Educate yourself, you probably need less money than you thinkAre you renting a home? Would you like to own your own home? What is holding you back?  According to a recent survey done by the National Association of Realtors:Only 11% of current renters know they can purchase a home with 5 % or Less as a down payment.A WHOPPING 89% got the answer wrong thinking you need more than a 5% down payment.Scarier yet:  Almost 45% of renters believe you need to put at least 20% down to buy a home.Is this misconception keeping you from purchasing a home?You probably can get away with a lower down payment than you think, Here are the current minimum down payments available to qualified buyers for common programs: Conventional Loans as little as 3% down  FHA Loans 3.5% down (FHA also reduced its mortg... 04/24/2023

USDA announced it is reviewing the Rural Areas, It appears that in NJ we may lose a few eligible areas.Every 5 years USDA does a review and adjusts the designated areas of eligibility. Why is this important? USDA is one of the BEST ways to purchase a home with no down payment.  There are geographical restrictions and income limits, but at the end of the day- they are reasonable and offer buyers an option for a great market interest rate and No PMI, just an inexpensive Guarantee fee that is a fraction of typical Mortgage insurance.In NJ these are the areas we may lose eligibility:I have highlighted the ones I feel will hurt the most, and common areas I use the USDA program for my clients.If you are curious about other areas of the country that are facing changes you can see the full list... 03/28/2023

 FHA Loans Just got MUCH more affordable After years of being one of the more expensive options for mortgage insurance this is welcome news.  In many cases FHA will now be the less expensive option for mortgage insurance for low down payment borrowers vs conventional mortgages.The typical 3.5% down FHA loan will  see the Monthly Mortgage Insurance Premium dropping from .85 to .55. (for loans under $726,200)What does that all mean in English?In my market a typical FHA borrower will likely have a $400,000 mortgage.   Prior to this change the MIP would cost about $283/month and after the change it will be about $183/month - A WHOPPING $100 less per month!The FHFA that oversees the agencies has made it a mission to make homes more affordable for all. We can see that in recent changes to Con... 02/28/2023

LLPAs/Add-ons Significant increases!For Conventional Mortgages there have been Loan Level Price adjustments since 2008. Simply put- not everyone gets the same rate with these adjustors adding price for risk.While there has always been some minor adjustments to the LLPAs each year this is the biggest change since the advent of LLPAs. We will start seeing these changes on rate sheets in the next few weeks for 60 day locks... Here are some of the highlights:The negative side: Ever since we had LLPAs 740 was the magic number for credit scores. This will be a significant change with 2 new credit buckets 760+ and 780+  So the new magic number for Credit score is 780. There are higher add-ons for most loans with credit scores between 680-779 Refinances will be significantly more expensive VS a... 02/01/2023

Down payment assistance, for everyone?? Well, maybe not for everyone but darn close.At Homebridge we have a new program that can help buyers that are tight on cash and provide them either 3.5% or 5% down payment assistance. There is the possibility the DPA can be forgiven after 5 years of on time payments, but there are a few ways to structure things that may  be a better fit for you.  This program is available with NO income restrictions, and you do NOT have to be a First time buyer.It will be based on an FHA loan with FHA MIP and generous ratios. and based on FHA loan limits for your area.Do you think this will be a good fit for you? If so, reach out to me, I would be happy to help.  And if you want to see 30 seconds of my talking head you can find me on  IG: @Robrauf  (IG is definite... 01/13/2023

 Now & LaterI’m sure you’ve heard variations on the theme: Marry the house, date the mortgage…. Well, we have a Program for that - Our Now & Later program (not the candy!!). When your clients buy and finance a home with me and close by April 1, 2023 we will give them a $1,500 coupon towards their future refinance. Here’s the details:  Buyer buys a home and closes their mortgage with Homebridge by 4/1/23 Pays their mortgage on time, every time for at least 7 months. Buyer then submits a refinance with me/Homebridge by 12/31/24 (a two year window) We pay $1500 towards there refinance closing costs This applies to FNMA, FHLMC, VA, FHA and USDA, not for Bonds or Simple Access programs. Buy the house, begin building equity and refinance it when rates drop.  The markets feel we will see inter... 12/06/2022

