Archive for April, 2015

If you’re on the fence about selling your home, now may be the time! by Barb Crea

April 24th, 2015
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The phrase “Interest rates are going to go up by…..” has become akin to “The sky is falling.”  “Interest rates will be 1% higher by the end of the year” has been splashed across the news media for such a long time that people don’t even pay any attention to it anymore.  Well trust me, they will when it starts to happen!

In the meantime, while interest rates are still at their ALL TIME LOW, property values are going up, which is what every seller wants – BUT, these sellers are probably also going to be buyers.  While your sellers are waiting for the value of their homes to go up so they can get the BEST price for their house, guess what’s happening to the value of the house they’re thinking about buying?  If they’re on the fence about selling and continue to wait to get the BEST price for their current house, will they still be able to afford that new house if interest rates go up as predicted?

Buyers’ purchasing power is eroding right under their noses, and most of them don’t see it!  On a national level, the projected home price appreciation is between 4.0% – 5.1% according to folks like Freddie Mac and Core Logic.  Today’s Pioneer Press reported the median home price increased 7.8% over the past 12 months – to $212,100.  The limited supply of houses on the market has prices rising to levels that will affect affordability.  So what does this purchasing power and affordability mean?  As property values and interest rates go up, the amount of house a buyer can purchase decreases – what people can afford goes down.  People have budgets, and the house of their dreams may end up being beyond their reach.

4-24-2015 2-02-03 PMThis graph would be a GREAT addition to your listing and buying presentations.  Email me at barbarac@fairwaymc.com or call (952) 853-0222 to request a copy.  Additional ‘Purchasing Power’ graphs are also available in $100,000 price increments from $100,000 up to $1M upon request.  We need to remember that people have budgets, and we have to educate them on how increasing property values and interest rates will affect their purchasing power before the house of their dreams slips away!  – Barb Crea, NMLS #310389

 

 

Get to know our Fairway Team!

April 17th, 2015
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office staff

Fairway Independent Mortgage Corporation,
Bloomington Branch

I want to introduce you to a group of dedicated mortgage professionals who share our corporate values:

From left to right – Tracy McConnell, Randy Cullen, Mary Chris Gallo, Barb Crea, Carrie Guarrero, Shannon Black, Coach Kate Wilson, Kim Motzko and  Jennifer Broom.  Not pictured: Andrea Rodriguez, Kris Wilson, and David Cox (he was our photographer).

We all share the Fairway Core Values of: Humility first, foster growth and knowledge, have fun, create an amazing experience, speed to respond, seek wise counsel, stay balanced, committed to serve, consistent communication, and family focused.

We invite you to get to know our Fairway Team and let us help you with your residential mortgage needs. From our family to yours, we are all committed to serve.   – Randy Cullen NMLS #326128

 

 

Let’s see CHANGE as a positive! – by Barb Crea

April 10th, 2015
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4-10-2015 9-50-06 AMCHANGE – something we all hate, yet something we deal with daily in this industry.  August 1, 2015 is fast approaching and TILA-RESPA Integrated Disclosures (TRID) becomes effective.  Agents are hearing a lot on the street about TRID and are expressing concerns about their deals closing on time come August, and rightfully so.  If you’re not working with a lender that has nailed this down AND has systems in place to meet required timelines, you should be worried.  We tightened up our “Life of Loan Process” several months ago within our Bloomington branch, and are closely tracking the percentage of loans that are already meeting the new required deadlines – and we’re doing great!

So what is TRID?  The TILA-RESPA Integrated Mortgage Disclosures (TRID) consolidates four existing disclosures required under the Truth-in-Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA) for closed-end credit transactions secured by real property.  Specifically, the Final Rule mandates the use of two disclosures:

  • The three-page Loan Estimate (LE) replaces the Good Faith Estimate (GFE) and the initial Truth-in-Lending (TIL).
  • The five-page Closing Disclosure (CD) replaces the HUD-1 Settlement Statement and final Truth-in-Lending (TIL).

The goal is to improve consumer understanding and promote industry compliance with TILA and RESPA initial and final disclosures.

What will change, and how will it impact you?

Under the rule there will be changes to the disclosure forms, how fees are disclosed, and delivery timing of the disclosures.  Loan applications received on or after August 1, 2015 must comply with TRID.  Fairway has been working on implementing changes to accommodate TRID for several months.

Below are a couple of changes that will affect loan applications received on or after August 1, 2015:

Loan Estimate (LE) and other disclosures must be hand/electronically delivered or placed in the mail to borrowers within 3 business days of receiving:

  • Name
  • Income
  • Social security number
  • Property Address
  • Estimate of property value
  • Loan amount sought

The Loan Estimate (LE) will combine and include the following disclosures, they will no longer be separate documents:

  • The appraisal notice
  • The servicing notice
  • The Total Interest Percentage (TIP) disclosure – interest paid over life of loan – NEW
  • In 5 Years disclosure – total payments over five years – NEW

The Loan Estimate (LE) itemizes and alphabetizes the closing costs in each section making it easier to read and understand.

Closing Disclosure (CD) prepared by Closer and delivered to borrower 3 business days prior to consummation (document signing)

  • Changes that require Closing Disclosure (CD) re-disclosure and a new 3-day waiting period:
    • Change in APR of more than .125% (up or down)
    • Change in loan product (e.g. from adjustable rate to fixed rate)
    • Addition of a prepayment penalty
  • Other changes only require re-disclosure before or at document signing and will not require a new 3-day waiting period

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