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Old 08-23-2013, 11:21 AM
 
30 posts, read 47,557 times
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Anyone have a crystal ball? That's about the time I'll be buying a house and would like some idea what the rates will be. I'll be priced out if it's high 5's
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Old 08-23-2013, 12:37 PM
 
Location: Mount Laurel
4,146 posts, read 8,419,237 times
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I don't quite understand how someone could get priced out if the interests rate move 1 - 1.5 percent from current rates. If you do, you may want to re-think whether or not you are planning to take too much mortgage. Just remember that if the rates moves too much, the housing prices will be reflected as well.

In other words, no need for crystal ball. Things are pretty much going to be the same for owners occupied home in most markets.
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Old 08-23-2013, 01:39 PM
 
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I have a range for what I want and what I can qualify for. I'm not dumb enough to try and max out what I can afford. It just hurts a little knowing that my internal price range has to be shaded back because of the moving interest rates. Like anyone else, I want the most for my money.
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Old 08-23-2013, 02:18 PM
 
382 posts, read 651,459 times
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A lot of people got stuck with higher rates over the last few mos. When we were first looking we were quoted 3.25 and now the latest is 4.45. That's a fairly large difference in monthly payments. Coupled with the fact that prices have increased in our area 13% over the last year. It's like 2006 all over again...kind of. Many people were having homes built that had to walk away, since the builders don't let you lock in until 30 days before the house is supposed to be completed.

My guess is that rates will be at 5% by the end of the year, due to the fact that the Fed will start its tapering of quantitative easing. People are expecting that to happen either next month, or sometime in the fall. Rates have already increased dramatically based on one meeting where the Fed just HINTED at the fact that they MIGHT start tapering, at some point. Look what happened to the rates after that. Now imagine what is going to happen once they actually do start tapering.

However, keep in mind that higher rates will likely result in lower demand, less competition, less bidding wars, and thus lower prices. Check out the new homes sales data that was just released this morning. That is a pretty good indicator of things to come. No crystal ball, but it's just my humble opinion.
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Old 08-23-2013, 03:37 PM
 
Location: New York
2,251 posts, read 4,170,907 times
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.

Every time someone asked what the rates will be in the future - think of this song.........lol..!!!!


If I had a million dollars (subtitled) - YouTube


My $00.02 of advice from the class of Life -101


As a person ages - money is harder to earn and there are less opportunity's. Point the more you invest in yourself to make yourself look better financially today, the better the deal you can qualify for in the future.


Work on your credit first!!! If your credit score is low the interests rates are high. Contrary - if your credit score is high, you can qualify for low interest rates. Credit is a very important topic many people fail to approach first. Most people go house hunting find the home first they like, only to find out how hard it is to qualify for financing with little or no credit. Do not pay anyone to help you with your credit, you should learn what credit is on your own.


Make a large down payment - the more you put down the smaller the loan, and the less in interest you will pay. I like that fact you your thinking next year. Cut back on your expenses and try to save as much as possible for your down payment. Plan on putting down as much as possible, at least 20% or more. Not only will this eliminate PMI, with a large down payment there's less restrictions on being approved. Adding it's public knowledge over the life of a mortgage, a borrower will pay x-times more than the original amount borrowed. A smaller loan yields a smaller payment, freeing up money.


Send extra towards your principle - If you send at least one extra (13) payment a year, this knocks 7.5 years off the mortgage, and your reported as more responsible to the CB's and your credit score goes really high. Sending one extra payment a year, you can lower the net-effective interest rate 2% on your own...


Paying off your mortgage early. We paid off our 30 year mortgage in half the time by doing what I'm mention above. My wife and I lead a very modish life we are not rich. We focused less on the things wanted now vs what we could do to make our future easier. Sending extra towards principle really knocks of the term. Some years we would send our tax returns, sometimes two or three full payments a month. It's a feeling of accomplishment paying off your house.


There's a downside to everything thing. - with no installment (secured) debt being reported into the credit report. the FICA score can show a N/A rating as soon as a year. If that happens you have to re-qualify for credit all over again.


My point of my post is you have to plan a year, 5 years, 10 years into your future by making short and long term goals. You have to seek out knowledge about what opportunity's you can accomplish today.


We keep our credit alive by financing a new car every few years. Just last month got my wife a new Hyundai (got to keep the Mrs happy). Last year bought and installed solar energy, now our electric bill is $12.95 monthly. Next year planning on taking my son and two daughters on a cruise. It's going cost a lot, I'm looking at it as time spent with my kids as priceless......


"Again if I had a million dollars"...

Good Luck....

.

Last edited by Modification Specialist; 08-23-2013 at 03:48 PM..
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Old 08-23-2013, 03:53 PM
 
30 posts, read 47,557 times
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Thanks for the advice! I've been as stingy as they come for the past year in hopes of being a home-owner.
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Old 08-24-2013, 10:45 AM
 
Location: Rheinland-Pfalz, Germany
693 posts, read 926,233 times
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Quote:
Originally Posted by Cabear16 View Post
Thanks for the advice! I've been as stingy as they come for the past year in hopes of being a home-owner.
I am with you on this, started last October hard core and its been tough on the family. It has however enabled me to be in a strong position when talking with lenders. Its worth the loss of the extras for a bit to be in this position. I will be happy when the process is over so I can go back to being a drunken sailor, lol!
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Old 08-29-2013, 03:08 PM
 
Location: New York
2,251 posts, read 4,170,907 times
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Carbear,

When buying your first home there are many things to consider. You will come upon information unknown to you. Making the right choices will determine how to be easy or hard it will be to purchase. The point here is keeping your self organized.

I am going to recommend over the next year keeping a record. So you can learn and review, before you get into a situation over your shoulders. The point here is understanding no-one is going to hold your hand guiding what to do when you get to the closing table.

Create a loose leaf binder notebook and separating into chapters.

Label the outside "My House", next the title page list different sections.
  • Houses (will be the biggest section) subdividing each home you see , realtors can give a copy of the MLS sheet containing house details.
  • Home Inspectors - when you find a home, it is worth paying to have it inspected. Create a list of inspectors will there fees. This can identfy major/minor problems with the property, also help with your negotiating a better price.
  • Banks (Lenders) - speak to different leaders, getting loan officer's names that can later provide a pre-qual letter. Study the different loan's you can qualify for and how to amortize (calculate) loan payments based on mortgage amount, interest rate, and term
  • Insurance company's for HO Insurance - compare different Ins company's, look at blanket policy with your car insurance.
  • Home taxes - be aware different town's have different tax rates.
  • Utility's - found out information before hand what the steps are for turning on the electric and water.
  • Your financial information - when qualifying for mortgages lenders are going to want to see at least six months of seasoned funds.
  • Credit - learning about the five parts of credit, how each part contributes to your credit score. Getting a copy of your credit report and deputing any incorrect information.
  • Attorneys - in some states it is a law that closing attorneys be present to witness the signing the loan documents. That is all they are required to do. Getting your own attorney at the most, all they are going to do is read the documents your signing. They are not interpreting whether a loan is good or bad. It is your responsibility to understand the loan your getting into.
It is totally up to you on what and how much information to include. I am sure here are mature and experience members that work the mortgage/real estate field will probably shrug their shoulders at my suggestion. I am willing to bet there are many younger home buyers that creating a similar list can be their bible.




.
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Old 08-29-2013, 03:26 PM
 
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5.375%.
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