 Buydowns: Don’t get caught up in the Hype. Buydowns are NOT the greatest thing since sliced bread. They aren’t new, in fact they are an ancient tool we put at the bottom of the toolbox 30yrs ago because it doesn’t work as well as others at our disposal.   Here’s why: In today’s world a seller MUST pay for the buydown.  Last I checked it is still a seller’s market (at least it is in my market) and seller concessions are not the norm. You will also have to qualify at the note rate, so the highest years rate is where your ratios are based so qualifying may actually be more difficult with a buydown. Back in the 80s and early 90s we used 2/1 buydowns all the time as a tool to qualify at a lower rate. When guidelines changed and didn’t allow for that anymore we stopped using them.  With inte... 11/09/2022

PENDING! EYE APPEAL, LOCATION, EXPANSION POSSIBILITIES...all make homes sell! This home has all three! Enjoy the heart of summer living in this gracefully middle-aged Cape Cod situated on a corner lot just blocks from the best restaurants and amusements LBI has to offer! This charming shore home offers south-facing windows in the spacious living area that bathe the room in light, large kitchen with adjoining utility room and laundry room, along with exterior access to large, fenced backyard for those afternoon barbecues. The oversized detached garage with work bench is perfect for those families with hobbies offering ample storage area for surf boards, beach chairs and bikes. This Island Retreat boasts 2 bedrooms with hardwood flooring, cable hookup and room for your king-size furniture... 11/06/2022

The Sky is NOT falling, and the bubble is not going to pop.I have seen so much doom and gloom in the Real Estate world, and a lot of it is in the Mainstream Media.. Nothing sells better than a negative headline, and unfortunately news is a business that sells advertising.So, are housing prices falling as some have said?  I don't see it.  We are seeing price reductions on listings, but that is because they were priced wrong to start with, not because there are not buyers out there willing to pay market price.  Inventory is up, so prices must be going down.. Ummmm, again- look at the data yourself. Yes we have more inventory.. but it was at abysmal levels and arguably still is. Take a look at this graph of inventory for single family homes:This is as far back as inventory data goes, but I... 10/14/2022

NEW CONFORMING LIMIT ANNOUNCEMENT With prices continuing to climb for residential Real Estate, it is no surprise to see another increase in the conforming limit.  We are up a little more than 10% from last years limit with a Maximum loan amount for a single family conforming loan now at $715,000 ($1,073,000 for Alaska and Hawaii). We will begin offering this loan amount for single family homes immediately for new applications.  High Balance loan limits or 2-4 family Loan limits will stay the same until we receive more information from Fannie and Freddie.  We do anticipate the High Balance limit will be over 7 figures, matching AK and HI above.Fun Fact: When I first started in the business the Conforming loan limit was $153,100 ad we didn't have a high balance option.  Anything above $15... 09/13/2022

 With the latest Fannie announcement today (SEL-2022-08) we have new acceptable sources for gifts:Assets and verification of assets  has always been Strict on Mortgages. FNMA has made Gift giving a little easier with this latest update. FNMA now has 3 categories of donors: Relative Unmarried Partner (new) Unrelated Friend (new) The 2 new categories are for non-relatives that share a familial relationship with the borrower.  These are defined as A domestic partner of the borrower An individual engaged to marry the borrower A former relative of the borrower A Godparent of the borrower A relative of the domestic partner of the borrower previously we were not allowed to accept gifts from anyone other than a relative so this is certainly an improvement on the guidelines.  Keep in mind that c... 09/07/2022

Buyer Fatigue: Our buyers have not had it easy in this market and they are tired. We need to keep them engaged and optimistic. (I think we may even have some agent Fatigue as well?) While inventory is not great, it is improving.  Bidding wars still exist but not to the extent they were last year.  Buyers: It is still a good time to buy, especially with the big increase in rent payments we have been seeing. Agents: Use the tools we have available - There is a true cost to waiting. Reach back out to your tired buyers and reconnect With news overload and a difficult market there is less competition, while still a seller's market it is becoming more friendly to buyers and every forecast is still showing home prices increasing for years to come.Rates, Inflation, etc… Fed Chair Powell spooked... 08/30/2022

Not Human Arms, but Adjustable Rate Mortgages, ARMs for short.(Because everything in the mortgage world is an acronym)With the uptick in interest rates this year we have had numerous inquiries about Adjustable Rate Mortgages.. but we have really not been using them for our traditional buyers at all.For most of 2022 the Yield curve has been very flat, meaning there has been almost no difference between long term and short term interest rates. This has caused ARMs to be effectively non existent. In recent weeks we have seen the yield curve invert significantly... In English: Long term rates have actually been lower than Short term rates.  Here is an example from this morning: Yesterday this was even worse with the 10 year being 0.55% lower than the 2yr which is opposite what you would exp... 08/19/2022

