WASHINGTON — Average U.S. long-term mortgage rates arrested their five-week decline this week but the benchmark 30-year loan remained below 4 percent. Mortgage company Freddie Mac said Thursday the nationwide average for a 30-year mortgage rose to 3.98 percent from 3.92 percent last week. It remained at its lowest level since June 2013. The rate stood at 4.53 percent back in January.
The average for a 15-year mortgage, a popular choice for people who are refinancing, increased to 3.13 percent from 3.08 percent. The sustained decline in long-term rates sparked a boomlet of homeowners looking to refinance mortgages. Homeowners eager for a bargain rate fired off inquiries to lenders. Applications for “re-fi’s” jumped 23 percent in the week ended Oct. 17 — reaching their highest level since November 2013, according to the Mortgage Bankers Association. But refinance applications fell 7 percent in the latest week, ended Oct. 24.
In recent weeks concern over global economic weaknesses brought market turmoil and sent investors seeking safety by pouring money into U.S. Treasurys. Higher demand drives up prices for those government bonds and causes their yields to drop. The yield on the 10-year Treasury note touched new lows. Mortgage rates often follow the yield in the 10-year note.
This week, the 10-year note rose to 2.32 percent Wednesday from 2.22 percent the previous week. The note traded at 2.29 percent Thursday morning.
To calculate average mortgage rates, Freddie Mac surveys lenders across the country between Monday and Wednesday each week. The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.
The average fee for a 30-year mortgage was unchanged from last week at 0.5 point. The fee for a 15-year mortgage also remained at 0.5 point. The average rate on a five-year adjustable-rate mortgage rose to 2.94 percent from 2.91 percent. The fee was steady at 0.5 point.
For a one-year ARM, the average rate edged up to 2.43 percent from to 2.41 percent. The fee held at 0.4 point.
In a divorce, it’s bad enough that you’re losing someone you once loved or may still love. It’s even worse when you find out you may lose your house, too. And finding a replacement, much like starting a love life all over, won’t be easy. After all, lenders tend to give mortgage loans to people with good credit and a solid stream of income. If you were previously a two-income household, you aren’t now, and if you’re paying alimony, you have less money than you did.
Whether you’re in the midst of a divorce or its aftermath, here are some things you can do to land a mortgage and what you can reasonably expect.
You may want to get your name or your ex’s name off the mortgage. But perhaps not; it depends. If you are planning to buy a house, and your ex is living in the home you co-own, then ideally, your ex
It can be difficult for a person paying alimony to buy a house because of the way lenders look at that alimony.
needs to refinance in his or her name. That will decrease your debt and increase your odds of being able to get a new mortgage.
What if your ex can’t refinance on her or his own? If you’d like to see your ex and the kids remain in the house, you may want to leave your name on the mortgage and co-own the house for a while with your ex.
“People do that all the time,” says Katie Connell, a family law attorney with Boyd Collar Nolen & Tuggle in Atlanta and a governor-appointed member of the Georgia Commission on Child Support. “I’m stereotyping, but often a woman who didn’t work full time and doesn’t have the income stream or the credit to buy her own house, she and her ex-husband have agreed, with their family transitioning and changing, that it’s in their better interest to keep mom and the kids in the house for, say, four or five years or when the kids go into their college freshman year,” she says. “The husband is often willing to essentially extend his credit to his ex-wife by letting his name stay on the mortgage.”
If you’re going that route, Connell says you’ll want to work out details about how profits will be split once the house is sold down the road. It may not be an equal split since one ex-spouse will be likely making the mortgage payments and possibly spending money to maintain the home for those extra years.
Connell says that arrangement tends to work better if the ex without the house still has enough income and good credit to buy a new home of his or her own.
Don’t buy a home during the divorce proceedings. Even if you’re rich beyond belief, and your credit and income stream are solid, it’s still a risky move. Connell says one of her clients lost $10,000 in earnest money when he tried to buy a house during his divorce proceedings.
“He had great credit, a very good income, but when the lender found out he was going through a divorce, they said, ‘Your alimony and child support payments are question marks,'” Connell says. “By the
Some lenders won’t even consider letting a divorced person who receives alimony use that alimony as evidence of income….
way, this client had a different lawyer back then. If I had been representing him, I would have said, ‘Don’t do it!'”
