Page 9


The Mortgage Coach


S


horter days and lon- ger nights, alert us that winter is just around the corner.


Another spin around the sun and New Year’s Day is coming. Time for refl ection and for setting goals, and making plans. T e hous- ing market is in constant motion and cons tantly stirring our emo t i o n s . When me- dian home values are rising, ev- ery home- owner feels the pride and security in home ownership. When the news goes in the opposite direction and median values are declining, worries of a pending crash, and talk of overpriced housing fi ll the me- dia. T ere is never the “ideal” time to buy a home. When you can aff ord a home is the “ideal” time to buy. As home prices fl uctuate,


so do interest rates. No mat- ter the price, the bottom line is always - Can you aff ord the


PET PIC’s


Zippy on a kayak at Lost Creek Reservoir in Oregon!


From V. Doyle of SR “Happiness consists in frequent repetition of pleasure” ~ Arthur Schopenhauer UPBEAT TIMES, INC. • December 2018 • 9 Getting Off The Fence by Barry O'Meara of Santa Rosa, CA • barryo@stearns.com


payment? What is your debt- to-income (DTI) ratio or the “ability-to-repay”?


T is is


cornerstone of underwriting and the key to getting a loan approved. A couple of ways to lower your monthly payment are to pay less for the home or get a lower interest rate. As interest rates move up you can actu- ally buy your interest rate down. As a rule of thumb one point can buy you .25% lower inter- est rate. Now


keep in mind the curve is not a straight line and many factors play into the fi nal interest rate. Credit score, loan-to-value, type, and use of the property. T ere is no easy answer. Seller credits can balance


rising interest rates and pro- vide an aff ordable payment. Home values fl uctuate based on market trends. We are at a point within the fl uctuation that could support seller cred- its and the appraised value.


Home purchase will require an appraisal, unless your loan has an appraisal waiver. Apprais- als require a licensed appraiser to visit the property and sup- port the market value with “comps” which refl ect recent sales of comparable homes in the area. T e subject proper- ty’s price will need to be sand- wiched between one higher priced home, and one lower priced home, or “comps”, as they are known. If you cannot fi nd “comps” to support the value, the appraised value is used. T is may put a damper on any seller credits you may be asking for. T e market may be shiſt ing, but we still are in a window of time that there will be enough sold comps to sup- port the value. T e point is the market has


shiſt ed and there is room for negotiation.


Ask for seller


concessions and ask for cred- its. A $10,000 seller credit can allow you to buy your interest rate down and make your pay- ment lower than you would get with a $10,000 reduction in the sales price. Recently, I worked with an


agent who structured the off er so that they asked the seller to credit the buyer 6% of the sales price. T ree percent was


enough to cover their closing costs and we used 3% to buy their rate down. T is allowed them to lower their payment enough to qualify for the loan, and the seller got the price they wanted.


Building the credit


into your price is one way to fi nance your closing costs. Buyers, sellers, realtors, and lenders do not have a crystal ball to know what the future holds. Act on what you have in front of you now. Hind sight is 20/20. Dwelling on the past can keep you from enjoying the present. Not acting, now, could keep you from building wealth in your future. Get off the fence and make your move now!


Weird Facts & Trivia - 3


The town of Derry Church, Pennsylvania, was renamed Hershey to honor Milton Hershey and his candy bar factory.


Philip Silvershein named a pyramid candy bar with choc- olate, raisins, cashews and Brazil nuts after his grand- daughter. The name he gave it: Chunky.


The Wonka bar is a chocolate bar with the word “Wonka” imprinted on it and a graham cracker base. It is named after a fi ctional candy bar of the same name in the book Char- lie and the Chocolate Factory.


Holiday Season!! Bless All!!


Wishing ALL Joy & Love this


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