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  • El_flasko

    Ultimate Member
    Industry Partner
    Nov 16, 2008
    7,298
    Abingdon, MD
    So here we go...

    Today we heard talk of more rate hikes coming soon and whispers of more down the road. 30yr fixed FHA and VA rates have been hovering in the high 3's to low 4's for the last few weeks while conventional 30yrs have been in the low 4's for some time now (all for well qualified applicants).

    The purchase market has been surprisingly hot for those deciding to list prior to spring from what I've been seeing. Low inventory is producing multiple offers on many listings out there and the strongest financing offers are winning across the boards.

    As usual, call or email me with any questions you may have!

    Ryan
     

    tdt91

    I will miss you my friend
    Apr 24, 2009
    10,810
    Abingdon
    I heard that on the radio today. Existing home sales spiked in Jan.
    Ryan, whats driving this, consumer confidence or interest rates rising and the fence dwellers jumping in, or both?

    Whatever it is, it's good for my business. :party29:
     

    El_flasko

    Ultimate Member
    Industry Partner
    Nov 16, 2008
    7,298
    Abingdon, MD
    I heard that on the radio today. Existing home sales spiked in Jan.

    Ryan, whats driving this, consumer confidence or interest rates rising and the fence dwellers jumping in, or both?



    Whatever it is, it's good for my business. :party29:



    Fence jumpers, slowly rising rates, and guidelines loosening ever so slightly imho. Inventory is low from what I'm seeing so strong buyers are jumping at well priced homes. I'm writing prequalification letters left and right for Buyer's going after newly listed homes with 4+ offers on them. This spring will hopefully be very strong.
     

    tdt91

    I will miss you my friend
    Apr 24, 2009
    10,810
    Abingdon
    And I hope the starts go way up this year too! With the demand it only seems natural
     

    Bertfish

    Throw bread on me
    Mar 13, 2013
    17,606
    White Marsh, MD
    I know the rate hikes indicate a healthier economy but they could not come at a worse time for me.

    Bought my place in November of 2015, I think I'm at 3.75% or 4%. Had to take a damn ARM, though, which kicks in after 5 years. Figured I would refinance before the 5 year fixed rate window closed which is still a reality for me. With the rates going up though I feel like a refinance will actually cost me.
     

    protegeV

    Ready to go
    Apr 3, 2011
    46,880
    TX
    I know the rate hikes indicate a healthier economy but they could not come at a worse time for me.

    Bought my place in November of 2015, I think I'm at 3.75% or 4%. Had to take a damn ARM, though, which kicks in after 5 years. Figured I would refinance before the 5 year fixed rate window closed which is still a reality for me. With the rates going up though I feel like a refinance will actually cost me.

    Just curious, why did you HAVE to do an ARM?

    We're house hunting down in TX and I'm trying to find the balance between buying now while rates are low or later when rates go up and the sellers market cools off.
     

    TheBert

    The Member
    MDS Supporter
    Aug 10, 2013
    7,684
    Gaithersburg, Maryland
    Just curious, why did you HAVE to do an ARM?

    We're house hunting down in TX and I'm trying to find the balance between buying now while rates are low or later when rates go up and the sellers market cools off.

    The ARM allows you to buy the house you want to have in 5 years today. Just find the house you want, buy it and pay the going rate. If you settle for something now you will be upset when you see what you want in a few years and you have to pay higher rates.
     

    MEGARMS

    KnowNothing
    Jun 3, 2012
    3,843
    Carroll County
    The ARM allows you to buy the house you want to have in 5 years today. Just find the house you want, buy it and pay the going rate.

    And this my friends is a big part of the reason we had the meltdown the last time around. Too many people buying more house than they could afford in hopes that values would continue to rise. Really, really bad idea and it ended up costing the taxpayer billions of dollars.

    Here is an idea. Buy what you can afford now and then upgrade in 5 years if you can afford to do so.
     