Connell adds that when the client’s ex learned he lost $10,000 in earnest money, the ex’s lawyer naturally felt that the ex was entitled to at least half of that money – it was, after all, money that otherwise would have been in the pot of assets to split.
It can be difficult for a person paying alimony to buy a house because of the way lenders look at that alimony. “Alimony is considered a debt,” says Susan Pryor, branch manager of Silverton Mortgage Specialists, a direct lender in Atlanta. “If you make $10,000 a month and give $3,000 to your ex-spouse, the lender doesn’t look at it like you’re making $7,000 a month. They look at it like you have a $3,000 car payment every month.”
Where should you live during the divorce proceedings? Assuming you aren’t selling the house immediately and you’re both looking for a place to rent, there are two common approaches couples take, according to Connell.
Stay in your house with your soon-to-be ex. “We definitely see more people grinning and bearing it and living together longer,” Connell says. “We saw a lot of that in this last recession.” It’s an idea that makes some sense. Living together awhile longer will save you both money. And especially if you have children, maintaining a civil relationship under the same roof may help with your post-divorce relationship.
You could nest. You hear “nesting” used a lot in pregnancy, but Connell says that in the divorce industry, the term refers to renting an apartment near the house and living there while a divorce is worked out. “We see a lot of couples who take turns living there, and the kids stay in the house,” Connell says.
Connell adds the latter arrangement may not work for couples who still harbor a lot of anger or suspicion. She recalls an instance where a wife was convinced the husband was unplugging lamps and cable cords throughout the house before he would leave for the week.
“No damage or harm was done, but [the wife felt] it was just to be a pest,” Connell says. Meanwhile, the husband said the cords came unplugged from his vacuuming, and that the wife was leaving dirty dishes in the sink.
Whatever you do, Pryor urges divorcing homeowners to not rush their decision of where to live next. “You may be under tremendous stress, and it’s an emotional situation. Divorce can shake your planning, and you may not be able to make the right decisions,” she says.
Besides, you may not be able to rush, even if you want to. Some lenders won’t even consider letting a divorced person who receives alimony use that alimony as evidence of income until there’s a six-month history of alimony payments being paid on time, Connell says.
You may be better off without a mortgage. This may be the last thing you want to hear if you want to hang onto your house or buy a new home. But the money math may not add up.
It’s a common mistake with divorced homeowners, says Jean Ann Dorrell, a certified estate planner in Sumter County, Florida. Many people, she says, are “trying to hold onto a house because it’s where the kids grew up or because you don’t want the kids to have to change schools, you don’t want to lose friends and you stay too long trying to afford something you never could have or should have.”
Pryor agrees. “We see it a lot,” she says. “It’s especially emotional when children are involved.” She adds that spouses who didn’t know a divorce was coming tend to be the ones who can’t face their new budget.
Pryor recommends professional help for anyone divorced and struggling to keep their home or figure out where to live next.
“I think it’s important to do some financial planning, and there are planners who focus on divorce, so you can see what money is coming in and what’s going out,” Pryor says. “Just because you can barely make that mortgage payment every month doesn’t mean you should stay in the house.”
Buying a house is a little like asking someone to marry you. In both cases, you make your offer believing there’s a good chance you’ll get a yes, but you know you could get a no. If the answer is yes in either situation, your fates will be linked for many years to come — possibly until death do you part. But if you don’t get an immediate answer, the wait can be excruciating. We may not be able to help you with your love life, but if you want your house offer to be greeted with a yes — and a quick one — here are four rules to follow.
Be likable. Money talks, but so do you. And you don’t want to say anything that could turn off a seller.
“You’re most likely buying someone’s home that they have memories and a lot of emotional ties to,” says Marc Takacs, a real estate agent with Keller Williams Realty in Atlanta. So if the seller is present when you see the house, keep quiet about your grand plans for landscaping or repainting the living room.
“Don’t tell someone how bad, ugly, stupid, etcetera, that someone’s house is, and then try to buy it. That doesn’t work,” Takacs says.
Well, it might, if the homeowner is desperate and primed to sell, but if there are other buyers circling, you’ve given the seller an excuse to reject your offer and accept someone else’s.
