sale homes on the market since at least 2013 Supply is only expected to worsen from here with little home building and lots of demand Could be the recipe for even higher home prices in 2020 This isn’t the first time we’ve run out of homes, but after an uptick in inventory over the past couple years, it appeared things were turning around. However, that “inventory bump a year ago proved to be short-lived,” per Zillow, as we now have the lowest number of for-sale homes in at least seven years. Yes, inventory is basically back to levels not seen since 2013, and if you recall, home prices were bottoming just before and around that time. To make matters worse, supply is supposed to get even tighter before we see any relief. While this is... --- > If you’re looking to buy a home, or refinance an existing home loan you already have, you will undoubtedly come across Quicken Loans during your search. - Published: 2020-01-15 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/quicken-loans-review/ - Categories: Mortgage Tips If you’re looking to buy a home, or refinance an existing home loan you already have, you will undoubtedly come across Quicken Loans during your search. They are at times the largest mortgage lender in the United States (when only counting retail loan originations), recently overtaking San Francisco, CA-based bank Wells Fargo thanks to the success of their Rocket Mortgage technology. Wells Fargo has since taken back their crown, but the two will yo-yo in the rankings between #1 and #2 unless Quicken really breaks out and leaves them behind. Let’s learn more about Quicken Loans to determine if they’re a good choice for your mortgage needs. How Quicken Loans Got Started: A Little History Company was founded in 1985 by Dan Gilbert, originally called Rock Financial Later went public and sold to Intuit in 1999 and renamed Quicken Loans Bought back by Gilbert and investors in 2002 and taken private Has closed over half a trillion dollars in mortgages since 2013 Back in 1985, Dan Gilbert started Rock Financial, which would later be known as Quicken Loans. Just three years later, he took the company public with the help of Bear Stearns and Prudential Securities. Initially, the lender was branch-based like a depository bank, but Gilbert quickly embraced technology with the launch of online lender Rockloans. com in January 1999 (that website still exists but offers personal loans). At the end of 1999, Intuit Inc. , the company behind TurboTax and QuickBooks, acquired Rock Financial and renamed it Quicken... --- > Over the years, I’ve seen tons of ads and articles about a so-called “mortgage trick,” only to click on the associated hyperlink and see nothing regarding - Published: 2020-01-14 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/there-is-no-mortgage-trick/ - Categories: Mortgage Tips, Refinance Over the years, I’ve seen tons of ads and articles about a so-called “mortgage trick,” only to click on the associated hyperlink and see nothing regarding any tricks. Talk about disappointing. For the record, I’m always interested to see what someone might have up their sleeve, which is why I continue to click year after year, hoping there really will be a trick one of these days. Instead, I repeat the same mistake over and over again, expecting a different result, which some liken to insanity. I’m okay with that, I’ll swallow my pride. You may have seen these same ads or articles claiming to save you thousands or more on your mortgage by “using this one trick,” only to be left disappointed or scratching your head. Did I miss something? In fact, I got suckered into another one this morning, which revealed absolutely nothing new. Quelle surprise. When it comes down to it, there’s no mortgage trick. A trick is defined as "a cunning or skillful act or scheme intended to deceive or outwit someone," per Google. Or one that mystifies the audience – think the quintessential magician pulling the rabbit out of the hat, or making a dove appear out of nowhere. Do you really think mortgages are like magic, or anywhere close to it? And are they entertaining or even the least bit interesting? Not really, even though I try to make them slightly more appealing on this blog. Whether I'm actually accomplishing is another question. A... --- > If you’ve been even remotely interested in taking out a home loan, you’ve undoubtedly heard of LendingTree, which bills itself as the leading online loan - Published: 2020-01-13 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/lendingtree-review/ - Categories: Mortgage Tips If you’ve been even remotely interested in taking out a home loan, you’ve undoubtedly heard of LendingTree, which bills itself as the leading online loan marketplace. Ultimately, they are a lead generator and mortgage broker that is licensed in all 50 states that matches up borrowers with lenders, similar to a company called Credible. Aside from home loans, they also help customers compare credit cards, auto loans, debt consolidation services, personal loans, student loans, insurance providers, and more. Let’s learn more about the company and why you might want to enlist them in your home loan search. Table of Contents - How LendingTree Got Started - What Does LendingTree Do? - How LendingTree Works - How Are LendingTree’s Mortgage Rates? - Should I Use LendingTree to Get a Mortgage? - LendingTree vs Rocket Mortgage How LendingTree Got Started Company began in 1996 after founder had trouble getting a mortgage Goal was to make it easier for consumers to compare loan rates/options without having to call individual lenders LendingTree model ensures customers actually comparison shop via multiple rate quotes Research shows more quotes equal more savings First things first, a little history on the company, which was founded back in 1996 by Doug Lebda and headquartered in Charlotte, North Carolina. Like many other prospective home buyers, Lebda grew frustrated with what turned out to be a time-consuming and arduous process while searching for financing on his first condo, valued at just $55,000. He wanted to ensure he took out the best... --- > If you’re into football squares, there’s a new game available via Rocket Mortgage by Quicken Loans related to them becoming an “official mortgage sponsor” - Published: 2020-01-09 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/rocket-mortgage-becomes-official-nfl-sponsor-launches-super-bowl-squares-game/ - Categories: Mortgage News If you’re into football squares, there’s a new game available via Rocket Mortgage by Quicken Loans related to them becoming an “official mortgage sponsor” of the NFL. The Rocket Mortgage Super Bowl Squares Sweepstakes, which the Detroit-based lender is calling “the largest official game of Super Bowl squares in history,” is free to enter. Simply cruise over to RocketMortgageSquares. com before 11:59 p. m. EST on Thursday, January 30, 2020 to register, then select one of 100 spaces on a 10-by-10 grid. If you don't want them to bother you, simply uncheck the many options that allow them to contact/solicit you. From there, hope your square gets picked, and also hope you’re randomly selected from what will probably be a large pool of entrants on the same square. How the Super Bowl Squares Game Works As noted, you get to pick one of 100 squares on a 10-by-10 grid. One axis (0-9) represents the last digit of the NFC team’s score, and the opposing axis (0-9) represents the last digit of the AFC team’s score. For example, if the game is 7-3 at any point, and your square shares those two digits from the corresponding teams, you’d be eligible to win a prize. And the prize is pretty significant - $50,000 per square. However, your square will likely be occupied by many more entrants, so it’s not a win unless you get picked from that pool of potential winners. The upside is this version of the game will award up... --- > Well, it’s a new year and it certainly didn’t begin quietly. Might as well address the elephant in the room when it comes to your mortgage. This isn’t the - Published: 2020-01-06 - Modified: 2020-02-05 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-vs-a-potential-war-with-iran/ - Categories: Mortgage Matchups, Mortgage News, Mortgage Rates Well, it’s a new year and it certainly didn’t begin quietly. Might as well address the elephant in the room when it comes to your mortgage. This isn’t the first time I’ve discussed the possibility of war and its impact on mortgage rates, with the last discussion centered on the Syrian conflict back in 2013. At that time, the 30-year fixed mortgage was roughly 4. 50% on average. As the drama unfolded, rates fell about 30 basis points in a matter of months before climbing back to where they started. That’s the most recent example, though it might not be the best indicator of things to come because the adversaries are different, as is the scenario. How an Iranian Conflict Would Affect Mortgage Rates First off, we aren’t at war with Iran, at least not formally. Some argue that we’ve been at war with Iran for decades, via a cold war involving its proxies. Secondly, that may not change as a result of the strike that took out their leading general, Qasem Soleimani. While the rhetoric has certainly ratcheted up in recent days, nothing has materialized yet other than more threats. There is a good chance Iran will take retaliatory action, but what action it takes will likely be the driving force behind any changes to mortgage rates. Simply put, fear leads to lower interest rates as investors flee the stock market, which is traditionally riskier, to the bond market, which is known as a safe haven in times of... --- > Well, 2019 is set to come to a close. It's certainly been an interesting year (and decade), surely one to remember. But now it's time to look forward to - Published: 2019-12-30 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2020-real-estate-and-mortgage-predictions/ - Categories: Housing Market, Mortgage News Well, 2019 is set to come to a close. It's certainly been an interesting year (and decade), surely one to remember. But now it's time to look forward to what 2020 might bring with regard to the housing market, mortgages, and so on. Let's dive in. You can see my 2019 predictions here. 1. Mortgage rates will go down As always, we tackle mortgage rates first. The forecasts have been wrong year after year lately, with most pundits calling for an end to the ultra-low rate era. But over time, it has become apparent that this is simply the new normal for rates. They probably aren’t going back to 5-6% anytime soon. Instead, expect 30-year fixed rates closer to 4%, as they have been for years now. In 2020, we might even see new all-time lows if the election, Brexit, or other geopolitical events really shake things up. If you’re a home buyer or a refinancer, 2020 will be yet another favorable year in the financing department. 2. Home prices will go up (limited inventory, but not a seller’s market) Now let’s talk home prices, which don’t have a clear correlation with mortgage rates. No, one doesn’t go up while the other goes down, despite many assuming that. While we’ve already seen the really stellar years of appreciation since bottoming nearly a decade ago, the end of home price appreciation isn’t quite here yet. In fact, 2020 should be another solid year in terms of home price growth, likely mirroring... --- > As 2019 wraps up, it’s time once again to consider what the future holds for mortgage rates. Looking back over the past 12 months, it was another great - Published: 2019-12-12 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2020-mortgage-rate-predictions/ - Categories: Mortgage News, Mortgage Rates As 2019 wraps up, it’s time once again to consider what the future holds for mortgage rates. Looking back over the past 12 months, it was another great year for anyone looking to buy a home or refinance, at least with regard to interest rates. Sure, home prices aren’t on sale anymore, nor have they been for a long time, but financing remains dirt cheap, which is a big help for anyone struggling with affordability. While most pundits expected rates to rise throughout 2019 (I said mostly flat, but was still wrong), they once again defied expectations and sank back near all-time lows. Now let’s take a look at the freshest 2020 mortgage rate predictions from some industry heavyweights. MBA 2020 Mortgage Rate Forecast As always, we’ll start with the Mortgage Bankers Association first. Last year, they expected the 30-year fixed mortgage to hit 5% by the third quarter. Instead, it fell to around 3. 5% at that time, which was way off the mark. But they weren’t the only ones to get it wrong. Most predictions proved to be incorrect, just like in prior years. That being said, this is what their 2020 forecast looks like on a quarterly basis: First quarter 2020: 3. 7% Second quarter 2020: 3. 7% Third quarter 2020: 3. 7% 
Fourth quarter 2020: 3. 7% This year they’re playing it a lot safer and just going with a 3. 7% average for the 30-year fixed all year long. Yep, all year long. Great news... --- > Another year, another increase in FHA loan limits, thanks to yet another rise in home prices. This is good news if you’re thinking about taking out an FHA - Published: 2019-12-05 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2020-fha-loan-limits-rise-five-percent-from-a-year-earlier/ - Categories: Mortgage News Another year, another increase in FHA loan limits, thanks to yet another rise in home prices. This is good news if you’re thinking about taking out an FHA loan, as you’ll likely be able to borrow a little bit more without going over the maximum loan amount allowed. Like Fannie Mae and Freddie Mac, the FHA has a maximum loan amount, which varies based on whether the property resides in a low-cost or high-cost area of the country. Where home prices are generally cheaper, the “floor” is imposed. And in areas where home prices are more expensive, loan limits between the floor and “ceiling” are put in place. This is all driven by median home prices, which change from year to year. These loan limits are key to determine if you’re eligible for an FHA loan, or if you’ll need to seek conventional loan financing instead. If the home you have your eye on is particularly expensive, you might not be able to get an FHA loan, depending on loan limits in your city. This is because the FHA floor is significantly lower than the conforming loan limit, just 65 percent of the new higher max loan amount of $510,400 for a one-unit property. You Can Now Take Out an FHA Loan for $331,760 One-unit property: $331,760 Two-unit property: $424,800 Three-unit property: $513,450 Four-unit property: $638,100 Effective for case numbers assigned on or after January 1, 2020, you’ll be able to take out an FHA loan as large as $331,760.... --- > It’s that special time of the year again when the Federal Housing Finance Agency (FHFA) adjusts the conforming loan limit for the upcoming year. As - Published: 2019-12-03 - Modified: 2019-12-05 - URL: https://www.thetruthaboutmortgage.com/2020-loan-limits-rise-above-500000-for-conforming-mortgages/ - Categories: Mortgage News It’s that special time of the year again when the Federal Housing Finance Agency (FHFA) adjusts the conforming loan limit for the upcoming year. As expected, the loan limit is going up again thanks to another year-over-year increase in home prices nationwide. Per the FHFA's seasonally adjusted, expanded-data home price index (HPI), residential property values increased 5. 38% between the third quarters of 2018 and 2019. As a result, the baseline maximum conforming loan limit for 2020 will increase by that very same percentage. 2020 Conforming Loan Limit Will Be $510,400 $510,400 for a one-unit property $653,550 for a two-unit property $789,950 for a three-unit property $981,700 for a four-unit property Beginning in 2020, the maximum loan amount for a one-unit property backed by Fannie Mae or Freddie Mac will be $510,400, a $26,050 increase from the current $484,350 limit. Similarly, loan limits will rise on duplexes, triplexes, and fourplexes. That should help a greater number of homeowners qualify for a conforming mortgage, which are generally more readily available and potentially easier to get approved for. Additionally, some lenders offer lower interest rates on conforming loans versus jumbo loans, another plus for those looking to refinance their mortgage or take out a new purchase home loan. It means a home buyer with a 20% down payment can purchase a $638,000 property and avoid the jumbo loan realm. If you’ve only got 3% down, which is one of the pros to a conforming loan, you’ll still be able to purchase a... --- > If you’re thinking about selling your home, you may have come across a company by the name of Offerpad. They are one of the original iBuyers, or instant - Published: 2019-11-12 - Modified: 2021-10-19 - URL: https://www.thetruthaboutmortgage.com/offerpad-review/ - Categories: Housing Market, Mortgage News If you’re thinking about selling your home, you may have come across a company by the name of Offerpad. They are one of the original iBuyers, or instant buyers of homes, currently operating in a dozen metros nationwide. In short, they allow homeowners to unload their properties quickly and easily without the need for a real estate agent. But like all other iBuyers, such as Opendoor, RedfinNow, or Zillow Offers, there is a cost to the convenience. Let’s learn more about this company, founded in 2015 by real estate agent Brian Bair and operating out of Gilbert, Arizona. What Is Offerpad? An instant home buying service based out of Gilbert, Arizona They'll provide you with a free, no-obligation offer to buy your property in as little as 24 hours Launched in 2015 by so-called super agent Brian Bair The company also sells home directly in the cities where it buys them Went public in September 2021 under ticket symbol "OPAD" on the NYSE Offerpad’s mission is simple: provide the best way to buy and sell a home. After Bair and his team bought, sold, and renovated some 100,000 properties nationwide, they came to the realization that it’s stressful to sell a home. And they knew there was a “better way. ” That led to the creation of the Offerpad platform, which offers an instant buyer service to homeowners. This allows home sellers to forgo the real estate agent search, the open houses, the home staging, and most importantly, the uncertainty.... --- > You know them for your computer, your phone, your TV streaming device, your TV programs (soon), maybe your credit card, and now possibly your mortgage - Published: 2019-11-05 - Modified: 2023-07-25 - URL: https://www.thetruthaboutmortgage.com/apple-pledges-1-billion-in-mortgage-assistance-to-first-time-home-buyers-in-california/ - Categories: Mortgage News You know them for your computer, your phone, your TV streaming device, your TV programs (soon), maybe your credit card, and now possibly your mortgage too. No, it’s not quite the launch of Apple Mortgage some may have hoped for, but the computing giant is getting involved in the mortgage business, along with the real estate industry. Like everyone else, Apple understands there’s a “housing availability and affordability crisis in California,” and instead of sitting on their hands, they’re taking action. As part of a partnership with California Governor Gavin Newsom, the state of California, and various community-based organizations, Apple will provide $2. 5 billion to fund new projects in Silicon Valley and the Bay Area, along with statewide housing support. Apple Wants to Fix Housing in the Bay Area with $2. 5 Billion Dollars Funds will be used to build more affordable housing in Northern California Apple will also part with land it owns in San Jose worth $300 million Company realizes current situation is unsustainable Can't have a city that consists only of highly-paid tech workers The tech company cites the fact that nearly 30,000 folks left San Francisco in the second quarter of 2019 alone, and notes homeownership in the Bay Area is at a seven-year low. Apple believes it is their “civic responsibility” to ensure the Bay remains a place where individuals can live, start a family, and contribute to the community. As such, some $2. 5 billion is being ponied up to ease the burden... --- > Yet another disruptor, known as Divvy Homes, is out to change the rent-to-own space so more renters can become homeowners. Divvy says it’s like a lease, - Published: 2019-11-04 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/divvy-homes-review/ - Categories: Mortgage News Yet another disruptor, known as Divvy Homes, is out to change the rent-to-own space so more renters can become homeowners. Divvy says it’s like a lease, but unlike a typical lease, it’s designed to help you inch your way to homeownership with every lease payment you make. That way you’re not “throwing away money on rent,” the common argument people make against renting. While it’s not that cut and dry, as renting actually has lots of advantages over homeownership, this setup might work for someone not quite ready to own. How Divvy Works Divvy is a new rent-to-own company Currently available in select markets nationwide Allows you to buy a home with just 2% down payment Without having to qualify for a mortgage At the moment, Divvy is available in the metros of Atlanta, Cleveland, Dallas, and Memphis, St. Louis, and Tampa. Here’s how it works. First, you select a home that's available for sale on the market, just as you would if you were purchasing it. But instead of buying it yourself, Divvy purchases it on your behalf. They do require that you put down 2% of the purchase price at closing, with the company covering the rest. The rest includes closing costs typically associated with a mortgage, along with the remaining 98% of the purchase price. Interestingly, you are required to take a quiz as part of the closing process, and attend a webinar to ensure you understand what you’re getting into. The property must also pass inspection,... --- > Mortgage Q&A: “Are closing costs included in a mortgage?” There seems to be a great deal of confusion when it comes to closing costs and mortgages, so - Published: 2019-10-31 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/are-closing-costs-included-in-mortgage/ - Categories: Mortgage Tips Mortgage Q&A: “Are closing costs included in a mortgage? ” There seems to be a great deal of confusion when it comes to closing costs and mortgages, so let's clear the air and make sense of it all. Simply put, home loans come with closing costs, similar to how most products and services come with associated fees. No one works for free, even if it doesn't hit your pocket directly. The interest alone isn't enough for lenders to originate mortgages, and a lot of hands are involved, so every party must get paid to participate. There's no way around that, but how you pay is certainly up to you. Typical Closing Costs with a Mortgage Lender fees such as admin/underwriting/processing and origination charges Third-party costs like home appraisal, home inspection, and notary fee Title and escrow fees Prepaid items (property taxes, homeowners insurance, HOA dues, etc. ) Closing costs include things like the loan origination fee, mortgage points, credit report fee, home inspection fee, appraisal fee, loan processing fee, application fee, title insurance and escrow fees, and so on. There's also the potential for recording fees, courier fees, wire fees, subescrow fees, endorsements, and more. So it's clear there are a lot of fees, and based on the number of said fees, the price tag can certainly add up pretty quickly. This is why it doesn't make sense to serially refinance your mortgage, just like it doesn't make sense to buy and sell a home over and over and pay... --- > There’s no question real estate is in full disruption mode, with endless companies vying to turn the age-old model of buying and selling homes on its - Published: 2019-10-24 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/realsure-review-guaranteed-cash-offer/ - Categories: Mortgage News There’s no question real estate is in full disruption mode, with endless companies vying to turn the age-old model of buying and selling homes on its head. Each week, a new company or initiative is launched to change the game, so many that it’s hard to keep up with them all. Take Curbio, Blend, BoardRE, Reali, ZeroDown, the list goes on and on. One of the more recent innovations in the space comes from Realogy, which operates a variety of major real estate brokerages, including Better Homes and Gardens Real Estate, Century 21, Coldwell Banker, and Sotheby's International Realty. RealSure Sell: A Cash Offer and a Traditional Home Listing in One Realogy, along with Home Partners of America, has launched two new products, which can be used in conjunction with one another to remove some of the obstacles involved with buying and selling real estate. The first is known as “RealSure Sell,” and is a guaranteed cash offer combined with a standard for-sale listing by a traditional real estate agent. Think of it as a plain old listing with an iBuyer option attached. When you list with a Realogy-affiliated agent, you receive a “compelling cash offer immediately upon listing. ” This offer is valid for a full 45 days while your home is listed on the market. It works kind of like a contingency plan, assuming your home doesn’t sell as planned. The company said it designed RealSure to solve two concerns consumers deal with when selling their home –... --- > Real estate brokerage Compass has launched a unique new offering known as “Compass Bridge Loan Services” that solves the buy before you sell conundrum. - Published: 2019-10-23 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/compass-bridge-loan-services-review/ - Categories: Housing Market, Mortgage News Real estate brokerage Compass has launched a unique new offering known as “Compass Bridge Loan Services” that solves the buy before you sell conundrum. Many existing homeowners buy replacement properties when selling their current ones, but it can be tricky to time a sale and purchase concurrently. Aside from mortgage lending issues, like coming up with a down payment and balancing two monthly mortgage payments, there’s also the other buyer/seller to worry about. This can be especially challenging in a hot market where all-cash offers are the norm, or if competition makes things like contingencies hard to draw into the contract. To alleviate these pressures, Compass has joined forced with two large mortgage lenders, Freedom Mortgage and Better, to help their home sellers get a bridge loan. How Compass Bridge Loan Services Works Sign listing agreement with a Compass real estate agent Apply for a bridge loan with any bank, including their preferred lenders Use funds to purchase replacement property and move in when you want Sell old property and use proceeds to pay off the bridge loan First, the home seller signs an exclusive contract with a Compass real estate agent to sell their existing home. Next, they apply for a bridge loan with the bank of their choice, including Compass’ vetted lenders Freedom Mortgage and Better. Those two lenders can apparently get the job done fast, as time is often of the essence in situations like these. For the record, Better isn’t available to customers in MA, NH,... --- > If you’re thinking about selling your home, you’ve got a lot of options. It’s not 2012 anymore, when you simply enlisted the services of a real estate - Published: 2019-10-17 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/what-is-an-ibuyer/ - Categories: Housing Market, Mortgage Tips If you’re thinking about selling your home, you’ve got a lot of options. It’s not 2012 anymore, when you simply enlisted the services of a real estate agent and went on about your day. Or bravely went down the for-sale-by-owner (FSBO) path, a much less common scenario. Today, there are many more ways to unload a property thanks to the disruptors. What Is an iBuyer? It stands for instant buyer, a company that buys your home and then sells it shortly after iBuyers offer all-cash in as little as 24 hours Can choose your own close date and sell property as-is Downside is offer will likely be below traditional market offers and fees and repair costs still apply By now, you’ve probably heard the phrase “iBuyer. ” The term iBuyer is short for “instant buyer. ” These companies buy homes almost immediately, with all-cash offers generated in as little as 24 hours, and then sell them not long after. While the valuation methods might differ from company to company, the name of the game is speed. With some companies, you simply enter your address into an online form and provide details about your home and the computers do the rest. They instantly run comparable sales and factor in any improvements your home has to generate a so-called competitive market offer. Assuming you like their offer, they’ll come by your home and verify the home is in the condition described, and adjust their offer to account for any necessary repairs. Others... --- > Over the past few years, VA loans have been at the center of controversies related to loan churning and high prepayment speeds. In short, some veterans - Published: 2019-10-10 - Modified: 2019-10-10 - URL: https://www.thetruthaboutmortgage.com/va-loan-funding-fee-refund/ - Categories: Mortgage News Over the past few years, VA loans have been at the center of controversies related to loan churning and high prepayment speeds. In short, some veterans were refinancing their home loans at a very aggressive pace, whether beneficial to them or not. It was happening so frequently that Ginnie Mae, which guarantees the underlying mortgage-backed securities, got involved. This led to a number of important policy changes, including a requirement that the borrower make at least six consecutive monthly payments on the loan being refinanced. And required the first payment due date on the refinance loan to occur no earlier than 210 days after the first payment due date of the original loan. This seasoning requirement first applied to streamline refinances, and was later extended to cash out refinances. Several large VA lenders faced pooling restrictions thanks to their elevated prepayment speeds, which limited how they could unload their mortgages. $400 Million in VA Funding Fee Refunds Available Now it turns out more than 100,000 veterans are due a refund related to the VA funding fee found on most VA loans. This week, the U. S. Department of Veterans Affairs (VA) announced the completion of an “aggressive initiative” to process funding fee refunds to veteran homeowners. The result of the multi-year investigation, which included VA-backed home loans spanning nearly two decades, will result in refunds in excess of $400 million. The VA’s Loan Guaranty Service (LGY) program identified some 130,000 loans that were potentially due a refund, then VA staff... --- > A startup named Curbio wants to help homeowners sell for more by improving their properties before they go to market. The twist is that the homeowner - Published: 2019-10-09 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/curbio-review/ - Categories: Housing Market, Mortgage Tips A startup named Curbio wants to help homeowners sell for more by improving their properties before they go to market. The twist is that the homeowner doesn’t have to pay for the renovations until settlement, meaning cash on hand isn’t an issue. The Problem Curbio Wants to Solve Say you want to sell your home, which you’ve lived in for the past 30 years. You think it looks great, but after a real estate agent stops by and chimes in, you get a rude awakening. Apparently, the abundant doilies, giant draped windows, pink garage door, and outdated bathrooms and kitchen aren’t as fashionable as you thought. You’re told the home you expected to list for $650,000 is better off being listed for $549,000. Ouch. So do you chance it and defy the real estate agent’s best intentions and list for more, only for the property to stagnate on the market? Or do you do as they say, lower the price, and then hope it sells, despite the many improvements needed? Both scenarios probably don’t sound very appealing to the seller, and even if a buyer comes along, there’s a good chance there will be repair requests to get across the finish line. This situation is all too common, and perhaps one of the reasons why iBuyers like RedfinNow and Zillow Offers have surged in popularity over the past few years. The sell “as-is” thing worked when the housing market was on the up and up, but now that price gains... --- > Hint: It wasn’t because of a low credit score. Some say a mortgage (homeownership) is a privilege, not a right. In other words, you have to display some - Published: 2019-09-26 - Modified: 2019-09-26 - URL: https://www.thetruthaboutmortgage.com/the-number-one-reason-mortgages-were-denied-in-2018/ - Categories: Mortgage News Hint: It wasn’t because of a low credit score. Some say a mortgage (homeownership) is a privilege, not a right. In other words, you have to display some financial responsibility in order to obtain one. After all, a bank is willing to let you borrow several hundred thousand dollars or more for three decades, so they can’t just be given out willy nilly. Fortunately, we returned to underwriting loans after the latest mortgage crisis, so the quality of loans is once again passable. Unfortunately, this means some borrowers are being left out in the cold when it comes to getting approved. But that doesn’t mean these folks have nowhere to turn – in most cases, it’s just matter of taking some steps to correct the issue. Home Improvement Loans Denied the Most In 2018, an astonishing 2. 65 million home loans were denied, which equated to an equally shocking 24. 7% denial rate, per CoreLogic, which recently parsed last year’s HMDA data. As you can see, home improvement loans were most likely to be denied, with nearly half failing to cross the finish line in 2018. Both rate and term refis and cash out refis also exhibited high denial rates, at 28. 1% and 29. 8%, respectively. Meanwhile, home purchase loans were denied 14. 6% of the time, which can be pretty devastating for someone missing out on their dream home. DTI Is the Main Roadblock, Not Credit Scores or Down Payment Interestingly, credit scores and down payments were not... --- > A new report from Redfin revealed 2012 was an absolutely fantastic time to purchase a home. Collectively, that crop of home buyers earned $203 billion in - Published: 2019-09-26 - Modified: 2021-08-20 - URL: https://www.thetruthaboutmortgage.com/2012-was-a-really-good-year-to-buy-a-home/ - Categories: Housing Market, Mortgage News A new report from Redfin revealed 2012 was an absolutely fantastic time to purchase a home. Collectively, that crop of home buyers earned $203 billion in equity since their well-timed purchases, with the median homeowner having gained 261%, or $141,000. The average home sold in 2012 has increased by a whopping $110,000, from a median sale price of $210,000 to an estimated value of $320,000 today. And these lucky buyers typically started off with just $54,000 in home equity that ballooned into $195,000. Biggest Home Equity Gainers by City In terms of most home equity gained, it was San Francisco leading the way with $741,000 median dollars, followed by San Jose ($669,000) and Oakland ($461,000). Rounding out the top five were Seattle ($364,000) and Los Angeles ($318,000). Home equity has grown a staggering $15 billion in the Los Angeles metro alone thanks to rising home prices since the fairly recent housing bottom. They’ve also gone up more than $8 billion in Seattle and $7. 9 billion in Oakland. On a percentage basis, Tacoma, Washington (1453%) and Virginia Beach, VA (1333%) led the way, thanks in part to their proximity to major U. S. military bases. Median home equity growth in Tacoma is $218,000 through September, and $80,000 in Virginia Beach. This means sellers might be able to pocket six figures when unloading their properties, despite owning them little more than half a decade. The numbers are based on about 1. 4 million home sales across 138 housing markets nationwide during... --- > The thing about mortgages is they continue to be difficult to obtain relative to just about everything else out there. Today, it’s easy to buy anything - Published: 2019-09-25 - Modified: 2019-09-25 - URL: https://www.thetruthaboutmortgage.com/blend-launches-one-tap-pre-approvals-for-mortgages/ - Categories: Mortgage News The thing about mortgages is they continue to be difficult to obtain relative to just about everything else out there. Today, it’s easy to buy anything with the literal click of a button, whether it’s a new pair of shoes, groceries, a plane ticket, or a new car. You can pretty much do it instantaneously without leaving your couch. When it comes to home loans, it’s still a process that tends to take weeks or more than a month, despite being a fairly straightforward transaction. Even home buying and selling is becoming simple, with iBuyers like Zillow beginning to dominate the landscape and cut out real estate agents in the process. It’s just the pesky mortgage that slows it all down. Why Mortgages Take Forever Mortgages tend to take 4-6 weeks from start to finish There are many entities involved that slow down the process Such as processors, underwriters, appraisers, title/escrow companies, etc. The manual review of documents is also very time consuming, and can be exacerbated based on lender capacity One of the main roadblocks to instant mortgage approvals is the many entities involved, on several different levels. We’re talking borrowers, lenders, appraisers, employers, loan officers, loan processors, underwriters, funders, title and escrow companies, insurance companies, notaries, and so on. A borrower seeking a mortgage has to provide a ton of paperwork, from a credit report to paystubs and tax returns to bank statements, disclosures, and more. Unfortunately, these documents come from a variety of sources, and once collected,... --- > It’s time for a new mortgage match-up. Since paying down the mortgage early seems to be so en vogue these days, it makes sense to compare “20-year - Published: 2019-09-19 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/20-year-vs-30-year-mortgages/ - Categories: Mortgage Matchups, Mortgage Tips It’s time for a new mortgage match-up. Since paying down the mortgage early seems to be so en vogue these days, it makes sense to compare “20-year mortgages vs. 30-year mortgages. ” The most common type of mortgage is the 30-year fixed. It amortizes over 30-years and the mortgage rate never changes during that time. Each mortgage payment is the same every month, so there isn’t any fear of interest rates resetting higher and pushing a homeowner toward foreclosure. It's also very affordable relative to other loan programs because of the ultra-long amortization period. Pretty straightforward, right? For this reason, it holds a near-90% share of the home purchase market, and accounts for over three-quarters of all home loans, including refinances. It is the gold standard. This simplicity and safety explains its popularity, but that doesn’t mean it’s the perfect home loan. After all, they take a full three decades to pay off, and with first-time home buyers sometimes entering the market between the ages of 30 and 40, one could easily carry their mortgage into retirement. Fortunately, there are other options with different loan terms to consider. How a 20-Year Fixed Mortgage Works Just like the more common and popular 30-year fixed mortgage The interest rate never changes during the entire loan term But the 20-year mortgage term is a full decade shorter This results in less interest paid in exchange for a higher monthly payment The 20-year fixed mortgage is a pretty simple loan program, just like it's... --- > Most people don’t bother shopping around for their mortgage, despite the tremendous potential savings involved. In fact, nearly half of consumers only - Published: 2019-09-18 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/borrowers-with-low-credit-scores-should-shop-their-mortgage-more/ - Categories: Mortgage Rates, Mortgage Tips Most people don’t bother shopping around for their mortgage, despite the tremendous potential savings involved. In fact, nearly half of consumers only bother obtaining a single mortgage rate quote. It’s understandable since it’s certainly not any fun calling a bank to inquire about a mortgage refinance or to set up home purchase financing. So expecting someone to call two or even three banks sounds completely intolerable. But the studies are out there – and they prove you can save some real money if you do take the time to contact more than one mortgage lender. While that’s totally your prerogative, it turns out some borrowers should put even more time into the process. Got a Low Credit Score? You Better Shop a Lot A new study from Zillow found that borrowers with the lowest credit scores are quoted the widest range of interest rates on their home loans, which means comparison shopping can be even more beneficial. For those with credit scores between 620 and 639, generally considered right smack above subprime, there was a 133-basis point (1. 33%) range between the lowest and highest APRs offered to borrowers seeking 30-year fixed-rate mortgages between September 2018 and mid-May 2019. Meanwhile, those with excellent credit scores (760+) only saw a range of 92 basis points (0. 92%) between the best and worst APRs. In terms of median APR offered, the 620 to 639 credit score cohort received a quote of 5. 48%, nearly a full percentage point (0. 94%) above the... --- > It can be more difficult to get a mortgage if you're self-employed. Learn about the special requirements and loan programs available to business owners. - Published: 2019-09-05 - Modified: 2021-08-07 - URL: https://www.thetruthaboutmortgage.com/mortgages-for-self-employed-borrowers-tips-to-qualify/ - Categories: Mortgage Tips Over the past few years, it’s gotten a lot easier to get a mortgage as technology has evolved. Today, when a mortgage lender asks for your financials, you may be given the option to grant digital access to things like your credit history, income, and assets using your login credentials. There’s much less of a need to collect, scan, and fax documents, or even upload them anymore. Yes, that too is becoming passé, thanks to single source validation and real-time income and asset reports. Unfortunately, one area that continues to be problematic is mortgages for self-employed borrowers, who often have more complicated financial situations that can’t be run through an automated underwriting system. That’s beginning to change as well, but if you’re self-employed and in need of a home loan, there’s a good chance the process is going to be more challenging than you expect. In fact, Fannie Mae's automated underwriting system used to explicitly view self-employment as representing increased risk. But going forward, now evaluates the composition of a borrower's income instead. So borrowers whose total annual income consists of a higher percentage of variable income, such as bonus pay, overtime, and commissions, will be seen as higher risk. You may also be restricted in how much you can borrow thanks to lender overlays, so be sure to take the time to shop around as requirements can vary by bank. Self-Employed vs. Salaried Borrowers If you are a W-2 employee you are considered salaried If you run your own... --- > On August 29th, 2019, major iBuyer Opendoor launched a mortgage lending division known as “Opendoor Home Loans” to create a one-stop shop for home buyers - Published: 2019-08-30 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/opendoor-home-loans-review/ - Categories: Mortgage Tips On August 29th, 2019, major iBuyer Opendoor launched a mortgage lending division known as “Opendoor Home Loans” to create a one-stop shop for home buyers and sellers. As a result, those interested in purchasing a property from Opendoor can take advantage of their financing department, similar to how home builders partner with mortgage lenders to facilitate loan closings. You can even sell an existing property to Opendoor and finance a new one, all with one company if you feel so inclined. Let’s learn more about this new mortgage lender, which operates out of Plano, Texas. Opendoor Home Loans Wants to Cut Closing Times in Half Aim to close home purchase loans in 3 weeks Offer $100 per day toward closing costs if loan closing is delayed Can generate a pre-qual letter in minutes via phone or computer Limited-time $1,000 closing cost credit also available to customers Noting that financing is often “one of the most complicated and intimidating parts of a home purchase,” they claim they can cut the typical 45-day timeline in half. So instead of closing in a month and a half, they aim to close your home loan in as little as about three weeks. They’re backing up that promise by offering $100 per day for every day beyond the scheduled closing date that the loan closing is delayed. To get started, they ask that you get pre-qualified, which can be accomplished over the phone or online in just minutes. You’ll receive a pre-qualification letter as well,... --- > Mortgage Q&A: “What is a lender overlay?” If you’ve been studying underwriting guidelines recently to determine if you’re eligible for a mortgage, - Published: 2019-08-29 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/what-is-a-lender-overlay/ - Categories: Mortgage Tips Mortgage Q&A: “What is a lender overlay? ” If you’ve been studying underwriting guidelines recently to determine if you’re eligible for a mortgage, it’s important to understand that they can vary widely from bank to bank. Even if you think you qualify based on the guidelines set forth by the FHA, USDA, VA, or Fannie Mae and Freddie Mac, you may be denied by an individual lender. Let's learn more about why this can happen and what you can do about it. Different Mortgage Lenders Assume Varying Levels of Risk Just like any other line of business out there Mortgage lenders have varying risk appetites and specialties Some will accept lots of risk in exchange for higher interest rates While others will stick to more conservative lending even if they lose customers in the process In a nutshell, mortgage lenders have different appetites for risk, along with different specialties, so what one lender will gladly approve, another may not touch with a 10-foot pole. One important concept you should familiarize yourself with is the “lender overlay,” which is essentially an expanded guideline (or set of guidelines) on top of what Fannie Mae, Freddie Mac, or the FHA/VA will allow. Think of it as a second coat of paint, applied after the primer. The primer is the bare minimum necessary, but you don’t see people driving around too often without that second coat. The same goes for mortgages. Fannie Mae, Freddie Mac, and the FHA/VA all set underwriting guidelines for residential... --- > People looking to buy a condo with FHA financing rejoice. HUD has released a new condominium approval process that, among other things, brings back spot - Published: 2019-08-15 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/fha-approved-condos-individual-units-now-eligible-for-financing/ - Categories: Housing Market, Mortgage News People looking to buy a condo with FHA financing rejoice. HUD has released a new condominium approval process that, among other things, brings back spot approvals. The policy, which goes into effect on October 15th, 2019, is part of the FHA's “broader Administration objective to reduce regulatory barriers that currently restrict affordable homeownership opportunities” In layman’s terms, it means more folks with low credit scores and not a lot of money in the bank will be able to take out a low-down payment mortgage on a condo, instead of being restricted to a single-family home purchase. That's an important distinction because condos tend to be considerably cheaper than houses, making them a more affordable option for those with lower incomes. Per HUD, there are more than 150,000 condominium projects in the United States, but a mere 6. 