Mortgage rates increased for the fifth consecutive week, with the average 30-year fixed mortgage rate rising to the highest point since August, according to Bankrate.com's weekly national survey of large lenders.
The average 30-year fixed mortgage rate is now 6.47 percent and has an average of 0.26 discount and origination points.
The average 15-year fixed rate mortgage, popular for refinancing, increased by a similar amount, to 6.21 percent. With larger loans, the average jumbo 30-year fixed rate climbed to 6.68 percent. On adjustable rate mortgages, the average one-year ARM nudged higher to 6.09 percent while the 5/1 ARM jumped up to 6.37 percent.
“Mortgage rates often show short spurts of volatility and prolonged periods of little movement,” Bankrate says in its survey report. “Mortgage rates had been confined to a narrow range of approximately one-third of a percentage point for nearly seven months — including weeks on end with virtually no movement. But they broke out of that range with this week's move, as hopes for a Fed interest rate cut continue to wane.”
Fixed mortgage rates have increased nearly one-third percentage point since mid-March. At the time, the average 30-year fixed mortgage rate dipped to 6.16 percent, meaning that a $165,000 loan would have carried a monthly payment of $1,006.30. With the average 30-year fixed rate now 6.47 percent, the same loan originated today would carry a monthly payment of $1,039.66. Fixed mortgage rates still remain a compelling refinancing alternative for adjustable rate borrowers facing sharp payment adjustments.
Bankrate's national weekly mortgage survey is conducted each Wednesday from data provided by the top 10 banks and thrifts in the top 10 markets.
— REALTOR® Magazine Online
Thursday, May 31, 2007
Thursday, May 24, 2007
How to Find a Dog-Friendly Home
The American Kennel Club says 86 percent of all owners of purebred dogs and 91 percent of the club’s members are home owners. That said, many buyers are not only looking for the perfect home for themselves, but one that can accommodate their furry friends, too.
The club offers these suggestions for dog owners who are considering buying a home:
* Check with your local city government on zoning ordinances governing pets and fencing to keep your pet safe. If you're buying a condo or dealing with a homeowner's association, read the rules carefully.
* Certain dog breeds are banned in some areas. Make sure your breed is a fit with local ordinances.
* Consider where your pet will live; while nearby green space isn’t mandatory, the dog may appreciate it.
Source: The San Diego Union-Tribune, Cathy Lubenski (05/20/07)
The club offers these suggestions for dog owners who are considering buying a home:
* Check with your local city government on zoning ordinances governing pets and fencing to keep your pet safe. If you're buying a condo or dealing with a homeowner's association, read the rules carefully.
* Certain dog breeds are banned in some areas. Make sure your breed is a fit with local ordinances.
* Consider where your pet will live; while nearby green space isn’t mandatory, the dog may appreciate it.
Source: The San Diego Union-Tribune, Cathy Lubenski (05/20/07)
Monday, May 14, 2007
NAR: CBS News Magazine Misses the Mark
In the world of political campaigns, it's a standard ploy to set the stage with an empty chair when one candidate refuses to debate his opponents.
The CBS show 60 Minutes gave the NATIONAL ASSOCIATION OF REALTORS® the empty chair treatment in a May 13 segment that examined the impact of online brokerages on the real estate industry. The show featured interviews with a representative from the now-defunct eRealty and the president and CEO of Redfin, but no one from NAR, even though NAR twice offered and prepared association spokespersons for interviews with Leslie Stahl.
NAR expressed disappointment that CBS made the decision it would rather interview opponents and let them make unanswered — and inaccurate and unfair — accusations about REALTORS® and NAR policies.
The one-sided journalism and egregious errors served no one well, especially the once-vaunted news magazine show, NAR says. NAR staff spent nearly a year working with CBS, briefing producers on the issues involved. The producers attended the REALTORS® Conference in New Orleans and met with NAR's legal counsel for half a day in Chicago. Yet, still the segment was full of major errors, NAR says.
NAR: What They Got Wrong
NAR is in communication with 60 Minutes and accuses the program for being unbalanced in its reporting and presentation of misinformation. NAR will be sending the CBS network a letter demanding an opportunity to correct any errors and misrepresentations. Here are some examples of the misinformation that NAR notes:
Error: The 6 percent commission is "sacrosanct."
Fact: All commissions are negotiable. The average commission rate is not 6 percent, but 5.1 percent, according to Real Trends.
Error: NAR is the industry's "governing body."
Fact: NAR is a trade association. It does not govern the industry.
Error: In 2003, NAR issued new rules of its own that threatened to block Internet discounters' access to the MLS.