Another no-no, according to Takacs, is being high-maintenance. “Don’t overstay your welcome,” he advises. “I don’t think anything irritates a seller more than when a buyer visits a house too much or stays for too long.”
He also suggests that when you submit your offer, avoid making unreasonable demands such as a lightning-fast closing date. “Try to be considerate of the fact people are trying to carry on with their lives, move and all the other stuff that goes along with that. Being pushed out of your house can be very unsettling,” Takacs says.
Don’t be stingy with your offer, but don’t overreach. If you offer exactly what the seller is asking, you will get his or her attention and probably their respect and appreciation. In many cases, your offer
“If you buy it for more than you can afford, you’ll end up hating the house and yourself in the long run.”
will be accepted. Offer a tad bit more, and you may chase other buyers away whose offers are at or below the list price.
At the other end of the spectrum, a lowball offer may insult the homeowner. In some instances, it may be shrewd to offer significantly less than the list price, but first consult your real estate agent, who will probably have the best read on what your seller is likely to accept.
If you’re looking to make the strongest offer possible, make sure it’s not so high that you can’t afford it, warns Kelly Long, a Chicago-based money coach and member of the National CPA Financial Literacy Commission. “Don’t offer more than you can practically afford, even if you’re approved for more,” she says, adding that this can easily happen if you’re looking at a house that’s out of your price range.
“If you buy it for more than you can afford, you’ll end up hating the house and yourself in the long run,” she says.
That’s because the more expensive your house is, the higher your monthly payments will likely be. Long cites the rule of thumb that a monthly payment shouldn’t exceed more than 28 percent of your gross income. That includes taxes and insurance, she adds.
Be ready for a yes. If the seller says no, the next steps are clear enough: You make a better offer, or continue house-hunting. But even if the seller accepts the offer, you don’t have those front door keys yet.
“You may be pre-approved based on your credit report and supplying your W-2, but the [mortgage] application process is much more involved and requires extensive documentation in a short window of time,” Long says. “Make sure you have some time set aside to gather all the necessary information in the week following the offer’s acceptance. You’ll also need to schedule, attend and pay for an inspection in that first week, so make sure you have the money on hand to pay for that.”
You may also be asked to offer earnest money, a deposit you give a homeowner to show you’re serious about your offer. Generally, earnest money is anywhere from 1 percent to 3 percent of the house’s total purchase price. You can get the money back if the sale doesn’t go through, but you can also lose it if you flake out and decide not to buy the house for no reason, or you don’t follow what you’ve agreed to in the purchase contract.
Don’t sabotage yourself to seal the deal. Speaking of that contract, be careful about what you put in it.
Yes, you want the house. You want the sellers to like you. But in an effort to get those keys from the sellers, don’t be their doormat.
According to Kent Sisk, an account executive at NexTitle, a title and escrow agency based in Bellevue, Washington, “the market is so hot right now [that] many buyers are waiving the inspection period, sometimes waiving the inspection altogether, in order to get their offer approved.”
After all, you don’t want to learn after you buy the house that the roof leaks or there’s mold hidden away in the ventilation. Or you may end up berating yourself if you waive the appraisal contingency, which lets you back out of the deal if the lender concludes the appraised value is less the sale price, and later learn that you vastly overpaid for your home.
Ideally, your offer will be one that makes everyone, the seller and you, happy and reassured that everything between now and the closing will go smoothly. If you feel like you need to win this house at all costs and things go badly after your offer is accepted, not only will you lose — it will definitely cost you.
If you work from home, having an inspiring home office to call your own is something you may wish for – but have you ever considered that it may help your career, too? Whether or not you have client meetings at home, a workspace that is not only functional but beautiful might just inspire and motivate you to go the extra mile. (After all, who wants to show up to work in sweatpants when your office looks like a million bucks?) Ready, set, let’s get to work!
Modern Moroccan. Glossy black walls, trim and floors create an opulent backdrop for a plush Moroccan-style rug and a hammered pendant light in this stunning home office.
If your room gets good natural light, the high sheen of the black walls will actually help the room feel brighter than you might think — but be aware that rooms without much natural light may feel too dark with black walls.