5% of them are approved for FHA financing. The new policy is estimated to make somewhere between 20,000 to 60,000 condominium units eligible for FHA-insured financing annually. The FHA’s New Condo Approval Process In the past the entire condo complex needed to be approved for FHA financing New rule will allow for individual units to obtain FHA financing Should make it easier for home buyers to purchase a condo with fewer restrictions Also extends recertification requirement for approved condominium projects from 2 to 3 years Come October 15th, it’ll get easier to obtain an FHA loan on a condominium. Before this rule was proposed, and as it stands now, if a condo complex... --- > It’s common knowledge that home buyers are interested in purchasing properties in good school districts. After all, many individuals purchase homes - Published: 2019-08-14 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/you-might-get-a-better-deal-if-you-buy-a-house-where-kids-live/ - Categories: Housing Market, Mortgage Tips It’s common knowledge that home buyers are interested in purchasing properties in good school districts. After all, many individuals purchase homes because they either have kids, or plan to in the near future. Simply put, families and families-to-be need more space, and a house is where you get that. But even if you don’t have children (and no plans to start a family), it can be smart to buy a house in a solid school district to ensure the resale value is strong when it comes time to sell. What’s perhaps more interesting is the idea that you might be able to get a better deal on a home purchase if you buy it from a family. Homeowners with Kids Sell More Urgently 23% of homeowners with kids sold “very urgently” per Realtor survey Versus just 14% of homeowners without kids Nearly half of homeowners with kids sold “somewhat urgently” While half of homeowners without kids said they could wait for right offer A new survey from the National Association of Realtors revealed that homeowners with children sold more urgently than those with no children. Specifically, 23% of sellers with children reported to NAR that they sold their home “very urgently. ” Comparatively, only 14% of sellers without kids said they had to sell their home quickly. Additionally, 46% of those with children residing in the home said they had to sell “somewhat urgently,” while about half of sellers with no children said they were “able to wait for the... --- > Mortgage match-ups: "Mortgage rates vs. the stock market." With all the recent stock market volatility, you may be wondering what effect such events have - Published: 2019-08-06 - Modified: 2023-02-05 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-vs-stock-market/ - Categories: Mortgage Matchups, Mortgage Rates Mortgage match-ups: "Mortgage rates vs. the stock market. " With all the recent stock market volatility, you may be wondering what effect such events have on mortgage rates. Do mortgage rates go up if stocks go down and vice versa? Or do they move in relative lockstep? Let's find out! Stocks and Mortgage Rates Follow the Economy Both stocks and mortgage rates take cues from the economy And they react to news in mostly the same way Whether it's good news or bad news Because what's going on economically matters to the underlying security Simply put, when economic fears rise, as they commonly do, whether justified or not, investors flee the stock market and head toward safer U. S. Treasury bonds, such as the benchmark 10-year bond. So stocks and bonds have an inverse relationship. Imagine a scale that is constantly rising and falling as investors jump from one side to the other. This phenomenon is known as the "flight-to-quality," whereby investors ditch the risk and head to safe havens like gold and U. S. Treasuries when fear is in the air. They do this because Treasuries have an explicit government guarantee, whereas anything can happen with individual stocks. In fact, a stock could go to zero and that would be that. Investment lost. Anyway, when demand for Treasuries and bonds increases, prices go up and yields drop because demand is so strong that a higher yield is no longer necessary to lure in investors. And because the 30-year fixed... --- > If you happen to be in the market to buy a home, you’re probably not giddy with delight over today’s sky-high listing prices. After all, home prices - Published: 2019-07-31 - Modified: 2024-01-31 - URL: https://www.thetruthaboutmortgage.com/wait-home-buying-is-the-cheapest-its-been-in-20-years/ - Categories: Housing Market, Mortgage News If you happen to be in the market to buy a home, you’re probably not giddy with delight over today’s sky-high listing prices. After all, home prices continue to inch higher and higher from their near-term lows seen about a decade ago after surging for years. Knowing the home seller purchased the property for 50% less than what they’re attempting to unload it for today, even though they bought it just five years ago, may also be hard to swallow. But what if I told you consumer house-buying power might reach its highest point in nearly 20 years if mortgage rates simply dip from around 3. 8% to 3. 7%. Forget the Home's Price Tag, Consider the Affordability It's not enough to look at listing prices over time You have to consider wage growth and interest rate movement This allows you to see real home prices adjusted for inflation To determine if they're a good deal or not First American, a large title insurance company, measures affordability using its Real House Price Index, or RHPI. It relies upon changes in income and interest rates to determine consumer house-buying power. Simply put, when average household income rises and/or mortgage interest rates fall, consumer house-buying power increases. Unadjusted home prices (the listing price you actually see) play a role as well, but you can’t just take the price at face value and look at it in a vacuum. One has to consider what those dollars are actually worth today once you factor... --- > If you ask most people, they’ll probably say you should save up a good chunk of money before buying a home, possibly even 20% of the purchase price. A - Published: 2019-07-30 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/why-a-low-down-payment-mortgage-might-be-the-safer-move/ - Categories: Mortgage Tips If you ask most people, they’ll probably say you should save up a good chunk of money before buying a home, possibly even 20% of the purchase price. A mortgage underwriter might share similar sentiment, even if their very own loan programs allow for low or even zero down payments. The general thinking is that someone who puts down more money has skin in the game, and is therefore a lower default risk. They won’t want to miss their mortgage payments and in the process lose their home, the equity they’ve accrued, and the down payment they plunked down with it. But a new study from the JPMorgan Chase and Co. Institute reveals that liquidity appears to be more important than equity, income, or payment burden. Money in the Bank More Important Than Down Payment If you put a large amount down when buying a home Be sure not to overlook the many closing costs involved While the monthly payment will be cheaper if you put more down You might not have a lot set aside if things go wrong When you purchase a home, it comes with lots of closing costs, ranging from appraisal and inspection fees, title and escrow charges, lender fees, moving fees, new furniture, renovations, and so on. It can be quite the financial hit, which explains why mortgage lenders often require asset reserves to ensure you can make your mortgage payments for a few months if money gets tight. Those who put down say 20%... --- > Here’s a hint – a moving van. While the 30-year fixed is the most common home loan program utilized by borrowers today, it might not be the most - Published: 2019-07-25 - Modified: 2019-07-25 - URL: https://www.thetruthaboutmortgage.com/one-quick-reason-to-avoid-the-30-year-fixed/ - Categories: Mortgage Tips Here’s a hint – a moving van. While the 30-year fixed is the most common home loan program utilized by borrowers today, it might not be the most economical. Aside from taking three decades to pay off your mortgage in full, you’re probably also paying a premium for something you might not even benefit from. Are You Really Staying for 30 Years? Most folks have trouble committing to something for 30 days, let alone 30 years. And when it comes to homeownership, this is no different. Sure, you might think you found your forever home, but a year or two later, you could be itching to move on to greener pastures, or simply someplace else. We move for a lot of different reasons, whether it’s due to a job relocation, a growing family, or other miscellaneous scenarios. Whatever the reason, one thing is clear; homeowners on average don’t stay in their properties for anywhere close to 30 years. So why take out a 30-year fixed mortgage and pay a premium for it? Average Tenure Rising, But Still Nowhere Close to 30 Years A recent report from ATTOM Data Solutions revealed that those who sold a home in the second quarter of 2019 had owned it for an average of 8. 09 years. This is actually a new peak, up three percent from the first quarter and four percent from Q2 2018. It’s also much longer than the homeownership tenure seen prior to the Great Recession, where it averaged 4. 21... --- > While they’re not yet directly involved in the mortgage industry, Amazon has now dipped its toes in the real estate pool via a new home buying program - Published: 2019-07-23 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/amazon-turnkey-review/ - Categories: Housing Market, Mortgage News While they’re not yet directly involved in the mortgage industry, Amazon has now dipped its toes in the real estate pool via a new home buying program known as TurnKey. What is TurnKey you ask? Well, it’s essentially a link-up between Realogy, a consortium of real estate brokerages, and Amazon, the largest retailer on the planet. Together, they want to pair you with a top real estate in your area and then help furnish your house with all the latest gadgetry. Read on to learn more about this new initiative, and more importantly, if it's a good deal for the consumer. What Is Amazon TurnKey? A new partnership between mega retailer Amazon and Realogy Amazon will refer home buyers to Realogy's real estate agents And these home buyers will get free stuff from Amazon Realogy will pay for it in exchange for the new business earned In short, TurnKey is a real estate referral program that seems to be targeting first-time home buyers, and more specifically Millennials. Instead of asking your parents, colleagues, or friends who they used when they purchased a home, you turn to, well, TurnKey, to pair you up with an agent. They claim their service “seamlessly connects homebuyers to one of the best real estate agents within their city or neighborhood,” who are part of the expansive Realogy family of brands. That includes agents from Better Homes and Gardens Real Estate, Century 21, Coldwell Banker, Corcoran, ERA, and Sotheby's International Realty, to name just a few.... --- > What a difference a decade makes. Back in 2009, it was a lot more common to hear about underwater mortgages than free and clear homeowners. In fact, a - Published: 2019-07-18 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/37-of-american-homeowners-are-now-free-and-clear/ - Categories: Housing Market, Mortgage News What a difference a decade makes. Back in 2009, it was a lot more common to hear about underwater mortgages than free and clear homeowners. In fact, a Deutsche Bank analyst warned at the time that 48% of U. S. homeowners would owe more on their mortgages than their properties were worth. Negative equity levels did indeed surge, thanks to plummeting home values and toxic zero down mortgages that allowed for negative amortization and interest-only payments. But times have changed. What Does Free and Clear Mean? A homeowner with no outstanding mortgages on their property Is considered to be "free and clear" It means there are no liens or encumbrances on title More importantly no additional mortgage payments are due! A new analysis from Zillow revealed that nearly forty percent (37%) of American homeowners are now “free and clear,” meaning they don’t carry a mortgage at all. That number is up from 29% back in mid-2012, when home prices were struggling to find a bottom and reverse course. This is the result of paying off a home loan, either on schedule or ahead of time thanks to a prepayment or extra payments, including biweekly mortgage payments. For those who took out 15-year fixed mortgages back in 2004 or so, they’d be free and clear too if they didn’t refinance or default during that span. It’s also possible some of these homeowners paid cash up front and never had a mortgage. Whatever the method, these homeowners are no longer borrowing money... --- > An overview of down payment requirements for a variety of different mortgages, including what's required for conventional and government-backed home loans. - Published: 2019-07-15 - Modified: 2023-11-14 - URL: https://www.thetruthaboutmortgage.com/a-primer-on-mortgage-down-payment-requirements/ - Categories: Mortgage Tips If you’re in the market to buy a new home or condo, you’ve undoubtedly thought (or stressed) about the required down payment. It's one of the biggest roadblocks to homeownership, and an obstacle that never seems to get any better over time. In fact, Zillow recently noted that it takes the average American over seven years to save up a 20% down payment. So much for instant gratification... But how much should you put down when buying a home? Better yet, how much do you need to put down? Well, let's talk about that. How Mortgage Down Payments Used to Work It used to be common to put down 20% or more when buying real estate As home prices got expensive, lenders began offering zero down financing The mortgage crisis hit and low down payments were partially to blame But now we're back to allowing a relatively low 3% to 3. 5% down Before the mortgage crisis unfolded, perhaps in the late 1990s and early 2000s, it was quite common for homeowners to come up with at least 20% of the sales price for down payment. This was the traditional number banks deemed acceptable in terms of risk. So prospective homeowners took their time, saved up money in the bank, and when the time was right, made a bid on a property. The way the banks saw it, borrowers had “skin in the game,” and were therefore a pretty safe bet when it came to making timely mortgage payments. Even... --- > If you’ve got a low credit score, but are determined to buy a new home (or looking to refinance your existing mortgage), you may be wondering how to get a mortgage. - Published: 2019-07-08 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/how-to-get-a-mortgage-with-a-low-credit-score/ - Categories: Mortgage Tips Mortgage Q&A: “How to get a mortgage with a low credit score. ” If you’ve got a low credit score, but are determined to buy a home (or are looking to refinance your existing mortgage), you may be wondering how to get a mortgage. Or if it's even possible. First things first though – how low is your credit score? Are we talking a 660 credit score or a 500 credit score? Everyone seems to have a different definition of low, so let's start there. You might even be pleasantly surprised to learn that your low score isn't really low at all, but instead just not absolute perfection. Mortgage lenders rely on FICO scores to make credit decisions. The FICO score range dips as low as 300 and rises as high as 850. The average credit score is somewhere around the high 600s to low 700s at any given time. I say somewhere because there are always different numbers being cited by different sources, and the data is often outdated. It's also a moving target that doesn't stay constant, but average scores don't stray too far from the high-600 to low-700 range. Home Loans for Bad Credit There are actually plenty of options for homeowners with questionable credit Including popular government home loans like FHA, USDA, and VA loans Along with non-government mortgages such as those backed by Fannie Mae and Freddie Mac However you might pay a premium for the privilege, so good credit should always be a priority... --- > Mortgage Q&A: “How soon can I refinance my mortgage?” With mortgage rates marching toward new all-time lows again, a lot of recent home buyers are - Published: 2019-06-27 - Modified: 2021-09-02 - URL: https://www.thetruthaboutmortgage.com/how-soon-can-i-refinance-my-mortgage/ - Categories: Mortgage Tips, Refinance Mortgage Q&A: “How soon can I refinance my mortgage? ” With mortgage rates marching toward new all-time lows again, a lot of recent home buyers are probably asking this question, even those who just closed on their mortgage weeks ago. After all, if your mortgage interest rate is a half-point or more above today’s new low levels, you might be leaving a considerable amount of money on the table. And because you haven’t yet made a dent in your mortgage, there’s no fear of resetting the clock and starting all over. There are of course closing costs to think about, including those you may have paid on your previous mortgage such as discount points, along with third-party costs like title insurance and appraisal fees, and so on. But it could be a smart move to grab a new mortgage while rates are low, even if yours is still in its infancy. Why Do You Need to Refinance Your Mortgage Right Away? Interest rates went down considerably Your borrower profile improved dramatically You want a different loan product A life event such as divorce occurred You paid cash and want your money back First let’s talk about why someone would want to refinance their mortgage shortly after taking it out. The most common and topical reason is because mortgage rates fell, substantially. It’s impossible to time the market and buy a home at exactly the “right time” when it comes to mortgage rates. Ultimately, they might be low or high when... --- > An online lender called "Owning" is looking to shake up the mortgage industry with what it refers to as "ridiculously low rates." In the past, they - Published: 2019-06-21 - Modified: 2024-06-22 - URL: https://www.thetruthaboutmortgage.com/owning-review/ - Categories: Mortgage Tips An online lender called "Owning" is looking to shake up the mortgage industry with what it refers to as "ridiculously low rates. " In the past, they doubled as a mortgage lender and real estate company, offering mortgage refinancing at low rates and a variety of home buying and selling tools including iBuying. But in early 2021, Owning was acquired by Chicago-based Guaranteed Rate, and will act as its lead generator going forward. The company now focuses on helping aspiring home buyers finance a property, and current homeowners interested in securing a lower rate on their existing home loan. Aside from attempting to make the process easier via new technology, they also offer an on-time closing guarantee. Read on to learn more. Owning Is a Direct-to-Consumer Mortgage Lender Direct-to-consumer mortgage lender offering home purchase loans and refinances Founded in 2018, headquartered in Orange, California Acquired by Guaranteed Rate in early 2021 Licensed to lend in 43 states and the District of Columbia Specialize in low-rate mortgage refinances and home purchases BBB accredited with an 'A+' rating at the moment 4. 9-star rating on Google based on over 2,100 customer reviews Not available in Alaska, Kentucky, Nevada, New York, Rhode Island, Utah, or Vermont What Owning Offers Home purchase loans Refinance loans (rate and term and cash out) Conventional loans backed by Fannie Mae and Freddie Mac Jumbo loans that exceed the conforming limit FHA/VA/USDA loans Fixed-rate and adjustable-rate options Lend on primary, second, and investment properties The Orange, CA-based company... --- > Freddie Mac has just launched a new renovation loan product known as the “Freddie Mac CHOICERenovation Mortgage.” While the name is a bit of a mouthful, - Published: 2019-06-20 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/freddie-mac-choicerenovation-mortgage-review/ - Categories: Mortgage News Freddie Mac has just launched a new renovation loan product known as the “Freddie Mac CHOICERenovation Mortgage. ” While the name is a bit of a mouthful, the offering is expected to be more liberal than their existing plainly named Renovation Mortgage. The new loan program will go head-to-head with similar offerings from Fannie Mae (HomeStyle Renovation) and the FHA (203k loan). Let’s learn more about the CHOICERenovation Mortgage and what makes it different from their old product. What Is the CHOICERenovation Mortgage? An all-in-one single close home loan That includes renovation costs and permanent financing Similar to Fannie Mae's Homestyle Renovation and FHA's 203k Can be used by first-time home buyers and existing homeowners via refinance In light of the aging housing stock out there, Freddie Mac is stepping up their renovation loan offering to help more homeowners and home buyers fix up properties that need some TLC. Since the Great Recession ended in 2009, the renovation market has grown by more than 50% to more than $400 billion annually, per the Harvard Joint Center for Housing Studies. Perhaps more shockingly, 40% of the nation’s 137 million homes are at least 50 years old, while 80% are at least 20 years old. This might explain all those dumpsters you see lining the neighborhoods, and the incessant noise of table saws throughout the day. Anyway, like the FHA 203k and HomeStyle Renovation loans, the CHOICERenovation Mortgage features a single-close home loan that combines purchase and renovation costs into one. It... --- > It’s starting to feel a little like 2006 again. Recently, we’ve seen mortgage lenders launching interest-only mortgages, 40-year mortgage terms, and now a - Published: 2019-06-12 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/startup-zerodown-lease-to-own/ - Categories: Housing Market, Mortgage News It’s starting to feel a little like 2006 again. Recently, we’ve seen mortgage lenders launching interest-only mortgages, 40-year mortgage terms, and now a company by the name of “ZeroDown” has launched in San Francisco. Before we worry that it’s the coming of yet another housing crisis, let’s learn more about this startup that aims to tackle the ongoing “affordability crisis” taking place in the Bay Area. While the name appears to say it all, ZeroDown actually offers even more than a home with no down payment requirement, with a twist. They let customers make all-cash offers on homes of their choosing and help them close in less than a week. How ZeroDown Works Bay Area residents can buy homes on a lease-to-own basis With no required down payment Can purchase the home after 2 years and up to 5 years later Or simply cash out purchase-credits earned during that time First off, this program is only available in the San Francisco Bay Area, similar to the POPPYLoan that launched a few years back for similar reasons. Anyway, to get started prospective home buyers fill out an online application to determine eligibility, with a soft credit pull and typical income/asset stuff verified. Assuming the applicant qualifies, they choose a home to purchase, which ZeroDown pays for in cash. Customers then have five years to “build up credit toward their down payment” via regular fixed monthly payments that do not change. With each payment made, borrowers earn so-called “purchase-credits,” which the company... --- > Mortgage Q&A: “What is home equity?” You've probably heard the phrase "home equity" get thrown around, likely during a fast-paced radio or TV - Published: 2019-06-03 - Modified: 2022-12-07 - URL: https://www.thetruthaboutmortgage.com/what-is-home-equity/ - Categories: Mortgage Tips Mortgage Q&A: “What is home equity? ” You've probably heard the phrase "home equity" get thrown around, likely during a fast-paced radio or TV commercial urging you to pull the equity out of your home NOW! So what the heck is it, and why do mortgage lenders keep bringing it up? It must be important, right? Let's learn more about it so you can determine if it's something you should be tinkering with. I'll also show you the formula to calculate how much you've got and discuss various ways to tap into it. How to Calculate Home Equity: Your Property Value Minus Loan Balance(s) In short, home equity is your ownership in an underlying property, minus any liens (mortgages) a bank or lender may have against it. To calculate your home equity, simply take the current market value of your property and subtract any outstanding liens/mortgage balances. It's actually pretty easy to figure out how much equity you've got in your home, as long as you know what your home is worth. But that's often the sticking point. A home value estimator like Zillow's Zestimate or the Redfin Estimate, or your own personal opinion, might not align with what the bank or lender feels your home is worth. Let's look at a quick home equity example: Current property value: $500,000 Existing liens: $350,000 first mortgage, $100,000 second mortgage Home equity: $50,000 In the scenario above, you'd have total outstanding liens of $450,000 on a property currently worth $500,000. The $50,000... --- > While homeowners of all ages are mostly happy they purchased a property, younger borrowers seem to be regretting their mortgages more than the rest of the - Published: 2019-05-30 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/young-homeowners-are-having-more-mortgage-regrets/ - Categories: Housing Market, Mortgage News While homeowners of all ages are mostly happy they purchased a property, younger borrowers seem to be regretting their mortgages more than the rest of the population. Per the semiannual survey titled, “Zillow Housing Aspirations Report,” Millennial and Generation Z homeowners are more likely to have qualms about their home loan compared to those aged 55 and older. But don’t call them lazy – Millennials contacted an average of 2. 8 mortgage lenders before choosing one, versus just 1. 7 for Gen X, 1. 8 for Boomers, and 1. 3 by the Silent Generation. The Mortgage Payments Are Too High The biggest regret for the 18-34-year-old cohort was “mortgage payments are too high. ” Some 30% cited this as a regret compared to just 12% of the 55+ crowd. This might have something to do with all those hidden costs of homeownership. In reality, they aren’t really hidden, but if you’ve been renting, you might be unfamiliar with things like property taxes, homeowners insurance, mortgage insurance, and so on. The mortgage payment itself might look appealing, especially with mortgage rates as low as they are, but once you consider the total housing payment, your feelings could change. Seasoned homeowners will already know about the total housing payment, not to mention the many other costs that go into homeownership like costly utilities and maintenance. So if you’re thinking about buying, look at everything that goes into a mortgage payment! I Rushed the Process The second most common regret (29% vs. 12%... --- > A new study from Redfin proved what we probably all assumed was the case; vacant homes sell for less than those filled with stuff. There’s something - Published: 2019-05-21 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/why-you-should-live-in-your-home-until-it-sells/ - Categories: Housing Market, Mortgage Tips A new study from Redfin proved what we probably all assumed was the case; vacant homes sell for less than those filled with stuff. There’s something slightly unappetizing about a vacant home, whether it’s the emptiness of it all, or the desperation knowing someone is losing money each month it sits on the market. Homes are also simply more exposed when there aren’t area rugs, couches, tables, and beds covering up minor (or major) defects. Vacant Homes Sell for Less and Take Longer to Sell Empty homes sold for 3. 6% less than occupied ones in 2018 That's about $11,000 less on average They also took an extra six days to sell So you may want to stick around (or at least make it appear that way) As suspected, vacant homes often sit on the market longer than their occupied counterparts and fetch lower prices. On average, such properties spent an additional six days on the market and went for $11,306 less when they finally did sell. This is according to a survey of homes listed and sold in 2018, conducted by real estate brokerage (and mortgage lender and iBuyer) Redfin. The biggest discounts were seen in Omaha, Nebraska and Greenville, South Carolina, where vacant properties sold for 7. 2% less than occupied homes on average, a haircut of about $15,000. Similar discounts were seen in El Paso, Texas, where the average vacant home sold for 6. 6% less, or roughly $10,000, compared with occupied homes. Discounts were smaller in... --- > First Redfin brought us the 1% listing fee, which disrupted the traditional 2.5% to 3% listing agents charge(d) to sell a home. But that still meant the - Published: 2019-05-14 - Modified: 2023-04-06 - URL: https://www.thetruthaboutmortgage.com/redfin-direct-buy-a-redfin-listed-home-without-a-real-estate-agent/ - Categories: Housing Market, Mortgage News First Redfin brought us the 1% listing fee, which disrupted the traditional 2. 5% to 3% listing agents charge(d) to sell a home. But that still meant the home seller was on the hook for 3. 5% or so if they elected to use an outside buyer’s agent, who needed to be paid 2. 5% commission for their end of the deal. Now they’ve upped the ante by launching “Redfin Direct,” which is being pitched as a service to buy a home without a real estate agent. The upside is that the 2. 5% commission is removed entirely, and only a 2% listing fee remains. That should result in savings for both home buyers and sellers, with less money going to third parties. How Redfin Direct Works The program was initially piloted in just a few metros nationwide, including Boston, Northern Virginia, and Texas on properties listed by a Redfin agent. It has since been rolled out to the Inland Empire, Los Angeles, Orange County, Sacramento, San Diego, and the rest of Virginia. Like a typical home purchase, a prospective buyer visits the Redfin website and browses the available inventory. This inventory only includes Redfin-listed homes, which ideally (as far as Redfin is concerned) will increase over time as the company gets a larger share of listings via its lower 1% commission. Next, this hypothetical buyer can book tours and visits the properties he or she is interested in viewing. Assuming they want to proceed with an offer, they can... --- > Mortgage Q&A: “What credit score do I need to get a mortgage?” If you're thinking about purchasing a new home or refinancing an existing mortgage, you - Published: 2019-05-07 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-credit-score-do-i-need-to-get-a-mortgage/ - Categories: Credit Scores, Mortgage Tips Mortgage Q&A: “What credit score do I need to get a mortgage? ” If you're thinking about purchasing a new home or refinancing an existing mortgage, you should know that your credit score is going to be a huge factor. In fact, it can make or break your loan approval and carries the most weight when it comes to determining your mortgage rate. Why are credit scores so important to mortgage lenders, you ask? Well, they use credit score(s) to measure your payment default risk, coupled with things like down payment, income, assets, and property/occupancy type. While credit scores aren't perfect, and were even partially blamed for the mortgage crisis of the early 2000s, they do tell lenders a lot about you. Simply put, the higher your credit score, the lower your interest rate, all else equal. And the more loan options you'll have. So be sure to get it right! Which Credit Score Do Mortgage Lenders Use? Mortgage Credit Scores Credit bureau Equifax Experian TransUnion FICO score version FICO Score 5 FICO Score 2 FICO Score 4 Also known as Equifax Beacon 5. 0 Experian/Fair Isaac Risk Model v2 TransUnion FICO Risk Score 04 (Classic 04) Are mortgage credit scores different? Mortgage lenders use FICO scores just like other finance companies But they pull one version from each of the three major credit bureaus This creates what is known as a tri-merge credit report The middle score is used for qualifying and mortgage rate purposes First and foremost, you... --- > Some 45 million Americans are expected to reach the typical first-time home buyer age in the next decade, which is a fresh 34 years old. This is 7.4% more - Published: 2019-04-30 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/why-you-might-want-to-skip-the-starter-home/ - Categories: Housing Market, Mortgage Tips Some 45 million Americans are expected to reach the typical first-time home buyer age in the next decade, which is a fresh 34 years old. This is 7. 4% more than the 41. 8 million individuals currently aged 35-44, per a new analysis from Zillow. In short, this means there’s the potential for even more demand than usual in the starter home market as those aged 24-33 transition from renting to owning. But it also means you might want to skip the starter home completely and just go for the forever home, or at least a property you can keep for the long haul. A Shortage of Starter Homes The lower-third of the market has appreciated 57. 3% in the past five years While for-sale inventory has fallen 23. 2% during that time With 45 million more potential buyers coming of age in the next decade It could get even more competitive and unaffordable Over the past five years, so-called “starter homes” (those in the least expensive third of the market) gained 57. 3% in value. While that’s great news for those who purchased such homes back in 2013-2014, it’s terrible news for those still renting. Another unfortunate truth is that many of the homes in this tier weren’t purchased by young couples with a dog that were planning to have a baby. Instead, they were purchased by institutional investors and later turned into single-family rentals. So they’re effectively off the market, perhaps for decades to come if that nascent... --- > Aside from tracking mud through your beautiful home, it turns out open houses actually lead to higher sales prices and less time on market, per a new - Published: 2019-04-25 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/study-open-houses-result-in-faster-more-expensive-home-sales/ - Categories: Housing Market, Mortgage News Aside from tracking mud through your beautiful home, it turns out open houses actually lead to higher sales prices and less time on market, per a new analysis from Redfin. The real estate brokerage, which studied 2018 for-sale listings, noted that properties featuring an open house sold for $9,046 more on average and spent seven less days sitting on the market. They discovered this by looking at sale-to-list price ratios and time on market of homes that held an open house within their first week on the market versus those that never had one. There’s certainly a lot of controversy regarding open houses, with some critics saying they do more for the listing agent than the homeowner (in the way of new leads for the agent). But they’re also pretty customary in many regions of the country, with some home sellers probably assuming they’re obligatory. However, it turns out they’re fairly rare in some parts of the U. S. In fact, just 24% of 2018 for-sale listings held an open house in the first week, which seems lower than you’d expect. They also aren’t held if the property is unique (think a multi-million-dollar mansion owned by someone famous who only wants serious buyers snooping around). Will Your Home Sell for More If You Hold an Open House? Homes sold for more in nearly all metros studied by Redfin When an open house took place in the first week of listing This was also the case in places where open houses... --- > Following the announcement made last summer to acquire Mortgage Lenders of America, “Zillow Home Loans” is now officially open for business. The new - Published: 2019-04-10 - Modified: 2023-11-15 - URL: https://www.thetruthaboutmortgage.com/zillow-home-loans-review-live/ - Categories: Mortgage News Following the announcement made last summer to acquire Mortgage Lenders of America, “Zillow Home Loans” is now officially open for business. The new division of Zillow, which is 300 employees strong and operating out of Overland, Kansas, complements the company’s Zillow Offers platform, which acts as an iBuyer of homes in various regions of the country. But the use of Zillow Home Loans is not restricted to just Zillow Offers' home sales, per a company press release. This means they’ll act as a full-scale mortgage lender, ostensibly offering both purchase and refinance loans to borrowers nationwide, regardless of whether they're buying or selling a Zillow-owned home. As to why they entered the competitive space, Zillow notes that obtaining a mortgage is often the “most complicated part of buying a home,” and so it’s eliminating that pain point. Or at least taking more control of it. Doing so makes their business of buying and selling homes a lot more certain, seeing that they’ll control the financing piece if the customer chooses to use Zillow Home Loans. They might even be able to get the home seller to use them for financing the replacement home purchase, while snagging the buyer's financing of a Zillow Offers’ property at the same time. There's clearly a lot of upside here. What Zillow Home Loans Offers At the moment, they’re advertising four main types of home loans on their website, including: - Conventional loans (those backed by Fannie Mae and Freddie Mac) - FHA loans -... --- > More fun and exciting mortgage Q&A: “What does a monthly mortgage payment consist of?” Have you ever been curious what you’re paying each month to - Published: 2019-03-04 - Modified: 2024-05-28 - URL: https://www.thetruthaboutmortgage.com/what-does-a-mortgage-payment-consist-of/ - Categories: Mortgage Tips More fun and exciting mortgage Q&A: “What does a monthly mortgage payment consist of? ” Have you ever been curious what you’re paying each month to live in your shiny new (or possibly dingy old) home or condo? Or how much it might cost per month to acquire such real estate? Let's learn more about what goes into a home loan payment so you can better estimate your total monthly outlay, or if you're a first-time home buyer, narrow down an appropriate purchase price. Knowing what it all costs is a cornerstone to the rent vs. buy question, and also key to knowing how much house you might be able to afford if you decide to dive into the real estate market. What a Typical Mortgage Payment Includes A monthly home mortgage payment, assuming it's not an interest-only loan, generally consists of four key components: a principal portion an interest portion property taxes homeowners insurance Mortgage Payment = PITI There’s a handy acronym to sum up the four parts of a mortgage payment known as "PITI. " When you say it, it sounds like "pity. " And I suppose it is a pity that we have to make mortgage payments every month, often for a staggering 30 years... or 360 months, but I digress. Anyway, mortgage lenders typically want "X" number of months of PITI for cash reserves if you’re verifying assets when you apply for a home loan. In short, this tells the mortgage underwriter you can actually pay... --- > In yet another effort to push mortgage lending firmly into the 21st century, loanDepot has debuted its proprietary “mello smartloan” technology, an - Published: 2019-02-21 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/loandepot-mello-smartloan/ - Categories: Mortgage Tips In yet another effort to push mortgage lending firmly into the 21st century, loanDepot has debuted its proprietary “mello smartloan” technology, an end-to-end digital mortgage loan intended to cut out the paperwork and lengthy turn times. It should also make the process a lot more secure, with less sensitive information floating around the web via email from borrower to lender. loanDepot claims it made history with this launch, so let’s learn more about it. mello smartloan Can Generate a Real Loan Approval in Just 7 Minutes loanDepot claims its new proprietary loan engine technology is really fast With real loan approvals generated in as little as seven minutes The process is less paperwork-intensive and more secure It can reduce fraud, lower costs to both lender and borrower, and create a better overall customer experience Aside from being a more secure lending platform, mello smartloan is built for speed, similar to many of the other new offerings we’ve seen lately in this space. The mortgage loan process can be very lengthy as it often takes anywhere from 30-45 days to close a mortgage, something that just won’t do in today’s era of instant gratification. Coincidentally, the company claims it can provide a customer with a full loan approval in as little as seven minutes, which happens to be a minute faster than Quicken’s Rocket Mortgage. So if you’re short on time (or patience), this might be just the ticket for you. Of course, timing isn’t everything. We also have to consider... --- > It’s that time again when we fret about the viability of the 30-year fixed mortgage. This last occurred in 2014 when Dick Bove warned that the Fed’s - Published: 2019-02-14 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/is-the-30-year-fixed-mortgage-going-extinct/ - Categories: Mortgage Tips It’s that time again when we fret about the viability of the 30-year fixed mortgage. This last occurred in 2014 when Dick Bove warned that the Fed’s tapering of mortgage purchases would mean curtains for the popular loan program. Say Goodbye to the 30-Year Fixed? It seems to happen every few years as folks start speculating about the future of Fannie Mae and Freddie Mac. The pair have been under government control since 2008 after the mortgage crisis basically tore them to shreds. Today, the Senate Banking Committee is going to hear from Mark Calabria, who has been nominated to become the next Federal Housing Finance Agency (FHFA) director. Assuming he replaces current director Mel Watt, some worry the very well-liked and widely used 30-year fixed mortgage may cease to exist. The basis for that argument is he might unwind Fannie and Freddie, which back the majority of 30-year mortgages out there. They’re able to play “middleman” as the WSJ puts it, by linking the loans with outside investors who are willing to take on the risks associated with a three-decade long fixed-rate loan. But if Calabria gets elected and decides that he doesn’t want the government to purchase 30-year fixed mortgages anymore, he could direct Fannie and Freddie to stop buying or backing such loans. This could make the mortgage market a lot less liquid for home loans with 30-year fixed terms, thereby pushing them to extinction or greatly increasing their price. If fewer investors are willing to buy... --- > There have been a lot of unpleasant headlines regarding the state of the real estate market lately. Earlier this week, Redfin noted that only 1 in 8 - Published: 2019-02-13 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/is-the-real-estate-market-going-to-crash-in-2019/ - Categories: Housing Market, Mortgage Tips There have been a lot of unpleasant headlines regarding the state of the real estate market lately. Earlier this week, Redfin noted that only 1 in 8 offers written by their agents faced competition from other prospective home buyers in January. That was down 53% from a year earlier, allowing Redfin to proclaim that “bidding wars have nearly vanished. ” The End of Bidding Wars? I guess that’s somewhat true if only around 13% of homes are getting multiple offers. A year ago, hot spots like Seattle and San Francisco were getting multiples on about 7 out of 10 and 8 out of 10 homes, respectively. This January, less than 20% of homes for sale in those cities faced any sort of competition. Home Prices Are the #1 Barrier to Entry Nowadays Meanwhile, the National Association of Home Builders (NAHB) noted that home prices are just too high for buyers these days. When they asked active buyers who hadn’t found a home in 3+ months of searching, the most common response (49%) was they couldn’t find an affordable home. Now this isn’t to say that there aren’t affordable homes out there, just not the homes these particular buyers would purchase. So nearly half of would-be buyers are struggling with prices, up from 42% a year earlier. This might explain that precipitous decline in bidding wars. A larger percentage of buyers also indicated that they couldn’t find a home with the right features, or in their desired neighborhood. Still, 63% said... --- > How to figure out a good price to pay for a home as a first-time home buyer, and ensuring you qualify for that loan amount. - Published: 2019-02-12 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/what-is-a-good-price-for-a-first-time-home-buyer/ - Categories: Housing Market, Mortgage Tips Buying your first home can be pretty nerve-wracking. Regardless of what you pay, whether it seems like a little or a lot, there are going to be some sleepless nights early on. The first time I bought a place, I threw the bed sheets over my head and didn’t emerge until morning, night after night. It was stressful. I even turned to a friend to talk about it, and he said if you’re worrying about the what-ifs, you’re already there. So chill out. Okay? Got it. The Lender Will Let You Know the Most You Can Afford Your first stop might be a bank or mortgage lender For a free no obligation pre-qual or pre-approval letter To determine the maximum you can afford based on your finances This can at least set the price ceiling to limit your home search We know there isn’t a universal answer here, but we can discuss the underlying stuff to come up with a suitable answer depending on your unique situation. Per the National Association of Realtors, the national median existing single-family home price in the third quarter of 2020 was $313,500, up a whopping 12% percent from a year earlier. First-timers might shoot for a price around these levels because starter homes tend to be on the cheaper side of things, but it's not that easy. Home prices in individual housing markets nationwide will run the gamut, with many cities well above the median. Additionally, one's finances will come into play because they... --- > As home prices continue to flirt with record highs nationwide, the cost of property taxes and hazard insurance can be the tipping point. For example, if - Published: 2019-01-29 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/the-cost-of-property-taxes-and-hazard-insurance/ - Categories: Mortgage Tips As home prices continue to flirt with record highs nationwide, the cost of property taxes and hazard insurance can be the tipping point. For example, if you purchase a one-million dollar home these days, you can expect to pay around $15,000 or more annually for property taxes and insurance in certain states. Ouch! On a monthly basis, you're looking at an additional $1,250, which is what a total monthly mortgage payment might cost folks in other, less expensive parts of the country. That’s a large chunk of change, especially considering million-dollar homes in California are the norm for many popular metropolitan areas. Factor in that most people buying these caliber homes aren’t necessarily multi-millionaires either and things can get unaffordable in a hurry. Simply put, if and when you buy a home, you need to consider these additional costs instead of merely looking at the mortgage payment. Taxes and Insurance Can Account for a Big Chunk of Your Mortgage Payment Let's look at a hypothetical $500,000 home purchase in California. Yes, there are still homes offered at that price, I think? Anyway, assuming our imaginary borrower could muster a 20% down payment, they'd be left with a $400,000 loan amount. If they obtained a mortgage interest rate of 4. 