Fact: The Virtual Office Web site policy did not block access to MLSs for discounters or any other brokers who are members of the MLS.
Error: The MLS is the database that lists virtually every home for sale in the country.
Fact: There is no single national MLS. Rather, there are more than 900 local and regional multiple listing services. These are not simply "databases" but a private exchange of offers of cooperation and compensation between real estate brokers.
Error: Eight states have "minimum service laws" that require REALTORS® to provide a level of service many Internet discounters can't afford.
Fact: "REALTOR®" is a trademarked term and should never be used synonymously with "real estate agent." The intent of minimum service laws is to ensure consumers receive a minimal level of service from licensees.
Error: The brokerage industry has a powerful lobby. Eleven states flatly prohibit rebates.
Fact: The intent of anti-rebate laws is to prevent kickbacks in real estate transactions, not to limit brokers' incentives to attract customers. The brokerage industry does not lobby for anti-rebate laws.
Other key points 60 Minutes misrepresented or overlooked that NAR cites include:
* NAR supports all business models and favors none. NAR's 1.3 million members include REALTORS® who work on a full-service basis, as well as those who consider themselves to be limited service, fee-for-service, minimum service, and discounters. NAR says it's great that consumers have a choice today.
* The real estate industry has harnessed technology for the benefit of consumers and will continue to do so. Real estate is both high-tech and high-touch, so it can be enhanced by both electronic and personal interaction.
* There is no such thing as a "standard commission." Commissions are negotiable and prices vary. The fact is that commission rates have decreased 16 percent from 1991 to 2004, according to Real Trends.
* The real estate business is unique in that competitors must also cooperate with each other to ensure a successful transaction, and MLS systems facilitate that cooperation. The first MLS was created more than 100 years ago as a way for brokers to share their listing agreements with each other in the hopes of procuring buyers for their properties more quickly and efficiently than they could on their own.
* The MLS is a tool to help listing brokers find cooperative buyer brokers to help sell their clients' homes. Without the collaborative incentive of the existing MLS, brokers would create their own separate systems, fragmenting rather than consolidating property information, NAR says.
NAR is encouraging real estate professionals to contact CBS to voice their concerns about the program.
— REALTOR® Magazine Online
The CBS show 60 Minutes gave the NATIONAL ASSOCIATION OF REALTORS® the empty chair treatment in a May 13 segment that examined the impact of online brokerages on the real estate industry. The show featured interviews with a representative from the now-defunct eRealty and the president and CEO of Redfin, but no one from NAR, even though NAR twice offered and prepared association spokespersons for interviews with Leslie Stahl.
NAR expressed disappointment that CBS made the decision it would rather interview opponents and let them make unanswered — and inaccurate and unfair — accusations about REALTORS® and NAR policies.
The one-sided journalism and egregious errors served no one well, especially the once-vaunted news magazine show, NAR says. NAR staff spent nearly a year working with CBS, briefing producers on the issues involved. The producers attended the REALTORS® Conference in New Orleans and met with NAR's legal counsel for half a day in Chicago. Yet, still the segment was full of major errors, NAR says.
NAR: What They Got Wrong
NAR is in communication with 60 Minutes and accuses the program for being unbalanced in its reporting and presentation of misinformation. NAR will be sending the CBS network a letter demanding an opportunity to correct any errors and misrepresentations. Here are some examples of the misinformation that NAR notes:
Error: The 6 percent commission is "sacrosanct."
Fact: All commissions are negotiable. The average commission rate is not 6 percent, but 5.1 percent, according to Real Trends.
Error: NAR is the industry's "governing body."
Fact: NAR is a trade association. It does not govern the industry.
Error: In 2003, NAR issued new rules of its own that threatened to block Internet discounters' access to the MLS.
Fact: The Virtual Office Web site policy did not block access to MLSs for discounters or any other brokers who are members of the MLS.
Error: The MLS is the database that lists virtually every home for sale in the country.
Fact: There is no single national MLS. Rather, there are more than 900 local and regional multiple listing services. These are not simply "databases" but a private exchange of offers of cooperation and compensation between real estate brokers.
Error: Eight states have "minimum service laws" that require REALTORS® to provide a level of service many Internet discounters can't afford.
Fact: "REALTOR®" is a trademarked term and should never be used synonymously with "real estate agent." The intent of minimum service laws is to ensure consumers receive a minimal level of service from licensees.
Error: The brokerage industry has a powerful lobby. Eleven states flatly prohibit rebates.
Fact: The intent of anti-rebate laws is to prevent kickbacks in real estate transactions, not to limit brokers' incentives to attract customers. The brokerage industry does not lobby for anti-rebate laws.
