Archive for Fort Lauderdale Mortgage – Jumbo Financing
Lower Your Interest Rate Not Your Offer Price
Posted by: | CommentsDoes A Lower Offer Price Or Lower Interest Rate Have More Value?
When buying a home, too often the focus of getting a great deal is placed solely on negotiating the lowest price on the property. Does the lowest price always mean the best deal? Common sense tells us that the less we pay for something, the better the deal we received. Most times, if a home buyer is paying cash for a property, the lowest price may be the best deal. However, if one is buying a home with a Fort Lauderdale mortgage, there may be more value to a lower interest rate than a lower offer price.
It’s very common for a home buyer to negotiate their transaction with the seller paying all or part of their closing costs. This Ft Lauderdale mortgage strategy is most often used to minimize the amount of cash the home buyer has to bring to closing. As a Fort Lauderdale mortgage broker and CMPS professional, I understand the value of seller paid concessions. Most FHA mortgage transactions rely on seller paid closing costs to make buying a home possible. Conventional mortgage transactions are less reliant on seller contributions to make the deal work.
When considering a Fort Lauderdale mortgage in conjunction with buying a home, you may find more value in using seller paid concessions to obtain a lower interest rate rather than negotiating the lowest sales price. Let me explain and illustrate how this Ft Lauderdale mortgage strategy can help a home buyer get the best deal.
John and Nancy are buying a home priced at $350,000 with a Ft Lauderdale mortgage. They want to get a great deal, so they are considering reducing their offer price by 4% or $14,000. This would make their offer $336,000 and with a 20% down payment they would have a Fort Lauderdale mortgage amount of $$268,800. A 30 year fixed rate Florida home loan at 4.75% would give them a monthly payment of $1402.19. Over the term of the loan, John and Nancy will have paid $235,988 in interest expense and $504,788 in monthly payments.
Now let’s look at buying a home at the asking price of $350,000 and receiving a 4% seller paid contribution that will be used to obtain a lower interest rate. Using the same 20% down payment criteria, John & Nancy would now have a Ft Lauderdale mortgage amount of $280,000. As a Fort Lauderdale mortgage broker, I would use the 4% seller contribution to get the home buyer a lower interest rate. They could obtain a 30 year fixed rate Florida home loan at 4.0% with a monthly payment of $1336.76. over the life of the loan John & Nancy will pay $201,235 in interest expense and $481,235 in monthly payments.
This Fort Lauderdale mortgage strategy resulted in saving John and Nancy $34,753 by offering a higher price and using a seller paid contribution to obtain a lower interest rate. Now, here’s the frosting on the cake. The 4% contribution paid by the seller is recognized by the IRS as prepaid interest and becomes a tax deduction for a home buyer. That means the $14,000 seller paid contribution becomes a tax deduction for John and Nancy. Assuming they are in a 28% tax bracket, that would provide John & Nancy another $4,000 tax deduction bringing their total savings to almost $39,000. Imagine, paying more for the home and saving money just by knowing how to structure a Fort Lauderdale to benefit the home buyer. Contact your professional Fort Lauderdale mortgage broker and CMPS professional, Harvey Collier today to help you structure your next Florida home loan.
Harvey Collier - First Trust Mortgage – 954-629-6151
Watch Out – Lapse Of Flood Insurance May Delay Your Closing
Posted by: | CommentsNational Flood Insurance Program Lapses
Congress has let the National Flood Insurance Program lapse for the third time this year. The program expiration occurred on June 1st, the first day of “hurricane season” for the Gulf of Mexico. Congress has attempted to grant a short-term extension of the National Flood Insurance Program, but efforts have been delayed, as the extension is attached to other legislation in the House and Senate. All the recent National Flood Insurance Program extensions have been short-term, as Congress hopes to overhaul the program, which will take some time.
Home buyers that are getting a mortgage to purchase their home are required by lenders to have flood insurance if their property is located in a Federal Flood Zone. Homeowners that already have flood insurance won’t be impacted by the lapse. Nor will buyers of condominiums where the Condo Association has a master flood policy. However, homeowners seeking to amend their current policy or purchase a new one will have to wait until Congress extends the program. More urgently, those home buyers purchasing a home located in a Federal Flood Zone and obtaining a mortgage won’t be able to close on their sale until Congress grants another short-term extension.