5%, their monthly principal and interest payment would be $2,026. 74. Not too bad, right? But wait, there's more! We have to dial in the property taxes and homeowners insurance, which will change the equation. Let's add $6,250 annually for property... --- > In an effort to make life a little easier for its mortgage customers, Chase has launched a new suite of “flexible automatic payments,” including a - Published: 2019-01-22 - Modified: 2019-01-22 - URL: https://www.thetruthaboutmortgage.com/chase-launches-free-biweekly-mortgage-payment-option/ - Categories: Mortgage News In an effort to make life a little easier for its mortgage customers, Chase has launched a new suite of “flexible automatic payments,” including a biweekly option. If you happen to have a home loan serviced by the banking giant, you should receive information regarding the new payment options, all of which are free. Chase now provides customers with three payment options that are automatically deducted either once a month, twice a month, or every two weeks. That last option is a biweekly setup, with 26 half payments resulting in 13 total monthly payments annually. Customers can also continue to make payments manually as well. Chase’s Flexible Automatic Mortgage Payments If you had been interested in a biweekly payment program, you can now do it hassle-free thanks to this change. You can also choose to make payments automatically and/or split your monthly payment into two to correspond with a paycheck. Once a month option: Choose any date within your mortgage payment grace period and monthly payment is automatically deducted. Twice a month option: Split your mortgage payment into two to be withdrawn twice monthly, paid once the total amount due is remitted. Every two weeks option: Make half a mortgage payment every two weeks, funds applied once total monthly payment collected. Results in at least two extra half payments annually with extra applied to principal. The first two options just allow borrowers to make automatic payments, which can be handy to avoid missing a mortgage payment. But neither actually save... --- > Getting a mortgage can be pretty exciting, especially if it's your first time. It can also be a very daunting process fraught with the potential for - Published: 2019-01-22 - Modified: 2023-10-18 - URL: https://www.thetruthaboutmortgage.com/15-things-to-do-after-your-mortgage-funds/ - Categories: Mortgage Tips Getting a mortgage can be pretty exciting, especially if it's your first time. It can also be a very daunting process fraught with the potential for errors and missteps. I've already discussed what to do before applying for a mortgage. Now let's talk about what to do after. 1. Make sure it actually funded! First things first, make sure your home loan really funded! Never assume anything in this world, especially when it involves a six- or seven-figure number. There have been countless stories of folks going out and buying big-ticket items days before their mortgage was set to fund, only to find out that it was a big no-no. Just because you signed loan docs doesn’t mean your mortgage funded. For example, refinance transactions generally require a 3-day rescission period from the day you sign to the day they fund. The last thing you want is for your lender to receive an alert about an undisclosed new debt, which could force them to re-run your numbers and delay your loan closing. 2. Look at all your paperwork While you should have gone through all your paperwork line by line before you signed and the loan ultimately funded, it doesn’t hurt to glance at it again now that the dust has settled. It can be a bit of a whirlwind while meeting deadlines and feeling high levels of stress. So once that’s all done, it can be a good time to sit down and review at your own pace, with... --- > If you’ve been doing some mortgage shopping/research lately and happened to come across the phrase “non-conforming loan,” you might have some questions. - Published: 2019-01-16 - Modified: 2021-09-02 - URL: https://www.thetruthaboutmortgage.com/what-is-a-non-conforming-mortgage-loan/ - Categories: Mortgage Tips If you’ve been doing some mortgage shopping/research lately and happened to come across the phrase “non-conforming loan,” you might have some questions. At first glance, you probably understand that the loan in question doesn’t conform, but to what exactly? Well, what they mean is that it doesn’t adhere to the standards of Fannie Mae and Freddie Mac, which together back the majority of mortgages in the United States. The pair essentially keep the mortgage market liquid by buying the loans lenders originate, or by packaging them into mortgage-backed securities (MBS). But if your particular loan doesn’t meet their underwriting criteria for one reason or another, it does not conform and therefore can’t be backed or purchased by them. As such, there’s a good chance it’ll be more difficult to find financing, and potentially more expensive as well, essentially because there are fewer lenders willing to fund your loan. For the record, many lenders only originate conforming loans, so your options can shrink in a hurry if your loan is non-conforming. Why Are Mortgages Deemed Non-Conforming? A loan is non-conforming if it doesn't meet Fannie Mae or Freddie Mac's guidelines There are numerous loan requirements that must be met Including maximum loan amounts, which vary by area/property type Mortgages that exceed these limits are known as jumbo loans The most common reason for a mortgage to be non-conforming is loan amount. Fannie Mae and Freddie Mac only accept loans up to a certain size, known as the conforming loan limit. This... --- > Just like that another year has passed, well almost, so it’s time once again to look forward to what the next 365 days might bring. Will 2019 be a winner - Published: 2018-12-19 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2019-mortgage-rate-forecast-we-could-be-in-for-a-big-surprise/ - Categories: Mortgage Rates, Mortgage Tips Just like that another year has passed, well almost, so it’s time once again to look forward to what the next 365 days might bring. Will 2019 be a winner for mortgage rates, or will home buyers and refinancers face more agony like they did in 2018? As always, I compile predictions and data from the leading mortgage and real estate industry groups to come up with the annual forecast. This year I’ll also include my own prediction to provide even more insight (or confusion) to the situation. Let’s dive in! 2019 Mortgage Rate Prediction Chart The chart above shows 2019 mortgage rate predictions from the MBA, Fannie Mae, Freddie Mac, and NAR. They're basically the biggest players in the residential mortgage space so they should have a good idea as to where rates may go, though like any other prediction, it might turn out that nobody gets it right. Note that these predictions come from the last release of 2018 from these trade groups, and that they update their forecasts throughout the year, often monthly. MBA 2019 Mortgage Rate Forecast We’ll start with the Mortgage Bankers Association and their monthly Mortgage Finance Forecast. Each month, they adjust their expectations for things like housing starts, home sales, home prices, mortgage origination volume, and most importantly, mortgage rates. Specifically, they detail where they think the 30-year fixed rate will land each quarter, based on Freddie Mac's average rate, which is based primarily on home purchase transactions. This is what 2019 looks... --- > Following the release of the 2019 conforming loan limit, HUD announced the 2019 FHA loan limits, which like the former will move higher next year. Similar - Published: 2018-12-17 - Modified: 2018-12-27 - URL: https://www.thetruthaboutmortgage.com/2019-fha-loan-limits-rise-floor-climbs-above-300k/ - Categories: Mortgage News Following the release of the 2019 conforming loan limit, HUD announced the 2019 FHA loan limits, which like the former will move higher next year. Similar to conforming loans, FHA loans have loan amount limits set either at the floor, the ceiling, or somewhere in between. The big difference is that the FHA floor (also the maximum loan amount in many counties) is much lower than the conforming limit, the latter of which is set to rise to $484,350 in 2019. This can be pretty important depending on the metro in which you’re buying or refinancing a home loan to ensure it is eligible for backing by the FHA. 2019 FHA Loan Limit Increasing to $314,827 New maximum FHA loan amount for low-cost areas is $314,827 Up roughly 7% from $294,515 in 2018 This means a home buyer in Phoenix, AZ can use FHA financing For a slightly larger home purchase, up to $326,000 vs. $305,000 currently Nationwide, this floor will increase to $314,827 from $294,515 come January 2019, which is 65% of the national conforming loan limit of $484,350. It represents a roughly seven percent increase from 2018, which is a reflection of rising home prices nationwide. A quick example of the impact would be the Phoenix, Arizona metro, which is set at the floor despite having a very wide range of home prices both high and low. The max FHA loan limit will climb from $294,515 to $314,827 in 2019, meaning a prospective home buyer could soon use... --- > There have been three recessions since the 1990s, including the Great Recession, which took place from 2007 and 2009 and lasted about a year and a half. - Published: 2018-12-13 - Modified: 2023-01-09 - URL: https://www.thetruthaboutmortgage.com/home-prices-vs-recessions/ - Categories: Housing Market, Mortgage Matchups There have been three recessions since the 1990s, including the Great Recession, which took place from 2007 and 2009 and lasted about a year and a half. Earlier, a recession took place in 1990 thanks to growing inflation and debt, followed by the Iraqi invasion of Kuwait, which exacerbated oil prices. Just about everyone knows what happened a decade later, the infamous dot-com bubble, where any old (actually very new) tech company was valued at billions of dollars, despite failing to turn a profit. Or even having a business to speak of. Feels Kind of Like the Year 2000 Again... Your electric scooter company is worth how much? What's a unicorn? Why does every new company use a single word for its name? This is starting to feel a little bit fishy Reminds me of when every website was worth a billion dollars Interestingly, it’s beginning to feel a lot like the year 2000 when you look at the many tech companies raising millions of dollars and grabbing billion-dollar valuations. Just look at those ubiquitous scooter companies, which are somehow worth billions... I anticipate those things being obsolete in 10 years, or at least relegated to bike paths at popular tourist attractions. Remember Segway? Ironically, they do the tech on some of these very scooters. Anyway, it’s clear that we seem to be heading back down a dark path, with fears of another recession right around the corner. So much so that there’s talk the Fed might stop raising rates,... --- > First off, here are my 2018 predictions in case you want to see how they panned out. Overall, I think I did alright, though my call for the 30-year fixed - Published: 2018-12-11 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2019-mortgage-and-real-estate-predictions/ - Categories: Housing Market, Mortgage Tips First off, here are my 2018 predictions in case you want to see how they panned out. Overall, I think I did alright, though my call for the 30-year fixed to end 2018 at 4. 5% didn't quite materialize. There's actually still time for that to happen thanks to a late rally, but it's doubtful. Anyway, let's get to those 2019 predictions... 1. Mortgage rates will only rise moderately, if at all Sure, mortgage interest rates will probably increase somewhat in 2019, but it’s doubtful we’ll see anything close to the carnage we saw in 2018. The silver lining to all the movement this year is less next year, or at least that’s the hope. We’ve already seen some pullbacks in late 2018 thanks to the ongoing trade war and concerns of an impending recession, which could force the Fed to pump the brakes on future rate hikes. Similarly, traders may ditch stocks and head for safe haven bonds, which would push down yields and ideally trickle down to lender rate sheets too. Regardless, mortgage rates remain attractive when you look at historical levels, especially since home prices are still below peaks in many metros seen during the last boom. I personally don’t see higher mortgage rates being a roadblock for most folks, though it’s obvious they can reduce overall home purchasing power. That just means looking for cheaper homes, such as those in the suburbs instead of the big city. Or hoping for a raise at work. Or a... --- > As expected, the conforming loan limit for 2019 has increased thanks to an ongoing rise in property values, according to a news bulletin released by the - Published: 2018-11-27 - Modified: 2018-12-27 - URL: https://www.thetruthaboutmortgage.com/2019-conforming-loan-limit-will-be-484350-for-mortgages-backed-by-fannie-and-freddie/ - Categories: Mortgage News As expected, the conforming loan limit for 2019 has increased thanks to an ongoing rise in property values, according to a news bulletin released by the Federal Housing Finance Agency (FHFA) this morning. Beginning in 2019, the maximum loan amount for a one-unit property will be $484,350, a $31,250 increase from the current $453,100 limit. Per the FHFA's seasonally adjusted, expanded-data home price index (HPI), property values increased 6. 9% between the third quarters of 2017 and 2018. As a result, the conforming loan limit in 2019 will rise by the same percentage. For reference, home prices rose by 6. 8% in the same period a year earlier. So despite some negative press regarding the housing market recently, it’s still humming along just fine. Higher 2019 Conforming Limit May Help Homeowners Secure Lower Mortgage Rates Home prices increased 6. 9% between Q3 2017 and 2018 As a result the conforming limit will rise by same percentage This could benefit new and existing homeowners Since conforming loans are generally priced lower and easier to qualify for This so-called “baseline conforming limit” is the maximum loan amount acceptable for residential mortgages eligible for purchase by Fannie Mae and Freddie Mac. It also applies to VA home loans, which are offered to active duty military and veterans. Generally, conforming mortgages price cheaper than non-conforming ones, such as jumbo loans. However, this isn’t always the case. Still, if you can keep your loan amount at or below the conforming limit, you should have the... --- > When you apply for a mortgage, underwriters will comb through your finances to determine if you’re a good candidate for a loan. This includes verifying a - Published: 2018-10-31 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/what-is-verification-of-employment-for-a-mortgage/ - Categories: Mortgage Tips When you apply for a mortgage, underwriters will comb through your finances to determine if you’re a good candidate for a loan. This includes verifying a lot of personal information, including your income, assets, credit history, and employment. Without these important details, it would be impossible for the lender to assess your default risk, or chances of missing a mortgage payment, or worse, being foreclosed upon. This is known as “capacity,” which is one of the three C's of underwriting and basically your ability to repay the loan. When You Apply for a Mortgage You’ll Provide Employment Information First you simply input your employment information on the loan application Including job position and time on the job Along with your salary and any overtime/bonuses This is later verified with financial documents and verification of employment During the initial stages of the home loan process, you’ll simply input or tell the bank or broker what you do for a living, how much you make, and how long you’ve done it. As a rule of thumb, mortgage lenders generally want a minimum of two years in the same position or line of work. This shows them a history of earnings, that you have consistently been employed, and have the ability to maintain employment, all of which are important to ensure timely mortgage payments are made in the future. Once your home loan application arrives at the underwriter’s desk, they’ll dig into the details a bit more and connect all the dots. This... --- > If you haven’t heard of "Guaranteed Rate," there’s a good chance you’ve never applied for a home loan before. Or maybe you just don’t live in the Midwest, - Published: 2018-10-31 - Modified: 2024-08-17 - URL: https://www.thetruthaboutmortgage.com/guaranteed-rate-mortgage-review/ - Categories: Mortgage Tips If you haven’t heard of "Guaranteed Rate," there’s a good chance you’ve never applied for a home loan before. Or maybe you just don’t live in the Midwest, where they’re headquartered. Despite being from Chicago, they offer home loans to borrowers in all 50 states and Washington D. C. , so they can be included in your mortgage search if and when it comes time to apply. Their goal is to become the top retail mortgage lender in the country, which while ambitious, isn’t necessarily out of reach given their tremendous growth in such a short period of time. The Relatively Short History of Guaranteed Rate The retail mortgage lender was founded in the year 2000 Its headquarters are in Chicago, Illinois They have roughly 4,000 employees and nearly 350 offices nationwide One of the top-10 largest retail mortgage lenders in the country Funded nearly $50 billion in home loans during 2020 While they’re a pretty big name in the mortgage world, they only got started back in the year 2000. That means they’re less than 20 years old, which is pretty short stint for a such a successful lender. In 2020, they originated more than $48. 8 billion in home loans, which should put them in or close to the top 10 in terms of total volume for all mortgage lenders. Part of their growth can be attributed to acquisitions, including Manhattan Mortgage in 2012, and Sun State Home Loans, Nationwide Direct, Arbor Mortgage, and Firstrust Mortgage in 2014.... --- > Despite closing a higher number of mortgage loans last year, Quicken Loans was unable to wrestle the coveted top spot away from Wells Fargo, per HMDA data - Published: 2018-10-30 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/wells-fargo-the-top-mortgage-lender-in-2017-quicken-tops-for-number-of-loans/ - Categories: Mortgage News Despite closing a higher number of mortgage loans last year, Quicken Loans was unable to wrestle the coveted top spot away from Wells Fargo, per HMDA data parsed by iEmergent. During 2017, the under-fire San Francisco-based bank managed to fund $93 billion in total residential mortgage volume, claiming a 5. 6% share of the total mortgage market in the process. It’s pretty impressive when you consider the many scandals they’ve had to face in the past couple years. Apparently customers weren’t all that concerned about their questionable practices, even some involving their mortgage processes like that lock scandal. The company handily beat out its closest rival, Quicken Loans, which managed only $81. 3 billion in total volume throughout the year. While a healthy number for sure, it was about $12 billion shy of Wells Fargo, which makes it clear that the megabank isn’t quite ready to give up its mega lead. Quicken Closed the Most Mortgage Loans in 2017 However, what was interesting was total number of loans originated. Quicken and its highly successful Rocket Mortgage platform mustered a higher number of originated loans during 2017. Per iEmergent, the Detroit-based nonbank lender closed 395,648 loans, besting Wells Fargo by more than 100,000 loans (Wells closed just 272,938 loans). If we break that down by loan size, we’re looking at an average loan amount of $205,601 for Quicken and $340,844 for Wells Fargo. That’s a difference of roughly $135,000 per loan, with Wells’ loans about 66% larger on average. Wow! In... --- > Today let’s talk about PrimeLending, a PlainsCapital Company, which is a top-10 mortgage lender that does business in all 50 states. Perhaps their biggest - Published: 2018-10-25 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/primelending-mortgage-review-committed-to-customer-satisfaction/ - Categories: Mortgage Tips Today let’s talk about PrimeLending, a PlainsCapital Company, which is a top-10 mortgage lender that does business in all 50 states. Perhaps their biggest claim to fame is their 96% customer satisfaction rating given to their fleet of 1,500 loan officers. They certainly seem to pride themselves on making their customers happy, with the slogan “Home Loans Made Simple. ” They also have a mascot named "Mo," short for momentum, that is a real live buffalo living near Fort Worth, TX. Let’s learn more about who they, what types of loans they offer, and why you might use them on your next purchase or refinance transaction. Who Is PrimeLending? A direct-to-consumer mortgage lender owned by the PlainsCapital Company that has been around since 1986 A wholly owned subsidiary of PlainsCapital Bank (that is also a wholly owned subsidiary of Hilltop Holdings Inc. ) Publicly traded under the symbol (NYSE: HTH) Funded more than $22 billion in home loans during 2021 Most active in the states of California and Texas but licensed nationwide First a little bit about their history – PrimeLending started out back in 1986, which if you’re good at math, is just over 35 years. Back then, they had just 20 employees. Today, they’ve got more than 3,000 employees throughout the nation. And since that time, they’ve apparently helped more than 500,000 Americans purchase a home, fix up a property, or refinance an existing mortgage. They seem to excel in home purchase lending, as evidenced by the fact... --- > If you already own some real estate, perhaps a house or a condo, and are looking to move on, you might ask yourself if it’s better to sell it or rent it - Published: 2018-10-15 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/sell-your-house-or-rent-it-out/ - Categories: Housing Market, Mortgage Tips If you already own some real estate, perhaps a house or a condo, and are looking to move on, you might ask yourself if it’s better to sell it or rent it out. This is an especially pertinent question when home prices appear to be peaking and are at/close to all-time highs. Similar to how they are now, maybe? Like most things in life, the answer to this question isn’t universal – there are lots of different factors and scenarios to consider that will vary widely by individual situation. But we can at least discuss some of the pros and cons of keeping a property versus selling it. Some of wealthiest folks out there got that way by investing in real estate, holding onto their properties, and building an empire. So there’s clearly a lot of potential upside. But there are risks as well. Buy a Primary Residence Then Eventually Rent It Out Instead of buying a rental property outright It might be possible to buy a primary residence that you live in initially Then eventually rent out once you’re ready to move on This can result in better financing terms and greater knowledge of the property Personally, I like the idea of purchasing real estate, living in it for a while, and then renting it out. This way you get to know the property, the neighborhood, the neighbors, and so forth. You should also get the best financing terms available because mortgage rates are cheapest for primary residences. Buying... --- > In a perfect world, you could tap into your home equity and lower your mortgage interest rate at the same time. But because interest rates rise and fall - Published: 2018-09-27 - Modified: 2018-09-27 - URL: https://www.thetruthaboutmortgage.com/how-to-get-cash-out-of-your-home-in-a-rising-rate-environment/ - Categories: Mortgage Tips, Refinance In a perfect world, you could tap into your home equity and lower your mortgage interest rate at the same time. But because interest rates rise and fall over time, this simply won’t always be the case for homeowners in need of cash. This is especially true these days as the great bulk of existing homeowners out there locked in mortgage rates at all-time lows. This has created an interesting problem - homeowners are sitting on the most available home equity in history, yet very few are tapping into it. The reason being is that most don’t want to give up their 3. 5% 30-year fixed mortgage in exchange for one closer to 4. 75% or even higher. After all, doing so will hit their monthly housing payment twice – once via the higher interest rate, and a second time via the larger loan amount associated with the cash out refinance. For some, this could create qualification issues if DTIs are maxed out. And for others it’s just not an attractive option. At the same time, there are few other places (if any) where you can borrow money more cheaply than via your home. Clearly credit card interest rates are sky-high, as are any personal loan options. So even if rates have risen since you last purchased your property or refinanced, cashing out will likely still be the cheapest option. So what are you to do if you need cash and interest rates are unfavorable? Open a Second Mortgage If... --- > Are you sick and tired of your Redfin Estimate or Zillow Zestimate being too low? Do you feel your property is worth much, much more than they say it is? - Published: 2018-09-26 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/redfin-launches-the-owner-estimate-to-give-homeowners-control/ - Categories: Housing Market, Mortgage News Are you sick and tired of your Redfin Estimate or Zillow Zestimate being too low? Do you feel your property is worth much, much more than they say it is? Well, I’ve got great news for you! Redfin has introduced the “Owner Estimate,” a new tool that gives the appraiser reigns to the homeowners themselves. Instead of letting that pesky algorithm scare off potential buyers, you can get your hands dirty and tell the company (or its computer) why your property is actually worth a whole lot more than the “most accurate online estimate for on-market homes,” per an independent study by SSRS. Of course, it’ll still rely on some “core machine-learning” to get the job done, but there’s a chance you can generate a higher value than what the company yields on its own. And best of all, you can feature the Owner Estimate on your property page for all to see, right above the Redfin Estimate (which you can incidentally hide). Even better, you don’t have to make the Owner Estimate publicly visible if you don’t like what it comes up with, so it’s basically a win-win. How to Generate a Redfin Owner Estimate It’s a pretty simple and straightforward process. Once logged in at Redfin, you begin by searching for your property on their website. This will populate a Redfin Estimate for said property, along with some public facts like square footage and number of bedrooms and bathrooms. Simply click on “Create an Owner Estimate” to get... --- > Following the recent trend of real estate and mortgage link-ups, Quicken Loans has launched “Rocket Homes” to fill in the real estate gap and - Published: 2018-09-11 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/quicken-launches-rocket-homes-to-compete-with-zillow-and-redfin/ - Categories: Housing Market, Mortgage News Following the recent trend of real estate and mortgage link-ups, Quicken Loans has launched “Rocket Homes” to fill in the real estate gap and simultaneously compete with the likes of Zillow and Redfin. The company actually isn’t new, but is a rebrand of Rock Holding Inc. ’s In-House Realty, aligning it with its very popular and successful Rocket Mortgage home loan lending unit. In-House Realty Becomes Rocket Homes The company has been around for more than 10 years Rebranding to align with other Quicken brands Already one of the nation’s largest real estate referral networks With more than 25,000 agents in nearly every neighborhood nationwide In-House Realty, now Rocket Homes, has been around for more than a decade, and is actually one of the largest real estate referral networks. They’ve already helped some 500,000 clients buy and sell homes via the assistance of 25,000+ licensed real estate agents. Now they want to go a step further by creating a seamless home buying experience from start to finish that combines the online home search, real estate agent selection, and the mortgage process. Together, the hope is to create a one-stop shopping experience for home buyers who can find a home via the Rocket Homes portal and then get financing for their home purchase via Quicken Loans, which will be the preferred lender. On the consumer side of things, Rocket Homes will probably look similar to Zillow, with a home search feature and tons of information on properties like number of bedrooms... --- > Everyone wants to be #1 these days. I guess that’s no different than any other days, but the battle to be on top is growing more and more contentious, - Published: 2018-09-11 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/the-largest-nonbank-home-purchase-lender-in-the-nation-is-a-wholesaler/ - Categories: Mortgage News Everyone wants to be #1 these days. I guess that’s no different than any other days, but the battle to be on top is growing more and more contentious, especially as overall home loan volume wanes. Rather surprisingly, a nonbank lender that also happens to be a wholesaler took the second spot for home purchase lending in the second quarter of the year. United Wholesale Mortgage Beat Out Everyone But Wells Fargo The wholesale lender originated $11. 2 billion in the second quarter Of which $8. 3 billion was home purchase loans Overall loan volume up 68% year-over-year compared to the six-month mark of 2017 Highest growth rate among top 25 mortgage lenders in the country I’m referring to United Wholesale Mortgage, or UWM for short, which issued a press release to celebrate the accomplishment this morning. It’s the latest in a string of “we’re bigger than you” announcements in the mortgage industry, with a prior notable one being Quicken Loan’s declaration that it was the largest home loan lender in America back in February. Of course, all of these proclamations come with a little fine print, or perhaps some very specific categorization. For example, Quicken was the top mortgage lender in the fourth quarter of 2017, but Wells Fargo was still the top lender for 2017 overall. And UWM was simply the largest nonbank purchase loan lender in the nation during the second quarter. If we remove the nonbank part from the equation, Wells Fargo was once again king,... --- > If you’re a prospective home buyer, life isn’t fun right now. The real estate market remains red hot (despite those headlines about it cooling) and - Published: 2018-08-14 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/5-things-home-buyers-are-doing-if-they-havent-found-a-property-after-3-months/ - Categories: Housing Market, Mortgage News If you’re a prospective home buyer, life isn’t fun right now. The real estate market remains red hot (despite those headlines about it cooling) and quality properties are few and far between. Adding to this frustration is the notion that with every passing day, mortgage interest rates are inching higher and higher, putting further strain on eroding affordability. Meanwhile, existing homeowners are having a field day, getting top dollar for homes that just a few years ago may have been underwater and worth half as much. The Home Search Is Often Taking 3 Months or Longer While 90 days isn't necessarily such a long time to find a home Today's buyers are spending a good amount of time house hunting And it's often ending with either few or no prospects Or concessions such as paying more than budgeted or buying outside the desired locale A new poll from the National Association of Home Builders (NAHB) found that the home search isn’t a quick one these days, even though homes seem to get scooped up instantly once they’re listed. Some 14% of adults who responded to their prior poll in the second quarter of 2018 said they planned to purchase a home in the next 12 months, with 49% "actively engaged" in the search. More than half of those who indicated that they had started the home searching process said they’ve been spending three months or longer attempting to find the right home. This has been the case for the past... --- > In what seemed like a pretty inevitable move, Zillow has gotten into the mortgage originating business via its acquisition of Mortgage Lenders of America, - Published: 2018-08-06 - Modified: 2023-11-15 - URL: https://www.thetruthaboutmortgage.com/zillow-enters-the-mortgage-originating-business/ - Categories: Mortgage News In what seemed like a pretty inevitable move, Zillow has gotten into the mortgage originating business via its acquisition of Mortgage Lenders of America, which is expected to close in the fourth quarter of 2018. I say inevitable because just about every other major real estate or mortgage player is taking steps to ensure they’re involved in all (or many) aspects of the transaction. In fact, Zillow noted in its second quarter 2018 shareholder letter that it’s their goal to become “more of an end-to-end provider for housing-related services. ” Obviously, it’s synergistic to do so and creates a new way to cross-sell and perhaps streamline the home buying process. It’s kind of like how real estate agents have a “mortgage person” in-house to quickly dole out home loan pre-approvals and to ensure their would-be home buyer can actually make it to the finish line. Zillow Was Already in the Mortgage Business Zillow has been in the mortgage business for many years Selling mortgage leads to lenders via its Mortgage Marketplace And it owns a company called Mortech That provides mortgage pricing, online rate quoting, and rate sheet generation For the record, Zillow isn't at all new to the mortgage industry, with its Mortech arm that provides mortgage rate pricing and related tools, and its Mortgage Marketplace, where they sell borrower leads to lenders. So they're not entering the mortgage business, they're entering the mortgage origination business. They will actually be making mortgages instead of staying on the periphery. It's... --- > It’s that time of year again, when we enter the housing doldrums and everyone in the industry begins to panic. Further exacerbating things this time - Published: 2018-08-02 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/dont-make-the-mistake-of-calling-the-housing-top-too-early/ - Categories: Housing Market, Mortgage Tips It’s that time of year again, when we enter the housing doldrums and everyone in the industry begins to panic. Further exacerbating things this time around is the fact that mortgage interest rates are in uncharted territory. Yes, I’m being facetious, they’re a mere percentage point above their all-time lows. And last time I checked, a 30-year fixed mortgage in the 4% range is a pretty decent rate, even if it isn’t the lowest rate ever offered in history. But sure, it doesn’t help matters that financing is more expensive and clearly does nothing to boost eroding affordability. Though it probably won't hinder the market much either. It’s Typical for Things to Slow Down This Time of Year If you've been seeing reports of slowing home sales And headlines warning that we could be headed toward another bubble Know that it's normal for housing to sputter out in the heat of summer Before repeating its spring fling next year The housing market is more or less predictable, with a quiet winter, followed by a busy spring home buying period, followed by a waning summer and less busy fall. So it’s not unusual for market watchers and everyday Joes to begin questioning the housing market this time of year, wondering if this is the last great year for real estate. After all, if the market isn’t absolutely crushing it, something must be seriously wrong, right? We’re already starting to see the articles about the housing market “cracking. ” Or beginning to... --- > While "Freedom Mortgage" might not be a household name like Quicken Loans or Wells Fargo, the company often finds itself in top-10 lists when it comes to - Published: 2018-07-30 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/freedom-mortgage-review-specialize-in-va-loans-but-offer-everything-else-too/ - Categories: Mortgage Tips While "Freedom Mortgage" might not be a household name like Quicken Loans or Wells Fargo, the company often finds itself in top-10 lists when it comes to mortgage lending. In fact, they were the top VA lender during 2020, funding a whopping $72 billion in VA loans, and the top FHA lender with $35 billion in FHA loan volume. Freedom Mortgage also set a new monthly record in December 2020 with nearly $15 billion in total volume, which is a testament to how large they have become. So they’re clearly no slouch in the home loan space. In fact, they recently celebrated their one millionth borrower, who happened to be a veteran living in Fishers, Indiana. The borrower being a veteran was no coincidence because Freedom Mortgage specializes in government lending, including both VA loans and FHA loans. It also wasn’t surprising that the borrower resided in Fishers, seeing that Freedom Mortgage is the second largest employer there thanks to its 2006 acquisition of Irwin Mortgage. Table of Contents - Freedom Mortgage History - #1 VA Loan Lender in the United States - What Freedom Mortgage Offers - Freedom Mortgage Rates - Freedom Mortgage Reviews - Thoughts on Freedom Mortgage - Pros and Cons of Freedom Mortgage - Freedom Mortgage vs. Veterans United The History of Freedom Mortgage They were founded all the way back in 1990 (they are industry veterans) Refer to themselves as 5th largest mortgage provider in the United States The company's main headquarters are in Boca... --- > If you’re one of many people out there who happens to bring in money from a so-called “gig economy” job, you might be wondering if such income can be used - Published: 2018-07-25 - Modified: 2019-10-22 - URL: https://www.thetruthaboutmortgage.com/getting-a-mortgage-with-a-gig-economy-job/ - Categories: Mortgage Tips If you’re one of many people out there who happens to bring in money from a so-called “gig economy” job, you might be wondering if such income can be used to obtain a home loan. Most mortgage lenders will verify your income to determine how much mortgage you can afford. But if it can’t be documented, or is unusual in any way, you may run into trouble when attempting to use it. While the kinks are still being worked out for on-demand workers, seeing that it’s such a new trend, the good news is mortgage financiers like Fannie Mae and Freddie Mac are already discussing options and beginning to take action. This means it should get easier to use gig economy income when it comes time to get a mortgage, even if it isn’t totally clear at the moment. The cooling mortgage market may also result in a more expeditious effort on this front to get more customers in the door as millions could benefit from clearer rules. What Is the Gig Economy? While temporary employment isn't a new thing by any means The ability to work remotely and get hired quickly Often just with a smartphone and no direct boss Is a relatively new concept that is changing the way we look at working First things first, let’s discuss what exactly the gig economy is. Put simply, it’s the workforce behind companies like Uber, Lyft, Postmates, Airbnb, Amazon Flex, Etsy, TaskRabbit, and many others. It’s basically a job that... --- > Redfin just launched its so-called “Compete Score,” a tool designed to help prospective home buyers determine how hard it’ll be to “win a home” in a - Published: 2018-07-24 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/redfin-compete-score-how-hard-is-it-to-win-that-home/ - Categories: Housing Market, Mortgage News Redfin just launched its so-called “Compete Score,” a tool designed to help prospective home buyers determine how hard it’ll be to “win a home” in a particular city or neighborhood. Is this the beginning of the end? The late stages of a housing market rally that began nearly six years ago depending on the region of the country? It feels a little ominous, but let’s learn more about this new tool for home buyers and sellers that complements their existing Redfin Estimate. What Is Redfin Compete Score? A new housing market competition tool from Redfin That measures now competitive a city or neighborhood is Based on things like average number of offers received Along with sale-to-list price ratio and days on market At the moment, Compete Score is available in some 8,200 cities and 13,000 neighborhoods across the United States. In short, it measures how many offers a home typically receives in a certain region, along with what price a home tends to sell for relative to its list price. Additionally, days on market and number of waived contingencies is calculated. This results in a Compete Score ranging from 0 to 100, with the higher numbers representing more competition and the lower numbers signifying less interest. When you browse a specific listing on Redfin’s website or app, you’ll see a section about market competition under the neighborhood tab. You can also see a Compete Score for an entire city or neighborhood on the new “Home Values” tab when searching in... --- > One of the larger, but perhaps lesser-known mortgage lenders out there is Flagstar Bank, which was just acquired by New York Community Bancorp in late - Published: 2018-07-11 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/flagstar-mortgage-review-tons-of-loan-programs-to-choose-from/ - Categories: Mortgage Tips One of the larger, but perhaps lesser-known mortgage lenders out there is Flagstar Bank, which was just acquired by New York Community Bancorp in late April 2021. The savings bank, which has been around since the late 1980s, is based out of Troy, Michigan and publicly traded on the NYSE. They’ve also got billions in assets so they probably aren’t going anywhere anytime soon. Flagstar survived the Great Recession in the early 2000s, albeit with some bruises and scratches thanks in part to their strong mortgage presence. Despite a series of settlements related to their mortgage business, they remain also a top home loan originator, with the company self-proclaiming itself to be a “top 5 bank mortgage originator. ” Notice they said bank because many of today’s largest mortgage lenders aren’t banks, and are in fact non-banks, meaning they don’t take in deposits like Flagstar does. Not only is Flagstar a bank, but they have aspirations to become an even bigger one. The company recently acquired 52 banking branches from Wells Fargo in a bid to double its customer base, and it just happened to purchase them from the nation’s largest mortgage lender. And their logo is being featured on the front of the Detroit Pistons jerseys, representing the franchise's first-ever sponsor. So it sounds like Flagstar is on a mission to grow even larger in the home loan space and become more of a household name nationwide. Let’s learn more about them to see if they should be included... --- > While all the headlines paint a really rosy picture for the real estate market where sellers are cashing in mega gains, the average takeaway isn’t all - Published: 2018-06-27 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/average-home-seller-in-2017-made-only-39000/ - Categories: Housing Market, Mortgage News While all the headlines paint a really rosy picture for the real estate market where sellers are cashing in mega gains, the average takeaway isn’t all that great. A recent analysis from Zillow revealed that the typical home seller in 2017 earned just $38,856, which was actually slightly below the figure seen a year earlier. And while the past two years have been the best since 2007, when the median gain was $47,500, it’s not all that fantastic. A $15k Gain for Home Sellers After Inflation? You can look at the before and after sales price and think Wow! But once you factor in inflation And other costs like staging, moving, and other fees The actual return on investment could be quite poor Adjusted for inflation, the number falls to just $15,000 for the average home seller. And if you look at it as an annualized return, it’s just 2. 