Other key points 60 Minutes misrepresented or overlooked that NAR cites include:
* NAR supports all business models and favors none. NAR's 1.3 million members include REALTORS® who work on a full-service basis, as well as those who consider themselves to be limited service, fee-for-service, minimum service, and discounters. NAR says it's great that consumers have a choice today.
* The real estate industry has harnessed technology for the benefit of consumers and will continue to do so. Real estate is both high-tech and high-touch, so it can be enhanced by both electronic and personal interaction.
* There is no such thing as a "standard commission." Commissions are negotiable and prices vary. The fact is that commission rates have decreased 16 percent from 1991 to 2004, according to Real Trends.
* The real estate business is unique in that competitors must also cooperate with each other to ensure a successful transaction, and MLS systems facilitate that cooperation. The first MLS was created more than 100 years ago as a way for brokers to share their listing agreements with each other in the hopes of procuring buyers for their properties more quickly and efficiently than they could on their own.
* The MLS is a tool to help listing brokers find cooperative buyer brokers to help sell their clients' homes. Without the collaborative incentive of the existing MLS, brokers would create their own separate systems, fragmenting rather than consolidating property information, NAR says.
NAR is encouraging real estate professionals to contact CBS to voice their concerns about the program.
— REALTOR® Magazine Online
Monday, May 7, 2007
Bank of America Rolls Out No-Fee Mortgage
Bank of America on Tuesday will begin offering nationally a no-fee mortgage, which will eliminate most of the charges that add a few thousand dollars to every closing.
Bank of America, which is the nation’s second largest lender by assets, has been offering this mortgage in Washington state since September. In February, it expanded the program to eight additional states. Tomorrow, it will begin advertising the “No Fee Mortgage Plus” nationally.
The loan also eliminates private mortgage insurance and the bank is guaranteeing its customers the best deal on interest rates and an on-time closing. Borrowers must put down at least 5 percent. The loans aren’t available to sub-prime customers.
Floyd Robinson, Bank of America's president of consumer real estate and insurance services, said the loan eliminates on average $3,350 in closing costs on a $200,000 loan.
No other major bank appears to be offering similar loans. Robinson says the bank is able to make money by cross-selling new products. "This is about a relationship more so than about a single product sell," he says.
Source: The Associated Press, Ieva M. Augstums (05/07/2007)
Bank of America, which is the nation’s second largest lender by assets, has been offering this mortgage in Washington state since September. In February, it expanded the program to eight additional states. Tomorrow, it will begin advertising the “No Fee Mortgage Plus” nationally.
The loan also eliminates private mortgage insurance and the bank is guaranteeing its customers the best deal on interest rates and an on-time closing. Borrowers must put down at least 5 percent. The loans aren’t available to sub-prime customers.
Floyd Robinson, Bank of America's president of consumer real estate and insurance services, said the loan eliminates on average $3,350 in closing costs on a $200,000 loan.
No other major bank appears to be offering similar loans. Robinson says the bank is able to make money by cross-selling new products. "This is about a relationship more so than about a single product sell," he says.
Source: The Associated Press, Ieva M. Augstums (05/07/2007)
Saturday, May 5, 2007
Buying a Home is (Not Really) Like Buying a Car
By Barry James
Anyone who has ever bought a car knows you must first find out the cost of similar cars in the marketplace. It's easy to gather the information you need from newspapers, the Blue Book, or online used car sales sites. Your research will provide you with the range of prices you might pay and you can make an informed purchase decision as a result. It's really pretty simple and requires very little pricing expertise.
If you want to buy a home, it's not so easy and certainly not simple. The value of a home is much more difficult to predict and the information available to homebuyers can be untrustworthy. Online home valuation sites are fun to play with, but they are based on past sales, not current market factors. Newspaper listings give you some information, but houses are usually so different that it's hard to compare. And, you don't know how many other buyers want to buy the same house. Competitive bidding can drive a house's price up beyond what you thought it was worth.
The best resource available to homebuyers to learn the current value of a home they might wish to purchase is a CMA, or Comparative Market Analysis. CMA is the term real estate agents use when they conduct an in-depth analysis of a home's worth in today's market.
The best part about a CMA is that it's usually free!
When should I ask for a CMA?
If you don't get a CMA you might offer a price that's more than the home is worth; conversely, you might submit a price that's too low and lose out to another, better informed homebuyer. Every real estate agent in the country will want to complete a CMA on the home you want to buy before helping you buy it. Buyers who haven't yet chosen a real estate agent often ask several agents to complete CMAs so there is opportunity to meet different agents and to see how they work.