The NAR has been contacting members and asking them to contact their Congressional Representatives to extend the National Flood Insurance Program sooner than later. It is feared that if Congress doesn’t act by the end of the month, their could be significant repercussions on other areas of the housing recovery. A word to the wise, as soon as you have an executed sales contract, check to see if the property is located in a Federal Flood Zone. Hopefully the problem will be resolved soon, but until then it’s important to stay on top of this important issue.
Fort Lauderdale Real Estate Update For Q1 2010
Posted by: | CommentsFort Lauderdale Mortgage Broker Breaks Down Q1 Results
First quarter real estate results have been tabulated and released by the Fort Lauderdale Board of Realtors. What direction is the Fort Lauderdale Real Estate market heading? What changes and trends did first quarter results reveal?
Listing activity increased from January to March. Single family home listings increased 13%, while condominium/town home listings increased 8%. However, based on a comparison to the same period last year, the number of total new properties for sale remained steady. The overall inventory level decreased from a 11 month supply of homes to 10 months. The listing results of the Fort Lauderdale Real Estate activity report show inventories are holding steady despite the continuing supply of distressed properties coming on the market. Lenders seem to be doing a good job managing their pipeline of inventory, so as not to flood the market and drive prices lower.
Pending home sales over the first quarter held steady, but increased dramatically from a year ago. Both single family homes and condominiums showed pending sales growth. Distressed property sales in the Fort Lauderdale Real Estate market accounted for 35% of home sales, which is higher than the national average. Florida is home to all 10 markets having the most foreclosures. San Diego, Oakland and Sacramento California lead the nation in short sale transactions.
The report revealed that the average sales price increased 14% over the quarter, while the median sales price remained constant. The total sold dollars of Fort Lauderdale Real Estate over the quarter rose 22% from January to March. On a year over year basis home sales for the quarter were up 25%. As a Fort Lauderdale mortgage broker, I’ve never seen such a high percentage of cash sales as we’ve seen over the past year. Well priced properties in the $250,000 and under category are selling quickly with many multiple offers being made.
Conclusion – The Fort Lauderdale Real Estate market is slowly, but steadily improving. Despite the number of foreclosed properties and probably another two year supply still ahead, buyers are taking advantage of dramatically reduced home prices. The results for Q1 show a healthier Fort Lauderdale Real Estate market than a year ago. The Fort Lauderdale housing recovery is underway, but it’s going to be a very slow and challenging recovery for the foreseeable future.
The Florida Home Loan Minefield
Posted by: | CommentsGetting a Florida home loan these days can be more challenging than ever before. Lenders are being extremely careful and turning over every rock, as they scrutinize every borrower. Qualifying for a Florida home loan these days is like going through airport security and being taken to the little room for closer examination. Let’s just say, going through the mortgage process on your own is like being dropped off in the desert without a compass or GPS.
Underwriting guidelines are changing daily, as lenders discover additional risk factors related to thousands of delinquent mortgages. Credit scores, down payments, property types, debt-to-income ratios, appraisal, property condition and income determination have all become potential land mines waiting to blow up your transaction.
How does a buyer navigate these potential pitfalls and have the best chance to be approved for their Florida home loan? Now, more than ever before, buyers need the experience and knowledge of a professional Florida mortgage broker. Each lender has created their own rules that has made mortgage lending more restrictive and very inconsistent from bank to bank. A professional Florida mortgage broker can match you to a lender that best fits your profile and is most likely to approve your loan. They can offer you products from multiple lenders and pave the way for a smoother transaction.
Self-employed, commissioned and bonus recipients will experience the most difficult transactions. Be prepared for the lender to examine every line item on your credit report and bank statements. You’ll need to explain any derogatory credit and source any deposits showing on your bank statements. There are many traps you will encounter during the mortgage process. Do you want to trust your Florida home loan to a clerk at your bank that was probably on the teller line last week and has no idea how to read a tax return? Many issues and potential problems can be resolved upfront before a lender sees the file.
Make a smart decision and work with a professional Florida mortgage broker when searching for your Florida home loan. My 25+ years of Florida home loan experience combined with my Certified Mortgage Planner designation, makes me uniquely qualified to give you honest answers, great advice and guide you to a successful closing. To learn more about my unique qualifications, read here.