94%. For the record, those who sold their homes last year owned them for a median 8. 5 years. So before you think you’re missing out, ask yourself exactly what you expect to miss. Some Sellers Are Cashing In Big Time There will always be big winners in real estate Just like there are with any other investments Like the stock market where individual names skyrocket But understand returns will vary tremendously Sure, other areas saw much bigger returns. For example, San Jose home sellers led the nation with a staggering $296,000 median dollar gain, which adjusted for inflation was... --- > Another Millennial or even Gen-Z focused mortgage lender has come online, literally, to offer you a mortgage. I’m talking about Laurel Road, which sounds - Published: 2018-06-13 - Modified: 2024-08-01 - URL: https://www.thetruthaboutmortgage.com/laurel-road-truly-digital-mortgages-built-entirely-online/ - Categories: Mortgage News Another Millennial or even Gen-Z focused mortgage lender has come online, literally, to offer you a mortgage. I’m talking about Laurel Road, which sounds like a really neat place to get a home loan. They claim to “offer an end-to-end digital experience,” meaning you can go through the entire home loan process without leaving your couch, maybe. The use of technology like data verification and the policy of human interaction only when needed can speed up the loan process and potentially cut costs for the borrower. It’s a pretty common claim these days as up-and-coming disruptors emerge in the space and the old guard scurry to update their stale practices. Let’s learn more about the company to see what they’re all about and if they’re any different than what’s already out there. Laurel Road Began in the Student Loan Space Originally known as Darien Rowayton Bank Their online lending division began offering student loan refinancing in 2013 They’ve done over $3 billion in loan origination volume since then And now wants to dive into the mortgage space They are a Darien, Connecticut-based FDIC-insured bank and direct lender formerly known as “Darien Rowayton Bank,” which is the name of two cities near Stamford, CT. They appear to have three physical bank branches in that area of Connecticut, but seem to be making the move primarily to online lender. They offer home loan products in all 50 states, including Washington D. C. Laurel Road’s online lending division launched a student loan refinancing... --- > If you speak to any financial planners or so-called experts on the matter, they’ll probably say, “Yes, pay off your mortgage before you retire.” But is it - Published: 2018-06-13 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/should-you-pay-off-your-mortgage-before-retirement/ - Categories: Mortgage Tips If you speak to any financial planners or so-called experts on the matter, they’ll probably say, “Yes, pay off your mortgage before you retire. ” But is it fair to make the same conclusion for all individuals? Probably not. And times are changing... Homes are a lot more expensive than they used to be. And mortgage rates are a lot lower. Contrast this to the 1980s, when mortgage rates were double-digits and home values were sub-$100k. This, along with eroding affordability and lower savings for the average American, and it's a question that has taken on new life. Carrying a Mortgage Into Retirement Most experts will tell you to extinguish the mortgage before you retire from your job The rationale is that you'll be on a fixed income with reduced cash flow But with mortgage rates so cheap, one could argue to keep the mortgage And put money toward other things, like funding a retirement account The logic to burning the mortgage before you retire is that you’ll be on a fixed income and you’ll need to stick to a strict budget to ensure you have cash on hand for all your living expenses. And potentially even more money to pay for expensive medical care as you get really old. There’s also the fear of losing your home because you can’t keep up with mortgage payments, the last thing any older retired individual would want to deal with. Others may go even go a step further in saying that paying... --- > If you haven’t heard of PNC Mortgage before, you probably will soon. They’re a rapidly growing mortgage lender just outside the top-10 list. - Published: 2018-06-05 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/pnc-mortgage-review-low-rates-maybe-but-not-much-else/ - Categories: Mortgage Tips If you haven’t heard of PNC Mortgage before, you probably will in the near future. They’re a rapidly growing depository bank and mortgage lender with 2,600 branches across 19 states nationwide. PNC is also one of the top 10 largest banks in the United States based on total assets. However, most of their retail operations tend to be in the Midwest and Northeast regions of the country. But you can still apply for a home loan with the company from just about anywhere in the United States because they let you apply online, by phone, or in person at a branch. Let’s learn more about PNC to see if they should be included in your home loan search. Who Is PNC Bank? A depository bank and mortgage lender with roots in Pittsburgh The name is based on two former predecessors (Pittsburgh National Corporation and Provident National Corporation) They acquired National City Mortgage during the housing crisis in 2008 to become a major mortgage player A top-20 mortgage lender nationally that funded about $20 billion in home loans during 2022 The history of PNC Bank can be traced all the way back to the mid-1800s, though it’s unclear when they first began offering mortgages on residential properties. But one thing is certain – they’ve been around a while and look to be growing larger as time goes on, especially in the home lending space. One major catalyst in their growth story had to do with their timely acquisition of National City... --- > Okay, it sounds a little silly, but it’s not a bad deal if you happen to have a million dollars lying around the house. CitiMortgage has so-called - Published: 2018-05-31 - Modified: 2018-05-31 - URL: https://www.thetruthaboutmortgage.com/citi-is-offering-50-off-your-mortgage-rate-if-you-deposit-a-million-bucks/ - Categories: Mortgage News Okay, it sounds a little silly, but it’s not a bad deal if you happen to have a million dollars lying around the house. CitiMortgage has so-called “relationship pricing” that affords its customers certain discounts on home loans they take out with the bank, which I know a lot of other banks offer as well. They just seem to be upping the ante when it comes to the discount, going beyond the boring old . 125% off your mortgage rate. CitiMortgage Offers Tiered Rate Discounts Depending on What You Deposit As you can see from this handy chart, even if you deposit just one dollar, you can get $250 off your closing costs when taking out a home loan with Citi. These tiers are available to both new and existing Citi customers, so if you already meet requirements, it's a no-brainer to at least consider them when looking for a mortgage. The caveat with any of these discounts is that you must agree to have the money automatically transferred from your Citi checking or savings account each month to make your mortgage payments. Banks favor autopay when it comes to receiving mortgage payments because there’s probably some data point out there that says it lowers default rates. It's unclear how long the money actually has to remain with Citi once your mortgage is funded. They certainly wouldn't require it to be there for a full 30 years... Anyway, if you’re able to muster a deposit of $50,000 or more, you... --- > A new home loan program is being rolled out this July by Freddie Mac, known as “HomeOne Mortgage,” which features a 3% down payment and no income - Published: 2018-04-30 - Modified: 2018-04-30 - URL: https://www.thetruthaboutmortgage.com/freddie-mac-homeone-mortgage-new-3-down-mortgage-with-no-income-restrictions/ - Categories: Mortgage News A new home loan program is being rolled out this July by Freddie Mac, known as “HomeOne Mortgage,” which features a 3% down payment and no income restrictions. While Freddie Mac already offers a similar 3% down program via its Home Possible Advantage loan, this new product doesn’t restrict borrower eligibility by income or geography. To accompany this launch, the existing Home Possible line of mortgages will see their income limits revised (capped) to 100% of area median income (AMI) for all loans other than those in low-census income tracts. This is being done to better serve low- and moderate-income borrowers via that program. In other words, HomeOne will be a broader 3% down home loan program, though the underwriting requirements are fairly similar. Let’s learn more about this exciting new home loan financing option. Freddie Mac HomeOne Requirements Must be an owner-occupied property Includes 1-unit single-family residences, condos and townhouses Must be a purchase transaction or rate and term refinance (no cash out) At least one borrower must be a first-time home buyer If all borrowers first-timers, must complete homeownership education Max loan-to-value ratio (LTV) of 97% Must be a fixed-rate mortgage At least one borrower must have a usable credit score The highlight of the new HomeOne loan program is its 3% minimum down payment, along with the lack of income restrictions. They actually allow a combined loan-to-value (CLTV) of 105% if you use an Affordable Second mortgage to go with it. But most home buyers will probably... --- > While mortgages are largely a commoditized product, unlike perhaps a TV or a smartphone with unique technology, their cost can still vary considerably by - Published: 2018-04-18 - Modified: 2025-03-11 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-vary-by-lender-so-shop-around/ - Categories: Mortgage Rates, Mortgage Tips While mortgages are largely a commoditized product, unlike perhaps a TV or a smartphone with unique technology, their cost can still vary considerably by lender. The reason mortgage rates are different across banks and lenders could be a result of operating costs, risk appetite, desire to dominant a certain region, and so on. If one bank’s strategy is to be the most competitive on rate in California, they might be able to smoke the competition. But you won’t know that if you only speak to one company and it happens to not be that bank. Even One Additional Quote Can Save You Thousands! Here's why one mortgage quote simply isn't enough Borrowers who gather two mortgage quotes can save between $966 and $2,086 over the life of the home loan The savings jump even higher if you take the time to get 5+ quotes With the average expected savings a whopping $2,914! I get it – no one wants to do it, it’s painful, it’s annoying, it can be time-consuming. Who wants to be badgered by multiple salespeople? No one. But you need to change your mindset and look at that time spent as an investment. What is your ROI for spending a few additional hours speaking to other banks, credit unions, and mortgage brokers? A new analysis from mortgage financier Freddie Mac found that the ROI could be sky-high, seeing that 80% of borrowers who obtained just one additional mortgage rate quote will save between $966 and $2,086 over... --- > Here we go again? Maybe, maybe not. Regardless, Carrington Mortgage has launched a new line of subprime mortgages available to the 100 million odd U.S. - Published: 2018-04-05 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/carrington-mortgage-launches-line-of-subprime-mortgages/ - Categories: Mortgage News Here we go again? Maybe, maybe not. Regardless, Carrington Mortgage has launched a new line of subprime mortgages available to the 100 million odd U. S. consumers who have less than perfect credit. For the record, Carrington already offers subprime loans via government channels, like the FHA and VA, since both permit credit scores in the 500s, which is well below the typical 620 FICO score subprime cutoff. What makes this more interesting is that the loans aren’t backed by Fannie Mae and Freddie Mac, or Ginnie Mae, so they appear to a be a proprietary loan solution offered up by Carrington. Home Loans for Credit Scores Down to 500 FICO scores as low as 500 Loan amounts as high as $1. 5 million Cash out as high as $500,000 Recent credit events are OK Bank statements acceptable to verify income My assumption is that the new line of mortgages will be considered non-QM, which means they don’t comply with the Qualified Mortgage rule. Among other things, the QM rule requires a max DTI ratio of 43% and no excessive upfront points and fees, with a 3% cap in place. It’s possible some of the loans may still earn the QM stamp of approval, but it will probably depend on the loan in question. Anyway, Carrington says they are an “ideal solution” for those who have lower credit scores, high debt-to-income ratios, a recent credit event, or just happen to be self-employed. Carrington’s Non-Agency Loan Products They are portfolio loan... --- > One trend I’ve been seeing lately is buying a multi-unit property, such as a duplex, and renting out one unit while living in the other. The cool kids are - Published: 2018-04-04 - Modified: 2023-01-19 - URL: https://www.thetruthaboutmortgage.com/getting-a-mortgage-on-a-duplex-triplex-or-fourplex/ - Categories: Mortgage Tips One trend I’ve been seeing lately is buying a multi-unit property, such as a duplex, and renting out one unit while living in the other. The cool kids are referring to this as “house hacking” because you essentially get someone else to pay your mortgage, or at least a portion of it. Sweet bro! While that might be true, there are different underwriting guidelines applied to multi-unit properties, so it might not be as simple as it appears. First, What Is a Duplex? A duplex is a two-unit residential property Located on the same lot adjacent to one another With separate entrances (doorways) And completely exclusive living quarters Let’s start by defining what a duplex is . As the name suggests, it consists of two units, as opposed to one. So you wind up with two attached living units. This differs from a townhouse, which may have two floors but only one unit. The theory here is that you’d live in one and rent out the other, collect the rent from your tenant, and apply it to your mortgage payment each month. In effect, they pay off your mortgage for you. In that sense, you could lower your net housing expense while making an investment for your future. Sounds like a win-win, right? On the one hand, living right next to your tenant is a good thing – you can keep your eye on things and make sure they don’t destroy the place. On the other hand, living directly adjacent... --- > There’s been a lot of hubbub about mortgage rates since the start of the year. It’s not unwarranted, given the fact that 30-year fixed rates increased - Published: 2018-03-21 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/what-will-happen-to-home-sales-if-mortgage-rates-rise-to-9/ - Categories: Housing Market, Mortgage News There’s been a lot of hubbub about mortgage rates since the start of the year. It’s not unwarranted, given the fact that 30-year fixed rates increased from 3. 95% to 4. 46% from January through early March, per Freddie Mac data. But they also dropped last week for the first time all year – so it’s possible we’re beginning to see a plateau after a few stressful months. And history tells us that periods of rapid increases are often followed by declines, meaning relief might be in sight for those affected by the supposed carnage. Forget 5%, How About a 9% Mortgage Rate? While 5% mortgage rates are within reach Let's talk about what would happen if they increased to 9% A doubling of current interest rates Actually wouldn't do much to dent the housing market Now let’s talk about that headline - what would happen to residential home sales if 30-year fixed mortgage rates doubled from around current levels of ~4. 5% to 9%? This assertion comes from First American (a title insurance company) and its chief economist Mark Fleming. He compares the unlikely scenario to actual events that took place between 1977 and 1981. During that period, mortgage interest rates rose from 8% to 18%, which is actually a 125% increase. It was the most “dramatic increase” in rates in 50 years, and in 1980 alone, rates shot up 50% year-over-year. As a result, single-family home sales plummeted 36% between 1979 and 1981. Could the same thing happen... --- > There is yet another zero down mortgage option available to prospective home buyers, the latest being offered by The Massachusetts Housing Finance Agency - Published: 2018-03-19 - Modified: 2021-09-02 - URL: https://www.thetruthaboutmortgage.com/masshousing-launches-zero-down-mortgage/ - Categories: Mortgage News There is yet another zero down mortgage option available to prospective home buyers, the latest being offered by The Massachusetts Housing Finance Agency (MassHousing). The quasi-public agency already offers 30-year fixed-rate mortgages up to 97% loan-to-value (LTV), but launched its Down Payment Assistance (DPA) program to extend financing to 100% combined loan-to-value (CLTV), meaning no down payment is necessary to purchase a home. Like similar home loan programs, there are maximum income limits, and it’s only available to home buyers in the state of Massachusetts. First-Time Home Buyers Can Get a Property with Zero Down MassHousing is offering a rare zero down home loan option To first-time home buyers Generally defined as those who haven't owned real estate in the past 3 years The property must be your primary residence First things first, the single-family home or condo needs to be your first. Generally, this means no ownership in real property in the past three years prior to application. It also means the home should be your primary residence, one that you occupy. But in reality, you may have owned a home several years ago and could still be eligible. Additionally, it might be possible to purchase a 1-4 unit property via this program. On top of the occupancy requirement, there are income limits, which vary by county. The maximum area median income is $103,4000 or less in eastern Massachusetts, $85,700 in Worcester County, and $67,200 in Berkshire County. Assuming you meet those requirements, you also have to meet minimum... --- > Guild Mortgage is one name you may have come across lately while searching for a mortgage. They’re a rapidly growing independent mortgage banker with over - Published: 2018-03-19 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/guild-mortgage-review/ - Categories: Mortgage Tips Guild Mortgage is one name you may have come across lately while searching for a mortgage. They’re a rapidly growing independent mortgage banker with over 350 physical, retail branches nationwide. Those branches are located in 49 states nationwide, with their employee headcount around 4,200 at last glance. New York seems to be the one state missing. In years past, they beat out Rocket Mortgage (formerly Quicken Loans) for the number one spot in customer satisfaction for primary mortgage originations by J. D. Power, which was a very big deal given Quicken's hold on the top spot. Let’s learn more about this privately held company to determine if they might be a good choice for your home loan needs. Guild Mortgage Got Started in San Diego in the 1960s Founded in 1960, originally known as Guardian Mortgage Initially offered FHA loans and financing for homes built by American Housing Guild Now a top-30 mortgage lender nationwide focused on retail lending Offers all types of home loans including mortgage refinances and renovation loans A publicly traded company under the symbol NYSE: GHLD Funded $15 billion in home loans during 2023 Licensed to do business in 49 states and the District of Columbia Originally known as Guardian Mortgage, the company launched in 1960 in San Diego, California, founded by Martin Gleich. In the beginning, they offered FHA loans to first-time home buyers and home purchase loans to buyers of homes built by American Housing Guild. Today, they are a top-10 mortgage lender by... --- > USAA Mortgage, technically known as USAA Bank Home Loans, is one of the larger mortgage lenders out there, though not quite in the top 10. They’re - Published: 2018-03-14 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/usaa-mortgage-review-va-loans-jumbo-and-more/ - Categories: Mortgage Tips USAA Mortgage, technically known as USAA Bank Home Loans, is one of the larger mortgage lenders out there, though not quite in the top 10. They’re probably best described as a top 25 mortgage lender, but they’ve got a great website (per my opinion) and good customer service, per J. D. Power, so I figured it would be prudent to take a closer look. For the record, USAA stands for United Services Automobile Association, an outfit based out of San Antonio, Texas. The company has that name because they started out in the insurance business, helping military members get auto insurance coverage, then gradually began offering more financial services, including auto loans, personal loans, credit cards, and home loans. They're basically a full-fledged bank today, but let’s learn more about those mortgage offerings, including USAA's mortgage rates, shall we. What USAA Mortgage Offers Mainly conforming loans that meet Fannie/Freddie guidelines Also VA loans for military and their families Don't offer FHA or USDA loans Must be a USAA member to get a mortgage from them First off, USAA offer plenty of loan options, including conforming loans that meet the underwriting guidelines of Fannie Mae and Freddie Mac, along with VA loans, which are available for active duty military and veterans and their families. Additionally, they offer jumbo loans on loan amounts as high as $3 million, which should satisfy most home buyers, and even jumbo VA loans. Notably absent from their mortgage product lineup are FHA loans and USDA loans,... --- > There have been a lot of so-called mortgage disruptors entering the space of late, but this might be the biggest yet. Could Amazon Mortgage be in the - Published: 2018-03-09 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/amazon-mortgage-might-be-a-thing-soon/ - Categories: Mortgage News There have been a lot of so-called mortgage disruptors entering the space of late, but this might be the biggest yet. Could Amazon Mortgage be in the works? One recent clue says yes. Earlier this week, HousingWire noted that Amazon appears to be in the process of setting up a mortgage shop, and is apparently hiring talent from a nonbank in the top 10 HMDA lenders. I believe that includes the likes of Quicken Loans, loanDepot, and Caliber Home Loans, though it’s unclear if any of their former employees are actually involved. All the publication could say beyond that is Amazon is looking for someone to head up their “newly-formed mortgage lending division. ” A 1-Click Mortgage Sounds Kind of Nice, But... Amazon makes shopping really easy Allowing millions of customers to buy millions of items with one click But mortgages are a different beast Though the hope is technology will make them a lot easier and faster If you use Amazon, which I’m going to assume you do, you’re probably familiar with how easy they make everything. For example, you can setup 1-click ordering that allows you to purchase items you see on the site with a single click of the mouse. Or you can use a Dash Button to quickly reorder an item you use on a regular basis. You can also get most items delivered to your door in two days, though getting a mortgage in two days is another story. While home loans will inevitably never... --- > Mortgage Q&A: “What is a gift letter?” A reader recently inquired about mortgage gift letters, so instead of simply answering their question, I - Published: 2018-03-05 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-is-a-gift-letter-for-a-mortgage/ - Categories: Mortgage Tips Mortgage Q&A: “What is a gift letter? ” A reader recently inquired about mortgage gift letters, so instead of simply answering their question, I figured I’d write an entire post on the subject to help others better understand this topic. If you’ve been browsing real estate listings lately and have big plans to buy a big house, but your down payment isn’t so big, you might have heard that you can get a gift for the down payment. You may also opt for a gift simply to get the loan-to-value ratio (LTV) down to 80% to obtain a favorable mortgage interest rate and/or avoid private mortgage insurance on a conventional loan. The same strategy might help you win a bidding war if the sellers aren’t all that impressed with your 3% down payment. Whatever the reason, you’ve got options if you have a wealthy donor willing to help you out. But gifting money isn't without its own requirements. Gift for Down Payment If you don't have your own down payment funds It's possible to get a gift from a qualified donor Such as a family member or domestic partner This option is available on many different types of loans, but rules vary While mortgage loan underwriting requirements vary, most mortgage lenders will allow you to use gift money for a down payment if you’re purchasing an owner-occupied property, one you plan to occupy as your primary residence. It can also be an option for a second home, such as a... --- > Ideal Credit Union, which has six locations scattered across Minnesota, is the latest mortgage company to offer a no down payment mortgage. But theirs is - Published: 2018-03-05 - Modified: 2018-07-17 - URL: https://www.thetruthaboutmortgage.com/ideal-credit-union-is-offering-a-zero-down-mortgage-with-a-catch/ - Categories: Mortgage News Ideal Credit Union, which has six locations scattered across Minnesota, is the latest mortgage company to offer a no down payment mortgage. But theirs is a little different than the rest. Instead of pitching the portfolio loan product to those who can barely afford a mortgage payment, they seem to be targeting prospective home buyers who make plenty but don’t necessarily have the assets to show for it (yet). Skip the Down Payment A Minnesota-based credit union Has launched a zero down home loan With a unique catch It isn't offered in a 30-year fixed product Their pitch for the new zero down mortgage product is “skip the down payment,” which I’m sure a lot renters would be thrilled to do if they could. But before you skip anything, you have to make sure you qualify for the mortgage. And you’re not getting a 30-year fixed mortgage via this program. That would be way too easy, apparently. Instead, you can choose from either a 20-year or 15-year fixed mortgage, both of which are usually suited for borrowers with more-than-adequate incomes. I say that because many borrowers struggle with maximum debt-to-income ratios even when applying for 30-year fixed mortgages. After all, the monthly mortgage payment will be about 50% higher for a 15-year fixed and roughly 25% higher for a 20-year fixed mortgage versus a 30-year loan. The upside is lower mortgage rates on both products relative to the 30-year fixed. Targeting the Well-Paid, Cash Poor You can get either a... --- > It turns out 2017 was a banner year for mortgages, just not all of them. A total of $1.148 trillion in home purchase mortgages were funded last year, the - Published: 2018-03-01 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2017-was-the-best-year-for-home-purchase-mortgages-since-the-market-peak/ - Categories: Housing Market, Mortgage News It turns out 2017 was a banner year for mortgages, just not all of them. A total of $1. 148 trillion in home purchase mortgages were funded last year, the highest total since 2006, per new data from Inside Mortgage Finance. I guess if we consider inflation, and the fact that it has been over a decade, the numbers aren’t as peachy as they look. Still, the 2017 home purchase mortgage origination tally was up a sizable 10. 7% from 2016, thanks in part to first-time home buyers, who appear to be replacing real estate investors in what might be the later stages of this massive real estate rally. If you recall, home prices peaked in 2006, and then tanked, hard, before beginning to recover in 2012. We’re now flying high again, and some folks are worried we might be headed toward another housing crash. More on that in a minute. First-Timers Accounted for Half of Purchase Mortgages Nearly half of purchase mortgages went to first-timers Which tells you who's buying a home these days The investors seemed to have mostly disappeared Let's just hope the newcomers don't get burned like the group before them These first-timers accounted for nearly half (48. 6%) of purchase mortgages backed by Fannie Mae, Freddie Mac and Ginnie Mae (FHA loans and VA loans). Loan volume for first time buyers was up 4. 1% from 2016, while volume for repeat buyers inched up a mere 0. 3%. This might be a testament to the... --- > With the red hot real estate market showing no signs of letting up, prospective home buyers need to get increasingly creative in order to land their dream - Published: 2018-02-27 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/hud-homes-buy-a-foreclosed-home-for-a-potential-discount/ - Categories: Mortgage Tips With the red hot real estate market showing no signs of letting up, prospective home buyers need to get increasingly creative in order to land their dream home, or any home for that matter. The fact of the matter is housing inventory is extremely limited, regardless of whether mortgage rates are going up or down. And that probably won't change anytime soon. One such overlooked program for a potential home buyer is “HUD Homes,” also known as HUD Homestore, which is the Department of Housing and Urban Development’s real-estate owned (REO) inventory available for purchase. In short, these properties were lost or forfeited, and are now ready to be purchased by a new homeowner. As such, a discount and/or less competition might work in your favor. What Is a HUD Home? The Department of Housing and Urban Development’s (HUD) real-estate owned inventory Foreclosed properties where the former occupant was an FHA loan holder Can be any residential 1-4 unit property including single-family homes, townhouses or condos Sold by HUD to the public as a means to cut their losses and move on First off, you should know what you’re buying if you go this route. Put simply, a HUD home is a 1-to-4 unit residential property that was acquired by HUD after an FHA borrower was foreclosed on. Once an FHA borrower loses their home, HUD becomes the property owner. Since they aren’t in the business of acquiring and selling homes, they look to offload the properties as soon as... --- > Before mortgage rates began their recent upward trajectory to start off 2018, quite a few mortgage refinances squeaked through the door. Some 446,295 - Published: 2018-02-19 - Modified: 2018-07-17 - URL: https://www.thetruthaboutmortgage.com/there-are-still-nearly-90000-borrowers-who-could-benefit-from-a-harp-refinance/ - Categories: Mortgage News, Refinance Before mortgage rates began their recent upward trajectory to start off 2018, quite a few mortgage refinances squeaked through the door. Some 446,295 refinances were completed by Fannie Mae and Freddie Mac in the fourth quarter of 2017, up considerably from 362,934 in the third quarter, according to the Federal Housing Finance Agency (FHFA). The FHFA's Refinance Report for the fourth quarter also revealed that 6,309 loans were refinanced through the Home Affordable Refinance Program (HARP). Nearly 3. 5 Million Homeowners Have Refinanced via HARP While 3. 5 million homeowners already took advantage of HARP Another 88k still stand to benefit from the program You may want to act quick if it's you Because mortgage rates are on the rise With the latest quarter’s numbers now on the books, the total number of HARP refinances completed via the program since inception in 2009 stands at 3,484,025. It’s oh-so-close to 3. 5 million, which even if it doesn’t get that high, would be seen as a very successful campaign to help underwater homeowners take advantage of lower mortgage interest rates. Speaking of getting to that number, there are still 88,841 borrowers who stand to benefit financially from a HARP refinance, per data from September 30th, 2017. Sure, mortgage rates have increased since then, but who knows what these near-90,000 borrowers are currently paying. Many borrowers who haven't refinanced post-mortgage crisis still have fixed rates of 6% and up. The 30-year fixed is closer to 4. 5% today as opposed to the... --- > I came across a flyer today from loanDepot advertising a 150-day rate lock for borrowers interested in today’s mortgage rates, who are worried (like - Published: 2018-02-14 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/loandepot-has-a-150-day-rate-lock-for-those-who-want-todays-rates-this-summer/ - Categories: Mortgage News I came across a flyer today from loanDepot advertising a 150-day rate lock for borrowers interested in today’s mortgage rates, who are worried (like everyone else) that they’ll be a lot higher later this year. It’s not unusual for mortgage lenders to offer 60- or 90-day rate locks for those just beginning the loan process, but a full five months is certainly noteworthy. It’s also a testament to the current fear and panic in the mortgage market, with just about everyone believing it’s a sure thing that mortgage rates will go up from here. As it stands, they’re already significantly higher than they were at the end of 2017. The 30-year fixed could be had for around 4% in December, but is now closer to 4. 5%. On a $400,000 loan amount, we’re talking about a difference of roughly $120 per month. It shouldn’t necessarily sway someone’s decision to rent or buy, but it’s still one more negative to contend with seeing that home prices are lofty themselves. You Can Lock Before You Find a Home loanDepot is offering a crazy 150-day rate lock And you can lock your rate before you even find a property They're also tacking on a float-down option To cover all bases What makes this offer even more compelling is the fact that you can lock your rate before you actually find your dream home. Yep, no purchase contract is necessary to get today’s rate written in stone. And to make the deal even sweeter... --- > Well, it’s been a stressful couple of weeks, and the way the stock market is swinging at the moment, it doesn’t appear to be abating. Grab your Tums, - Published: 2018-02-12 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/higher-mortgage-rates-likely-to-have-little-effect-on-housing-market/ - Categories: Mortgage News Well, it’s been a stressful couple of weeks, and the way the stock market is swinging at the moment, it doesn’t appear to be abating. Grab your Tums, buckle your seat belt, and hang on. Don’t you love waking up to the Dow rising 400 points, only to check in after lunch and find that the index is 500 points in the red? It should provide for a nice chuckle. The current atmosphere is reminiscent of the fast and loose days prior to the Dotcom bubble crash. I recall it vividly – mega gains followed by mega losses for months on end. Up down up down until the ups went away. We might not be “there” quite yet, but it is feeling eerily familiar. Meanwhile, those low mortgage rates (remember those? ) we’ve all come to rely on are starting to drive off into the sunset. What was once a sub-4% 30-year fixed is now closer to 4. 5%, depending on the mortgage lender in question. And quite frankly, that’s no fun for prospective home buyers or even lenders for that matter. It hurts both parties in terms of affordability and profitability, respectively. But is it as bad as it seems? The answer is probably not. In times like these, I wait patiently for cooler heads to prevail, and fortunately, some have. Mortgage Rates Have Seen 1%+ Increases More Than 10 Times in the Past 43 Years Using similar data from the past We know that rates have increased at... --- > Call it a sign of the times, or perhaps the power of the sharing, or “gig” economy. You can now officially use Airbnb income to qualify for a mortgage - Published: 2018-02-08 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/airbnb-income-can-officially-be-used-to-qualify-for-a-mortgage-refinance/ - Categories: Mortgage Tips Call it a sign of the times, or perhaps the power of the sharing, or “gig” economy. You can now officially use Airbnb income to qualify for a mortgage refinance with select lenders. Yes, if you’ve been renting out your home, or a part of your home via the short-term rental company Airbnb, you might be able to use that income to help qualify for a mortgage. This could be especially helpful now that mortgage rates have shot up from recent lows, giving homeowners that extra little bit of income to ensure their DTI ratio doesn’t exceed the maximum. What's more, you're able to rent out your primary residence and still qualify for a home loan as if it's owner-occupied. That too can lead to a lower mortgage rate, as interest rates are higher on second homes and investment properties. Airbnb Mortgage Pilot Program Backed by Fannie Mae Airbnb has teamed up with Fannie Mae on a new pilot program It involves three large lenders: Quicken Mortgage, Better Mortgage, and Citizens Bank Will make it easier to use Airbnb income to qualify for a home refinance Can use rental income to lower your DTI if you've been renting your primary residence for at least 12 months Initially, three mortgage lenders will take part in the pilot project backed by Fannie Mae, with others likely to join in the future if all goes well. They include the likes of Quicken Loans, currently the largest home loan lender if you consider the... --- > File this one under: why didn’t we (they) think of this sooner. While it might seem like a no-brainer in hindsight, top reverse mortgage lender American - Published: 2018-02-07 - Modified: 2018-07-17 - URL: https://www.thetruthaboutmortgage.com/top-reverse-mortgage-lender-aag-now-offering-forward-mortgages/ - Categories: Mortgage News File this one under: why didn’t we (they) think of this sooner. While it might seem like a no-brainer in hindsight, top reverse mortgage lender American Advisors Group (AAG) will now start serving up forward mortgages to its customers. Reverse vs. Forward Mortgage In what seems like a strange turn of events No pun intended, honest! Top reverse mortgage lender AAG Will begin offering forward mortgages to customers A forward mortgage is just a fancy way of calling a home loan a mortgage if the context is reverse mortgages. A reverse mortgage, on the other hand, is a home loan where the borrower doesn’t have to make monthly payments but receives cash via the home equity they have accrued. They are popular among seniors who need dough, want to keep their homes, but might be on fixed income and unable to afford monthly payments that come with a mortgage. Or unable to qualify for a typical mortgage refinance. Anyway, AAG, which bills itself as the “nation's leader in reverse mortgage lending,” realized a reverse mortgage wasn’t the “right fit” for all homeowners. But they were getting in contact with to a ton of homeowners with a massive amount of combined home equity. At some point a lightbulb went off and they realized a lot of potential leads were going out the door. Apparently, AAG interacts with 400,000+ “older Americans” each year, thanks in part to their TV advertisements featuring Magnum P. I. aka Tom Selleck. By the way, he’s 73!... --- > Anyone watching this space knew it was going to happen, but perhaps not this fast. Quicken Loans officially became the largest mortgage lender in the - Published: 2018-02-02 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/quicken-loans-is-the-largest-home-loan-lender-for-the-first-time-ever/ - Categories: Mortgage News Anyone watching this space knew it was going to happen, but perhaps not this fast. Quicken Loans officially became the largest mortgage lender in the country during the fourth quarter of 2017, surpassing its long-time rival Wells Fargo. Quicken Loans Largest Mortgage Lender in Fourth Quarter of 2017 Quicken Loans quietly became the largest home loan lender nationwide The non-bank managed $25 billion in retail origination volume during Q4 2017 Surpassing Wells Fargo by about $2 billion from October through December But the San Francisco-based bank was still the largest lender for all of 2017 The Detroit-based residential direct-to-consumer home loan lender mustered around $25 billion in loan origination volume during the final quarter of the year, outpacing rival Wells by some $2 billion, according to Crain’s Detroit. Bank of America and Chase, which are far larger banks, only managed $13 billion and $11 billion during the quarter, respectively. Of course, we’re only talking about a three-month period here. Quicken Loans CEO Jay Farner confirmed to Crain’s that it didn’t beat out Wells Fargo throughout 2017. The San Francisco-based bank and mortgage lender, which had a rough year and change thanks to scandals aplenty, reportedly did $114 billion in residential home loans last year. Quicken didn’t disclose its total annual figure, but confirmed it wasn’t as high as Wells’ 2017 calendar year numbers. Wells also apparently had its worst quarter in the final three months of the year, which might explain how Quicken was finally able to overtake the megabank.... --- > In a bid to get a leg up on the competition, Better Mortgage is allowing prospective home buyers to get an appraisal on a property before actually making - Published: 2018-02-01 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/better-mortgage-is-offering-pre-offer-home-appraisals-to-its-customers/ - Categories: Mortgage News In a bid to get a leg up on the competition, Better Mortgage is allowing prospective home buyers to get an appraisal on a property before actually making an offer. Ideally, this gives them the power to go head-to-head with all-cash buyers, who are often favored because of the relative risks involved with obtaining a mortgage. One of those risks centers on the home appraisal, which may not come in at value. If it happens to fall short of the purchase price, the buyer and seller would need to renegotiate, and it’s not always a positive outcome. How the Pre-Offer Appraisals Work Better Mortgage is offering complimentary pre-offer appraisals Which are exactly what they sound like A home appraisal conducted before you make an offer on a home Conducted by a local appraiser or Appraisal Management Company (AMC) In a nutshell, Better Mortgage has so-called “appraiser panels” in select markets, which are made up of independent local appraisers or Appraisal Management Companies (AMCs). Like other home appraisers, they will visit the subject property, inspect it, and provide a value. The difference is that they come up with a valuation range, not a specific home value. Once the home buyer executes the purchase contract, the same appraiser will return to the property and complete the appraisal, fine-tuning the valuation as they would on a normal appraisal. They are basically at the ready if and when a prospective home buyer is interested in making an offer. Per Better, they were developed to... --- > It’s 2018 and the mortgage settlements continue. As part of an agreement reached today with 49 states and Washington D.C., PHH Mortgage Corp. will pay out - Published: 2018-01-03 - Modified: 2018-06-12 - URL: https://www.thetruthaboutmortgage.com/phh-mortgage-to-provide-borrowers-with-30-4-million-for-improper-loan-servicing/ - Categories: Mortgage News It’s 2018 and the mortgage settlements continue. As part of an agreement reached today with 49 states and Washington D. C. , PHH Mortgage Corp. will pay out $30. 