How is a CMA prepared?
First, an agent will walk through the home you're thinking of buying. The agent will point out needed improvements that you might have to pay for after purchasing the home, or that you may ask the seller to address before buying the home.
Second, the agent will research information about comparable properties in the area, usually using a real estate industry resource called the Multiple Listing Service. This includes:
· Properties that have sold and closed within the last 12 months
· Active listings – properties currently for sale
· Pending sales – listings that have sold but not yet closed
· Expired listings – properties that did not sell during the listing period
· Lastly, the agent suggests a probable selling price. Don't be surprised if a CMA results in a price range rather than a set price, particularly in markets were there are price differences due to property size, age, architectural style or physical condition.
What can you expect to see in a CMA?
A completed CMA is presented in the form of a report, which includes the selling price, detailed information about the home, and the comparable properties that were researched to determine its value. Because the price derived from a CMA is somewhat subjective, some agents may include brief statements on the perceived selling points your home.
A CMA is not an appraisal.
A real estate appraisal is a comprehensive evaluation performed by an independent professional appraiser. With a CMA, the agent's experience in the business and familiarity with the local area can affect the accuracy. Typically, a CMA prepared by an experienced agent with good knowledge of the local market is right in line with the home's appraised value. A CMA can therefore be a very useful tool in a real estate transaction.
When buying your car an incorrect price might cost you a few hundred dollars. If you offer the wrong price for a home, you could lose tens of thousands of dollars, or not get the home of your dreams. Do your homework and ask a real estate professional for a Comparative Market Analysis to ensure you get the most value for your money.
Copyright © 2007 HomeGain.com, Inc.
Anyone who has ever bought a car knows you must first find out the cost of similar cars in the marketplace. It's easy to gather the information you need from newspapers, the Blue Book, or online used car sales sites. Your research will provide you with the range of prices you might pay and you can make an informed purchase decision as a result. It's really pretty simple and requires very little pricing expertise.
If you want to buy a home, it's not so easy and certainly not simple. The value of a home is much more difficult to predict and the information available to homebuyers can be untrustworthy. Online home valuation sites are fun to play with, but they are based on past sales, not current market factors. Newspaper listings give you some information, but houses are usually so different that it's hard to compare. And, you don't know how many other buyers want to buy the same house. Competitive bidding can drive a house's price up beyond what you thought it was worth.
The best resource available to homebuyers to learn the current value of a home they might wish to purchase is a CMA, or Comparative Market Analysis. CMA is the term real estate agents use when they conduct an in-depth analysis of a home's worth in today's market.
The best part about a CMA is that it's usually free!
When should I ask for a CMA?
If you don't get a CMA you might offer a price that's more than the home is worth; conversely, you might submit a price that's too low and lose out to another, better informed homebuyer. Every real estate agent in the country will want to complete a CMA on the home you want to buy before helping you buy it. Buyers who haven't yet chosen a real estate agent often ask several agents to complete CMAs so there is opportunity to meet different agents and to see how they work.
How is a CMA prepared?
First, an agent will walk through the home you're thinking of buying. The agent will point out needed improvements that you might have to pay for after purchasing the home, or that you may ask the seller to address before buying the home.
Second, the agent will research information about comparable properties in the area, usually using a real estate industry resource called the Multiple Listing Service. This includes:
· Properties that have sold and closed within the last 12 months
· Active listings – properties currently for sale
· Pending sales – listings that have sold but not yet closed
· Expired listings – properties that did not sell during the listing period
· Lastly, the agent suggests a probable selling price. Don't be surprised if a CMA results in a price range rather than a set price, particularly in markets were there are price differences due to property size, age, architectural style or physical condition.
What can you expect to see in a CMA?
A completed CMA is presented in the form of a report, which includes the selling price, detailed information about the home, and the comparable properties that were researched to determine its value. Because the price derived from a CMA is somewhat subjective, some agents may include brief statements on the perceived selling points your home.
A CMA is not an appraisal.
A real estate appraisal is a comprehensive evaluation performed by an independent professional appraiser. With a CMA, the agent's experience in the business and familiarity with the local area can affect the accuracy. Typically, a CMA prepared by an experienced agent with good knowledge of the local market is right in line with the home's appraised value. A CMA can therefore be a very useful tool in a real estate transaction.
When buying your car an incorrect price might cost you a few hundred dollars. If you offer the wrong price for a home, you could lose tens of thousands of dollars, or not get the home of your dreams. Do your homework and ask a real estate professional for a Comparative Market Analysis to ensure you get the most value for your money.
Copyright © 2007 HomeGain.com, Inc.
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