Florida Mortgage Broker Secrets To Sell Your Home
Posted by: | CommentsFlorida Mortgage Broker and CMPS Professional, Harvey Collier can show you how to attract buyers and compete against short-sale and foreclosure properties by using a time tested strategy. Wrap your listing with a “Special Financing Offer”. Florida Home Builders used this strategy to attract buyers away from resales during the boom years. It may be time to dust-off this proven sales incentive and give it a little tweak. Why not use the best Florida mortgage as the honey to attract the bees (buyers) away from your competition, short-sale and foreclosure homes.
Here’s how it works. Your Florida mortgage broker can utilize a seller concession to create a special buy down mortgage that will be very attractive to any potential buyer. During the housing boom, new home builders offered buyers special mortgage terms including below market interest rates that allowed buyers to qualify for a larger Florida home loan and more upgrades for the home (boosting builder profits). Builders were very successful luring potential resale buyers way from existing homes with lower payments and more house for the money. Let’s rethink this strategy and reapply to today’s short-sale and foreclosure marketplace.
Now you are the home builder trying to attract buyers away from distressed property sales. There’s only one way to compete with the steady wave of short-sale and foreclosed properties coming on the market over the next 2 years … Drop Your Price … Again …. Again … Okay, as your Professional Florida mortgage broker, here’s the “honey” recipe. Once you and your professional Realtor agree that your property is fairly priced to the market and it still hasn’t sold, it’s time to wrap it with financing. With the help of the best Florida mortgage program, you can create a financing option that will draw the bees to your hive.
Here’s an example of how I structured this strategy for a client that just sold his home using the strategy. The property was listed in the MLS and advertised with “Special Owner Arranged Financing”. This heading got a lot more inquiries as they always wanted to know if it was owner held financing. This opened up an additional pool of buyers for the Agent and seller. It turns out that the buyers of the home that we just closed about 2 weeks ago, initially called thinking it was owner financing. They had already been turned down for a Fort Lauderdale mortgage of the same amount and were hoping they might get the owner to hold the mortgage with their excellent credit scores and job stability.
The house had been listed for $345,00 and reduced over 4 months to $280,000. When the homeowner contacted me, he was about to reduce the price again by $20,000 to be at or below several other short-sale properties in the neighborhood. I structured a best Florida mortgage option keeping the home priced at $280,000 and having him contribute 4% to the interest rate buy down. This can be done with a FHA loan or Conventional loan with either a fixed rate loan or many Adjustable Rate loan options. The beauty of the concept is that it can be tailored to the buyers needs and risk tolerance. In this particular case we illustrated a 30 year fixed rate mortgage and a 5/1 ARM. The buyer of the home selected the 5/1 ARM best Florida mortgage option, as it allowed them to qualify at the buy down start rate with a lower payment and debt-to-income ratio that had restricted their qualifying before.
The buyers locked in their Fort Lauderdale mortgage at 3%, fixed for 5 years. Here’s what it did for the buyers:
- Allowed them to qualify for a 22% higher priced home in a neighbor they wanted, but couldn’t afford now.
- Even at the higher sales price of $280,000 the payment on their best Florida mortgage was $172 less per month.
- The buyer was actually able to deduct the cost of the seller paid buy down from their income taxes receiving an additional $2240 windfall.
Here’s what it did for the seller:
- Attracted many more potential buyers with “Special Financing Offer”.
- Instead of $20,000 price reduction, seller only paid $8,960, netting an additional $11,040.
- Most importantly, got the property SOLD!
Here’s what it did for the Realtor:
- Most importantly, got the property SOLD!
- Got both ends of the deal as buyer responded to internet posting.
- Received another sale from the seller repurchasing another home.
- Received the goodwill of the neighborhood, as property values weren’t compromised by a reduced sales price.
This best Florida mortgage strategy can and will work for you. Wrap the listing with an interesting financing arrangement and you might just sell that home faster without having to give it away. Your Florida mortgage broker, Harvey Collier has 25+ years of experience to help you sell your home.
Contact: Harvey Collier, First Trust Mortgage
www.MortgagePro-Florida.com or email:HarveyCollier@MortgagePro-Florida.com
