Archive for November, 2015

Happy Thanksgiving!

November 25th, 2015
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thanksgivingThe Kate Wilson Team at Fairway Independent Mortgage would like to wish you a peaceful and safe Thanksgiving holiday.

Our office will be closing early on Wednesday and will be closed Thursday and Friday to allow time to enjoy the holiday with family and friends.

 

Happy Thanksgiving from all of us at The Kate Wilson Team!

 

 

No matter what your business, a plan is essential to your success. – by Randy Cullen

November 20th, 2015
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tumblr_inline_nak84cAaQE1qms4deBusiness planning is something that comes easy to some and eludes others. Without a plan, you do business on a per transaction basis rather than an on purpose basis. Where do you find yourself? With a plan for your business, you set goals for yourself and know the expected outcome – without a plan you stumble. Let’s be proactive!

No matter what your business, a plan is essential to your success. Business plans do not need to be elaborate, but they need to real.  Real goals to achieve your success keep you focused and on task.  Business plans force you to engage and be held accountable for the results. Whether you have a team you are managing or you are just managing yourself, have a role for everyone on your team and a role for yourself. On a team, you need not be the only person responsible for success – look at the big picture. Part of your plan could be to delegate things that are not the highest and best use of your time to someone else on the team.

Everyone has a life and the responsibilities that come with it. Your life is the most important starting point – you know what you and your family need. Schedule your time so business appointments don’t conflict with family commitments you may already have – keep your life in balance.  Don’t let the next deal create a conflict you’ll regret. Set your schedule to allow for non-negotiable family time. Stand firm on your schedule; after all, it is your life.

Take a look at the business you have done year-to-date. Ask yourself if you are where you wanted to be at this point in 2015. You have a month and a half to work hard to hit your numbers. Don’t fall into telling yourself “the market always slows this time of year,” and “I’ll make up the shortfall in 2016.”  The time to act is now – ENGAGE!

You are in control, so get in the driver’s seat and drive. Don’t let the events of the day put someone else in the driver’s seat with you ending up at a destination not of your choice. Work with a database and a schedule, and make time for both business and a personal life. Be balanced!

Need some pointers on fine-tuning your business plan? Save the date, Thursday December 10th from 1PM to 3PM. We have set up time to dive deep into the marketing part of your business plan. Expect to see more information on the event and how to register next week. Plan well – Randy Cullen NMLS 326128

 

How will rising prices and interest rates affect your purchasing power? …by Barb Crea

November 13th, 2015
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Buyer's Purch Power 11 13 2015Interest Rates Remain Low…  BUT a headline in the Pioneer Press Newspaper this morning stated “Average long-term U.S. mortgage rates this week rose sharply for a second straight week as expectations grew that the Federal Reserve may soon raise its key short-term interest rate.” According to the Wall Street Journal, about 92% of the business and academic economists polled in recent days said they expect the Fed to raise its benchmark-federal-funds rate at its December 15-16 policy meeting. Five percent said the Fed will stay on hold until March and 3% predicted the Fed will keep rates at near-zero longer.

While a .25% increase doesn’t seem like a big deal to some folks, to others it can mean the difference between buying a new home or not. The Buyer’s Purchasing Power chart clearly shows the impact that incremental increases in the interest rate can have on purchasing power. A borrower qualifying for a $400,000 loan at 3.75% is looking at qualifying for only $360,000 at 4.75%. That’s a 10% drop in purchasing power!

On the flip-side, looking at home prices and appreciation – a buyer looking to purchase a home for $400,000 decides to wait until next spring. If the price of that home increases 3%, they will pay $412,000. If interest rates remain the same as they are now, that buyer will pay $19,421 more between the additional down payment and the principal and interest payments over the term of the loan. If the price goes up 3% AND the interest rate goes up .50%, their cost of waiting increases to $54,736.

As real estate and mortgage professionals, we know that home values are increasing, the cost of new construction will go up in the spring (it does every year), and eventually long-term interest rates will increase – they have the last two weeks.

Many times we hear potential buyers saying things like “I’m going to wait until after the holidays” or “We’re going to wait until spring to buy or build.” Instead of responding with “Great, I’ll touch base with you after the Holidays,” perhaps we should ask ourselves – does that client understand how much MORE they may end up paying by waiting AND that they may not have the same purchasing power they have NOW?

The Kate Wilson Team of Fairway Independent Mortgage can help educate your clients on the potential impact rising prices and interest rates can have on THEIR purchasing power, so they won’t have to settle for less than their perfect dream home down the road.   –Barb Crea NMLS 310389

 

 

 

 

 

 

 

The bond market, interest rates, and other mortgage news – by Randy Cullen

November 6th, 2015
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todays-washington-mortgage-ratesI subscribe to a service called Rate Watch, which gives live reporting on the mortgage bond market and what drives interest rates up or down. I have seen the mortgage bond market in free fall lately, and interest rates on the rise. It is always interesting to see what drives the market. This morning’s report was based around the huge shocker in non-farm payroll numbers that had just been released. The market anticipated what the number should be and was looking for 182,000 new jobs being created for the period. What the market got was a shock with 271,000 new jobs being created! That news sent the mortgage bond market falling, and yes, interest rates rising. No one is quite sure if the bottom of the fall is in sight. The market reacts to the news and then adjusts to reality a few days later once all the information is digested. So, in the next day or so when the market settles, there should be a bounce back correction that takes place. Interest Rates should show improvement.

Last month the market had the opposite surprise, with a lack of creation in the non-farm payroll numbers. Even though this came as a surprise to the bond market, it is still just one month of data being reported, not a trend. Keep in mind, the numbers come in monthly and will change as the economy expands or contracts. The two month average is still barely 200,000 new jobs each month, and that’s not enough to get excited about. Other indicators that move the markets are GDP (Gross Domestic Product), Retail Sales numbers, Manufacturing, etc. The Federal Reserve Bank actually publishes a report with charts and graphs.  Find it at: https://www.richmondfed.org/~/media/richmondfedorg/research/national_economy/national_economic_indicators/pdf/all_charts.pdf.

In other news, we have had a change with Minnesota Housing Finance Agency regarding FHA loans. Effective with loan reservations on or after December 1st 2015, all FHA loans submitted must have a minimum representative credit score greater than, or equal to, 660 for all borrowers on the application. All FHA loans must follow the new minimum credit score requirements as outlined below: Read the rest of this entry »