4 million to borrowers impacted by so-called improper mortgage servicing. PHH Is a Top-10 Home Loan Servicer Because PHH is one of the largest residential loan servicers A lot of customers have been affected By their alleged loss mitigation abuses Which could mean you're eligible for a cash payment The company, which is the ninth largest non-bank residential mortgage servicer in the country, was accused of improperly servicing home loans from January 1st, 2009 through December 31st, 2012. The complaint filed by the state attorneys general alleged that PHH “threatened foreclosure and conveyed conflicting messages” to some homeowners who were taking part in loss mitigation efforts. This was a common issue during the aftermath of the housing crisis, whereby some lenders would engage in dual tracking, which simultaneously pushes a borrower toward foreclosure while their loan modification is being processed. The practice has since been outlawed, and lenders are required to pump the brakes on foreclosure if another loss mitigation option is being administered. PHH was also accused of charging “unauthorized fees for default-related services,” along with failing to maintain adequate documentation pertaining to the foreclosure. They also apparently failed to respond to borrowers’ complaints in a timely manner, or apply payments made by certain borrowers. In addition, the complaint claims that PHH didn’t properly oversee its third-party vendors or preserve... --- > Well, it’s a new year, and with that comes new and exciting home loan programs to help borrowers purchase homes or refinance existing mortgages. The - Published: 2018-01-02 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/guaranteed-rate-launches-new-jumbo-loan-with-interest-only-option/ - Categories: Mortgage News Well, it’s a new year, and with that comes new and exciting home loan programs to help borrowers purchase homes or refinance existing mortgages. The newest one comes courtesy of Guaranteed Rate, which launched its “GR Flex Power” mortgage that requires as little as 10% down on loan amounts as high as $3 million. Additionally, those who are able to muster a 15% down payment can take advantage of an interest-only option on both fixed mortgages and ARMs. And despite the down payment being less than 20%, the GR Flex Power loan does not require private mortgage insurance to be paid. That’s a good thing seeing that it’s no longer tax deductible. Of course, the mortgage rate will probably be higher to compensate for the lack of PMI. Whether that turns out to be a net positive or negative will depend on how you pay your taxes. GR Flex Power Is Underwritten In-House It's starting to feel like the old days in the mortgage world The GR Flex Power home loan combines jumbo with interest-only Loan amounts as high as $3 million and DTIs up to 50% A portfolio loan product to be sure It should be noted that this new jumbo loan program is a portfolio loan, meaning it is proprietary to Guaranteed Rate. This allows them to underwrite the loan program in-house, instead of being at the mercy of third-parties such as Fannie Mae, Freddie Mac, or the FHA. As such, they’re able to waive the PMI requirement... --- > Just like that, another year has gone by, well, almost. There are still a few days left and anything can happen. In the meantime, I present my latest - Published: 2017-12-29 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2018-real-estate-and-mortgage-predictions/ - Categories: Housing Market, Mortgage Tips Just like that, another year has gone by, well, almost. There are still a few days left and anything can happen. In the meantime, I present my latest installment of real estate and mortgage predictions for the year 2018, which I hope will be a fantastic one for all. As always, you can see my prior predictions to see how well I did in the past. Here are the ones from 2017 and 2016. You can search my site for even older ones if you’ve got nothing but time on your hands. Speaking of 2017, I think I did alright, though I was slightly wrong about mortgage rates and missed the mark on the FHA premium cut, though that one was a bit of a curve ball. Anyway, let’s forget about the past and look ahead to the future. 1. Mortgage rates will rise moderately I always like to start with the mortgage rate prediction first since it tends to be the most interesting (and the most in demand). A couple weeks ago, I penned my 2018 mortgage rate forecast post, which is a compilation of several prominent real estate and mortgage groups’ predictions. I’m going to go with Freddie Mac in 2018 and bank on a slow rise throughout the year that ends with the 30-year fixed mortgage close to 4. 5%, up from the current 4% or so. It’s probably not enough to dent anyone’s homeownership dreams, though if home prices rise as well, and you can’t get... --- > Back in the mid-1990s, former Federal Reserve Board chairman Alan Greenspan used the phrase “irrational exuberance,” which served as a warning that the - Published: 2017-12-20 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/see-how-exuberant-your-housing-market-is/ - Categories: Housing Market, Mortgage News Back in the mid-1990s, former Federal Reserve Board chairman Alan Greenspan used the phrase “irrational exuberance,” which served as a warning that the stock market may have been overextended. This was around the time of the dot-com bubble and there was increasing worry that investors were piling into tech stocks with no regard for their actual value. It turns out this was indeed a reason to worry. The housing market in the early 2000s mirrored this atmosphere, with everyone and their mother buying houses for the sole purpose of turning a quick profit. If they already owned a home, they were refinancing their mortgage early six months (in serial fashion) and pulling cash out each time they did to purchase Hummers and other luxuries, all the while banking on further home price appreciation to absorb the cost. I’ve mentioned before that I was renting a house with some friends during that time and was told by the owner that, “Oh, I refinance every six months, I have my rep at Countrywide, no worries. ” This was in response to me fretting about the state of the housing market – but she had it fully under control. Because why wouldn’t you refinance every six months, right? Now we’ve come a long way since then, but the housing recovery isn’t exactly equal across every market, this according to new research by Kate Seabaugh, Manager, and Danielle Nguyen, Research Analyst, of John Burns Real Estate Consulting. One Housing Market Is Still in Recovery... --- > It’s that time of the year again, when we take a look at what’s in store for mortgage rates the following year. So without further ado, here is the “2018 - Published: 2017-12-13 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/2018-mortgage-rate-forecast-overall-its-looking-pretty-good/ - Categories: Mortgage Rates, Mortgage Tips It’s that time of the year again, when we take a look at what’s in store for mortgage rates the following year. So without further ado, here is the “2018 mortgage rate forecast” from a variety of different housing and mortgage groups. Note that these forecasts generally apply to conventional loans backed by Fannie Mae and Freddie Mac. Typically, rates are slightly lower on FHA loans. 2018 Mid-Year Mortgage Rate Update We're now roughly midway through 2018 Let's take a look at which mortgage rate predictions are the most spot on The 30-year fixed has risen from around 4% to 4. 625%-4. 75% so far this year The MBA and NAR are doing the best, but a lot can change in no time at all Now that we're about halfway through the year, I figured I'd check in to see which forecast is most on point. It appears that with the 30-year fixed averaging close to 4. 625% and 4. 75% as of early August, the estimates from the Mortgage Bankers Association and National Association of Realtors are the most accurate. The MBA predicted a rate of 4. 7% by the third quarter of 2018 and they've basically nailed it on the head, which is somewhat unwelcome news for the prospective homeowners and existing borrowers looking to refinance their home loans. The NAR expected a rate around 4. 6%, which is also pretty close to what's being offered by mortgage lenders these days. Fannie Mae's prediction of 4. 1% is... --- > A new survey of housing experts and economists led by Zillow sees home prices rising 4.1% in 2018 before annual gains normalize at around three percent - Published: 2017-12-11 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/will-2018-be-the-last-great-year-for-this-real-estate-boom/ - Categories: Housing Market, Mortgage Tips A new survey of housing experts and economists led by Zillow sees home prices rising 4. 1% in 2018 before annual gains normalize at around three percent per year. So far this year, home prices have risen about 6. 5% (through October), though this same group of panelists estimated a 5. 6% annual gain on average. A year ago, the group expected home prices to rise just 3. 61% in 2017 and 2. 97% in 2018. In other words, they’ve been surprised by the exponential growth just like everyone else, and have constantly revised their estimates skywards. We’ve Been Hearing This Tune for a While It seems every year the real estate market does well We hear that it could be the last good year Until another year comes along And home prices rise yet again It reminds me of the mortgage rate predictions, which each year point to higher rates, and in recent years, have been wrong year after year. But as I warned with rates, they’ll eventually be right, and when that time comes, it could catch some folks out if they opt for an ARM over a fixed mortgage. Back in 2014, we were told that home prices would peak in 2016, yet another prediction we all know fell flat. That same forecast had home prices doing nothing for six years once they settled in during 2016. Oops. Wrong again. I don’t blame them – I think just about everyone felt home price gains were unsustainable back... --- > Just like the 2018 conforming loan limits, the FHA will see its 2018 loan limits increase as well, which is welcome news for home buyers in more expensive - Published: 2017-12-07 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2018-fha-floor-loan-limit-increased-to-294515/ - Categories: Mortgage News Just like the 2018 conforming loan limits, the FHA will see its 2018 loan limits increase as well, which is welcome news for home buyers in more expensive areas of the country. For FHA case numbers assigned on or after January 1st, 2018, the new loan limit floor for FHA loans will increase to $294,515 from $275,665. The floor, which is the FHA's minimum loan limit, is set at 65 percent of the national conforming loan limit of $453,100, which is a requirement under the Housing and Economic Recovery Act of 2008 (HERA). It applies in regions of the country where 115 percent of the median home price is less than the floor limit. FHA Loan Limit Ceiling Rising to $679,650 FHA loans limits will rise just like the conforming limit The new loan limit floor will increase from $275,665 to $294,515 The new loan limit ceiling will be $679,650, up from $636,150 This should allow more home buyers to take advantage of FHA financing Additionally, the FHA's loan limit ceiling, which is the max loan amount the FHA will insure, will increase to $679,650 from $636,150, in line with the high-cost conforming loan limit. There are several dozen metros that will enjoy these new, higher limits, including places like Los Angeles, San Francisco, New York City, Breckenridge, CO, areas in Virginia, and Washington D. C. While the FHA isn’t really geared toward high-income borrowers, it can still be a solution for some who lack a large down payment and/or... --- > Mortgage Q&A: "Can you pay the mortgage with bitcoin?" First off, I apologize for writing an article about bitcoin. I know it’s all the rage right now - Published: 2017-11-30 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/can-you-pay-the-mortgage-with-bitcoin/ - Categories: Mortgage Tips Mortgage Q&A: "Can you pay the mortgage with bitcoin? " First off, I apologize for writing an article about bitcoin. I know it’s all the rage right now and I’m just adding to the hype, but it’s newfound relevancy warrants this post, maybe. U. S. Mortgage Lenders Accept U. S. Dollars At the moment U. S. dollars are the only form of payment accepted by U. S. mortgage lenders Any so-called bitcoin payment option will likely be through an intermediary service that converts bitcoin to USD before it reaches your lender/servicer The same goes for credit card payments, which only work via third-party processors But that could change if the technology allows for easier and cheaper crypto transfers As far as I know, all U. S. mortgage servicers only accept U. S. dollars for mortgage payments. So the simple answer would be no, you can’t use your bitcoin to pay the mortgage. But I have heard of third-party companies offering the service in the past, perhaps working as an intermediary between bitcoin holders and loan servicers. At that point though, you have to question what the benefit of such a service would be. If anything, it might just cost you money in conversion fees and so on. And even delays! I’ve also heard of individuals buying real estate with bitcoin, but that’s a different story because it’s an agreement between buyer and seller, and it’s effectively a cash-alternative transaction. In other words, they’re probably buying a property outright with bitcoin... --- > Home Partners of America and New Penn Financial have joined forces to offer renters the ability to get a mortgage with as little as their security - Published: 2017-11-29 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/new-program-allows-renters-to-get-a-mortgage-with-as-little-as-a-security-deposit/ - Categories: Mortgage News Home Partners of America and New Penn Financial have joined forces to offer renters the ability to get a mortgage with as little as their security deposit. The joint venture aims to alleviate one of the main obstacles to owning a home, the down payment. It’s not the first time we’ve seen this in recent history, with HomeFundMe launching a crowdfunded mortgage down payment just last month. But this new program brings together a rent-to-own company with a mortgage lender to bridge the financing gap. The Ownership Conversion Pilot: Rent-to-Own with a Twist It's structured like a typical rent-to-own deal Where once a buyer finds a home to purchase It is purchased by the company and leased to the individual What makes it unique is the fact that they've partnered with a mortgage lender to facilitate the move from renter to owner The so-called “Ownership Conversion Pilot” has the same objective as others that came before it, but it’ll work a little differently. First, an approved applicant works with a licensed real estate agent to find a home that meets Home Partners' criteria, then the company purchases the property on their behalf. Home Partners of America currently buy homes in more than 50 markets nationwide, including places like Portland, Oregon and Stockton, California. Once the home is purchased, it is then leased to the applicant in a typical rent-to-own scenario, whereby the renter is given an option to buy the property in the future. There are both pre-determined rents and... --- > It’s that time of year again, when the FHFA announces the conforming loan limit for the upcoming year. And like last year, it’s going up! This marks just - Published: 2017-11-28 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2018-conforming-loan-limit-jumps-to-453100/ - Categories: Mortgage News It’s that time of year again, when the FHFA announces the conforming loan limit for the upcoming year. And like last year, it’s going up! This marks just the second increase in the past decade thanks to that pesky housing crisis that happened. But this year-over-year increase is a lot more significant than last year’s more nominal rise from $417,000 to $424,100. Because home prices have been on a tear lately, loan limits are getting a major boost. And it could be enough to put a lot of borrowers back in the conforming zone, which could amount to some savings. The conforming loan limit is the max loan size accepted by Fannie Mae and Freddie Mac, so it’s important for borrowers to stay at or below this level to receive the most favorable mortgage rate pricing. Home Price Gains Give Loan Limits a Big Boost Due to a 6. 8% rise in home prices Between the 3rd quarter of 2016 and 2017 The conforming loan limit will jump to $453,100 from $424,100 The high-cost loan limits will also rise to $679,650 from $636,150 The FHFA found that property values increased by 6. 8% between the third quarter of 2016 and 2017, which will lead to an increase in the baseline maximum conforming loan limit by the same percentage. That means homeowners will be able to borrow as much as $453,100 come January 1st, instead of the current $424,100. Additionally, the high-cost loan limits are also going up. The new ceiling... --- > People seem to be fascinated with how mortgages are calculated and paid off, but when it comes down to it, there’s nothing too mind-blowing happening. - Published: 2017-11-21 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/are-mortgages-simple-interest-and-compounded-monthly/ - Categories: Mortgage Tips People seem to be fascinated with how mortgages are calculated and paid off, but when it comes down to it, there’s nothing too mind-blowing happening. Each month, a portion of principal and interest are paid off as mortgage payments are made. Over time, the loan balance is reduced, as is the total amount of interest due. Mortgages Are Simple Interest Simple interest means it's not compounded So you don't pay interest on top of interest What you owe in interest is pre-determined on a home loan And paid over the life of the loan Here in the United States, mortgages use simple interest, meaning it is not compounded. So there is no interest paid on interest that is added onto the outstanding mortgage balance each month. Conversely, think of an everyday saving account that offers you compounding interest. If you have a balance of $1,000 and an interest rate of 1%, you’d actually earn more than 1% in the first year because that earned interest is compounded either daily or monthly. Put another way, you earn interest on your interest each day or month, which allows your money to grow more quickly. Mortgages don’t do that because the total amount of interest due is already calculated beforehand and can be displayed via an mortgage amortization schedule. For example, a $300,000 mortgage set at 4% on a 30-year fixed mortgage will have total interest due of $215,610 over the life of the loan. We know this beforehand because mortgages are amortized.... --- > Flagstar Bank is the latest mortgage lender to offer a home loan with zero down payment requirement. They even go a step further by offering to pay the - Published: 2017-11-13 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/flagstar-offering-zero-down-mortgages-to-michigan-home-buyers/ - Categories: Mortgage News Flagstar Bank is the latest mortgage lender to offer a home loan with zero down payment requirement. They even go a step further by offering to pay the borrower’s closing costs too. Sounds pretty sweet, doesn't it? Unfortunately, the new loan program is only available to select borrowers in the state of Michigan, where most of the company’s physical bank branches are located. However, Flagstar does have retail locations in 27 states, and offers mortgages to borrowers nationwide via their wholesale and correspondent channels. Flagstar Gift Program Provides 3% Down Payment and Closing Costs While not available to all home buyers nationwide Borrowers with limited income who purchase properties In low- and moderate-income areas of Michigan Can get a home with no down payment or closing costs thanks to Flagstar's gift program The so-called “gift program” from Flagstar Bank is intended to help low- and moderate-income home buyers in low- and moderate-income areas throughout Michigan. The company will promote homeownership in these areas by removing one of the major hurdles, the pesky down payment. It seems to be building off the Fannie Mae and Freddie Mae 97% LTV loan program that is widely available nationwide because borrowers will be gifted a 3% down payment. That means they’ll wind up with a loan for 97% of the value of the home, instant equity, and no cash out of pocket required. There is no obligation for borrowers to repay this 3% gift either, though they will apparently receive an IRS form 1099,... --- > It’s feeling a little like 2007 today. Back then, I was writing posts like this on a daily basis. Capital One has announced that it is exiting the - Published: 2017-11-08 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/capital-one-to-stop-offering-mortgages/ - Categories: Mortgage News It’s feeling a little like 2007 today. Back then, I was writing posts like this on a daily basis. Capital One has announced that it is exiting the mortgage business, seemingly surprising given the current real estate climate that is red hot. If you attempt to visit the Capital One Home Loans website, you’ll be greeted by a “Down For Maintenance” message. It also says they’ll “be back online shortly,” for whatever that’s worth. Mortgage Competition Too Fierce In what was seen as a surprising move Capital One exited the mortgage business entirely Thanks to increased competition that dented profitability 1,000+ jobs will be lost as a result Per Bloomberg, Capital One chose to exit the mortgage origination business entirely because increased competition meant it wasn’t a profitable venture. They will also cease making home equity loans, and more importantly, 1,100 employees will lose their jobs. Some 905 positions will be cut in Plano, Texas, St. Cloud, Minnesota, and Melville, New York. An additional 200 jobs are being eliminated at an undisclosed call center in what is apparently an unrelated move. Capital One president of financial services Sanjiv Yajnik told employees in an internal memo that the affected business lines “are in a structurally disadvantaged position, given the challenging rate environment and marketplace. ” And added that those “factors do not allow us to be both competitive and profitable for the foreseeable future. ” I’ll take that to mean that mortgage rates are now about three-quarters of a percentage point... --- > A so-called direct home buyer by the name of OfferPad that agrees to purchase homes in as little as 24 hours has announced a new joint venture with - Published: 2017-11-07 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/offerpad-home-loans-ibuyer-links-up-with-loandepot-to-provide-bridge-financing/ - Categories: Housing Market, Mortgage News A so-called direct home buyer by the name of OfferPad that agrees to purchase homes in as little as 24 hours has announced a new joint venture with loanDepot to provide financing to those who use its platform. Specifically, the link up will look to solve one of the more common problems home sellers face – financing a new home purchase while they still own their old home. This can present all types of issues, with loans typically falling through thanks to debt-to-income ratios being too high with two mortgages to account for, or because sellers don’t want an offer that is contingent on a sale of the buyer’s existing home. This apparently resolves those issues by combining a bridge loan from loanDepot with a guaranteed purchase from OfferPad. What OfferPad Home Loans Provides A direct home buyer called OfferPad Is linking up with mortgage lender loanDepot To provide short-term bridge financing for a subsequent home purchase When you sell your existing home to them In a nutshell, a homeowner can agree to sell their existing home to OfferPad and also receive short-term financing for their next home purchase via OfferPad Home Loans. The loan will bridge the gap that occurs when the home seller is finalizing their old home sale. Instead of having to sell first, then find a new home to buy, they can do both things at once and still qualify for mortgage financing. All without the obligation of finding temporary housing. Once they close on their... --- > In case you hadn’t heard, home equity lines of credit are expected to get a lot more popular in coming years as homeowners take advantage of all that - Published: 2017-11-01 - Modified: 2018-07-17 - URL: https://www.thetruthaboutmortgage.com/the-five-most-common-uses-of-home-equity-lines-of-credit/ - Categories: Mortgage News In case you hadn’t heard, home equity lines of credit are expected to get a lot more popular in coming years as homeowners take advantage of all that recent home price appreciation. A new TransUnion study reveals that some 10 million borrowers are expected to take out a home equity line of credit (HELOC) between 2018 and 2022. If that happens, it would be more than double the 4. 8 million HELOCs originated during the previous five-year period between 2012 and 2016. HELOCs Expected to Surge in Popularity Thanks to a combination of rapidly rising home prices Coupled with higher mortgage interest rates Second mortgages like HELOCs should become a lot more popular As a means to tap into all that newfound home equity You can thank rising home prices, which have increased aggregate home equity to levels above those seen in the mid 2000s. Back in 2005, when collective home equity stood at $13. 3 trillion, there were an astounding 4. 9 million HELOCs originated. Then HELOC volume tanked as the housing crisis stripped away trillions in home equity, leaving homeowners with just $6. 3 trillion to play with. That resulted in a dismal 600,000 in HELOCs during 2011, and similarly low numbers in the years that followed. In 2016, collective home equity surged back to around $13. 3 trillion, but just 1. 2 million HELOCs were taken out, clearly a sign that many more are on the horizon. Keep Your First Mortgage Intact One benefit to a HELOC... --- > The National Association of Realtors just released its 2017 Profile of Home Buyers and Sellers, and there are lots of interesting tidbits. Let’s explore - Published: 2017-10-31 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/10-takeaways-from-the-annual-realtor-survey/ - Categories: Housing Market, Mortgage News The National Association of Realtors just released its 2017 Profile of Home Buyers and Sellers, and there are lots of interesting tidbits. Let’s explore 10 of them. 88% of Recent Buyers Financed Their Home Purchase First things first, an overwhelming share of recent home buyers used a mortgage to finance their home purchase, as opposed to buying a home with all cash. Typically, this is out of necessity not preference. And for those who did use a mortgage, they generally financed 90% of the home purchase, meaning they put down just 10%. Doing so means they must pay mortgage insurance. Mortgage rates are also less favorable if you put down less than 20%. Down Payments Getting Lower for First-Timers Speaking of down payments, they’re going down for first-time home buyers thanks to higher listing prices. The typical down payment for first-timers was just five percent, down from six percent a year ago and matching the lowest point since 2013. Repeat buyers were a different story, benefiting from higher sales prices by putting down 14% on subsequent home purchases, up from 11% in 2016. Mortgages Easier to Get, Conventional Is King Fewer home buyers indicated problems obtaining a mortgage, with only 34% saying the mortgage application and approval process was somewhat or much more difficult than they had expected. That number was down from 37% a year earlier, thanks to the improved financial health of borrowers and an easing in credit standards. Some 58% of borrowers went with a conventional home... --- > Back in 2013, FHA home loans became a lot less attractive because most newly originated mortgages required mortgage insurance to be paid for the entire - Published: 2017-10-27 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/new-bill-aims-to-end-fha-mortgage-premiums-for-life-policy/ - Categories: Mortgage News Back in 2013, FHA home loans became a lot less attractive because most newly originated mortgages required mortgage insurance to be paid for the entire life of the loan. Instead of paying mortgage insurance premiums for say 5-10 years, or until the loan-to-value (LTV) fell to 78%, many new FHA borrowers were stuck paying the annual mortgage insurance premium (MIP) for the entire mortgage term. This reversed an earlier policy set forth in 2001 that cancelled MIP on FHA loans when the outstanding balance reached 78% of the lower of the sales price or appraised value, based on the original amortization schedule. FHA Annual MIP Chart Most FHA loans require MI for life Other than those under 90% LTV which isn't their target market This bill would change that And bring the policy closer to its original state While most will argue that mortgage insurance is only necessary on a high-LTV loan, and thus unnecessary once the LTV falls to a low enough point to provide a safe equity cushion to the lender, the FHA thought otherwise. In their mind, they were still insuring these loans long after the borrowers were paying the mortgage insurance. As such, the agency’s Mutual Mortgage Insurance (MMI) Fund lost billions in foregone revenue while putting the American public (taxpayers) at risk of a bailout. The change certainly coincided with an MMI Fund deficit, which explains why the FHA also increased mortgage insurance premiums at that time as well. It was a one-two punch for... --- > In a nutshell, the FHA 203k loan program allows prospective home buyers to finance the cost of a property and improvements in one convenient mortgage. - Published: 2017-10-24 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/fha-203k-loan-program-the-all-in-one-renovation-mortgage/ - Categories: Mortgage Tips In a nutshell, the FHA 203k loan program allows prospective home buyers to finance the cost of a property and improvements in one convenient mortgage. Instead of buying a fixer-upper, taking out a mortgage, and then later taking out a home equity line or executing a cash out refinance to fund necessary improvements, home buyers can apply for a single FHA 203k loan at the time of purchase and get all the money they need in one shot. This means they can finance the property and get funds to repair or improve/upgrade their home in a single mortgage loan. This is both convenient and at other times necessary to qualify for FHA financing. An FHA 203k loan can also benefit existing homeowners looking to improve upon their homes – they can get funds for improvements based on the after-improvement value of the property, helpful if they’ve got limited equity. The value of the property is determined by using the lower of the value of the property before renovations plus the cost of those fixes, or 110% of the appraised value of the property after it has been rehabbed. Like a traditional FHA loan, it is a government-backed loan that must be originated by an FHA-approved lender, making it easier to qualify for in some instances and also attractively priced. They are also advantageous to the originating lender because they can get insurance for the loans before the improvements to the underlying collateral are actually made. FHA 203k Loan Requirements Property... --- > Wouldn’t it be nice if your mortgage lender could gather your income, asset, and employment information from a single digital document, similar to a - Published: 2017-10-24 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/imagine-getting-a-mortgage-with-just-a-couple-clicks/ - Categories: Mortgage News Wouldn’t it be nice if your mortgage lender could gather your income, asset, and employment information from a single digital document, similar to a credit report? And instead of asking you to send over bank statements (all pages, even the blank ones! ), recent pay stubs, two years of W-2’s, and employment information, simply asked you to verify a single bank account. That’d probably make it a lot easier to get a mortgage, right? And perhaps a lot less frustrating too. Single Source Validation Can Make Getting a Mortgage a Lot Easier A new technology called Single Source Validation Makes it faster and easier to verify borrower data Such as income, assets, and employment That look and feel similar to credit reports Well, Fannie Mae has actually rolled out this technology via “Single Source Validation,” which as the name suggests, allows lenders to validate a variety of borrower attributes from one data source. They’ve partnered up with a vendor called Finicity, a Salt Lake City-based company that can generate asset verification reports within Fannie Mae's Desktop Underwriter (DU). Another company called FormFree has also linked up with Fannie, and has a similar product called AccountChek, which facilitates the transmission of bank, retirement and investment account data. These asset reports are then used to automatically verify three important items: income, assets, and employment. Aside from being a lot easier on borrowers, this single source of data will also increase efficiency for mortgage lenders and speed up the loan process. One early... --- > It’s one of the more common dilemmas these days – you graduated college and you’re ready to start a family (or at least buy a home for your dog), but - Published: 2017-10-19 - Modified: 2023-10-16 - URL: https://www.thetruthaboutmortgage.com/freddie-mac-revises-student-loan-guidelines/ - Categories: Mortgage News It’s one of the more common dilemmas these days – you graduated college and you’re ready to start a family (or at least buy a home for your dog), but student loan debt is holding you back. Further complicating this is the fact that student loans are paid off in all types of different ways, with some loans deferred and others containing repayment terms that are income-driven. Whatever the case, these student loans have proven to be yet another roadblock to homeownership, with down payment probably still the number one hurdle. Of course, with a wider availability of zero down home loans, 1% down mortgages, and 3% down mortgages available today, down payment is becoming less of an issue. Freddie Mac Student Loan Guidelines Might Get Tougher Freddie Mac used to allow the actual student loan payment Listed on the credit report for qualifying purposes But now they'll use the greater of the actual payment or 0. 5% of the original balance Whichever figure is higher At the moment, student loans in repayment must use the actual monthly payment listed on the credit report. If a payment isn’t listed for whatever reason, the lender must obtain documentation to verify the payment. Going forward (January 18th, 2018 or sooner if adopted earlier), lenders will need to use the greater of the monthly payment listed on the credit report or 0. 5% of the original student loan balance (or outstanding balance), also whichever is greater. The good news is that the lender... --- > The latest buzz in the mortgage world is e-mortgages, or digital mortgages, or paperless mortgages. Or mortgages that don’t require human interaction, or - Published: 2017-10-19 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/while-mortgages-go-digital-people-still-matter-a-lot/ - Categories: Mortgage News The latest buzz in the mortgage world is e-mortgages, or digital mortgages, or paperless mortgages. Or mortgages that don’t require human interaction, or the painstaking process of getting dressed in the morning. But it turns out people still matter, despite the obvious and unstoppable shift to online, and soon (already happening now) to mobile. This Blog Is Alright, I Guess Wondering who influences mortgage shoppers the most? It's a close race between mortgage lenders And real estate agents Both interested parties to the transaction so consider independent research! A survey released by Fannie Mae today found that while prospective home buyers are increasingly turning to online sources for mortgage and real estate information, they still trust in people. Fannie Mae asked folks who had purchased a home in 2016 with a Fannie-backed mortgage which source of information was the “most influential” while researching and gathering advice. And it turns out it wasn’t this blog. Shoot! Instead, it is mortgage lenders and real estate agents who are the most influential. If you’re wondering why, it’s because they, along with friends and family, are seen as “more trustworthy and credible” than online sources, aka my blog and others like it. I’m fine with that, though as I’ve pointed out in the past, real estate agents can often determine where their borrower will get a mortgage, better or worse. And really, I think my blog and others like it simply fit into the new ecosystem to provide additional sources of information, different perspectives,... --- > Curious what’s driving Millennial homeownership? Is it marriage or the prospect of a little one crawling around? Nope. Aside from more living space and - Published: 2017-10-05 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/millennials-are-buying-homes-to-give-their-dogs-room-to-roam/ - Categories: Housing Market, Mortgage News Curious what’s driving Millennial homeownership? Is it marriage or the prospect of a little one crawling around? Nope. Aside from more living space and building equity, dogs are motivating young folks to buy homes. And as a dog lover myself, I’m okay with that. This was discovered in a survey conducted by SunTrust Bank that polled 18 to 36 year olds who recently purchased their first home. Must Love Dogs One of the most highly cited reasons for buying a home Is to give Fido a yard to run around in Only bested by more living space for the owner And the desire to build home equity While it wasn’t the top response, it was in the top three. Specifically, 33% of these buyers said “the desire to have a better space or yard for a dog influenced their decision to purchase their first home. ” That’s pretty amazing. Beating out the dogs was the need for more living space, which ranked #1 and was cited by 66% of these Millennial home buyers. It was followed by the desire to build home equity (cited by 36% of buyer-respondents), no surprise given it’s a great way to acquire wealth. Funnily enough, it beat out marriage (25%) and the birth of child (19%) as the other reasons to own a home. For those who hadn’t yet purchased their first home, 42% still said their dog (or desire to have one) was a “key factor” in their plan to buy a property in... --- > Ever wonder what share of borrowers are taking out a 15-year mortgage as opposed to a standard 30-year fixed? Or an ARM instead? Well, I was, and so I - Published: 2017-10-04 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-originations-by-product-type-whats-most-popular/ - Categories: Mortgage Tips Ever wonder what share of borrowers are taking out a 15-year mortgage as opposed to a standard 30-year fixed? Or an ARM instead? Well, I was, and so I went looking for the data. Fortunately, I was able to track down some of the details thanks to the Urban Institute, which provided me with some great statistics since the year 2000. As you might expect, the 30-year fixed is the king of mortgage originations, though its dominance has been tested over the years. And it does depend if we’re talking about all originations, or just purchases. Mortgage product type choice definitely varies if we’re talking about a refinance as opposed to a home purchase since borrower needs change over time. Put simply, it’s more common for a borrower to choose the 15-year fixed when refinancing a mortgage, and a lot less likely to use one to buy a home. Why is this? Well, generally borrowers will go with a 30-year term because it increases affordability, meaning they can buy more house at the outset. Later, once they’ve built some equity (hopefully), they can refinance into a shorter-term fixed loan, such as the 15-year fixed, to save on interest and also ensure their loan term isn’t extended from the original maturity date. Nearly 90% of Purchase Mortgages Were 30-Year Fixed Mortgages The 30-year fixed is easily the most popular type of home loan available It has been for decades and probably will be for the foreseeable future Largely because it's the... --- > Don’t have the required down payment to purchase your dream home? No problem. There’s now a service that lets you crowdfund your mortgage down payment. - Published: 2017-10-02 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/homefundme-now-you-can-crowdfund-a-mortgage-down-payment/ - Categories: Mortgage News Don’t have the required down payment to purchase your dream home? No problem. There’s now a service that lets you crowdfund your mortgage down payment. Whew! A company by the name of HomeFundMe, not to be confused with GoFundMe, claims to be the “first industry approved crowdfunding service” to allow prospective home buyers to “crowdfund a mortgage down payment. ” In case you weren’t aware, down payment continues to be the biggest hurdle to homeownership, despite the wide array of loan programs that allow down payments as low as 3% (or even 1%! ). Can I Please Have Some Down Payment Money? Thanks! In an effort to address the biggest roadblock to homeownership A new company called HomeFundMe allows prospective home buyers To crowdfund their down payment from friends and family Similar to how individuals can raise funds for any purpose via existing services like GoFundMe What this all means is that you can now ask people to donate money to help you make a down payment on a home, using the HomeFundMe platform. For the record, HomeFundMe is a service of a mortgage lender by the name of CMG Mortgage Inc. And in order to take part, you are required to get pre-qualified for a mortgage with the company. Only then can you start your crowdfunding campaign. That means CMG Mortgage is likely wanting to be your mortgage lender. It’s a clever marketing tactic to obtain more purchase-money mortgage business as refis wane. Anyway, the HomeFundMe campaign operates on... --- > You’ve probably heard of HAMP, otherwise known as the Home Affordable Modification Program, which was very popular post-housing crisis. But what about - Published: 2017-10-02 - Modified: 2018-07-17 - URL: https://www.thetruthaboutmortgage.com/synovus-mortgage-offering-100-financing-via-affordable-mortgage-program/ - Categories: Mortgage News You’ve probably heard of HAMP, otherwise known as the Home Affordable Modification Program, which was very popular post-housing crisis. But what about AMP? Probably not. It stands for "Affordable Mortgage Program," and is the loan program offered by Synovus Mortgage Corp. (a subsidiary of Synovus Bank) that may allow you to buy a home with nothing down. Synovus Mortgage’s AMP Allows Up to 100% Financing Synovus Mortgage Corp. has launched a zero down mortgage option Known as the Affordable Mortgage Program or AMP Available to home buyers in Alabama, Florida, Georgia, South Carolina and Tennessee They've committed $100 million toward the special program so act fast! If you happen to reside in Alabama, Florida, Georgia, South Carolina and Tennessee, you may want to look into Synovus Mortgage’s AMP if you have little set aside for a down payment on a home. While you’re at it, you can also look into crowdfunding your down payment... Anyway, the company just announced that they had committed $100 million to AMP for first-time home buyers and others in need of financial assistance when purchasing a primary residence. In a press release, Synovus Mortgage Corp. director of residential mortgage Steve Shoemaker commented on the flexibility of AMP, noting that it has “the ability to layer on down payment assistance programs. ” Per their website that explains the program to some degree, this seems to mean using state bond programs and federal agency assistance, along with AMP’s flexible qualifying guidelines, to purchase a home with no... --- > One of the more common problems young home buyers face these days is student loan debt, which can complicate a mortgage approval (and a successful home - Published: 2017-09-26 - Modified: 2024-05-24 - URL: https://www.thetruthaboutmortgage.com/lennar-offers-to-pay-your-student-loans-if-you-buy-a-new-home/ - Categories: Housing Market, Mortgage News One of the more common problems young home buyers face these days is student loan debt, which can complicate a mortgage approval (and a successful home purchase). Lenders are well aware of this, as are home builders and the GSEs (Fannie Mae and Freddie Mac). To alleviate this issue, they recently eased guidelines related to student loan debt so more young folks can qualify for mortgages. Now one lender is going a step further by offering to pay off some of your student loan debt if you buy a home from their associated home builder. Eagle Home Mortgage's Student Loan Debt Mortgage Program Some 44 million Americans have student loans With average outstanding debt of $34,000 Lennar will pledge 3% of the purchase price to pay off that debt Making it easier to qualify for a home loan while putting homeownership within reach Apparently some 44 million Americans have student loan debt, which represents seven out of 10 graduates of both public and private colleges, this according to Fannie Mae. And these recent graduates have an average of $34,000 in debt thanks to their costly college education. To ease that burden, home builder Lennar is now offering to direct up to 3% of a home’s purchase price to pay off student loans when a borrower uses their affiliated lender Eagle Home Mortgage. Put simply, Lennar contributes the 3% and it does not increase the price of the home or add to the mortgage loan balance. Of course, if your mortgage... --- > Confused yet? Yeah, me too. Let’s dive in. For a while now, the 30-year fixed-rate mortgage has been under attack. In short, opponents of the popular loan - Published: 2017-09-20 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/a-30-year-fixed-mortgage-that-is-adjustable-self-refinancing-and-ideally-paid-off-early/ - Categories: Mortgage News Confused yet? Yeah, me too. Let’s dive in. For a while now, the 30-year fixed-rate mortgage has been under attack. In short, opponents of the popular loan program argue that it builds equity far too slowly and requires government support to even exist, what with that interest rate locked in for three decades. They’re right. It’s true that mortgage payments on the traditional 30-year fixed are mostly interest, especially during the first decade and change. Very little of the principal balance is paid off, even though the borrower is making fully-amortized mortgage payments month after month. This explains why homeowners can get into trouble even if they’re doing the right thing – if home prices fall and the borrower has only accrued a small amount of equity, they can easily find themselves in an underwater mortgage position. Enter the "Fixed-COFI Mortgage" A pair of researchers have come up with a 30-year fixed alternative Known as the Fixed-COFI mortgage That addresses flaws with the traditional 30-year fixed Including slow repayment of principal and the need to refinance should rates drop Say what? A pair of researchers at the Federal Reserve, Wayne Passmore and Alexander H. von Hafften, have come up with an alternative known as a “Fixed-COFI mortgage. ” In their working paper titled, “Improving the 30-Year Fixed- Rate Mortgage,” they argue that the 30-year fixed is “flawed” for three main reasons. First, equity accumulation is very low during the first decade of the loan, which they equate to essentially renting... --- > A company called ZHome, which can apparently generate an offer to buy your home within 24 hours, is also making it easier for existing homeowners to buy - Published: 2017-08-31 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/zhome-lets-you-sell-your-current-home-in-24-hours-so-you-can-buy-a-brand-new-one/ - Categories: Housing Market, Mortgage News A company called ZHome, which can apparently generate an offer to buy your home within 24 hours, is also making it easier for existing homeowners to buy brand news homes. There are several issues with unloading one home and acquiring another, especially in a red-hot housing market. Most sellers don’t want to deal with any major contingences from the buyer, like the ability to sell their existing home before buying theirs. At the same time, if all the equity is tied up in the existing home, it’s difficult for a homeowner to go anywhere. Enter the ZHome EZ Trade-Up Program It's difficult to buy and sell a home at the same time Especially when there is limited inventory on the market ZHome's EZ Trade-Up Program gives homeowners a cash offer And a flexible closing date that aligns with the closing of their new home With ZHome’s new EZ Trade-Up Program, homeowners can get a guaranteed cash offer for their existing homes, along with a flexible closing date that aligns with that of the new home. The company has partnered with William Lyon Homes in Southern Nevada to help homeowners trade in the old for the new. Because really, who wants to live in a used home? Just kidding, that phrase is silly. Can homes really be used? Anyway, this is how it works. You provide some basic information about your property to ZHome, set up a time for them to inspect your property, and then they'll send you a free,... --- > It’s been a tough year or so for Wells Fargo, the undisputed king of mortgages. While they continue to lead the nation in home loan origination volume, - Published: 2017-08-30 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/wells-fargo-hit-with-lawsuit-related-to-improper-mortgage-lock-fees/ - Categories: Mortgage News It’s been a tough year or so for Wells Fargo, the undisputed king of mortgages. While they continue to lead the nation in home loan origination volume, they seem to be getting hit from every angle thanks to some alleged unscrupulous behavior. Their mortgage business seemed to survive the big fake account scandal relatively unscathed, but now they’re dealing with another potential embarrassment related to mortgages. I guess it was only a matter of time. Did Wells Fargo Make Customers Pay Lock Extension Fees Unfairly? A lawsuit alleges that Wells Fargo improperly charged lock extension fees When borrowers ran out of time on their mortgage rate locks Due to delays caused by the bank itself Which normally would be covered/waived by the bank if it's their fault A new lawsuit brought forth by a Nevada borrower named Victor Muniz claims Wells Fargo charged him a rate lock extension fee after his loan was delayed due to the bank’s own issues. In other words, it wasn’t his fault that the bank didn’t close the loan before the lock expired, yet they still charged him a $287. 