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Even if you are in a market that is not as competitive, knowing your budget will give you the confidence of knowing if your dream home is within your reach.

Freddie Mac lays out the advantages of pre-approval in the My Home section of their website:

“It’s highly recommended that you work with your lender to get pre-approved before you begin house hunting. Pre-approval will tell you how much home you can afford and can help you move faster, and with greater confidence, in competitive markets.”

One of the many advantages of working with a local real estate professional is that many have relationships with lenders who will be able to help you with this process. Once you have selected a lender, you will need to fill out their loan application and provide them with important information regarding “your credit, debt, work history, down payment and residential history.”

Freddie Mac describes the 4 Cs that help determine the amount you will be qualified to borrow:

  1. Capacity: Your current and future ability to make your payments
  2. Capital or cash reserves: The money, savings and investments you have that can be sold quickly for cash
  3. Collateral: The home, or type of home, that you would like to purchase
  4. Credit: Your history of paying bills and other debts on time

Getting pre-approved is one of many steps that will show home sellers that you are serious about buying, and it often helps speed up the process once your offer has been accepted.

Bottom Line

Many potential home buyers overestimate the down payment and credit scores needed to qualify for a mortgage today. If you are ready and willing to buy, you may be pleasantly surprised at your ability to do so as well.

Dr. Gabriele Oettingen, psychologist, researcher and author of the book “Rethinking Positive Thinking,” says we’ve been inundated with advice tothink positively or visualize success. While visualizing the achievement of our goals may feel good, those same feelings can also inhibit our motivation by giving us an emotional payoff before we ever actually do anything.

Oettingen recommends a more effective motivation technique called WOOP: Wish, Outcome, Obstacle, Plan. Here’s how it works:

STEP 1: Wish. First, create a meaningful, challenging and feasible goal, say, calling five clients a day, writing thank you notes or asking for more referrals. Write this down, or use the free WOOP app.

STEP 2: Outcome. Visualize the highest and best result or feeling you would receive from accomplishing your wish. Be comprehensive. Write this down, too.

STEP 3: Obstacle. Identify things preventing you from accomplishing your wish; it could be lack of information, lack of a skill set or even your own feelings. Identifying the obstacle is important because it helps your mind contrast your outcome feelings with your goal, helping contain emotion.

STEP 4: Plan. Using “if/then” statements, write an action plan for overcoming each obstacle: “If [obstacle], then I will [action to overcome obstacle].” This critical piece of the method asks you to focus on a specific plan and creates what researchers call “implementation intentions,” which have been found to give results vastly superior to other achievement-based methods.

Whether your goals are personal or professional, this technique can help you stay focused and remain motivated long enough to obtain real results.

Categories : Uncategorized
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Great news: The Home Affordable Refinance Program (known as HARP) has been extended until the end of 2016. The program has already helped more than 3.3 million borrowers refinance.

Borrowers whose mortgages are owned or guaranteed by either Freddie Mac or Fannie Mae may be eligible to refinance under the provisions of HARP. To determine eligibility, check these websites, or get in touch with me today:

If you or anyone you know thinks they are too far “underwater” to take advantage of today’s low home loan rates, please get in touch. I may be able to help and I’m always happy to answer any questions you may have!
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ALERT: “Brexit” Provides Great Home Loan Opportunities

Britain’s June 23 vote to exit the European Union (or Brexit, as it is known) has caused tremendous volatility in markets around the world.

This is important news for homebuyers who have been on the fence, and homeowners worried they missed the chance to lower their monthly payment. Here’s why…

Loan rates are influenced by economic news here at home as well as circumstances around the globe that make news headlines. Global instability of any kind, including the mere uncertainty over the impact of Britain’s decision on the global economy, has caused investors to move money out of riskier Stocks and into more stable or safer investments, including Mortgage Bonds here in the U.S.

Home loan rates are tied to Mortgage Bonds, so when Mortgage Bonds improve, home loan rates typically do as well … just like they did after Britain’s historic decision. But the reality is, we simply don’t know how long this rate opportunity will be available.

If you or anyone you know would like to discuss home loan rates, or whether refinancing makes sense at this time, please get in touch today. I’m here to help!

Categories : Interest Rates
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The Fed Raised Rates:
Find Out What This Really Means

The Fed just raised its benchmark Federal Funds Rate for the first time in almost a decade. After holding the rate near zero to support the economic recovery, the Fed upped the target rate range to between 0.25 to 0.5 percent.

While a “rate hike” may sound worrisome, it’s important to understand what this really means.

The Fed Funds Rate is the rate at which banks lend money to each other overnight. It is not directly tied to long-term rates on consumer products like purchase or refinance home loans.

This means that consumers should not expect an increase in home loan rates as a direct result of the Fed’s decision.

Instead, home loan rates are tied to Mortgage Backed Securities, which are a type of Bond. Many factors impact the performance of both Stocks and Bonds, and will play a role in the direction of home loan rates as we move into the new year.

For example, an improving economy, higher wages and higher inflation could all cause home loan rates to rise. However, if our economy falters, or if there is continued uncertainty and turmoil here or overseas, investors could seek out “safer” investments like Bonds, which could help keep home loan rates low.

The good news is that you don’t have to figure this out on your own. If you want to see if you can take advantage of today’s low rates, or if you have any questions about the housing market, current rates or loan products, please don’t hesitate to contact us.

Categories : Interest Rates
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