Shepherd: a person who protects, guides, or watches over a person or group of people.
Why should you use a mortgage broker? One of the positive outcomes of mortgage crisis is that the rate offered to borrowers does not vary much from bank to bank. Many people decided that they may as well go to the local bank where they bank and get their loan there. Why not?
Easy. For the most part bank branches don't process loans themselves. In fact, they often do not have a mortgage specialist in house. Many times, the mortgage loans are processed in remote offices in different states.
A mortgage broker "shepherds" the loan from beginning to end. Documents don't get lost, sent to several different people and delayed for unexplained reasons.
It is stressful enough borrowing large sums of money. You want the same person answering your questions from the beginning and being responsible for your loan throughout the process.
Wednesday, February 22, 2012
Monday, February 13, 2012
To Rent or to Buy - the Age Old Question
An interesting article from the NY Times about the current New York rental and purchase markets.
When the real estate market was booming in 2007, renters showed up at apartments with checkbook in hand, ready to do battle with anyone else who might want the same place. That changed, of course, when the financial crisis hit in 2008. And the heady days that followed, when renters ruled in a down market, are now a fading memory.
In 2011 landlords once again got the upper hand as prices rose and vacancies dwindled. Multiple applications even made a comeback late last summer. All signs say landlords are likely to keep that advantage for a long time. In certain neighborhoods, rents are setting new records, exceeding the heights of 2007. Some landlords say that in extreme cases, eager renters have even bid up rents.
The demand in some buildings has become so intense that there are waiting lists bearing the names of dozens of potential tenants. This was unheard of during the downturn.
With fewer new buildings scheduled to open this year, inventory for luxury rentals will remain tight, helping to keep prices up at the high end. This pressure will inevitably trickle down to the lower end of the market.
Rental brokers said that rental prices had been buoyed in part by tighter mortgage lending, which has discouraged many potential first-time buyers from entering the sales market.
Rents in traditionally coveted neighborhoods like the West Village and Chelsea have hit new heights. But records are also being set in areas that are not as well traveled, including the financial district and Midtown West, where new rental towers have helped pull up average prices.
According to Citi Habitats data, the city’s priciest studios can be found in Chelsea, where the average rent is $2,332 a month; and the West Village claims the most expensive one-bedrooms, $3,278 a month.
But the financial district is not far behind, getting record rents for its one-bedrooms, at an average of $3,255 a month, and its two-bedrooms, at $4,575 a month.
Fewer new apartments are coming to market this year than in years past, largely because construction financing has been tight and the number of building permits issued by the city fell drastically after 2008. Citi Habitats Marketing Group estimates that there are only about 2,200 new rentals in Manhattan this year, down from more than 3,600 in 2011.
Many projects, including some rentals initially designed to be condos, will finally be finished in 2013 or 2014.
The purchase market is getting tighter as well. It seems that a lot of pent up demand from the financial crisis is driving both the rental and purchase markets.
When the real estate market was booming in 2007, renters showed up at apartments with checkbook in hand, ready to do battle with anyone else who might want the same place. That changed, of course, when the financial crisis hit in 2008. And the heady days that followed, when renters ruled in a down market, are now a fading memory.
In 2011 landlords once again got the upper hand as prices rose and vacancies dwindled. Multiple applications even made a comeback late last summer. All signs say landlords are likely to keep that advantage for a long time. In certain neighborhoods, rents are setting new records, exceeding the heights of 2007. Some landlords say that in extreme cases, eager renters have even bid up rents.
The demand in some buildings has become so intense that there are waiting lists bearing the names of dozens of potential tenants. This was unheard of during the downturn.
With fewer new buildings scheduled to open this year, inventory for luxury rentals will remain tight, helping to keep prices up at the high end. This pressure will inevitably trickle down to the lower end of the market.
Rental brokers said that rental prices had been buoyed in part by tighter mortgage lending, which has discouraged many potential first-time buyers from entering the sales market.
Rents in traditionally coveted neighborhoods like the West Village and Chelsea have hit new heights. But records are also being set in areas that are not as well traveled, including the financial district and Midtown West, where new rental towers have helped pull up average prices.