In a mostly black and white scheme, it often helps to include a small touch of color, like the pink Mongolian lamb pillow in this space; a colorful vase or tray would also work.
When we take a step back, we can see that this workspace has sliding glass doors. These are a great choice for a home office, because they provide privacy when you need it while still allowing natural light in from the next room.
Elegant textures. Mixing textures is a great way to create an elegant look. Here a hemp grass cloth brings richness and depth to the walls, while a high-gloss lacquered table brings the shine. The elegant chandelier, table lamp with black shade and soothing color palette are refined and graceful.
Tip: Have a cute vintage desk with a poor finish? Revive it by having it professionally lacquered in a hue you love.
Bright and modern. This fun, sun-drenched workspace is built around simple basics: white walls, light floors, a Parsons desk and a sheepskin rug. Pairing a modern chair with a vintage Louis armchair is a great way to build creative tension. A single large, colorful piece of artwork, a bright cushion and a coral lamp add personality.
Tip: Want to float your desk in the center of the room but need to plug in? If you’re not planning to hire an electrician to add outlets anytime soon, simply place your desk perpendicular to the wall instead. You’ll get the feeling of a centered desk, but your cord will be able to reach the wall.
Laid-back chic. A simple desk, black pendant light, classic fretwork desk chair and kilim rug create a cozy, homey feeling in this office — but then things take a less expected turn with a red zebra-print armchair and big botanical wall chart thrown into the mix.
Neon pop. A simple space can be made current with just a few additions: a black and white striped rug, stools with neon painted bases and a bold canvas on the wall. If you use your office more for projects than computer work, consider going with a comfy settee instead of a traditional desk chair.
Tip: Wish you had a great big piece of art for the wall? If you’re artistic or adventurous, try making your own. Blank, prestretched canvases are available at art stores, and a simple design can be accomplished even by DIY newbies. Go freehand, or for a crisp look, mark out the pattern using painter’s tape before applying color, and let each shade dry before adding the next to avoid smudging.
Fresh air. An oversize pendant light from Ikea sets the tone in this delightfully charming space. A big, cushy ottoman in the center of the room can do double duty as an extra seat and a coffee table, and the love seat is perfect for welcoming visitors. A light, spring-inspired color palette and stylized floral motifs make for a fresh, feminine space.
Posh eclectic. Blue lacquered walls, a zebra-print rug and antique armchairs mingle in this swanky home office. An oversize botanical art print and a bright orange table lamp have a youthful energy that helps the space feel fun and comfortable, even with all of the high-style glamour.
Professional polish. Just because you’re not in a big office building doesn’t mean you shouldn’t treat your workspace with the same respect you would if you were surrounded by colleagues. Try setting out your business cards on a glamorous tray; put matching pens or pencils in a gleaming metal holder; and use real stationery to pen thank-yous from time to time instead of emailing.
In July, more than half of the single family residences in Huntington Beach reduced the asking price of their home before entering or closing escrow. Last year at this time, it was just under half. Typically a reduced price correlates with extended…
Homeowners who stop paying their mortgage do so for a host of reasons. Lives and financial circumstances change. Job loss or relocation might put consumers in a bind. Housing values can plummet, leaving homeowners owing far more than the property is worth. About 6 percent of all mortgage loans were at least one payment behind at the end of the March, according to the Mortgage Bankers Association.
Whatever the catalyst, deciding to forgo that monthly payment is a choice few take lightly. Foreclosure can inflict serious damage on your credit. It’ll also make obtaining another home loan next to impossible in the short-term. Missing one or even a couple mortgage payments doesn’t
There’s no significant difference in score impact between a foreclosure and a short sale or deed-in-lieu of foreclosure. They’re all going to hurt.
mean foreclosure is imminent. But forgoing them will set in motion a process that can have long-lasting consequences for your credit and finances.
New Foreclosure Procedures: Deceptive practices and mismanagement regarding distressed borrowers remains one of the more disturbing legacies of the housing crisis. New foreclosure avoidance procedures crafted by the Consumer Financial Protection Bureau took effect earlier this year. Mortgage servicers must now send written notice to homeowners before they become 45 days delinquent. That notice will include information on all available foreclosure avoidance options, such as a loan modification or a short sale. Under a loan modification, the servicer will add the delinquent payments and penalties to the loan balance and create a new payment plan.