50 extension fee. Apparently, Muniz was told by an employee that the bank would cover the charge, only to have that decision reversed by a regional manager. That may have turned out to be a big mistake because now the Consumer Financial Protection Bureau (CFPB) is investigating the bank’s lock practices. It’s common for locks to run out if a mortgage gets tied up in... --- > A mortgage bank by the name of "360 Mortgage Group" is making some lofty claims, one being a 15-minute full mortgage approval. The company says its - Published: 2017-08-29 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/360-mortgage-group-touting-15-minute-mortgage-approval-sans-loan-officer/ - Categories: Mortgage News A mortgage bank by the name of "360 Mortgage Group" is making some lofty claims, one being a 15-minute full mortgage approval. The company says its customers can “receive a true loan approval in 15 minutes on average,” which sounds shockingly fast. Their claim is even more bold in that they don’t rely upon mortgage loan officers. In fact, they refer to their new proprietary fintech system as the NOLO platform, which is short for No Originating Loan Officer. Ouch, loan officers. The company goes on to say that LOs can actually slow things down and cause problems when they have “interfered with the process, as is standard in the industry. ” How the NOLO Platform Works: Data Mining 360 Mortgage Group is pitching an entirely-online loan approval That it can generate in as little as 15 minutes Without the need for a loan officer to guide the borrower All thanks to data mining technology The 360 loan approval is generated entirely online, without the need to speak to anyone during the process, namely a loan officer earning a commission. So you might be wondering how borrowers can get real home loan approvals in a quarter of an hour without getting any sort of guidance from a professional. It sounds too good to be true, but 360 Mortgage Group seems to take a lot of pride in their tech-driven platform that is driven by data mining. Basically, prospective borrowers input some basic personal information to complete an authentication process, then... --- > Think you can’t get a jumbo home loan these days? Think again. Power couple Jay-Z and Beyoncé somehow managed to get a $52.8 million-dollar mortgage from - Published: 2017-08-24 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/jay-z-and-beyonce-take-out-52-8-million-mortgage-on-bel-air-home/ - Categories: Housing Market, Mortgage News Think you can’t get a jumbo home loan these days? Think again. Power couple Jay-Z and Beyoncé somehow managed to get a $52. 8 million-dollar mortgage from the bank to finance their home in Los Angeles. Per the LA Times, the pair purchased the $88 million-dollar property in a Bel Air neighborhood via blind trusts and came in with a 40% down payment. That's 60% LTV, which seems like a good amount of skin in the game. Largest Mortgage Ever? While it might not be the largest home loan ever originated It's got to be pretty close at a whopping $52. 8 million That's a monthly payment of roughly $250,000 Which is more than the total mortgage balance of many Americans I’m not sure what constituted the largest mortgage ever, but $52. 8 million is probably way up there. To put it in perspective, a $52,800,000 loan amount on a 30-year fixed set at 4% equates to a monthly payment of $252,075. 28. Yes, more than a quarter-million a month. As the Times pointed out, the monthly payment alone is nearly half the median sales price ($610,000) of a single-family home in Los Angeles. The monthly payment also happens to be $50,000 more than the median home value in the United States. The good news is the sprawling two-acre estate includes four swimming pools, a spa, full-size basketball court, and a wellness center. It’s also 30,000 square feet, so there’s plenty of room for the in-laws. Why Did They Take... --- > Nationstar Mortgage, which was once on the brink of failure, officially announced its name change to “Mr. Cooper” in August 2017. The move appeared to be - Published: 2017-08-23 - Modified: 2025-03-31 - URL: https://www.thetruthaboutmortgage.com/mortgage-lender-nationstar-becomes-mr-cooper-will-offer-home-rewards-credit-card/ - Categories: Mortgage Tips Nationstar Mortgage, which was once on the brink of failure, officially announced its name change to “Mr. Cooper” in August 2017. The move appeared to be an effort to make a fresh start with a more appealing, modern, and consumer-friendly image. Back in late 2007, the company nearly went under along with other big-name lenders at the time. But they persevered have now reinvented themselves completely. Mr. Cooper Fast Facts Publicly traded mortgage company (NASDAQ: COOP) founded in 1994 A top-15 mortgage originator headquartered in Coppell, Texas Originally began as the in-house mortgage lender for home builder Centex Homes Funded over $6 billion in home loans via retail channel in 2023 Also operates a correspondent lending channel (shuttered its wholesale division in 2020) Third largest home loan servicer in the United States (and #1 non-bank loan servicer) Rocket Companies announced plans to acquire Mr. Cooper in March 2025 At first glance, the name Mr. Cooper sounds strange for a mortgage lender, but it kind of aligns with the hipster mortgage lenders that seem to be making their way to the forefront these days. Some examples include Clara, SoFi, and Homie, all of which are appealing to Millennials instead of baby boomers, with fresh marketing tactics and less of that stale, serious financial stuff no one seems to be interested in anymore. Heading down to the bank and sitting down with an associate at a big oak desk doesn’t really fly these days for most people. They’d rather sit at their... --- > Sometimes I’m surprised I miss the most basic of mortgage definitions, seeing that this blog has been around for more than a decade, but alas, I’ve never - Published: 2017-08-22 - Modified: 2023-06-12 - URL: https://www.thetruthaboutmortgage.com/primary-residence-vs-second-home-vs-investment/ - Categories: Mortgage Matchups, Mortgage Tips Sometimes I’m surprised I miss the most basic of mortgage definitions, seeing that this blog has been around for more than a decade, but alas, I’ve never written about occupancy specifically. So without further ado, let’s talk about the three main types of occupancy with regard to qualifying for a mortgage because they're pretty important. Mortgage Occupancy Type Primary Residence (Where you live) This is the property you live in all or most of the year Underwriting guidelines are easiest for this property type And mortgage rates are the lowest This is your standard owner-occupied property, a home or condo you plan to live in full time. Or at least the majority of the time. It may also be referred to as your principal residence. It can be a single-unit property or a multi-unit property, but you must live in it most of the year. The property should also be reasonably close to where you work, if applicable, and you must sign a form that says you plan to occupy said property shortly after closing. Now the good news. Since it’s your primary residence, mortgage rates are the lowest, and it’s also easier to get a mortgage because guidelines are more flexible. This means you can potentially put less down or refinance at a higher loan-to-value (LTV). We’re talking a 3% down payment mortgage, which is pretty much the lowest down payment you can get away with unless the lender has a zero down program, which again would likely only... --- > Here’s something that may finally speed up the typically slow home loan process: an appraisal-less home purchase. Yep, it’ll be a reality for some folks - Published: 2017-08-18 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/soon-you-may-be-able-to-buy-a-house-without-an-appraisal/ - Categories: Housing Market, Mortgage News Here’s something that may finally speed up the typically slow home loan process: an appraisal-less home purchase. Yep, it’ll be a reality for some folks come September thanks to a new initiative by Freddie Mac. First a little background. The dreaded home appraisal, which can take weeks to complete, is often an item that turns what could be a two-week process into a month-long one. Of course, buyers and sellers aren’t always in that big of a rush. And one could argue that an independent valuation is good for all parties. That stuff aside, an appraisal waiver will save the homeowner money because they won’t have to pay for one in certain situations. How much they save depends on what the lender charges, but it could be $500 or more. Freddie Mac’s Automated Appraisal Alternative Freddie Mac has rolled out ACE Their automated collateral evaluation Which can determine if an appraisal waiver is a possibility Using big data like public records, MLS data, and so on You might be wondering how Freddie Mac will be able to forego an appraisal, seeing that it’s a pretty important piece of the mortgage qualification pie. After all, lenders are lending out a lot of money, so they can’t just take the seller’s or borrower’s word for it that the home is worth X. That’s where big data comes in. The government-sponsored enterprise refers to their tool as an “automated appraisal alternative. ” What that means in layman terms is that Freddie will use... --- > We’ve been worrying that mortgage rates would go up for years now, but it just hasn’t happened yet. Sure, they’re up a little bit from record levels, but - Published: 2017-08-14 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/these-six-things-will-happen-if-mortgage-rates-go-up/ - Categories: Mortgage Tips We’ve been worrying that mortgage rates would go up for years now, but it just hasn’t happened yet. Sure, they’re up a little bit from record levels, but not by as much as expected. The 30-year fixed still sits firmly around 4%, while the 15-year fixed is in the low 3% range. Both have been slightly lower at different points in the past five years. This prolonged period of low rates has kept the mortgage business humming along while also propelling the housing market to record heights. But what happens when mortgage rates start to really take off higher? Well, six main things, this according to a working paper by Laurie Goodman over at the Urban Institute. Mortgage Volume Will Fall This one is inevitable If mortgage rates rise Mortgage loan application will fall There's just no way around that What goes up will cause something else to go down, and we’re talking about mortgage origination volume. As rates rise, fewer mortgages will be made because there will be less of an incentive to refinance. Fannie Mae, Freddie Mac, and the Mortgage Bankers Association all expect mortgage lending volume to decrease significantly from last year to this year. And they anticipate an even slower 2018. Of course, we’ve been hearing this for years, only to see these groups revise their estimates higher. But they’ll probably be right eventually... The Mortgage Industry Will Consolidate Because higher rates lower application volume Mortgage industry consolidation is also likely With smaller players absorbed by... --- > I’ve got more Millennial mortgage data for you, courtesy of the monthly Ellie Mae Millennial Tracker. This is a heavily watched group because they’re - Published: 2017-08-10 - Modified: 2018-07-17 - URL: https://www.thetruthaboutmortgage.com/millennials-favor-conventional-mortgages-over-fha/ - Categories: Mortgage News I’ve got more Millennial mortgage data for you, courtesy of the monthly Ellie Mae Millennial Tracker. This is a heavily watched group because they’re expected to carry the housing market to the next stage, hopefully higher. While the word Millennial gets thrown around a lot, Ellie Mae defines it as an individual born between 1980 and 1999. Some have wider date ranges, and other shorter. Anyway, we already know that Millennials favor adjustable-rate mortgages, but it turns out they’re also pretty keen on conventional loans too. 63% of Millennial Mortgages Were Conventional Most young home buyers are using conventional financing Such as loans backed by Fannie Mae and Freddie Mac As opposed to government loans backed by the FHA One reason might be because the down payment requirement is just 3% In June, nearly two-thirds (63%) of mortgages made to Millennial borrowers were conventional home loans, aka non-government loans. The overwhelming remainder (32%) were FHA loans, which require just a 3. 5% down payment, and for that reason, are favorable to young cash-strapped borrowers. The rest were probably a combination of VA and USDA loans, which allow for zero down payment, but aren’t as widely issued. The share of FHA loans peaked in February and March of this year at 36%, but has since fallen steadily. Meanwhile, the conventional share rose from 60% to 63% during that time. Ellie Mae executive vice president of corporate strategy Joe Tyrrell said this either means Millennials can afford more house without a government... --- > If you have an adjustable-rate mortgage, I’ve got some important news for you. The London Interbank Offered Rate, or LIBOR as it’s known to most, is going - Published: 2017-08-07 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/what-will-happen-to-your-mortgage-when-the-libor-goes-away/ - Categories: Mortgage Tips If you have an adjustable-rate mortgage, I’ve got some important news for you. The London Interbank Offered Rate, or LIBOR as it’s known to most, is going to be phased out over the next five years. After 2021, it won’t exist because banks no longer want to take a role in setting it. If you recall, the LIBOR was at the center of a scandal back in 2012 after it was discovered that bankers were manipulating the price for decades. Unfortunately, this meant innocent consumers, including many homeowners with adjustable-rate mortgages, were receiving inaccurate (perhaps higher) pricing once their loans became adjustable. Check Your Mortgage Paperwork First Find out if you're affected by the LIBOR switch By first asking yourself if you have an ARM And if so, checking your mortgage index On your Closing Disclosure (CD) form If you have an ARM, go ahead and check to see what index it’s tied to. Pull out your Closing Disclosure (CD) and look for the Adjustable Interest Rate (AIR) Table. As you can see, it will detail the initial interest rate on your loan, along with the index and margin in question. You may something like the image above, which stands for 12-Month LIBOR, or 1-year LIBOR. Many ARMs are attached to LIBOR, meaning once they become adjustable after the first three, five, or seven years, the rate will be determined by the margin plus the associated LIBOR index. So if your margin is 2. 25, and the one-year LIBOR index... --- > While we’ve come a long way since housing bottomed, the memories of how we got there still don’t feel very distant. A lot of things contributed to the - Published: 2017-08-03 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/1-down-payment-mortgages-come-under-fire/ - Categories: Mortgage News While we’ve come a long way since housing bottomed, the memories of how we got there still don’t feel very distant. A lot of things contributed to the complete breakdown of the real estate market, with exotic financing being one of them. So it’s no surprise that the new hot trend of “1% down mortgages” is now coming under the microscope. Update: UWM has re-launched the 1% down payment mortgage. Freddie Mac Is Changing the Rules Pertaining to 1% Down Mortgages While 1% down mortgages have been all the rage lately Freddie Mac is cracking down on the higher-risk home loans Requiring a minimum 3% borrower contribution That can't come via the transaction itself via lender credits, points, etc. Over the past couple years, many large lenders have introduced home loan programs that require just 1% down from the borrower, including big names like Quicken, Guaranteed Rate, Guild Mortgage, and even wholesaler United Wholesale Mortgage. In fact, just this week another lender joined the party, Garden State Home Loans, giving home buyers in Connecticut, Florida, New Jersey, and Pennsylvania the chance to achieve the American Dream with just a 1% down payment. As far as I can tell, most if not all of these programs rely upon Freddie Mac’s Home Possible Mortgage program, which is its 97% LTV offering. However, it turns out that some lenders may have taken it a little too far because Freddie Mac doesn’t seem comfortable with their interpretation of the program. Last week, Freddie Mac... --- > Mortgage industry newcomer Ally Home is getting into the price match game with its just launched promotion called, you guessed it, “Price Match - Published: 2017-07-26 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/ally-home-launches-price-match-guarantee-for-mortgages/ - Categories: Mortgage News Mortgage industry newcomer Ally Home is getting into the price match game with its just launched promotion called, you guessed it, “Price Match Guarantee. ” If you’re not familiar, Ally Home got into the mortgage business late last year, essentially rising from the ashes of GMAC Bank/ResCap. Now they want to separate themselves from the crowd by ensuring you get the best price on your mortgage, or at least equal to what you may have found elsewhere. They’ll Match Rates and Points Ally Mortgage is offering a Price Match Guarantee Like several other mortgage lenders out there Where they'll match the offer of another bank or lender But is matching enough? And what about lender fees? In a nutshell, Ally Home will match the interest rate and points (if applicable) of another lender if it happens to better what Ally Home offers you. All you have to do is let your Ally Home loan advisor know you’ve got a better offer and they’ll match it. That entails sending over the competing lender’s completed Loan Estimate, which must be dated within the past five business days, at the time you wish to lock your loan with Ally. In order to be eligible, the loan programs have to be the same too, obviously. There is a bit of a gotcha here, at least in my opinion. Ally Home will only match the mortgage rate and points. There’s no mention of fees. So it’s possible, if I’m interpreting this correctly, that Ally Home... --- > Mortgage Q&A: “How long does it take to get a mortgage?” This is a fairly common mortgage question because we humans aren’t very patient. This is - Published: 2017-07-20 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/how-long-does-it-take-to-get-a-mortgage/ - Categories: Mortgage Tips Mortgage Q&A: “How long does it take to get a mortgage? ” This is a fairly common mortgage question because we humans aren’t very patient. This is compounded by the fact that we’re asking for a very large sum of money for something we just must have. Because of that, the process does take time. After all, you’re not buying an ice cream cone, you’re buying a house or asking one lender to take on your old loan and present you with a new one (refinance). Back in the day, around the mid-to-late 2000s, mortgages could close really quickly. This was partially because underwriting guidelines were pretty flexible, and also because lenders were well-staffed and very competitive. In fact, it was common to get approved for a mortgage in 24 hours, or even the same day. Yes, you could submit a loan package in the morning and get a conditional approval from an underwriter that same afternoon. Then the mortgage crisis happened and things slowed down a lot. The fast and loose days were over and banks and lenders were a lot more careful about doling out hundreds of thousands of dollars. Average Time to Close a Home Loan Expect a range of 30-45 days from start to finish It can be quicker on some occasions if things are slow or a lender is super fast But it's best to expect a longer timeline and give yourself a buffer To avoid an expired rate lock and/or per diem interest Today,... --- > Despite the red-hot real estate market, more Americans are regretting their home purchases, per a new Trulia survey. It’s a bit odd because home prices - Published: 2017-07-19 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/for-some-reason-homeowner-regrets-are-on-the-rise/ - Categories: Housing Market, Mortgage News Despite the red-hot real estate market, more Americans are regretting their home purchases, per a new Trulia survey. It’s a bit odd because home prices have been rocketing higher throughout much of the nation since they bottomed in 2012. So even if you absolutely hated your home, you’d think all that equity would be enough to keep you happy. But that’s seemingly not the case. More Regrets Since Housing Bottomed Trulia says home buyer regrets are on the rise With recent buyers more regretful than those who purchased before the crisis One reason is today's buyers don't feel as financially secure Perhaps because they lived through the Great Recession and know things can unravel again For whatever reason, recent home buyers are more regretful than those who purchased homes prior to 2012. If you look at a chart of home prices before and after 2012, you’d probably be scratching your head. Somewhat amazingly, half of those who found their homes after the housing market bottomed in 2012 said they had regrets, compared to just 42% who found their home before 2012. Trulia pointed out one distinction between the two groups – feeling financially secure. Some 12% of recent buyers said they wished they had been more secure before buying a home, compared to 6% of the pre-2012 buyers. But that doesn’t do it for me. There has to be something else because anyone who didn’t have to go through the housing crisis and/or deal with negative equity shouldn’t feel worse... --- > It's not just avocado toast. A new anecdotal report from the WSJ reveals that Millennials who are buying homes are increasingly choosing adjustable-rate - Published: 2017-07-11 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/millennials-seem-to-like-adjustable-rate-mortgages/ - Categories: Mortgage News It's not just avocado toast. A new anecdotal report from the WSJ reveals that Millennials who are buying homes are increasingly choosing adjustable-rate mortgages to get the job done. While the data isn’t definitive by any stretch, John Walsh, the chairman of a large mortgage lender by the name of Total Mortgage Services, told the publication that interest in 7/1 ARMs jumped 18% from a year ago. He tells the WSJ that these home buyers aren’t “going to work at GE for the next 30 years,” which explains why they would choose an ARM instead of a fixed-rate mortgage. In a word, they’re “mobile. ” The argument is basically that they won’t be staying in the home for 30 years, and as such won’t be keeping the mortgage very long either. It Doesn’t Take Long to Outgrow a Home Today's young home buyers realize they may not stay long Either because of increased job mobility Or simply because they'll outgrow their homes and need larger ones This makes an ARM a compelling mortgage choice over a FRM It’s a pretty safe bet to make because these first-time buyers will likely outgrow their homes within a decade or less, especially if they advance in their careers and increase their purchasing power (and start families). Of course, that’s the simple way of looking at it. We could have made the same argument about 10 years ago. Back in 2006, a young home buyer could have (and probably did) take out an ARM... --- > Are you the impatient type? Well, have I’ve got news for you. A new service dubbed “RedfinNow” will get you a “top offer” for your property within 24 - Published: 2017-07-07 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/redfin-now-get-an-offer-on-your-home-within-24-hours/ - Categories: Housing Market, Mortgage News Are you the impatient type? Well, have I’ve got news for you. A new service dubbed “RedfinNow” will get you a “top offer” for your property within 24 hours of it being viewed. That’s pretty fast. Instead of dealing with the hassle of finding an agent, listing the property, getting a buyer to bite, then waiting weeks for it to sell, you can just turn it over to RedfinNow instead. RedfinNow Lets You Move in a Week RedfinNow is an expedited home selling program You can sell your property to Redfin in a matter of days As opposed to listing it, staging it, then waiting potentially months to sell it It could come in handy if you need a quick sale to purchase a new home This new venture is the latest in a string of new services rolled out by Redfin in a bid to “offer a complete solution. ” That is, everything you need to buy and sell a home, including a mortgage and title and escrow services. Yep, in 2016 they launched their title and settlement business “Title Forward” in eight states, and about half of their customers used the company. And in early 2017, they began originating and underwriting mortgages for their customers via Redfin Mortgage in the state of Texas. With the introduction of RedfinNow, they’ll be able to market themselves as an “end-to-end solution for customers buying and selling a home. ” How Redfin Now Works First you request an offer from Redfin Then... --- > Is the housing market getting stupid again, or is technology changing the way we buy homes? That’s still up for debate, but there are some troubling signs - Published: 2017-06-28 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/one-third-of-home-buyers-made-offers-without-actually-visiting-the-property/ - Categories: Housing Market, Mortgage News Is the housing market getting stupid again, or is technology changing the way we buy homes? That’s still up for debate, but there are some troubling signs out there. The latest is that one-third of home buyers made an offer on a property they didn’t even see in person, this according to a new survey from Redfin. That's up from 19% a year earlier and 21% two years ago. The company polled nearly 3,500 individuals in 11 metropolitan areas that bought or sold a home in the past year, attempted to do so, or plan to do so in the near future. Amazingly, 33% of buyers decided they were okay with buying a home they had never physically seen, touched, smelled, etc. That’s pretty bold. Millennials Most Likely to Make Offers from Afar There appears to be a new trend of making offers on homes Without actually seeing them in person It seems to be most common with Millennial home buyers Just know that purchasing a home is a big decision not to be taken lightly so put in the time! Rather surprisingly, or perhaps not surprisingly, it was Millennials who were the most likely to make an offer sight unseen. This group indicated to Redfin that they made an offer on a home they hadn’t seen at some point during their home search more so than any other demographic. Nearly half (41%) of Millennial buyers made at least one offer from afar. I say surprisingly because chances are it’s... --- > There’s been a lot of talk lately about mortgage lenders easing credit standards as refinance volume wanes and purchase activity remains constrained by - Published: 2017-06-27 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/fannie-mae-increasing-max-dti-to-50-dti-upping-ltvs-for-arms/ - Categories: Mortgage Tips There’s been a lot of talk lately about mortgage lenders easing credit standards as refinance volume wanes and purchase activity remains constrained by limited inventory. Because more and more new entrants (many so-called disruptors) have joined the fray, and there’s a smaller pool of eligible mortgage borrowers, risk appetite is expected to rise in coming months. In fact, a Fannie Mae survey released yesterday found that the share of lenders expecting to ease credit standards over the next quarter hit new all-time highs. Fannie Mae Increasing Max DTI to 50% Fannie is making it easier for borrowers To get approved for a mortgage with a high DTI ratio Via their automated underwriting system Which should usher in more of these types of loans First off, we’ve got Fannie Mae’s Desktop Underwriter (DU) Version 10. 1 release slated for the weekend of July 29th. The biggest change is that this version of DU will allow debt-to-income ratios as high as 50%, up from 45% currently. For the record, you can get approved at the moment with a DTI as high as 50%, but Fannie requires additional compensating factors to support a DTI ratio between 45-50%, such as lots of assets and an excellent credit score. With this release, that 50% DTI will be good to go because the DU risk assessment will automatically consider “a broad range of loan characteristics and borrower credit factors. ” In plain English, this means it’ll be easier to get approved for a mortgage with a... --- > There’s a new startup out there called “Homie” that transforms the old way people buy and sell homes by harnessing today’s technology and (kind of) - Published: 2017-06-26 - Modified: 2024-08-16 - URL: https://www.thetruthaboutmortgage.com/homie-a-startup-is-eliminating-real-estate-agent-and-loan-officer-commissions/ - Categories: Housing Market, Mortgage News There’s a new startup out there called “Homie” that transforms the old way people buy and sell homes by harnessing today’s technology and (kind of) ditching real estate agents. Well, in some cases the real estate agent will remain (at least one of them), but the service aims to help save buyers and sellers money by letting them go it alone. The service is currently available in the states of Arizona and Utah, with plans to expand to other states in the near future. Be Your Own Real Estate Agent with Homie Instead of paying the typical 5-6% real estate commission Home sellers can unload their home for less than $2,000 Which depending on the sales price Could amount to thousands in savings In short, you can get help from Homie to list your property (including on the MLS) and save on the typical 5-6% real estate agent commissions in the process. This could be helpful since real estate commissions can't be financed into the loan. For a flat fee of $199, Homie will help you list your home on Homie’s own site, Trulia, Zillow, and other websites. Included in that price is a home value report to help you determine a good listing price, a custom phone number, a yard sign, attorney legal assistance to navigate paperwork and negotiations, a tour scheduler, an offer generation tool, automated contract reminders, and professional photos of your home. You basically get a full suite of for-sale-by-owner tools to assist you in selling... --- > It seems 1% down is the new zero down in the mortgage world, with San Diego-based Guild Mortgage the latest to join the fray. The independent mortgage - Published: 2017-06-14 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/guild-mortgage-latest-to-offer-a-1-down-payment-mortgage/ - Categories: Mortgage News It seems 1% down is the new zero down in the mortgage world, with San Diego-based Guild Mortgage the latest to join the fray. The independent mortgage bank, like others before it, will take advantage of a grant to give homeowners instant equity, while requiring just 1% from the borrower’s own funds. The 1% down home loan program is a new form of down payment assistance, though unlike similar programs that preceded it, the gift doesn’t need to be paid back and the borrower actually gets some skin in the game. Guild Mortgage's 97% LTV with a 2% Grant and 1% Down Payment Like other 1% down mortgage options available Guild is relying on a 2% grant that doesn't need to be paid back But there are lots of guideline restrictions Including income limits and credit score minimums Aspiring homeowners who take advantage of the Guild 1% Down loan program can instantly acquire 3% equity in the property they purchase despite only putting down 1% thanks to a two percent grant that doesn’t need to be repaid. Quicken has a similar program, as does United Wholesale Mortgage if you go the mortgage broker route. Guild Mortgage refers to it as “3-for-1” equity with “no strings attached,” and say it’s ideal for those with good credit who lack the necessary down payment funds, a common problem these days. This gifted grant money is subject to income limits, required homebuyer classes and other criteria, though income limits don’t apply in census tracts... --- > Movement Mortgage is the latest of many mortgage lenders to offer a zero down option for prospective home buyers, referred to as the Mortgage Assistance - Published: 2017-06-07 - Modified: 2024-08-08 - URL: https://www.thetruthaboutmortgage.com/movement-mortgage-launches-zero-down-mortgage-called-map/ - Categories: Mortgage News Movement Mortgage is the latest of many mortgage lenders to offer a zero down option for prospective home buyers, referred to as the Mortgage Assistance Program, or MAP. Before we get into the details of that loan program, let's learn more about this growing mortgage company, which refers to itself as "a national top 10 retail mortgage lender. " Who Is Movement Mortgage? A national nonbank direct mortgage lender That is licensed in 49 states With nearly 800 offices nationwide And a former NFL player is their CEO If you haven't heard of Movement Mortgage, know that they're a rapidly growing direct mortgage lender based out of Fort Mill, South Carolina, founded back in 2008. They're a nonbank, meaning they don't collect deposits and pay interest like other big banks such as Wells Fargo or Chase. However, the company recently purchased Danville, Virginia-based First State Bank, which they've morphed into Movement Bank. So it's possible that the ultimate game plan is to make Movement Mortgage a depository institution going forward. What's interesting about the company is they were founded during the housing crisis, basically right around the time home prices had begun to fall after peaking a year or two earlier. Their CEO is Casey Crawford, who played tight end for the Carolina Panthers and Tampa Bay Buccaneers, and won a Super Bowl with the latter. So they've got a certain cachet. They do about $13 billion in annual home loan volume and are now licensed in 49 states (the... --- > There’s a new disruptor in the mortgage space called Magilla that lets you shop for a mortgage anonymously, assuming you don’t want lenders to bug you. - Published: 2017-06-05 - Modified: 2018-07-18 - URL: https://www.thetruthaboutmortgage.com/magilla-lets-you-shop-mortgage-lenders-anonymously/ - Categories: Mortgage News There’s a new disruptor in the mortgage space called Magilla that lets you shop for a mortgage anonymously, assuming you don’t want lenders to bug you. They refer to themselves as the “search engine for loans” because you can shop for a mortgage (or dozens of other types of loans) online and receive real offers from actual loan officers who work at FDIC-insured lenders. A common issue while shopping for a mortgage is being badgered by a lender once you make contact. Even if you’re no longer interested, you might continue to receive phone calls, e-mails, etc. To combat this longstanding problem, companies like Zillow gave mortgage shoppers the ability to search without giving up their private info. Magilla seems to be doing the same thing, though it’s a little different than the Zillow Mortgage Marketplace. The company also notes that their system is an effective way to see who is being most aggressive in a certain space. They claim that once a lender hits its quota for a certain type of loan, it directs its attention to a different type of loan to keep their loan portfolio balanced. This means one bank might be able to get extra competitive and offer something other banks can’t. Instead of running around calling each bank to see who this is, you can let them all come to you. The theory is that the top offer will present itself because they all know they need to offer their best to get you in... --- > The online real estate marketplace Zillow has just launched a new feature called “Zillow Offers,” formerly known as Zillow Instant Offers, aimed at - Published: 2017-05-24 - Modified: 2023-11-15 - URL: https://www.thetruthaboutmortgage.com/zillow-instant-offers-for-those-who-want-to-sell-their-home-fast/ - Categories: Housing Market, Mortgage News The online real estate marketplace Zillow has just launched a new feature called “Zillow Offers,” formerly known as Zillow Instant Offers, aimed at helping seemingly impatient sellers quickly offload their homes. In short, their research has found that some homeowners want a “faster, simpler selling option” to part ways with their property. What might make it different from other quick-sale services is that it comes with a free comparative market analysis (CMA) from a local real estate agent, which is likely intended to help sellers come to grips with what their home should sell for. There’s also a good chance that agent providing it will wind up representing them, so they aren’t on their own. Ideally, this means they won’t get ripped off by some real estate investor looking to make a quick buck. It also creates a new advertising stream for Zillow. Update: Zillow Offers shuts down because their iBuying unit wasn’t profitable and is too risky. Zillow Offers and COVID-19 On March 23rd, 2020, Zillow Offers was paused in all 24 housing markets where it was operating due to the COVID-19 pandemic. Other iBuyers like RedfinNow and Opendoor did the same in light of the uncertainty surrounding the outbreak. Simply put, companies that buy homes practically instantly weren’t too confident about the direction of the housing market, so it’d be tough to put a price on a home. But fast forward just two months to mid-May and they’re making their way back. Zillow announced on May 18th that... --- > I recently wrote about the need to put down 20% when buying a home, which although often recommended, isn’t a necessity these days. There are programs - Published: 2017-05-22 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/traditional-20-mortgage-down-payment-could-be-cut-in-half/ - Categories: Mortgage News I recently wrote about the need to put down 20% when buying a home, which although often recommended, isn’t a necessity these days. There are programs from both the FHA and Fannie Mae and Freddie Mac that allow much lower down payments. In fact, one only needs 3% of the purchase price to buy a home today thanks to newer offerings like Freddie Mac’s Home Possible Advantage. Under 20% Comes with a Price While there are plenty of home loan options For those unable to muster a 20% down payment There is a cost in the way of mortgage insurance And a higher mortgage interest rate But despite being a widespread option, anything under a 20% down payment comes with price, literally. We’re talking a higher mortgage rate to account for increased risk if/when you default, and the need for mortgage insurance to protect lenders willing to offer low-down payment loans. At some point, the late 1950s per Wikipedia, one company by the name of Mortgage Guaranty Insurance Corporation (MGIC) decided that it would insure the first 20 percent of a defaulted mortgage. This allowed lenders to offer mortgages to borrowers lacking that key 20% down payment, and seemingly ushered in a new era of low-down payment loans. Several decades later, the Homeowners Protection Act of 1998 was enacted to allow borrowers to drop PMI after their loan-to-value (LTV) reached 78% or 80%. Now, all that might change, assuming some form of regulatory reform takes place and lowers the standard... --- > These days, it’s not uncommon for individuals to open a bunch of credit cards in a short span of time to acquire lots of points and/or cash back. Those - Published: 2017-05-18 - Modified: 2025-02-13 - URL: https://www.thetruthaboutmortgage.com/can-credit-card-churning-hurt-your-chances-of-getting-a-mortgage/ - Categories: Mortgage Tips These days, it’s not uncommon for individuals to open a bunch of credit cards in a short span of time to acquire lots of points and/or cash back. Those who do it on a serial basis are known as churners. They basically open and close credit cards constantly to take advantage of the benefits without having to deal with the drawbacks, namely annual fees and finance charges. But you’ll often hear even the most hardcore churner say they’re pumping the brakes because they plan to buy a home, or they’re thinking about refinancing the mortgage (next year). Next year? Seriously? To Risk It or Not Risk It While the fears of credit card churning might be overblown You do have to tread cautiously here Ultimately a mortgage approval will outweigh any credit card bonus you might receive So it could make sense to wait until your home loan has funded So, does credit card churning put your mortgage approval at risk, or is the whole thing overblown? There are probably two camps on this one, but I generally think churning itself isn’t a huge problem, though it might be a nuisance. Allow me to explain. When you churn, you’re often asked to spend X amount in the first few months. This means racking up spending and increasing your outstanding debt, even if only for a limited time. As I’ve mentioned before, your credit scores can plunge simply from spending a lot on your plastic, even if you pay it off... --- > Wondering when the best time to buy a home is? And the worst time? Well, thanks to data science, we no longer have to guess whether it's fall and winter, - Published: 2017-05-11 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/the-best-time-to-buy-a-home-is-in-august-and-september/ - Categories: Housing Market, Mortgage Tips Wondering when the best time to buy a home is? And the worst time? Well, thanks to data science, we no longer have to guess whether it's fall and winter, or spring and summer. I'll save you the suspense: the very best time to buy your dream home is late summer, namely August and September, this according to a new study from real estate listing website Zillow. Apparently prospective home buyers will find the most home inventory and a greater number of price cuts during these temperature-hot months, giving them better odds of finding that perfect home. This means it might be easier to negotiate prices and perhaps even snag a lower price if the property stays on the market for a prolonged period of time. Inventory Remains a Problem An inventory glut in late summer Could be the perfect time to buy a home Because home sellers will be getting desperate And there might be fewer competing buyers at that time As you probably know (if you’ve been house hunting), inventory is scarce. It’s slim pickings out there and hasn’t gotten any better, despite predictions telling us otherwise. They were wrong about mortgage rates going up too... Overall, inventory is off 5. 