 Personal Time:  Our business can be a huge mental drain. Make sure you have something outside of work to shut work off and have it on your schedule as an appointment. If you do not, you will burn out. For me #1 is sailing and a close second is wood working. “Me Time” is important for your mental health. I could write volumes about this topic… simply put: Find something for YOU and make time for it.                                                                                                                          FED: The Federal reserve announced at 2pm yesterday a 75 basis point increase in Fed Funds (as anticipated) and they also confirmed they will continue to reduce their balance sheet and “ongoing rate hikes are appropriate”. Post meeting comments from Chairman Powell were al... 07/28/2022

 Product Spotlight:  Our Simple Access Cash Flow program is here to help your investors! With skyrocketing rents, it is very likely that investors can buy homes with positive cashflow and our investor program will ONLY look at the PITI verses the market rent…  If the property carries itself that is the only income qualifier. Of course, we will still need to run credit and verify assets. This cannot be used for first time buyers or for someone that doesn’t currently own a primary home.                                                                                                                          Recession: Based on current indicators it is very likely we will see a recession in the next year or so. 1st quarter GDP is already an indicator as is the inverted yield curve. While Rec... 07/06/2022

  Product Spotlight:  Have you had any difficult to qualify clients? Our Simple Access program is here to help! This program will help Self Employed buyers qualify allowing us to use: 12-24 Months of bank statements to show cash flow instead of tax returns. 1099s only Investment property, Cashflow using only the market rent VS the PITI to qualify. While not a “no doc” these are great ways to get clients into homes when their CPA is a little too good at finding write-offs.                                                                                                                          Interest rates: Did someone say Federal Reserve?  Unless you were living under a rock last week, I am sure you heard the Fed Increased Fed Funds 0.75% on Wednesday. On the surface you probably think ... 06/23/2022

As I came up with the idea for this post, and started to put it together I realize it sounds like I am anti Association...That is not true, but there are things to be aware of when purchasing a home the is in an association.Beyond some of the obvious items that include rules you must abide by, assigned parking, and use of your property there are some less obvious things that you need to consider when buying. Hidden Fees: While not actually hidden, they are more of an "unknown" you need to ask about. Most associations have fees to join. The most common one is a Capital Contribution which can range from a few hundred to a few thousand dollars. While this can be painful when you buy, as an owner they will help to keep the association healthy in the future. In addition, if you are buying a ... 04/20/2022

 First off... I have spent almost 35yrs in this crazy business in a predominantly zero point market place in NJ.  In English: We don't pay points here (not often at least)If you have not been paying attention we have had a pretty solid 2% increase in rate since the end of 2021, and even more if you go back a year or so.  It is rare that rates move that quickly, we hit 5 much faster than we thought we would and it is looking like 6 will come this year as well.When interest rates make fast moves like that we experience "Price Compression" where interest rates stack on top of each other. While this does happen often and it can become cheap to buy the next eighth, it usually is short lived.  In today's market you can often grab at least 1/2% improvement in rate for 1 point for a conventiona... 04/07/2022

There is a widely popular TV Commercial that has a Cow telling you how to boost your credit scores... in my experience it has not helped my clients.To be fair, I have not seen a before and after with this service, but I have seen numerous clients that have used it and they never have great scores, just a confusing report with "self reported" items adding monthly payments that need to be sorted out from the "real stuff" With so many automated systems running behind the scenes this is a recipe for trouble since a computer is not smart and only sees more debt. While this service may help someone with ZERO credit history generate a score to satisfy a landlord, it will not help (much) to fix bad, and it is unlikely to help for mortgage purposes."Thin credit" is one of the items mentioned in ... 03/30/2022

Be forewarned, this may come across as a little bit of a rant... Have you ever heard: If it sounds too good to be true, it probably is?  I am always shocked when people do not understand that concept.I am writing this based on a hand full of recent experiences with clients. 1) I will start start with a past client that just called me yesterday to see if he could refinance.  He started his refi journey with "his bank" who told him he could get a 2.0% interest rate last year on a 30yr VA. That never materialized at all and he moved on to "branch of the service" FCU who said they could do a rate in the High 2's and he couldn't get them to call him back after applying, could not get his loan to closing.. and I asked When did you apply... he answered: "September".  I tried not to laugh out l... 02/24/2022