A short sale is when the servicer allows the homeowner to sell the property for less than they owe. There are also additional protections for military members facing the prospect of mortgage default. There are two basic types of foreclosure — judicial and non-judicial — and what you encounter will depend in part on where you live. The major difference is a judicial foreclosure requires formal court proceedings, which usually means a more drawn-out process. In a non-judicial setting, the servicer can initiate a foreclosure sale without a judge’s approval. Neither path is especially speedy. It took banks 572 days on average to complete the foreclosure process, according to first quarter data from RealtyTrac.
But the wait was considerably longer in some states where judicial foreclosure is the primary path, including New Jersey (1,103 days), New York (986 days) Florida (935 days) and Hawaii (840 days). The lag time gives homeowners ample time to evaluate their options. And keep in mind that servicers can’t formally file for foreclosure until you’re more than 120 days delinquent on your mortgage. They’re also not allowed to start the process if you’ve applied for assistance.
Avoiding Foreclosure: Homeowners hoping to keep their property will need to work with their servicer toward an acceptable mitigation plan. The government has a pair of programs that might also be able to help distressed borrowers, one geared toward refinancing your mortgage and another focused on modifying the existing loan. Those who can’t or don’t want to continue making payments can explore a short sale or a deed-in-lieu of foreclosure, which involves the borrower deeding the property back to the servicer.
Filing for bankruptcy protection can also allow homeowners to temporarily halt the foreclosure process. Every borrower’s situation is different. Consulting with financial professionals and attorneys can help provide clarity in terms of how best to proceed in your specific situation. If you continue missing payments or otherwise fail to finalize or make good on a loss mitigation plan, the servicer will trudge on toward foreclosure.
Credit Consequences: No matter what route you choose, foreclosure — as well as a short sale or deed-in-lieu of foreclosure — will hurt your credit profile. How much depends in part on what kind of credit you had going in to the foreclosure. (If you’re not sure what condition your credit is in now, there are many resources that allow you to check your credit scores for free, including Credit.com.)
FICO studies have shown consumers with high scores could lose up to 160 points, a drop that could take as long as seven years to fully rebound. Contrary to common misconception, FICO also found there’s no significant difference in score impact between a foreclosure and a short sale or deed-in-lieu of foreclosure. They’re all going to hurt. Homeowners who experience a foreclosure will also likely need to wait at least two years to purchase another home. But the wait can be longer, depending on the type of loan they lost, the type they’re pursuing and other specific factors.
As the housing market’s recovery continues, there are some trends in design for this year’s high season.
1. Open: The biggest change in home design of the past quarter century is most likely the open concept kitchen. While traditionally the kitchen was hidden away and disconnected from the rest of the house, we now use kitchens as an opening to our living space. The focus on entertaining guests may be a source for this trend as open spaces maximize the ability to gather and relax with friends and family even while still preparing refreshments. It looks like this idea is here to stay and the walls will
Spaces are currently being designed for aging consumers.;
continue to come down between rooms of different function.
2. Neutral: Neutral palettes are dominating in the home and replacing the use of bright colors. White, sandy and gray tones are popular among the main features while bold colors pop up in small details, like throw pillows, lighting or backsplash. Subtle glamour is also emphasized through small decor dazzling against the neutral background.
3. Universal: Spaces are currently being designed for aging consumers; more Americans want to age in place. Universal design elements like having the master bedroom on the first floor, low drawer appliances and showers that accommodate benches or bars are growing in popularity to accommodate people who anticipate having less mobility in the future.
4. Quartz: When it comes to kitchens and bathrooms, factory-engineered quartz is taking the market by storm. While granite was the most popular countertop material for more than a decade, it appears it is being replaced. With the same professional look and feel as granite, quartz resists cracking and chipping and is non-porous so it is easier to clean and rarely gets stains.
5. Green: Energy-efficient and water-saving appliances are now standard in new or renovated homes. Touchless faucets, smaller master bathtubs, high-efficiency light fixtures, toilets and dishwashers have become preferred options as energy and financial savings can be significant. These are not only green options, but savings that homeowners can clearly see in their bills.