3% from a year ago, meaning you’ll have to buckle your seatbelt and prepare for another tough year if you’re in the market to buy a home, or getting ready to be. Real estate investing is also getting a lot less attractive, and not so easy. Conversely,... --- > It’s not very common for mortgage lenders to offer cash back or some other sort of reward for taking out a mortgage. Generally, you might get some sort of - Published: 2017-05-08 - Modified: 2024-05-24 - URL: https://www.thetruthaboutmortgage.com/chase-is-offering-100000-ultimate-rewards-points-when-you-take-out-a-mortgage/ - Categories: Mortgage News It’s not very common for mortgage lenders to offer cash back or some other sort of reward for taking out a mortgage. Generally, you might get some sort of closing cost guarantee or some assurance that if they screw up, you’ll be compensated. Really, that’s just making you whole. But Chase is looking to change that by offering a very healthy 100,000 Ultimate Rewards points (their own rewards currency) for those who apply for a mortgage (and close the sucker). Update: They have lowered the bonus to 75,000 Ultimate Rewards points, but now offer a bonus across multiple different credit cards. Chase Is Targeting Sapphire and Other Credit Card Customers Get 75,000 UR points if you have Chase Sapphire Reserve 50,000 UR points if you have Chase Sapphire Preferred 25,000 UR points if you have Chase Sapphire (no fee version) 25,000 UR points if you have Chase Freedom or Freedom Unlimited 75,000 United Miles if you have Chase Mileage Plus Club 50000 United Miles if you have Chase Mileage Plus Explorer In order to be eligible for this rather handsome bonus, you need to be an existing Chase credit card customer with either the Chase Sapphire Preferred card or the Chase Sapphire Reserve. It has since been opened up to those with a Chase Sapphire (no fee version), a Freedom or Freedom Unlimited card, and those with Chase co-branded United credit cards. Assuming you've got one of those, you need to take out a “new, residential first mortgage” with the... --- > You just closed your home loan and now a company is trying to sell you "mortgage protection insurance." What is it and should you buy it? - Published: 2017-05-02 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/what-is-mortgage-protection-insurance-and-do-you-need-it/ - Categories: Mortgage Tips So you just closed on your mortgage and you’re beginning to settle into your new home (and your new loan). You’re assessing the many things that will need to be fixed and changed to make your house a home. Then you receive an urgent notice in the mail regarding something called “mortgage protection insurance” or MPI for short. Or maybe it’s referred to as mortgage payment protection insurance or mortgage life insurance protection. In any event, it looks pretty serious and your blood pressure rises instantly. Mortgage Protection Insurance Looks Very Official, But Isn't... Once you move into your new home You'll likely be bombarded by very official-looking solicitations Warning you to purchase mortgage protection insurance To ensure you and your loved ones are financially secure The seemingly important document might have come in an official-looking envelope that bears some sort of message like “final notice,” despite being the first and only notice you've received. Once nervously opened, you’ll be presented with a sales pitch that includes a lot of personal information, such as your name, your lender's name, loan amount, record date, and a form that you’re urged to complete and return as soon as possible. There’s also a good chance it’ll be printed on pink paper, which for some reason makes it all the more urgent. But what you might not know, or what the company trying to sell you the insurance might not make very clear, is that it’s an entirely optional third-party coverage, just like a... --- > While pundits and fusspots continue to question whether we’re headed for another housing bubble, consider this: The most recent mortgages were among the - Published: 2017-03-22 - Modified: 2018-07-18 - URL: https://www.thetruthaboutmortgage.com/todays-mortgages-are-not-your-older-siblings-mortgages/ - Categories: Mortgage News While pundits and fusspots continue to question whether we’re headed for another housing bubble, consider this: The most recent mortgages were among the highest quality (lowest risk) since 2001. Indeed, mortgages originated during the fourth quarter of 2016 were of the utmost quality, exhibiting even less risk than those funded a year earlier, this according to the latest CoreLogic Housing Credit Index (HCI). The Housing Credit Index (HCI) Factors Include: Credit score (the higher the better) Loan-to-value ratio (LTV) Debt-to-income ratio (DTI) Documentation type (generally only one game in town nowadays: full doc) Occupancy status (owner-occ is the best occ) Condo/Co-up share (SFRs are safer) While the mortgages look pretty darn good, the company did note that the reduction in risk from both a year and a quarter earlier could be partially attributed to a higher refinance share. Per CoreLogic chief economist Frank Nothaft, refinance borrowers tend to have lower loan-to-value ratios (LTVs) and debt-to-income ratios (DTIs) than their home purchase counterparts. And because mortgage rates have since moved higher from late last year, default risk could increase as lenders loosen underwriting guidelines to accommodate “harder-to-qualify borrowers. ” Nothaft added that fraud could also rise as the mortgage market becomes more purchase-heavy. Credit Scores Up, DTIs and LTVs Steady Credit risk remains very low in the housing market Relative to what was seen a decade earlier Thanks to very high borrower credit scores And DTIs and LTVs that are in a healthy range As you can see from the chart... --- > Mortgage lenders have come a long way in the past decade. They used to approve loans without the need for income, asset, or employment documentation, and - Published: 2017-03-21 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/credit-bureau-experian-launches-real-time-asset-and-income-verification-for-mortgages/ - Categories: Mortgage News Mortgage lenders have come a long way in the past decade. They used to approve loans without the need for income, asset, or employment documentation, and now they can verify all those things in seconds. Yes, that was half a joke about the recent crisis and half a jab at the mortgage industry for continuing to reside in the Stone Age when it comes to underwriting and approving mortgages. But it appears the sea change we’ve all been waiting for is well underway. Instead of printing out stacks of paperwork and faxing in documents, mortgage borrowers can now verify many key items digitally. Perhaps this will shrink the average mortgage application from 500 pages to something a little more manageable. Maybe just 450 pages? It could also speed things up, as Experian notes some loan approvals can take as long as 70 days. Oh, and let’s not forget the $42 billion price tag to process all these mortgages each year. Experian Teams with Finicity to Automate Mortgages In an effort to speed up mortgage applications And make them less susceptible to fraud Experian and Finicity launched a real-time Verification of Asset (VOA) Report Along with a Verification of Income (VOI) Report to complement credit reports The latest step forward in this department comes via a partnership between credit bureau Experian and real-time financial data-sharing company Finicity. Together, we get Experian’s new “Digital Verification Solutions,” which among other things, will allow for asset and income verification. So instead of having to... --- > At first glance, I’m wondering why he didn’t list it for $10,999,999, but shoot, he probably has a reason. Legendary investor Warren Buffett has finally - Published: 2017-03-06 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/warren-buffett-just-listed-a-home-for-11-million-that-he-paid-150000-for/ - Categories: Housing Market, Mortgage News At first glance, I’m wondering why he didn’t list it for $10,999,999, but shoot, he probably has a reason. Legendary investor Warren Buffett has finally listed his vacation home located at 27 Emerald Bay in Laguna Beach, CA for $11 million. It seems he’s finally ready to take some profits after breaking even – oh wait, he’s up $10,850,000. Never mind. Yep, he bought the beach house back on April 6th, 1971 for $150,000. If we adjust for inflation the price would be $900,000 today, still a massive bargain to the astronomical listing price. Buffett Put Just 20% Down and Took Out a 30-Year Mortgage If you’re wondering how he financed the property way back then, he said he “probably only had $30,000 of equity in it,” meaning 20% down payment and 80% loan-to-value, which was common at the time. He took out a 30-year fixed mortgage from Great Western Savings and Loans, which was later acquired by Washington Mutual and then JPMorgan Chase. Per Freddie Mac, 30-yr fixed mortgage rates were around 7. 31% at the time – incidentally, it was the first month they began tracking 30-year fixed mortgage rates. Buffett apparently still holds the loan, remarking that “it’s the only mortgage I’ve had for fifty years,” meaning he must have refinanced once or twice to take advantage of either a lower rate or perhaps tapped some equity. Why would one of the world’s richest men still have a mortgage, let alone a tiny one? Wouldn't he have... --- > There’s a popular new loan in town that a lot of credit unions seem to be offering known as the “5/5 ARM,” which essentially replaces the more aggressive - Published: 2017-03-06 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/the-55-arm-is-an-adjustable-rate-mortgage-for-the-faint-of-heart/ - Categories: Mortgage Tips There’s a popular new loan in town that a lot of credit unions seem to be offering known as the “5/5 ARM,” which essentially replaces the more aggressive 5/1 ARM that continues to be the mainstay at larger banks and lenders. The San Francisco Federal Credit Union offers it via their POPPYLOAN, Caliber Home Loans has it, and PenFed also includes the product in its stable of loan programs. How the 5/5 ARM Works It's an adjustable-rate mortgage with a 30-year term That has a fixed interest rate for the first 60 months It then adjusts in year six and every five years thereafter With adjustments in year 6, 11, 16, 21, and 26 First off, you should know that the 5/5 ARM is an adjustable-rate mortgage. However, you get a fixed rate for the first five years of the loan term, just like a 30-year fixed. After that five years, the mortgage experiences its first rate adjustment, either up or down, based on the combination of the margin and the underlying mortgage index. The initial rate cap tends to be 2% on this program, meaning the rate can’t rise more than two percentage points from its starting rate, or fall by more than that in year six. Let’s look at an example of a 5/5 ARM to illustrate: Starting rate: 3. 125% Index: 1-year LIBOR Margin: 2% First adjustment: Year 6 Initial cap: 2% Periodic cap: 2% Lifetime cap: 5% If the starting rate is 3. 125%, the rate... --- > With home prices (and interest rates) on the rise, it’s getting more and more difficult to qualify for a mortgage. One simple strategy you can employ to - Published: 2017-02-23 - Modified: 2024-01-31 - URL: https://www.thetruthaboutmortgage.com/pay-down-your-debts-before-you-apply-for-a-mortgage-to-increase-purchasing-power/ - Categories: Mortgage Tips With home prices (and interest rates) on the rise, it’s getting more and more difficult to qualify for a mortgage. One simple strategy you can employ to boost your purchasing power is to pay down existing debts. I’ve already warned prospective mortgage applicants to avoid swiping their credit cards before and during the mortgage process, but this approach goes a step further. Less Debt = Lower DTI While a higher income is great It might not mean much if you have a ton of expenses If you can keep your debt to a minimum More of your income can be used to qualify for a home loan Put simply, if you have less debt, your debt-to-income ratio will be lower, even if your income doesn’t rise. For example, if you’ve got $2,000 in monthly debts and $10,000 in monthly income, your DTI is 20%. Lower that monthly debt down to $1,000 and you’ve got a DTI ratio of 10%. Once we add the proposed housing payment into the mix, your DTI will shoot up to account for that new monthly obligation, so it’s important to ensure you’ve got “room” to take on a new mortgage. If you’ve already got lots of existing debt that is reported on your credit report, and not much income, it’ll be difficult to qualify for a large mortgage and stay below key lender thresholds, such as the 43% max DTI ratio for Qualified Mortgages. Say you’ve got a slew of credit cards with balances on... --- > It sounds like magic, doesn’t it? A mortgage that allows for a loan-to-value ratio as high as 120%, portability, and can be used to pay off student loans. - Published: 2017-02-21 - Modified: 2024-05-24 - URL: https://www.thetruthaboutmortgage.com/burkeyloan-a-120-ltv-mortgage-thats-portable-and-can-pay-off-student-loans/ - Categories: Mortgage News It sounds like magic, doesn’t it? A mortgage that allows for a loan-to-value ratio as high as 120%, portability, and can be used to pay off student loans. Oh, and it can be tapped into when you need cash or put on pause when you require a “Life Refresh. ” Wow. Well, it’s a very real thing now thanks to BurkeyLoan, a Miami-based portfolio lender that offers the “BurkeyLoan Millennial Choice Mortgage. ” What Is BurkeyLoan? You might be wondering what on earth BurkeyLoan is? Well, Burkey is simply the name of the company’s founder, John Burkey, who seems to think his last name has a nice ring to it. Name aside, his signature loan is looking to completely shake up the mortgage industry by offering features that aren’t traditionally available to homeowners. And he’s stuffing them all in one single loan program. For starters, the BurkeyLoan Mortgage allows an LTV as high as 120%, meaning the entire property value can be financed, and another 20% of it can be tapped to pay off any student loans a borrower is grappling with. The company does apparently require a 10% minimum down payment, which is based on the price of the home and the outstanding student loan debt together. For example, say the purchase price is $500,000 and the borrower has $150,000 in student loans. The borrower would have to come up with a $65,000 down payment and they’d wind up with a loan amount of $585,000 on a home valued... --- > The mortgage and real estate marriage trend continues, this time with Realogy and Guaranteed Rate joining forces to create a new venture known as - Published: 2017-02-16 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/guaranteed-rate-affinity-another-mortgage-lender-and-real-estate-company-link-up/ - Categories: Mortgage News The mortgage and real estate marriage trend continues, this time with Realogy and Guaranteed Rate joining forces to create a new venture known as “Guaranteed Rate Affinity. ” This new partnership will result in a massive mortgage origination platform that pairs the nation’s eighth largest retail mortgage lender with the world’s largest franchisor of real estate brokerages. Under the agreement, Guaranteed Rate will provide its mortgage lending services to Realogy’s real estate brokerage company NRT, and to its relocation subsidiary Cartus. Some of Realogy’s NRT real estate brands include Climb Real Estate, Coldwell Banker, Corcoran Group Real Estate, Sotheby’s International Realty, and ZipRealty. Guaranteed Rate Replacing PHH as Lender of Choice The 8th largest retail mortgage lender in the U. S. Will provide home loan services to Realogy customers Which includes brands like Coldwell Banker, Sotheby's, and ZipRealty Follows the recent trend of mortgage and real estate companies linking up Part of the undertaking will involve the acquisition of four regional mortgage origination and processing centers previously belonging to PHH Home Loans, along with its relocation division and some of its employees. PHH used to provide these services to Realogy but has been reducing its mortgage footprint of late. The move should allow Guaranteed Rate to get its hands on a lot more purchase mortgage business, a trend that has grown in popularity as mortgage refinance activity continues to wane. Perhaps home buyers can take advantage of their “Double Match” loan program that only requires a 1% down payment. It’s... --- > While they might be better known for credit cards at this point, Chase also offers mortgages. And now they want to offer digital mortgages, or at least a - Published: 2017-02-16 - Modified: 2024-05-24 - URL: https://www.thetruthaboutmortgage.com/chase-wants-you-to-have-a-digital-mortgage-experience/ - Categories: Mortgage News While they might be better known for credit cards at this point, Chase also offers mortgages. And now they want to offer digital mortgages, or at least a digital mortgage experience. In other words, they don’t want to be your boring old brick-and-mortar grownup bank anymore. Let’s explore what exactly that means. Self-Serve Mortgages from Chase Today, the NYC-based megabank unveiled its grand plan to launch a so-called “digital, self-serve mortgage platform” that will ideally make it quicker, easier, and more transparent to get a mortgage from Chase. Once launched later this year, customers will be able to track loan progress online or via a mobile device... how novel! Okay, I’ll stop mocking and provide some specifics to this new rollout. The technology platform relies on some help from Roostify, a company whose sole purpose is to make loan closings faster (and better). They provide software that allows consumers to apply for mortgages online (or on their smartphone), while letting them easily connect financial accounts for document verification, and track progress all within an app or webpage. See the screenshots above and below for more on that. The presence of this technology basically streamlines a once cumbersome process and reduces mistakes and hiccups that can often slow down the loan process. It also keeps the whole team in the loop the entire time. The technology should also minimize the need for human interaction, something people seem to be pretty fond of these days, even when it involves major decisions and... --- > Here’s a strange one – a new company by the name of Loftium is offering down payment money and “monthly mortgage assistance” if you agree to Airbnb one - Published: 2017-02-08 - Modified: 2018-01-10 - URL: https://www.thetruthaboutmortgage.com/loftium-offers-mortgage-assistance-if-you-airbnb-your-extra-bedroom/ - Categories: Mortgage News Here’s a strange one – a new company by the name of Loftium is offering down payment money and “monthly mortgage assistance” if you agree to Airbnb one your new home’s extra bedrooms. The details are pretty scant, but it appears Loftium is looking for more short-term inventory to rent out via Airbnb in exchange for some upfront mortgage help. Up to $20k Toward Your Mortgage Down Payment As noted, there’s barely anything about this company on the internet, including on their own webpage, which is surprising because even the most obscure companies will have some sort of footprint. All I could find was info on two co-founders, Adam Stelle and Yifan Zhang, both with backgrounds in tech startups, including an app called Pact that pays you to be healthy, paid by members who aren’t. And a Seattle-based phone number, which could be where the company will be headquartered. It would make sense given the housing boom up there, and the lack of available supply. It seems Loftium will pay up to $20,000 toward your new home’s (or condo? ) mortgage down payment if you agree to list your spare bedroom(s) on Airbnb for 12 to 36 months. I suppose it’s like buying a multi-unit property where you live in one unit and rent out the other unit(s), except you’re letting a third-party company run the show with another third-party company. Confused yet? You could potentially have hundreds of guests throughout the year, as opposed to just one tenant who... --- > Before you panic, take comfort in the fact that mortgage rates probably won’t do too much in 2017, just as they haven’t in recent years, despite stark - Published: 2017-01-31 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2017-mortgage-rates-are-expected-to-stay-in-the-4-range/ - Categories: Mortgage Tips Before you panic, take comfort in the fact that mortgage rates probably won’t do too much in 2017, just as they haven’t in recent years, despite stark predictions telling us otherwise. I went ahead and compiled the 2017 mortgage rate forecasts of Fannie Mae, Freddie Mac, the Mortgage Bankers Association, and the National Association of Realtors to determine what we might expect this year. Interestingly, these four groups all seemed to get a bit more conservative this year, perhaps learning from past mistakes when they made much bolder predictions. Well, aside from Fannie Mae, which seemed to get it right last year while the other three had called for 30-year fixed rates closer to 5% to close out 2016. Fannie predicted a rate of 4. 1% to end the year, which is pretty darn close to where we’re at today. As it stands now, the 30-year fixed is averaging around 4. 19%, this according to the weekly survey from Freddie Mac. The good news is all four of the forecasts expect the 30-year to stay within the 4% realm throughout 2017, and in fact, in 2018 as well. The only thing we have to worry about is them being wrong again, though this time they could prove to be too modest, only for us to be unpleasantly surprised to the upside. In any case, there’s a good chance we’ll see some choppiness in 2017, so it’ll be important to stay on top of rate movement to ensure you lock at... --- > Black Knight Financial Services is apparently working on its own “mortgage-specific FICO score” to better determine individual mortgage borrower risk, - Published: 2017-01-26 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/black-knight-is-working-on-its-own-mortgage-credit-score/ - Categories: Mortgage News Black Knight Financial Services is apparently working on its own “mortgage-specific FICO score” to better determine individual mortgage borrower risk, instead of simply looking at the overall credit profile of borrowers. The news came from a webinar that Black Knight participated in with the Consumer Bankers Association back in December titled, “Hidden Opportunities with Subprime Borrowers. ” Hat tip Inside Mortgage Finance. The gist is that there are a lot of homeowners out there with imperfect credit, more specifically subprime credit (sub-620 FICO scores) who could stand to benefit from a mortgage refinance to a much lower interest rate, instead of paying say 8-10% currently. But many are unable to do so using traditional credit scoring models, despite the fact that they actually pose less mortgage default risk than those credit scores might let on. For example, even if they have a random unrelated collection or miss a credit card payment here and there, they might never, ever miss a mortgage payment. A New Mortgage Score Is in the Works Black Knight Senior Modeler Wesley Winter fielded a question from the audience about developing a mortgage FICO score, and said “we are working on that right now. ” He added that they “have access to the full dataset from one of the credit reporting agencies,” and are looking at similar credit behavior elements for the basis of a mortgage score “that could be offered as a standalone product. ” Whether heavyweights like Fannie Mae and Freddie Mac would actually use... --- > Whoa. In an unexpected turn of events, online real estate brokerage Redfin has launched a new mortgage service called, you guessed it, “Redfin Mortgage.” - Published: 2017-01-26 - Modified: 2025-03-10 - URL: https://www.thetruthaboutmortgage.com/redfin-mortgage-just-launched/ - Categories: Mortgage News Whoa. In an unexpected turn of events, online real estate brokerage Redfin has launched a new mortgage service called, you guessed it, “Redfin Mortgage. ” Well, maybe it wasn’t so unexpected, seeing that the mortgage trend is decidedly moving from refinances to purchases. Just ask Motto Mortgage... So it’s a very smart move for Redfin to get their hands on all that mortgage business, while also gaining more control of the many moving parts involved in the typical home purchase. In announcing the news, and the new website, the company noted that Redfin Mortgage “is the next step in our mission to put customers first. ” Redfin Agents and Redfin the Lender Will Work Together Redfin's goal is to streamline the home loan process By creating a unified team from within the same company It can seamlessly integrate its lending platform with Redfin's home-buying service To both speed things up and provide a smoother loan closing The goal seems to be harmony, and also savings, something Redfin introduced as an online real estate brokerage many years ago. They only charge a 1. 5% commission to sellers, which they refer to as “half the usual listing fee. ” In reality, it might be a little less as 2. 5% is a typical fee these days, but still, they don’t charge as much as a full-service real estate brokerage. And with many, if not all, home buyers using Redfin to peruse homes for sale, Redfin-listed properties get prominence as they’re always found... --- > You’ve heard the news. President Trump announced a freeze on the expected 25-basis point FHA premium cut just a week or so after it was announced. For - Published: 2017-01-25 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/the-pros-and-cons-of-trumps-fha-premium-cut-freeze/ - Categories: Mortgage News You’ve heard the news. President Trump announced a freeze on the expected 25-basis point FHA premium cut just a week or so after it was announced. For most folks, it was an unexpected and sad ending to a seemingly positive announcement that would have saved the average FHA home buyer about $500 annually. That money would have ostensibly gone back into the economy, either through home improvement or general spending. It would have also made FHA mortgages more affordable and perhaps a stronger alternative to conventional financing. Instead, the premium cut has been put on ice, likely in an effort to reduce the government’s footprint in the mortgage industry. It should be noted that it’s not necessarily dead in the water, meaning the discussion is ongoing. Two major players have already weighed in on the move, so let’s look at the potential pros and cons of Trump’s action. The Pros of an FHA Premium Cut The obvious major advantage Is a lower PMI payment due each month Which will make FHA loans a better option than conventional in many cases Enough so that it might allow more people to buy homes It seemed most in the industry were in favor of a premium cut, including the all-powerful National Association of Realtors, which tends to be a fan of lower home buying costs. The National Association of Home Builders (NAHB) also indicated that it supported the proposed rate cut, saying it would “reduce the cost of housing for creditworthy borrowers, particularly... --- > My friend asked me the other day if I’d rather have a low mortgage rate or pay a lower price for a home. I paused briefly, then said I’d rather pay less - Published: 2017-01-18 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/would-you-rather-have-a-low-mortgage-rate-or-pay-a-lower-price-for-a-home/ - Categories: Mortgage Rates, Mortgage Tips My friend asked me the other day if I’d rather have a low mortgage rate or pay a lower price for a home. I paused briefly, then said I’d rather pay less for the home. My thought process was basically that the price you pay for a home will never, ever change, whereas mortgage rates can and do change quite often. Put another way, you can’t change what you paid for a home, but you can change the financing (mortgage rate) as often as you’d like via a mortgage refinance, assuming it’s favorable to you. In that respect, it makes sense to go with the lower price tag as opposed to the lower mortgage rate. A lower home price also means a lower down payment, something that is often more difficult to get around than a monthly payment. There are Lots of Scenarios to Consider... There isn't just one scenario here Let's look at a few different possibilities To see if low home prices or low mortgage rates Are more powerful What If Home Prices Fall 5% and Rates Climb 0. 5%? Let’s pretend home prices fall about five percent as mortgage rates climb a half a percentage point. It should be noted that there’s no direct correlation between rates and prices. They could both easily rise in tandem. But let’s just see how it might look. $237,000 purchase price 20% down ($47,400) $189,600 loan amount 3. 5% rate = $851. 39 monthly payment Total principal paid after 84 months:... --- > Let’s get political – just kidding. Let’s talk about data that involves presidential elections and mortgage rates, more specifically, what happens to - Published: 2017-01-12 - Modified: 2024-08-03 - URL: https://www.thetruthaboutmortgage.com/mortgage-rates-vs-presidential-inaugurations-is-there-a-correlation/ - Categories: Mortgage Matchups Let’s get political – just kidding. Let’s talk about data that involves presidential elections and mortgage rates, more specifically, what happens to rates during an election year and the subsequent year to find out if there are any trends that pop out. I went ahead and scoured Freddie Mac’s 30-year fixed-rate mortgage data, which dates back to April 1971 and lined it up with every presidential election since then. Three pieces of data were plucked from their database: - Mortgage rates at the time of the election - Mortgage rates a month after the inauguration - Mortgage rates at inauguration year-end November 6th, 2012 Obama incumbent win (Democrat) The 30-year fixed averaged 3. 35% during the month of November 2012. It averaged a HIGHER 3. 53% for the month of February 2013, the month after Obama’s inauguration. It ended the year 2013 HIGHER at 4. 48%. November 4, 2008 Obama win (Democrat) The 30-year fixed averaged 6. 09% during the month of November 2008. It averaged a LOWER 5. 13% for the month of February 2009, the month after Obama’s inauguration. It ended the year 2009 LOWER at 4. 93%. November 2, 2004 Bush Jr. incumbent win (Republican) The 30-year fixed averaged 5. 73% during the month of November 2004. It averaged a LOWER 5. 63% for the month of February 2005, the month after Bush’s inauguration. It ended the year 2005 HIGHER at 6. 27%. November 7, 2000 Bush Jr. win (Republican) The 30-year fixed averaged 7. 75% during... --- > Well, another year has passed, and not just any year. Some have referred to 2016 as the worst year ever, though I’m a little more optimistic. Anyway, it’s - Published: 2016-12-28 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/2017-mortgage-and-real-estate-predictions/ - Categories: Housing Market, Mortgage Tips Well, another year has passed, and not just any year. Some have referred to 2016 as the worst year ever, though I’m a little more optimistic. Anyway, it’s time to look forward to see what the future holds for mortgages and real estate in 2017. But as always, you can view my prior year predictions for 2016 and 2015 and beyond. I think I did pretty well last year – I said mortgage rates wouldn’t go up much if at all, and that was true until the election. So I got burned late on that one. Otherwise, a lot of my predictions seemed to be on point, though I seemed to jump the gun on a couple that will probably come true this year. Without further ado, let’s talk about 2017... 1. Mortgage rates will pull back, but end up higher I’ll address the elephant in the room first; mortgage rates. My expectation is they’ll rise in 2017, but also pull back at some point, likely in the first half of the year. The incoming administration, along with a number of geopolitical events worldwide, will surely create the uncertainty necessary to drive rates lower. This means there will be opportunity to refinance and/or buy a home with a lower mortgage rate than what is currently on offer. The trick here will be timing it because I do think we end 2017 with higher mortgage rates, though hopefully still below 5% on the 30-year fixed. That would be less than a... --- > Just when you thought things were cooling off, home prices surprised us with yet another killer year. Tomorrow, Zillow will release the November edition - Published: 2016-12-21 - Modified: 2024-01-31 - URL: https://www.thetruthaboutmortgage.com/home-prices-rise-at-fastest-pace-since-2006/ - Categories: Housing Market, Mortgage News Just when you thought things were cooling off, home prices surprised us with yet another killer year. Tomorrow, Zillow will release the November edition of their Real Estate Market Reports, which will show that home prices increased 6. 5% in November from a year earlier, the best year-over-year gain since 2006. Yes, you heard that right. It might be a seasonal blip, but still, best 12 months since 2006... that’s impressive. I Was Wrong I’ll be the first one to admit I was wrong about sustained, stellar home price appreciation. I actually thought things were overheating a couple years ago, yet home prices continued to defy expectations. I suppose we can thank low mortgage rates and scant inventory for that. The good news is I’ve learned something from all of this. Whenever you think things are about to top out, they’ve probably got a lot more time to keep going higher. This is probably even more true when you watch things really closely. The same thing happened in the stock market. It looked frothy a couple years ago, but now we’re on the cusp of Dow 20,000. And probably Dow 21,000 if history is any indication. Not long after, it might be time to worry, or least get slightly less bullish. The takeaway is that market tops take a long time to reach, just like market bottoms, and you'll doubt yourself along the way. I’ve been hearing chatter lately about how we probably have another good year or so, maybe... --- > Fannie Mae and Freddie Mac have launched a new loan modification program for troubled mortgages known as “Flex Modification.” In a nutshell, the new - Published: 2016-12-15 - Modified: 2020-04-07 - URL: https://www.thetruthaboutmortgage.com/fannie-and-freddie-launch-flex-modification-program-no-paperwork-required-in-some-cases/ - Categories: Mortgage News Fannie Mae and Freddie Mac have launched a new loan modification program for troubled mortgages known as “Flex Modification. ” In a nutshell, the new flexible loss mitigation tool is a combination of HAMP, the Standard Modification, and the Streamlined Modification, and will replace the trio as early as March 2017. Loan servicers are encouraged to implement the Flex Modification at that time, but aren’t required to do so until October 1st, 2017. The Home Affordable Modification Program (HAMP) is slated to expire at the end of the this. How Flex Modification Works It lowers your monthly mortgage payment by as much as 20% via interest rate and/or loan term adjustment Past due amount added to loan balance and payments recalculated over remaining loan term It makes your home loan current once the trial modification period is completed successfully Allows you to stay in your home and avoid foreclosure One of the things that stood out to me was the lack of borrower documentation needed to get a loan modification under this new program. A major issue after the mortgage crisis was the ability to modify mortgages without complicated paperwork and long, drawn out processes. That led to revisions of HAMP to make it easier for borrowers to get relief, and it appears those lessons have been applied to the new Flex Modification. Like its predecessors, the Flex Modification will aim to lower monthly housing payments to help at-risk, delinquent borrowers avoid foreclosure. Those who are less than 90 days... --- > Fairway Independent Mortgage Corp. plans to launch a new smartphone app designed to make the home loan process a lot faster (and easier). The company will - Published: 2016-12-13 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/fairway-mortgage-app-close-your-mortgage-with-your-phone/ - Categories: Mortgage News Fairway Independent Mortgage Corp. plans to launch a new smartphone app designed to make the home loan process a lot faster (and easier). The company will release its FairwayNOW mobile application in January, though some version of it already appears to be available for download in the App Store. The to-be-released app will let Fairway customers do anything from search for homes to calculate different loan scenarios, and of course apply for a mortgage or pre-qualification. There are built-in calculators for home purchases, refinances, and general affordability, all of which can be saved in the app for later use. Apply for a Mortgage in Less Than 10 Minutes If you’re interested in applying for a mortgage, you’ll be able to do so in under 10 minutes, per Fairway. This isn’t groundbreaking stuff, seeing that many competitors (Rocket Mortgage and others) already offer the same technology in a shorter amount of time. But there are a few cool features of note. For one, once you apply for a mortgage using the app, you’ll be able to scan necessary documents using your smartphone’s camera and upload them securely to the company. No need to break out the scanner or the fax machine, thankfully. This will save time and aggravation. Additionally, Fairway will send customers push notifications as their loan progresses from approval to funding. That means you’ll be notified the second anything changes, which plays into that quick 10-day close. Instead of wondering if anything has been signed off, or if loan... --- > You may remember GMAC Bank, which was taken down by its fateful mortgage arm Residential Capital (ResCap) before eventually requiring a government - Published: 2016-12-12 - Modified: 2025-01-08 - URL: https://www.thetruthaboutmortgage.com/ally-home-bank-now-offers-retail-mortgages-to-its-customers/ - Categories: Mortgage Tips You may remember GMAC Bank, which was taken down by its fateful mortgage arm Residential Capital (ResCap) before eventually requiring a government bailout. It wasn’t an uncommon story at the time; many other mega mortgage companies took a fall too, including the likes of Countrywide and IndyMac, to name but two. Anyway, ResCap was a big mortgage player back in the day, originating billions of residential home loans in the lead up to the housing bubble. Then it all came crashing down... Once the company recovered from the financial crisis, it rebranded itself as Ally Financial, offering auto loans and high-yield savings accounts. Those businesses seemed like a safe way to dip their toes back in the lending waters. The auto loan portion of the business actually runs deep in its history seeing that GMAC stood for General Motors Acceptance Corporation. So you knew they were going to get back into that business, but the mortgage business was still a big question mark. They’re Back... with a Brand New Name After the Great Recession it became common to rebrand if you made it through Seeing that many companies faced lawsuits and bad PR That explains why ResCap is now known as Ally Home It gives them a fresh start and lets them forget all those painful memories Somehow these large companies have a way of reinventing themselves, with fresh new names and logos that can make us all forget the ugly past very quickly. And so without further ado, say... --- > Caliber Home Loans out of Irving, Texas wants to close your mortgage faster than anyone else, and thinks it can accomplish the feat in less than 10 days. - Published: 2016-12-09 - Modified: 2024-06-01 - URL: https://www.thetruthaboutmortgage.com/caliber-home-loans-unveils-ultimate-homebuying-experience-close-your-mortgage-in-10-days/ - Categories: Mortgage News Caliber Home Loans out of Irving, Texas wants to close your mortgage faster than anyone else, and thinks it can accomplish the feat in less than 10 days. Yes, you heard that right. Less than 10 days. So just how does Caliber plan to reduce the typical mortgage funding timeline of 30-45 days down to less than 10 days? Finance Your New Home in Just 10 Days? With their new “Ultimate Homebuying Experience” of course, which they tout as a “streamlined application, approval and closing experience. ” To start, the full application will take “only minutes,” at which point a Caliber loan officer and/or account executive will guide through the rest of the loan process. In short, Caliber will rely on electronic verification, a growing trend in the mortgage world that has yet to be fully embraced by all lenders. Think Rocket Mortgage. This includes verifying key income, asset, and employment information without having to send paperwork back and forth with a fax machine. Instead, borrowers can grant the lender access to these documents using third-party verification tools and/or services to greatly speed up the process. As a result, the loan officer can order all the documents it needs, instead of waiting on the borrower to get around to sending them. However, borrowers must sign off to provide access, something that could still prove elusive if they go on vacation during the loan process (this is a common, hilarious problem in the mortgage industry). Caliber’s Ultimate Homebuying Experience Key Details... --- > It’s been an eventful three weeks or so since the U.S. presidential election took place, that is, if you keep an eye on mortgage rates. They’ve moved in - Published: 2016-12-05 - Modified: 2016-12-05 - URL: https://www.thetruthaboutmortgage.com/post-election-mortgage-rate-surge-crushes-refi-candidates-puts-home-prices-on-watch/ - Categories: Mortgage News It’s been an eventful three weeks or so since the U. S. presidential election took place, that is, if you keep an eye on mortgage rates. They’ve moved in only one direction since November 8th – up. Way up. Though thanks to their pre-election starting point, they remain historically low and cheap to anyone old enough to remember where they stood a decade ago. In case you forgot, the 30-year fixed averaged 6. 24% in November 2006, per Freddie Mac data, about two percentage points above current levels. So yeah, things are still pretty darn good. However, because most homeowners these days hold rates that are much lower, the benefits of refinancing have quickly diminished for millions thanks to the recent rate rise. 4. 3 Million No Longer In the Money There are times when it makes sense to refinance your mortgage, and times when it does not, often dictated by prevailing interest rates. Unfortunately, mortgage rates have risen about a half point since then, more than halving the number of potential refinance candidates, this according to the latest Mortgage Monitor Report from Black Knight Financial Services. The company said the refinance population dwindled from 8. 3 million borrowers pre-election to just 4 million today thanks to a 49 basis point (bps) rise in rates. That matches the lowest refi population in 24 months, with the most recent low set back in July 2015. In short, the mortgage rate increase means fewer borrowers can qualify for a refinance thanks to... --- > I typically refer to the 30-year fixed mortgage as a set-it-and-forget-it type of mortgage because it’s fixed for the entire duration of the loan. The - Published: 2016-12-05 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/is-the-30-year-fixed-mortgage-actually-a-lot-of-work/ - Categories: Mortgage Tips I typically refer to the 30-year fixed mortgage as a set-it-and-forget-it type of mortgage because it’s fixed for the entire duration of the loan. The mortgage rate in month one is the same as the rate in month 360. The mortgage payment never changes, though the total housing payment could vary thanks to things like taxes, insurance, and PMI. Put simply, it’s a very easy mortgage to wrap your head around, and for that reason the most popular and common choice for homeowners here in the United States. The same isn’t true elsewhere in the world, which is one of the reasons why the 30-year fixed has been questioned a lot lately by economists and mortgage pundits. The latest opinion comes from Benjamin Keys of The Wharton School of the University of Pennsylvania, who analyzed how monetary policy makes its way into households via the mortgages borrowers hold. During the most recent crisis, those with adjustable-rate mortgages actually “won” in a sense because their rates adjusted lower when the government stepped in and bought tons of mortgage-backed securities while lowering other borrowing rates. Meanwhile, those with fixed rates didn’t benefit at all, and in fact were trapped in their mortgages because of equity issues, namely underwater mortgages. This meant those who ostensibly took on more risk were rewarded when the wheels fell off. And those who were seemingly prudent in their mortgage choice were punished because they were unable to refinance until HARP came along. Does that mean we should... --- > Now that mortgage rates have jumped, it might be time to take a look at how you’re repaying your mortgage. Put simply, if your mortgage rate is fixed and - Published: 2016-12-01 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/is-now-the-time-to-slow-down-mortgage-repayment/ - Categories: Mortgage Tips Now that mortgage rates have jumped, it might be time to take a look at how you’re repaying your mortgage. Put simply, if your mortgage rate is fixed and lower than prevailing rates, it could make sense to slow things down to take advantage of your low rate for longer. Yes, you have to continue making your full mortgage payment each month to satisfy your credit obligations, but if you’ve been paying extra, it could be time to rethink your strategy. For a while, I've been asking myself why everyone was in such a big rush to pay down their mortgages with rates so low and only expected to go higher. I even questioned the the timing of a 15-year fixed at the moment. It’s Been Popular to Pay Mortgages Down Fast Lately With mortgage rates so low A lot of borrowers have been refinancing into shorter-term mortgages But doing so when mortgages are so cheap Means your money could be better served elsewhere Lately, it’s been pretty trendy to knock down those large mortgage balances, with the 15-year fixed gaining in popularity quite a bit post-mortgage crisis. A lot of folks took advantage of the spread on new 15-year fixed rates versus their old 30-year fixed rates that were in the 5-7% range. This meant they could pay off mortgages in half the amount of time for roughly the same monthly payment. But now anyone looking to refinance their mortgage will likely be faced with a higher interest rate... --- > You may have already read the headlines. Things like Trump-fueled Treasury surge and the so-called Trump Effect, all driving mortgage rates higher. And - Published: 2016-11-14 - Modified: 2018-06-01 - URL: https://www.thetruthaboutmortgage.com/president-elect-trump-vs-mortgage-rates/ - Categories: Mortgage Matchups, Mortgage Rates You may have already read the headlines. Things like Trump-fueled Treasury surge and the so-called Trump Effect, all driving mortgage rates higher. And it’s not just fodder, it’s true. Since the election results came in last Tuesday night, mortgage rates have been on an upward tear, which clearly isn’t good news for those looking to secure a mortgage. Of course, it’s been great for anyone with an investment account because stocks have surged during the same period. It may also be a boon for savers if depositories eventually raise the interest rates they pay out. Something above 1% would be nice... The crappy part is that the recent jump could affect new homeowners for the next 30 years if they have to go with a higher rate today and things don’t improve anytime thereafter. Why Are Mortgage Rates Higher with a President Trump? Start with the basics A strong economy leads to higher interest rates as a means to cool inflation Everyone expects an economic boost under Trump So with that there are expectations of higher mortgage rates Put simply, mortgage rates tend to go up when the economy improves. The basic premise is a stronger economy means more inflation, which calls for higher interest rates to keep things in check. When news broke of Trump winning, stock futures actually plummeted because there was a lot of uncertainty of what a Trump presidency would mean for America. That uncertainty meant an expected stock selloff the next morning, which would have... --- > Often times student loans get in the way of a mortgage because of the tremendous monthly debt, but fintech lender SoFi wants to create the opposite - Published: 2016-11-03 - Modified: 2023-04-03 - URL: https://www.thetruthaboutmortgage.com/sofi-wants-you-to-pay-off-your-student-loans-with-a-mortgage/ - Categories: Mortgage News Often times student loans get in the way of a mortgage because of the tremendous monthly debt, but fintech lender SoFi wants to create the opposite effect. They’ve launched their so-called “Student Loan Payoff ReFi,” which as the name implies, is a way to get rid of student loan debt while refinancing the mortgage. The general idea is that mortgage rates (at the moment) are lower than the interest rates on student loans, meaning borrowers can save money by shuffling debt to their existing mortgage balance. Apparently 8. 