According to Citi Habitats data, the city’s priciest studios can be found in Chelsea, where the average rent is $2,332 a month; and the West Village claims the most expensive one-bedrooms, $3,278 a month.
But the financial district is not far behind, getting record rents for its one-bedrooms, at an average of $3,255 a month, and its two-bedrooms, at $4,575 a month.
Fewer new apartments are coming to market this year than in years past, largely because construction financing has been tight and the number of building permits issued by the city fell drastically after 2008. Citi Habitats Marketing Group estimates that there are only about 2,200 new rentals in Manhattan this year, down from more than 3,600 in 2011.
Many projects, including some rentals initially designed to be condos, will finally be finished in 2013 or 2014.
The purchase market is getting tighter as well. It seems that a lot of pent up demand from the financial crisis is driving both the rental and purchase markets.
Monday, February 6, 2012
Thursday, February 2, 2012
Bernanke's comments
"Uncertain job prospects, along with tight mortgage credit conditions, continue to hold back the demand for housing. Although low interest rates on conventional mortgages and the drop in home prices in recent years have greatly improved the affordability of housing, both residential sales and construction remain depressed. A persistent excess supply of vacant homes, largely stemming from foreclosures, is keeping downward pressure on prices and limiting the demand for new construction..."
That is the market in a nutshell. So the question is, what should you do?
Certainly, if you are in the market for a purchase, I think you should pursue it. Also, Obama is working on making refinaning easier for those who currently can't. Ultimately, the job and housing markets are so intertwined that as one goes, so goes the other. Look for an all out effort to improve the housing market.
That is the market in a nutshell. So the question is, what should you do?
Certainly, if you are in the market for a purchase, I think you should pursue it. Also, Obama is working on making refinaning easier for those who currently can't. Ultimately, the job and housing markets are so intertwined that as one goes, so goes the other. Look for an all out effort to improve the housing market.
Monday, January 30, 2012
Refinancing, Why Wait?
"Greece rejected an European Union-appointed budget watchdog appointed to Athens as a condition of bailout money."
In and of itself that does not sound like it should be affecting US mortgage rates. But it has. US Treasury 5 year bonds that are somewhat related to mortgage rates are at an all time high driving rates even lower.
Basically, until Europe has a plan as to how they are going to fix the economy, money is flowing into US Treasuries, reducing mortgage rates. These actions are taking precedence over internal US conditions including the employment rate. Should Europe look like they are coming to a consensus about solving their problems, look for rates to go up.
Sample rates:
30 year fixed to $417,000 - 3.75%
30 year fixed $417,001 - $625,500 - 4%
No one has any idea how long this will last.
In and of itself that does not sound like it should be affecting US mortgage rates. But it has. US Treasury 5 year bonds that are somewhat related to mortgage rates are at an all time high driving rates even lower.
Basically, until Europe has a plan as to how they are going to fix the economy, money is flowing into US Treasuries, reducing mortgage rates. These actions are taking precedence over internal US conditions including the employment rate. Should Europe look like they are coming to a consensus about solving their problems, look for rates to go up.
Sample rates:
30 year fixed to $417,000 - 3.75%
30 year fixed $417,001 - $625,500 - 4%
No one has any idea how long this will last.
Tuesday, January 24, 2012
Investing in Making a Home "Market Ready"
I have my real estate sales license. I occasionally show apartments for a friend who is a broker. This past weekend I showed a Manhattan jumbo studio on a high floor in a nice Manhattan, upper westside builidng. The apartment has a decent kitchen and bathroom and a lot of space for a Manhattan studio. However, the apartment has sustained some kind of water damage and the paint by the HVAC unit is peeling and unsightly.
The day was busy and several people looked at the apartment. Every one of them immediately went to the area of the peeling paint and dismissed the apartment as "damaged."
Clearly, the apartment needs updating. While I think that it would not be cost effective to redo the kitchen and bathroom before putting the apartment on the market, a coat of paint will probably pay for itself many times over.
The day was busy and several people looked at the apartment. Every one of them immediately went to the area of the peeling paint and dismissed the apartment as "damaged."
Clearly, the apartment needs updating. While I think that it would not be cost effective to redo the kitchen and bathroom before putting the apartment on the market, a coat of paint will probably pay for itself many times over.
Monday, January 23, 2012
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