Wednesday, January 15, 2014

Will home loan interest rates go down again?

Will home loan interest rates go down again?

Good question! I'm glad you asked. I decided to confide in my mortgage expert, Mariah Trujillo with Legacy Mortgage, on this question because I hear it quite often lately.  The short answer, most likely not.

Why not?  Another good question.  Even though the rates did tick down a little the past two weeks, experts like Mariah feel that rates will not go low or even stay at the current rate (which is 4.25% as of 1/14).  The main reason the rates down just a bit was because the job rate was much lower than what most economists predicted, 74,000...  Not good.  BUT, supposedly the economy is on an up swing, which is good for the economy but not good for interest rates.

I have been hearing that we have hit bottom for quite some time.  Since I have heard this for a while it must mean that have been "skipping" along the bottom.  Many say our economy is ready to recover.  If this is true, then rates will follow.  As the economy moves upward, so will interest rates.  In addition to the economy causing rates to rise,  Freddie Mac and Fannie Mae's service fees will increase as well.  These fees will be passed along in buyer's interest rates.  This should increase rates by .25%  These fees are certain to happen within the next few months or even weeks.

So, rates will rise.  We have been spoiled by great rates for quite some time now but, to me, anything below 6-7% is great!  If you are thinking about buying a home and are qualified at a certain amount, strike now while the iron is hot!  If you don't, the amount you have been qualified for will slowly dwindle.  Now is a good time to buy if you can afford it!

Tuesday, January 14, 2014

Making logical decisions as an Albuquerque home seller

Making logical decisions as an Albuquerque home seller can be difficult at times, especially if you have loved the home you are selling.  One would think that this applies to only to those selling their primary residence but it can happen to investors as well.  I have experienced this first hand.  If an investor has had to overcome several obstacles to selling the home (repairs and upgrades), their logic could be clouded.  For example, if an investor has put several personal hours into the home, it is often hard not to became emotionally attached.  As an investor I can only advise you to keep it real business like and to keep a realistic eye on the market.  It is what it is.  You DO NOT decide what your residential property is worth.  The real estate market will do that for you.  If we all could call the shots on what we get for our homes, well, we would watch another bubble burst and we all know how much fun that was to watch...

Now on to those selling their primary residence.  Delusions of grandeur can be your worst enemy.  Believe that!  I see it so many times and it is extremely painful to watch.  Just recently I witnessed a seller terminate a deal over a $2,500 radon mitigation request from the buyer.  The home was listed for $450, Sandia Heights.  Although it is picking up in Sandia Heights, it is not the most brisk of market places.  Now, if the seller were to set back, realize that their home had been on the market for 200 days and that their mortgage payment of at least $2,500 month was a real factor, they would have taken the request and ran to the closing table.  They did, however agree to a long term radon test of 90 days because they are (obviously) trying to save money and wait for different radon level results, right?  90 days.  In dollar terms, $7,500 later in mortgage payments.  AND no guarantee of passing radon levels.  Do you see where I am coming from here?  Spite can be a very expensive thing when selling a home.  Do not fall into the trap if you truly want to sell a home.

I certainly hope this helps if you are selling or planning on selling your home here in Albuquerque.  Just remember, as harsh as it may sound, the market does not care about your personal ties to the product you are trying to selling.  All the market cares about is that the quality and location of your products flows with the correct price.

by Tim Fish