5 million households have student debt obligations, so this mechanism could equal a lot of savings, and a lot of originations for SoFi. The program is being offered in conjunction with Fannie Mae, and is apparently cheaper than a traditional cash out refinance. How the SoFi Student Loan Payoff ReFi Works Say a student (or I suppose a parent) owns a home with a mortgage balance of $200,000 at 67% LTV, and there is also outstanding student loan debt of $40,000. This hypothetical homeowner can combine the two debts into one and enjoy a lower interest rate, despite a higher LTV. This example would push the LTV to 80%, likely the maximum under the program, but the rate would still be a competitive 3. 75% or so on a 30-year fixed. The payment would be even cheaper because student loans often amortize over a shorter period, such as 20 years. But the lower combined rate would offset the longer amortization period. SoFi... --- > HomeBridge Financial Services announced this morning that it plans to acquire the operating assets of Prospect Mortgage, LLC headquartered in Sherman - Published: 2016-11-01 - Modified: 2024-05-23 - URL: https://www.thetruthaboutmortgage.com/homebridge-financial-to-acquire-prospect-mortgage-loan-platform/ - Categories: Mortgage News HomeBridge Financial Services announced this morning that it plans to acquire the operating assets of Prospect Mortgage, LLC headquartered in Sherman Oaks, CA. Specifically, HomeBridge is going to get their hands on Prospect’s loan production platform, with the intent of creating a mega mortgage lender. HomeBridge is already a pretty major mortgage player, so combining forces with Prospect should make them a household name... well, that’s probably the hope. Seeking to Become a Mortgage Giant HomeBridge expects to be one of the largest non-bank home loan lenders in the nation once the acquisition is completed in January 2017. Together, their combined operation will grow to 250 retail mortgage branches nationwide with around 900 retail loan officers. Additionally, HomeBridge has two separate wholesale operations, HomeBridge Wholesale and REMN Wholesale. Collectively, the entire conglomerate will employ more than 3,000 full-time workers, making it one of the larger mortgage operations nationwide. Prospect Mortgage offers all types of mortgages, including both conventional and FHA, while also specializing in 203(k) renovation loans. In fact, they were the top originator of such loans nationwide as of April. HomeBridge was the second largest 203(k) lender, so together they’ll really be number one. And by that I mean double their nearest competitor. Around 1% Market Share Combined Per the press release, Prospect Mortgage funded nearly $9 billion in home loans in 2015. HomeBridge said it originated around the same amount last year. Interestingly, per HMDA data, Prospect seemed to be the bigger of the two lenders last year.... --- > Effective immediately, the FHA will lower its owner-occupancy requirement for certain approved condominium complexes to just 35%. That means a given - Published: 2016-10-27 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/fha-agrees-to-lower-owner-occupancy-requirement-to-35-for-certain-condos/ - Categories: Mortgage News Effective immediately, the FHA will lower its owner-occupancy requirement for certain approved condominium complexes to just 35%. That means a given complex only needs about a third of the units to be owner-occupied, instead of the prior rule stating that 50% had to be primary residences. The rule change should increase FHA lending on condos, something the National Association of Realtors has been pushing for to help lower-income renters become homeowners. After all, condos tend to be a more affordable option than single-family homes. About a year ago, the FHA eased its occupancy requirement in a variety of ways to make that occupancy number easier to satisfy, but this change goes even further. In a nutshell, more investor-owned units means more risk for the building as a whole, something the FHA isn’t too fond of. Their position is that owner-occupants are less likely to default on their HOA dues compared to non-owner occupants. But The Housing Opportunity through Modernization Act of 2016 (HOTMA) directed the agency to issue new guidance to avoid harming the marketability of a building. For example, it might be more difficult to sell a condominium unit if the buyer was planning to finance it with an FHA loan. That could lead to a price drop or a failed sale. After some evaluation, HUD determined that the FHA's Mutual Mortgage Insurance Fund (MMIF) could allow for a lower percentage of owner-occupants in some complexes but not in others. Condos Must Meet Certain Conditions While the new rule... --- > Good News for Real Estate Agents The Mortgage Bankers Association (MBA) expects home purchase lending to hit $1.1 trillion next year, per their latest - Published: 2016-10-26 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/home-purchase-mortgage-volume-to-exceed-1-trillion-in-2017/ - Categories: Housing Market, Mortgage News Good News for Real Estate Agents The Mortgage Bankers Association (MBA) expects home purchase lending to hit $1. 1 trillion next year, per their latest economic forecast released this week. That would mark an 11% increase from this year’s estimate and be the highest total since before the housing market took a turn for the worse nearly a decade ago. While things have largely turned around since then, inventory constraints continue to hamper home sales. Many first-time buyers are locked out of the market thanks to rising home prices and move-up buyers can’t move up because they lack the necessary equity and/or can’t find another home due to those inventory issues. That means fewer entry-level homes and essentially a logjam. Meanwhile, home builders have yet to fill the void left by fewer distressed sales such as short sales and foreclosures that dominated the housing market in recent years. Still, the MBA expects 2017 to be a banner year thanks to strong household formation, job growth, higher wages, and ongoing home price appreciation. Perhaps next year will the year of “not wanting to miss out,” coupled with the fear of not getting a rock bottom mortgage rate before they finally rise. We shall see. Purchase origination volume is expected to hit $990 billion this year, up from $903 billion in 2015. It is expected to rise to $1. 18 trillion in 2018 and $1. 25 trillion in 2019. Total Mortgage Volume Will Actually Fall Unfortunately, the uptick in purchase activity will... --- > Today, RE/MAX Holdings announced the launch of a new one-of-a-kind franchised mortgage brokerage known as Motto Mortgage. In a nutshell, the plan is to - Published: 2016-10-25 - Modified: 2021-08-21 - URL: https://www.thetruthaboutmortgage.com/motto-mortgage-looks-to-save-the-mortgage-broker/ - Categories: Mortgage News Today, RE/MAX Holdings announced the launch of a new one-of-a-kind franchised mortgage brokerage known as Motto Mortgage. In a nutshell, the plan is to create a one-stop shop where home buyers can work with real estate agents and mortgage lenders all in one place. The hope is to create a more seamless home buying experience by putting loan originators in real estate offices nationwide. Well, they say in close proximity to real estate offices. But instead of pairing agents with loan officers from Bank X, they’ll have access to a wide variety of loan products because they’ll be working for mortgage brokerages. Motto Mortgage Wants to Disrupt and Innovate the Industry RE/MAX is launching the very first mortgage brokerage franchise model in the U. S. Plan is to create a one-stop shop for home buyers Where they can search for a home and a mortgage in one place And get financing options beyond just one lender partner The company claims its mortgage brokerage franchise model is the first of its kind here in the United States, and hopes to “disrupt and innovate the industry. ” They say they’re a “different kind of mortgage company,” presumably because they’re combining a franchise model with a mortgage brokerage. Generally, mortgage brokers are smaller independent shops that don't have a nationwide presence so I suppose it’s unique in that sense. The franchise model is also apparently new. As such, each location will be independently owned and operated. RE/MAX CEO, Chairman and Co-Founder Dave Liniger... --- > They say the average mortgage application contains some 500 pages, which explains part of the frustration mortgage borrowers feel when going through the - Published: 2016-10-24 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/your-mortgage-is-about-to-get-more-paperless-finally/ - Categories: Mortgage News They say the average mortgage application contains some 500 pages, which explains part of the frustration mortgage borrowers feel when going through the loan process. But Fannie Mae and Freddie Mac want to ease that burden by finally digitalizing the mortgage experience. Both companies announced upcoming changes that will go live in December and next spring. Come December 10th, Fannie Mae will add both asset and employment validation to its stable of useful loan origination tools. That means borrowers will no longer need to provide work paystubs, bank statements, or investment account statements. Well, that’s the theory at least. We will see how it actually pans out... 'A Dramatically Better Mortgage Experience' Currently, borrowers are often asked to fax or e-mail these types of documents to verify income, assets, and employment. But as with most things, it can get complicated when pages go missing, are illegible, lost, etc. The most common complaint I hear about when attempting to get a mortgage is having to send the same document twice (or three times or more). At the moment, Fannie Mae is already validating income electronically, and in just over a month assets and employment will get the digital treatment too. Fannie expects these changes to result in “a dramatically better mortgage experience. ” Again, we’ll see how it turns out because technology has its own problems, but it’s certainly welcome news for both borrowers and lenders. Greater Certainty for Lenders While borrowers will be less burdened with paperwork demands, banks and... --- > A company called Plastiq enables consumers to make payments with their credit cards that might not otherwise be accepted by the recipient. One such - Published: 2016-10-14 - Modified: 2018-06-04 - URL: https://www.thetruthaboutmortgage.com/plastiq-lets-you-charge-the-mortgage-for-a-fee/ - Categories: Mortgage Tips A company called Plastiq enables consumers to make payments with their credit cards that might not otherwise be accepted by the recipient. One such example that comes to mind is the paying of a mortgage with a credit card. I noted in a previous post that was it was possible with a little bit of engineering, but there’s a more straightforward way if you’re willing to pay a fee. How Plastiq Works If you want to pay your mortgage with a credit card Plastiq allows you to do just that However they charge a fee for the convenience And only MasterCard and Discover are accepted Plastiq refers to itself as a “first-of-its-kind online payment service” because it enables such transactions by processing your credit card payment then sending on payment to the payee in a form they actually accept. As far as I know, no mortgage servicing companies accept credit cards as a form of payment. To get around this, Plastiq allows you to pay them first with the credit card of your choice, at which point they pay the loan servicer or mortgage lender via check or electronic bank transfer. These latter two forms of payment are generally acceptable, so Plastiq is able to make the mortgage payments on your behalf once you’ve paid them. The company accepts MasterCard and American Express, but Visa and Discover seem to be left out. If for some reason your payment doesn’t arrive in time, but was submitted before the recipient’s deadline, Plastiq... --- > If you’re wondering which mortgage company originated the most home loans last year, stop wondering and take a look. Most people know Wells Fargo is king - Published: 2016-10-05 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/check-out-the-top-40-mortgage-lenders-in-2015/ - Categories: Mortgage News If you’re wondering which mortgage company originated the most home loans last year, stop wondering and take a look. Most people know Wells Fargo is king when it comes to mortgages, and 2015 was no different. But what about the other top 39 lenders? Well, thanks to some great visualization software from Tableau and some generosity from Richey May and Co. , we can see who the major (and slightly less major) players are. The graphs below are based on Home Mortgage Disclosure Act (HMDA) data, which covers about 95% of all residential mortgages. The raw data was made readable thanks to the pair mentioned above. Wells Fargo Remained Mortgage King in 2015 Unsurprisingly, San Francisco-based Wells Fargo retained its crown as the top residential mortgage originator in 2015, registering volume of $119. 2 billion. That gave it about 7. 3% of the total market share in the United States. While it might not seem like a lot, its closest competitor had nearly half that share. For the record, its market share has fallen for the past couple years, from 10. 5% in 2013 to 7. 8% in 2014. Before we talk about the others, let me add that Wells’s production was 88% conventional and just 5% FHA. There was a sliver of USDA lending in there too. As far as transaction type, 52% was for a home purchase and 48% was for a refinance. Quicken Grabbed the Second Spot Coming in a relatively close second was Quicken Loans, with... --- > After increasing the price of a USDA-insured mortgage last year, the Rural Housing Service has now slashed the associated fees to make them much more - Published: 2016-10-04 - Modified: 2016-10-04 - URL: https://www.thetruthaboutmortgage.com/why-your-usda-loan-just-got-cheaper/ - Categories: Mortgage News After increasing the price of a USDA-insured mortgage last year, the Rural Housing Service has now slashed the associated fees to make them much more affordable and attractive to home buyers. Beginning October 1st, which not so incidentally is the start of fiscal year 2017, the USDA upfront guarantee fee will drop from 2. 75% to 1%. Yes, you read that correctly. Instead of having to pay nearly 3% of the loan amount to get a USDA loan, you’ll only have to pay 1%. That’s cheaper than the FHA’s 1. 75% upfront fee, and likely lower than the VA’s variable funding fee. Additionally, the RHS is lowering the annual fee it charges on USDA loans from 0. 50% to 0. 35%, which will keep more money in the pockets of rural home buyers. How Much Can You Save Thanks to This Change? 2. 75% 1% upfront guarantee fee 0. 50% 0. 35% annual fee Most folks who obtain USDA loan financing will roll the guarantee fee into the loan so it’s paid over time, instead of upfront at closing. This makes sense because these loans are often zero down mortgages that require little cash from the borrower. Let’s look at an example of the savings to illustrate how much of a difference this change will make. Imagine someone takes out a $200,000 USDA loan with zero money down. The guarantee fee is now 1% instead of 2. 75%. The guarantee fee is based on the total loan amount including the... --- > If you have a mortgage, you’ve undoubtedly had some company urge you to refinance, especially right now with mortgage rates being as low as they are. And - Published: 2016-09-29 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/why-dont-more-people-with-high-rate-mortgages-refinance/ - Categories: Mortgage News, Refinance If you have a mortgage, you’ve undoubtedly had some company urge you to refinance, especially right now with mortgage rates being as low as they are. And hey, the bank or lender probably has a point if you received your loan several years ago because the interest rate is likely much higher. But for some reason, many homeowners don’t refinance despite the seemingly obvious benefit of a lower monthly mortgage payment. Interestingly, many borrowers with what would be considered “high” interest rates don’t refinance. So why would someone with a 5% mortgage rate not take advantage of a 3. 5% 30-year fixed rate? Well, because maybe they can’t. If You Have a High Mortgage Rate, You’ve Probably Been Late CoreLogic found that those who don't refinance Often missed a mortgage payment at some point Which would explain why they didn't bother Since it's very difficult to get approved with late payments An analysis performed by CoreLogic revealed that some 23% of mortgages had interest rates above 5% as of the end of May, which would appear “ripe for refinancing. ” Seeing that the 30-year fixed is averaging close to 3. 5% at the moment, these mortgages should generally be “in the money,” that is to say, where it makes financial sense to refinance. This appeared to be a perplexing situation so they drilled down some more to determine what was holding these homeowners back. It turns out many higher-rate mortgages are either seriously delinquent, or have been 30-days past due... --- > A Virginia-based mortgage lender has launched a loan officer compensation plan that provides originators with a piece of the loan servicing fee. - Published: 2016-09-28 - Modified: 2024-05-23 - URL: https://www.thetruthaboutmortgage.com/mortgage-lender-to-share-servicing-income-with-loan-officers/ - Categories: Mortgage News A Virginia-based mortgage lender has launched a loan officer compensation plan that provides originators with a piece of the loan servicing fee. Typically, a loan officer closes a loan and gets paid a commission, then moves on to the next loan. In this respect, they don’t need to worry about the future performance of the loan. It’s a done deal and they can focus on bringing in more loans. However, the loan servicer (which is sometimes also the lender) will earn money throughout the life of the loan as monthly mortgage payments are made. Now one lender has decided to share a portion of this ongoing revenue with its top producing loan officers. Atlantic Bay's Progressive Earnings Plan Atlantic Bay Mortgage Group out of Virginia Beach, Virginia refers to this participation in the income stream of the loan as the “Progressive Earnings Plan. ” The way it works is fairly simple. If you’re able to muster $14 million in retail loan production in a calendar year, you can take part. For every loan funded that is retained by the company, Atlantic Bay will give a portion of the servicing fee to the loan officer who originated the mortgage. As you can see from the chart above, a loan officer able to produce $120 million annually could receive an additional $30,500 the first year, $60,000 the second year, and a whopping $197,000 in year seven. A more conservative figure of $15 million in annual production could net the LO an additional... --- > Fannie Mae has rolled out a new version of its automated writing system, known as Desktop Underwriter® (DU®) Version 10.0. The new version has a number of - Published: 2016-09-26 - Modified: 2016-09-26 - URL: https://www.thetruthaboutmortgage.com/its-now-easier-to-get-a-mortgage-without-a-credit-score/ - Categories: Mortgage News Fannie Mae has rolled out a new version of its automated writing system, known as Desktop Underwriter® (DU®) Version 10. 0. The new version has a number of important changes, two involving consumer credit scores. Firstly, this release will use trended credit data, which I wrote about back when it was initially announced about a year ago. This basically allow mortgage lenders to see your balance history on revolving accounts for the past two years, not just the minimum payment and credit limit. There’s a correlation between carrying a balance and becoming delinquent on the mortgage. Specifically, borrowers who pay off their credit card debt in full every month are 60% less likely to fall behind on the mortgage versus the borrowers who only make the minimum payment. That being said, I don’t know how mortgage lenders will view those who revolve their balances. Will they just be further scrutinized, or face some sort of pricing hit that leads to a higher mortgage rate? I suppose time will tell, but we do know it’s a big deal that it’s being included, with Equifax saying consumers will “see significant update to mortgage decisioning process” after the first tri-merge credit report update in 30 years. They further note that the inclusion of this new data will “more accurately identify and potentially reward responsible credit behavior,” meaning it could help too. However, per Fannie Mae, so-called “classic credit scores models” don’t actually use trended data, and these scores can continue to be used... --- > Recently, I wrote about when the next housing crash might take place. For opportunists, it’s something to look forward to. For others, and frankly most - Published: 2016-09-22 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/see-which-phase-of-the-housing-cycle-your-city-is-in/ - Categories: Housing Market, Mortgage Tips Recently, I wrote about when the next housing crash might take place. For opportunists, it’s something to look forward to. For others, and frankly most people, it’s a disaster waiting to happen... though today’s mortgages are pretty boring and largely affordable, meaning homeowners should be able to ride the ups and downs a lot better than they did previously. In that post, I spoke about an “18-year rhythm” that basically points to home prices peaking again around 2024. Of course, that’s the entire housing market. As we all know, real estate is local... it doesn’t necessarily matter what’s going on in Florida if you live in California, or if the NYC condo market is overheated when you’re planning to buy in Chicago. That brings me to this colorful and handy graph from John Burns Real Estate Consulting. It breaks down the housing cycle into five key phases, while also showing you which phase major markets are in at the moment. Director of Research Rick Palacios Jr. breaks it down for us by looking at where the 20 largest new home volume markets stand at the moment. My assumption is we can judge existing homes in these markets somewhat similarly. Start at the Bottom Phase 1 is when home prices are bottoming and distressed inventory is king Phase 2 is when sales and prices begin to pick up with strong affordability Phase 3 sees a strong recovery and eroding affordability Phase 4 is your contraction period and Phase 5 is your... --- > There’s yet another mortgage disruptor in town, the latest goes by the name of “Morty.” Sounds like a play on the word mortgage...or someone's last name, - Published: 2016-09-20 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/morty-the-mortgage-broker-2-0/ - Categories: Mortgage News There’s yet another mortgage disruptor in town, the latest goes by the name of “Morty. ” Sounds like a play on the word mortgage... or someone's last name, like Mortimer. Think Trading Places. Anyway, like many other new entrants to the home loan industry, they claim to offer the “modern, online mortgage. ” This means leveraging technology to make the home loan process a lot easier, and less painful. And hopefully cheaper too! Let’s find out more to see if they can change the mortgage landscape as we know it. How Morty Works You start by building a so-called “financial profile,” which includes things like your income, assets, employment, along with the subject property information. The Morty platform apparently allows you to automatically link this information, and doing so means you should receive accurate quotes. Kind of reminds me of how Quicken’s Rocket Mortgage works. The problem with the current setup is that standard quoting engines assume you’re telling the truth, or at least providing accurate details. Once all the paperwork comes in the quote might be higher, or entirely invalid depending on the differences. Ideally, Morty is able to catch all the gotchas during this information gathering process so you can go into underwriting with confidence you’ll actually be approved. I went ahead and filled out the form on the Morty website to get started and it asked a few basic questions, such as my name, e-mail address, transaction type, and property location. Unfortunately, that’s as far as I... --- > A new study from the Urban Institute reveals that women are better at paying the mortgage despite receiving less favorable terms than men. This despite - Published: 2016-09-07 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/women-are-better-at-paying-the-mortgage-despite-worse-terms/ - Categories: Mortgage News A new study from the Urban Institute reveals that women are better at paying the mortgage despite receiving less favorable terms than men. This despite the fact that they receive higher mortgage rates because of weaker credit profiles, which logic tells us would lead to higher default rates. Single Women Hold a Fifth of All Mortgages On average, just over a fifth of all mortgages consist of a female-only borrower, and it is this group that pays the most for a mortgage. Using HMDA data for mortgages originated between 2004 and 2014, the researchers found that the average mortgage rate for a female-only borrower was 5. 48% versus 5. 41% for male-only borrowers. It was also higher in situations where a female had a male co-borrower (5. 25%), compared to 5. 12% when the male had a female co-borrower (the most common scenario). But it appears lenders made out (or messed up) because females displayed lower default rates than their male counterparts. Women Default Less on the Mortgage The default rate for female-only borrowers between 2004 and 2007 was 24. 6% compared to 25. 4% for male-only borrowers. From 2008-2010, the default rates were 9. 6% versus 9. 7%, respectively, and the same pattern held steady from 2011-2014. In case you were wondering, default rates for couples are “considerably lower” than sole borrowers, as you can see above. For the record, women-only borrowers also get denied the most. Why Do Women Pay More for Their Mortgages? So we know women... --- > You may have heard that you can lower your monthly mortgage payment without refinancing via a "mortgage recast." These two financial tools are quite - Published: 2016-08-30 - Modified: 2024-09-25 - URL: https://www.thetruthaboutmortgage.com/mortgage-recasting-101-how-it-works-and-what-it-does/ - Categories: Mortgage Tips You may have heard that you can lower your monthly mortgage payment without refinancing via a "mortgage recast. " These two financial tools are quite different, which I’ll explain, but let’s first discuss recasting to get a better understanding of how it works. In short, a mortgage recast takes your remaining mortgage balance and divides it by the remaining months of the mortgage term to adjust the monthly payment downwards (or upwards). Let’s focus on the downward portion for now. The downside to mortgages is that the monthly payment doesn’t drop if the balance is paid faster. That’s right, even if you pay more than necessary, you’ll still owe the same amount each month because of the way mortgages are calculated. So if you made biweekly payments for a period of time, or contributed one big lump sum payment after some sort of windfall, you’d still be forced to make the original monthly payment until the loan was paid in full. In this case, you could benefit from recasting your mortgage to a lower monthly payment. Mortgage Recast Example Original loan amount: $250,000 Mortgage interest rate: 4% Original monthly payment: $1,193. 54 Balance after five years: $226,000 Lump sum payment: $51,000 New loan balance: $175,000 (it's lower but the payment doesn't change without a recast) Let’s assume you started out with a $250,000 loan amount on a 30-year fixed mortgage set at 4%. The monthly payment would be $1,193. 54. Now let’s pretend after five years you came upon some... --- > A little over a year ago, I wrote that HARP had received its final extension. I affixed the word “probably” to the end of it because the program kept - Published: 2016-08-30 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/permanent-harp-refinance-replacements-have-been-unveiled/ - Categories: Mortgage News A little over a year ago, I wrote that HARP had received its final extension. I affixed the word “probably” to the end of it because the program kept getting extended over and over. It reminded me of one of those “final day to save” sales... that seem to gather dust as the sale never actually ends. Well, it turns out HARP has indeed been extended again, though this really is the last time. Seriously. We know this because Fannie Mae and Freddie Mac have introduced their permanent replacements, which will go live once HARP is finally put to rest on September 30th, 2017. In fact, HARP is only getting this bonus extension to bridge the gap to the new streamline refinance programs being offered by the pair next October. Update: I spoke too soon. The FHFA extended HARP once again until December 31st, 2018, but this is the last extension, for real this time. Honestly! That being said, let’s learn more about HARP's permanent replacements, which will now go live on November 1st, 2018. Fannie Mae’s High Loan-to-Value Refinance Option While the complete requirements have yet to be published, Fannie Mae did release a fact sheet regarding its so-called “High Loan-to-Value Refinance Option. ” The program, like HARP, will give underwater homeowners the opportunity to refinance their mortgages to take advantage of lower mortgage rates, assuming low rates are still around in late 2017 and beyond. There won’t be any LTV restrictions other than the fact that it must... --- > If you’ve been renting out your own house or condo via Airbnb, or a similar service like HomeAway or FlipKey, you might have more difficulty securing a - Published: 2016-08-29 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/airbnb-is-reportedly-messing-up-mortgage-applications/ - Categories: Mortgage News If you’ve been renting out your own house or condo via Airbnb, or a similar service like HomeAway or FlipKey, you might have more difficulty securing a mortgage. This is one of many unintended consequences related to the so-called “Sharing Economy,” whereby individuals turn their homes and cars (and whatever else) into profit drivers. The same hoopla arose when Uber and Lyft first got started, with insurance companies often balking at drivers who used personal insurance policies to conduct what is seen by some as commercial driving. With companies like Airbnb, “hosts” are able to rent out their properties whenever they like, whether it’s just when they’re out of town, seasonally, or full-time. It’s supposedly a great way to make some extra cash when you aren’t using your home. However, the issue that seems to be befuddling mortgage lenders is the occupancy of such a property. Is It Still Owner-Occupied If It’s Listed on Airbnb or Elsewhere? You see, mortgage lenders ask how you’ll use your property when extending mortgage financing. After all, they’ve got a huge ownership interest in your home when you take out a massive loan on it. If it’s simply your primary residence, you are entitled to the most flexible financing options and the lowest interest rates because defaults are lowest on owner-occupied properties. However, if it’s a second home (which doesn’t allow rentals of any kind) or an investment property, the mortgage financing options become a lot more limited, and the interest rates significantly higher.... --- > A new analysis from Zillow reveals that many homes would actually be worth a lot more today had there been no housing bubble back in the early 2000s. The - Published: 2016-08-22 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/zillow-homes-would-be-worth-more-without-the-housing-bubble/ - Categories: Mortgage News A new analysis from Zillow reveals that many homes would actually be worth a lot more today had there been no housing bubble back in the early 2000s. The basic premise is that historic home price growth year after year would have amounted to better overall gains than a few boom years followed by a bust and then a partial recovery. Of course, home prices don’t just climb steadily over time. They ebb and flow, dip and peak, just like the stock market. So it matters when you buy, though as I’ve mentioned before, time tends to heal all wounds if you stick with real estate long term. However, you might just be better off investing in stocks, which have gained 40% since the bust. Imagine No Housing Bubble While just about everyone complains about bubbles Home prices would actually be higher without them If you're an opportunist You can use bubbles to your advantage to find attractive entry points Let’s pretend the housing bubble never happened. Instead, let’s assume home prices increased at historic rates year after year. The median home in the United States would actually be worth 26% more today than where it currently stands. Using 1985-1999 home price growth rates, Zillow discovered that the U. S. median home price would be nearly $235,000 today, instead of the actual $187,000. But that’s not how history played out. Instead, home prices surged between 2000 and 2006, and by the first quarter of 2007 the median price was 22.... --- > It seems just about everyone is lowering mortgage down payment requirements to deal with rising home prices, this despite the near-record low mortgage - Published: 2016-08-17 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/quicken-loans-1-down-mortgage-program/ - Categories: Mortgage News It seems just about everyone is lowering mortgage down payment requirements to deal with rising home prices, this despite the near-record low mortgage rates still widely available. You see, down payment is still the biggest hurdle to homeownership, and I suppose it was during the previous boom as well. That would explain why zero down mortgages were the norm back in 2006. The major problem then was that you could also state your income, your assets, and not disclose your job, so long as you had a decent credit score. No skin in the game and no disclosure equals no good. We’ve learned from those mistakes, I hope, and now underwriting is a lot more sound. Still, people want to buy homes, whether they’ve saved up a large down payment or not. And that would explain why Fannie and Freddie began offering 97% LTV mortgages. Building off those programs are mortgages with grants that still give the homeowner a 3% down payment, but without the borrower actually having to come up with the three percent in funds. Instead, many lenders are providing a 2% grant to homeowners and asking that they come up with the remaining one percent, which seems pretty fair. The use of a grant is allowed under both Fannie’s HomeReady program and Freddie’s Home Possible Advantage, and some banks dole outs funds in accordance with the Community Reinvestment Act. Quicken Loans 1% Down Payment Option Interestingly, the largest non-bank mortgage lender in the country, Quicken Loans, quietly... --- > While many expected the mortgage market to cool off this year thanks to both rising home prices and higher mortgage rates, the complete opposite seems to - Published: 2016-08-15 - Modified: 2024-01-31 - URL: https://www.thetruthaboutmortgage.com/mortgage-origination-volume-expected-to-hit-2-trillion-this-year/ - Categories: Mortgage News While many expected the mortgage market to cool off this year thanks to both rising home prices and higher mortgage rates, the complete opposite seems to have happened. Today, Freddie Mac released its latest monthly outlook report, noting that 2016 mortgage origination volume is now forecast to exceed $2 trillion for the first time since 2012. In case you don’t remember, mortgage rates hit an all-time record low in late 2012, which would explain why origination volume was so robust back then. It led to a massive refinancing wave as the 30-year fixed fell to a staggering 3. 31%. Total 1-4 Family Mortgage Originations (in Billions) Total residential mortgage volume four years ago was $2. 12 trillion, according to data from Freddie Mac. It wasn’t far off in 2013 either, at $1. 93 trillion, though it dropped off significantly in 2014 when volume totaled just $1. 35 trillion (thanks in part to higher mortgage rates). Last year, annual mortgage volume was slated to come in at $1. 75 trillion, and was expected to fall to $1. 58 trillion in 2016 and $1. 46 trillion in 2017. But no one expected mortgage rates to sink again as they have. Why Mortgage Volume Is Being Upwardly Revised That led the brains at Freddie to raise the origination forecast by $175 million over the previous month’s forecast, pushing it above $2 trillion. We aren’t too far from those record level rates now, and that’s one of the reasons why mortgage volume continues to... --- > Over the years, we’ve learned that buying homes near certain types of businesses can boost the value quite substantially. For example, homes near - Published: 2016-08-09 - Modified: 2023-10-12 - URL: https://www.thetruthaboutmortgage.com/buy-a-home-in-a-good-school-district-even-if-you-dont-have-or-want-kids/ - Categories: Mortgage Tips Over the years, we’ve learned that buying homes near certain types of businesses can boost the value quite substantially. For example, homes near Starbucks tend to outperform those near a Dunkin’ Donuts, and you’re better off buying a condo next to a Target, not a Walmart. If there’s a Whole Foods or Trader Joe’s nearby, even better. Throw in a good school and you’ve hit the housing jackpot. Schools Matter Whether You Step Foot in Them or Not Plenty of homeowners purchase properties with kids in mind, particularly because of the nearby schools. After all, private school isn’t getting any cheaper. But aside from saving a ton of money on tuition costs, you can also gain a ton of home equity simply by choosing to purchase a property in a good school district. The new parent company of RealtyTrac, ATTOM Data Solutions, decided to analyze this phenomenon and discovered it’s pretty darn significant. They looked at 2015 average test scores from nearly 19,000 elementary schools nationwide across 4,435 zip codes that cover a combined 45. 9 million single family homes and condos. From that they found that of the 1,661 zip codes with at least one good school, the average estimated home value (as of July) was $427,402, a 77% premium compared to the $241,096 average in the 2,774 zip codes without any good schools. So you might be thinking wait, homes near good schools are a lot more expensive. While that might be true, the home price appreciation in... --- > A week or so ago, I was scanning through my archived posts and it occurred to me that my blog's 10-year anniversary was just days away. I found the first - Published: 2016-07-28 - Modified: 2024-03-13 - URL: https://www.thetruthaboutmortgage.com/this-blog-is-10-years-old-today-whats-different-today-in-the-mortgage-industry/ - Categories: Mortgage News A week or so ago, I was scanning through my archived posts and it occurred to me that my blog's 10-year anniversary was just days away. I found the first post I wrote and laughed a bit as I read it, thinking how naïve and young I was at the time. I was in my mid-20s, working for a wholesale mortgage lender and pondering a home purchase. But property values were sky-high at the time and I was aware of that. I couldn’t wrap my head around buying a place at those prices. And in hindsight, I’m glad I didn’t. I know a lot of people who did buy back then, and many no longer own their homes, while some actually stuck it through and are now sitting fairly pretty. Those Who Held On Since 2006 Are Doing Fine As mentioned last week, time tends to heal all real estate wounds. Even if you buy at a particularly bad time, if you hold onto your property and pay down your mortgage, you’ll likely come out ahead. The problem 10 years ago was that the mortgages tied to those expensive properties weren’t sustainable. Many borrowers couldn’t afford to hold them beyond their first rate reset, which may have come in just six months’ time. But for those with a fixed-rate mortgage, or the income to endure the ups and downs, it was possible to ride out the storm and wind up in a decent equity position. Let’s pretend someone purchased a... --- > No it’s not déjà vu, or Groundhog Day. Guaranteed Rate has launched yet another 1% down payment mortgage in the span of about a month. However, their new - Published: 2016-07-22 - Modified: 2024-06-03 - URL: https://www.thetruthaboutmortgage.com/new-guaranteed-rate-double-match-mortgage-gives-you-2-of-the-down-payment-for-free/ - Categories: Mortgage News No it’s not déjà vu, or Groundhog Day. Guaranteed Rate has launched yet another 1% down payment mortgage in the span of about a month. However, their new “Double Match” loan program is quite a bit different than their previously announced 1% down mortgage that relied on a grant from the City of Chicago and Chicago Infrastructure Trust (CIT). Guaranteed Rate Double Match Mortgage Available Nationwide This is yet another 1% down home loan That relies upon a 2% grant from the mortgage lender The result is a 97% LTV mortgage (3% down) That fits the agency guidelines of Fannie Mae and Freddie Mac For one, the Double Match program is available to home buyers nationwide, not just in the city of Chicago. One thing that is the same is the down payment requirement, which is set at a low, low 1%. That’s right, you just need 1% of the purchase price to get into the home. It’s a 97% LTV mortgage, meaning it qualifies for backing from Fannie Mae and Freddie Mac, but you only have to come up with 1% of the total 3% down payment. The other 2% is a “completely forgivable” grant that doesn’t need to be paid back, even if the buyer moves or refinances their mortgage. They claim this is unlike other down payment assistance programs. I asked Guaranteed Rate for specifics regarding the grant and was told the following via their communications department: Guaranteed Rate is providing the grant There is no waiting... --- > Let’s talk about real estate investment for a moment. A recent commentary from mortgage financier Freddie Mac revealed that those aged 54 and older - Published: 2016-07-21 - Modified: 2024-08-04 - URL: https://www.thetruthaboutmortgage.com/time-heals-all-real-estate-wounds-if-you-let-it/ - Categories: Housing Market, Mortgage Tips Let’s talk about real estate investment for a moment. A recent commentary from mortgage financier Freddie Mac revealed that those aged 54 and older control about two-thirds of the home equity in single-family homes throughout the United States. However, this age group only accounts for a little more than a quarter of the population. The takeaway is that old people (yes, you’re old) hold much of the housing wealth in this nation. The reason they possess most of the housing wealth is the fact that they’ve owned homes for a long time, and because real estate values tend to rise over time, they’re in pretty good shape. Long Term Real Estate Holdings Increased Nearly Four Fold Real estate is a proven long-term investment With returns of nearly 400% over time It's not about getting caught up in a 30-day flip And it's not a get-rich-quick scheme Meanwhile, classic senior citizens (those 65 and older) who purchased what Freddie called the “average” house at age 30 have seen its value increase 3. 7 times. And guess what. I’m sure a lot of these folks went through spells where their home values plummeted, then increased, then fell again. But if they actually held on and didn’t let the year to year stuff bother them, time would heal all wounds. That’s the thing with true real estate investment. It isn’t a 30-day flip or a TV show, it’s a long-term commitment to invest in a piece of property, and not worry about what... --- ---