    TheBert

    The Member
    MDS Supporter
    Aug 10, 2013
    7,684
    Gaithersburg, Maryland
    And this my friends is a big part of the reason we had the meltdown the last time around. Too many people buying more house than they could afford in hopes that values would continue to rise. Really, really bad idea and it ended up costing the taxpayer billions of dollars.

    Here is an idea. Buy what you can afford now and then upgrade in 5 years if you can afford to do so.

    Don't blame me for the mortgage industries products.
     

    protegeV

    Ready to go
    Apr 3, 2011
    46,880
    TX
    And this my friends is a big part of the reason we had the meltdown the last time around. Too many people buying more house than they could afford in hopes that values would continue to rise. Really, really bad idea and it ended up costing the taxpayer billions of dollars.

    Here is an idea. Buy what you can afford now and then upgrade in 5 years if you can afford to do so.

    I'm shocked what the bank thinks we can afford.
    We sat down and determined what we wanted to spend and the max we would stretch for the "perfect" place. And by stretch, I mean still well within our means. The number the bank gave me was 25% higher than our highest number. There's no way I would spend that...
     

    Sticky

    Beware of Dog
    MDS Supporter
    Mar 16, 2013
    4,500
    AA Co
    Don't blame me for the mortgage industries products.

    I'm shocked what the bank thinks we can afford.
    We sat down and determined what we wanted to spend and the max we would stretch for the "perfect" place. And by stretch, I mean still well within our means. The number the bank gave me was 25% higher than our highest number. There's no way I would spend that...
    and herein lies the issue... it's what led to the last tumble and it could well again... the customers are out there, they just need to be 'properly' qualified for the system to stay intact. ;)
     

    j_h_smith

    Ultimate Member
    Jul 28, 2007
    28,516
    My son (lives near Philadelphia) just signed papers to refinance. He's happy with the terms. My second oldest son (lives in California) is wanting to look at buying his first house (condo is all he can afford). Seems like Spring has sprung early for the housing markets around the country.

    Hope this means a lot of business for you Ryan.

    Thanks for keeping us all up to date.
     

    terp91

    Active Member
    Mar 14, 2013
    204
    Halethorpe
    I'm shocked what the bank thinks we can afford.
    We sat down and determined what we wanted to spend and the max we would stretch for the "perfect" place. And by stretch, I mean still well within our means. The number the bank gave me was 25% higher than our highest number. There's no way I would spend that...

    Idk how the banks come up with their max approval numbers, but whatever method they use is nuts. Last year I was approved for nearly 450% of my annual pay as a single male in mid 20s. No way I was going anywhere near that amount or I'd be living on rice and beans for the next decade
     

    j_h_smith

    Ultimate Member
    Jul 28, 2007
    28,516
    Idk how the banks come up with their max approval numbers, but whatever method they use is nuts. Last year I was approved for nearly 450% of my annual pay as a single male in mid 20s. No way I was going anywhere near that amount or I'd be living on rice and beans for the next decade

    This practice was supposed to stop after the banking collapse. But I guess they've returned to their old habits. I've heard rumors of this being more of a problem now than it was before the collapse. That's why I've heard if it happens again, it will be real with major consequences.

    Lets hope they're wrong!
     

    terp91

    Active Member
    Mar 14, 2013
    204
    Halethorpe
    This practice was supposed to stop after the banking collapse. But I guess they've returned to their old habits. I've heard rumors of this being more of a problem now than it was before the collapse. That's why I've heard if it happens again, it will be real with major consequences.

    Lets hope they're wrong!


    I know a couple people who have been able to purchase way more house in the last year and a half than their job indicates they should be able to afford. I'm guessing there will be a small drop in the next five years if the economy isn't strong, or within 15 if it is. Hopefully I'm way off base on these.

    But it isn't even just homes, the auto industry is getting in on overzealous loans as well. One of my coworkers just bought a house and a new truck in the same month. How he can pay for both is beyond me. Maybe he never plans to retire so isn't saving anything?
     

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